Wills - Legalnaija

5 Emerging Trends in Estate Planning

by Legalnaija | Sep 27, 2017 | Uncategorized

Estate planning is a pertinent factor to take into consideration for the
disposition of an estate upon the death of the owner. Because of the
unpredictability of beneficiaries and estate laws across states, it is necessary
for each person to plan their estate so as to forestall any unwanted issues
relating to its disposition upon their death. These trends will be discussed
below.

General Note: nobody can say with
certainty when they will die. You can just walk out of your house to go to the
gym and a car will knock you down, thus ending your life. Or you can die in
your sleep. This list is endless. So, because of the unpredictability of the
human condition, everyone needs to create estate plans to secure their estate.
These means are listed below.

Create a Lifetime Gift

Estate holders can easily create lifetime gifts of material possessions
and landed properties to their intended beneficiaries to enjoy same before
their death. Once done, these gifts will not be subject to probate and its
accompanying estate taxes since the title in the properties involved had
already passed to its intended beneficiaries and so does not form part of the
estate to admitted into probate for disposition and federal taxing purposes.
And you will also have the satisfaction that you passed on a particular gift to
the person you want to pass it on to and they can even enjoy it while you are
still alive.

Create a plan for your Digital Assets (if you have one)

Holders of “Digital Assets” now create a plan for it. Currently, assets
exist both in the physical and digital sphere. Bitcoin wallets (alongside other
emerging cryptocurrencies), e-money wallets, online stock accounts,
money-making blog and website accounts with their corresponding payment systems
and passwords, Paypal accounts, Skrill and Neteller accounts, are simply some
out of the huge species of Digital Assets that float around on the Internet.
And these can be potentially worth thousands－if not millions－of dollars. In planning estates, holders of such
assets can create a document which harmonizes the details of all these
accounts in one place and then possibly put such document under the care of a
trusted attorney so that potential beneficiaries can access them when the need
arises.

Create
Letters of Instruction

Although
estates originally involved the creation of wills and the inclusion of every
conceivable item to be handled as it pertains to a person’s estate, a new
current mode is fast encroaching on wills. Clients can now create letters of
instruction and leave them with their attorneys. This simplifies inheritance
instructions more easily as estate holders can use this to outline the mode the
person to dispose of their property will have to follow, put together a list of
all assets (whether tangible or intangible), and possibly add in any detail and
instructions he wishes for the executioners to follow in managing the estate.
Holders can even include personal messages to friends and family.

Create
an Estate Dynasty Trust

Estate
dynasty trusts is another way of easily securing an estate. This can be created
in order to pass wealth from generation to generation without incurring
transfers taxes like gift and estate tax. This can potentially last for more
than a hundred years. Usually, it is rich people who have a lot of assets that
plan their estate in this way to protect their accumulated wealth from being
used wastefully by wasteful dependents.

Estate
planning serves as a means for people to hand down their legacies to their
beneficiaries and also to possibly cut down the costs of estate taxes on their
estate. Taking note of emerging trends and regulatory changes aids in
accomplishing such an objective. Plus, you will be content that should anything
happen to you, your assets are protected and will be used in the way you want
them to be used.

About
the author:

Kingsley
Ugochukwu Ani is a corporate attorney with particular interest in Reals Estate,
IT & IP law. He is also a writer and business development strategist. He
can be reached on aniugochukwu@gmail.com
and +2347035074930

How to make your wealth run in perpetuity

by Legalnaija | Sep 26, 2017 | Uncategorized

Many people are worried about what to do with their
accumulated wealth. There are several cases of wasteful dependents squandering
the wealth of their benefactors once they come into possession of their
inheritance. Because of this, a lot of people are worried about how their
wealth will be spent after their deaths; they know that after they make their
Wills and those same Wills are read after their demise, they cease to have
control over the way their money will be spent after their death.

However, there are ways for a person to retain control
of his estate/legacy even after death. Create a Dynasty Trust.

What is a Dynasty Trust?

A Dynasty Trust is a long-term Trust that is created
by someone planning his/her estate specifically designed so that it can benefit
multiple generations of beneficiaries. This way, the wealth can practically run
in perpetuity. If and where created, the beneficiaries have no control over the
Trust property/investment; they are only entitled to shares of profits in line
with the instructions in the created Trust instrument.

Pertinent Facts to note about Estate Dynasty Trusts

1. Multiple generations of beneficiaries can benefit from
the proceeds of such a Trust as long as there are provisions about the line of
beneficiaries who will keep on inheriting.

2. They can outlive even the original
beneficiaries/descendants of a testator and pass onto even third generation
descendants, depending on the instructions enclosed in the Trust instrument.

3. Trust properties can be excluded from the reach of
creditors since such Trust wealth is not the particular property of a
debtor/beneficiary. Thus, once a Dynasty Trust is created, the wealth infused
into such Trust automatically spills out of the estate of the Trust creator and
becomes a separate entity on its own. In other words, he can benefit from the
Trust but he does not own the property/wealth from which he enjoys.

4. Wealth can be protected from spendthrift beneficiaries
who may want to sell or mismanage the Trust property. After all, they can only
sell or mismanage something which is directly under their control.
Unfortunately, Dynasty Trust property is not under the control of any
beneficiary.

5. Dynasty Trusts can be funded with any assets which the
Trust owner has at his disposal as at the time of creating the Trust. However,
it is worthy to note that assets which can grow over time in value are the best
assets to be used for planning Dynasty Trusts. Eg: Landed property; up-growing
investments, etc.

6. Since Estate Dynasty Trusts are multi-generational, it
is always better to get a corporate Trustee to manage the Trust on behalf of
the beneficiaries. The reason is simply because corporations, unlike humans,
have no expiry date. In other words, corporations exist in perpetuity and even
if the original persons who had received the Dynasty Trust deed on behalf of
the corporation dies, others will automatically take over and continue with the
administration of the Trust estate.

Preservation of Family Wealth through Dynasty Trusts

If, when, and where such a Trust is created, it will
automatically serve to preserve the wealth which a person has accumulated in
his lifetime. To this effect, no particular child or beneficiary of the creator
of the Trust can lay hold of any property designated as part of the Dynasty
Trust as his own personal property. So, even if a beneficiary wants to sell,
use, or otherwise want to give out property which is the subject of an estate
Dynasty Trust, they can’t. The property will remain tied up for however long
the Trust creator wants it to be (this will be done subject to the laws against
perpetuity in the state of the Trust creator because no Trust can really run in
perpetuity; the Common Law rule against perpetuity). so, if a person wants to
preserve wealth for multiple generations, then Dynasty Trusts would be the
ideal answer to achieve this.

How Long Can An Estate Legacy Trust last?

Generally, such a Trust, if and where created in the
course of the estate planning by a person, cannot last forever. The reason is
because of the Common Law Rule against Perpetuity. Nothing created under the
Common (English) Law (for Common Law practitioners), can last forever. It must
have a specific duration, and this may be influenced by the applicable laws of
the jurisdiction where the Trust is being created.

Generally, where this Trust is created, it will end
twenty years after the death of the last beneficiary of the original Trust. Or,
it can be any other term, the point being that the properties must become disposable
after the passage of a certain period of time. But, depending on jurisdiction
and relaxation of policies, a Trust can last for a period of up to three
hundred years after the death of the creator of the Trust instrument. Terms of
the Trust will be instrumental in making this so.

Should I consider such a Trust?

If you want to leave a legacy for your future
generations, not just properties, then the answer is yes. The reason is because
of its long-term applicability as against properties bequeathed to
beneficiaries in a Will instrument of which ownership passes to the
beneficiaries who can then use the properties in the way they deem fit.

Who can create an Estate Dynasty Trust for me?

In order to get such a Trust, it is pertinent to hire
an estate attorney who has the legal and technical know-how to handle the
crafting of a Dynasty Trust that will encompass the vision of the settlor
leaving the legacy for his family.

Things to Note in Dynasty Trust
creation

Ø A seasoned estate attorney

Ø A knowledge of applicable laws

Ø The Trust itself

Ø Terms of the Trust couched in such a way as to
maximize the time for the enjoyment of the Trust interests before they become
alienable.

Ø The Trustee to be appointed (in most cases this is
usually assets management companies or perhaps any firm with expertise in
handling wealth). As aforementioned, it is better to appoint a corporate
trustee over a individual person.

Ø Trust manager

Ø The beneficiaries and the chain to be followed after
the death of the original beneficiaries to the Trust.

End Note

If you want to expand your legacy, then a Dynasty
Trust may be just the right instrument that can bring that plan to light. It is
one of the major factors a wealthy estate owner can easily consider when
planning the dissolution of his estate subsequently.

© by Kingsley
Ugochukwu Ani L.P. All Rights Reserved. This article is meant for
personal/academic purposes, not commercial use by the readers.

About the Author:

Kingsley
Ugochukwu Ani Esq. Is a corporate lawyer with particular emphasis on real
estate, IP & IT areas of law. He is also a content writer and a business
development strategist. He can be reached on aniugochukwu@gmail.com and
+2347035074930.

Wills And Letters Of Administration | Adeolu Adesuyi

by Legalnaija | Aug 14, 2017 | Uncategorized

Many Nigerians have a misconceived
impression about making Wills. When asked if he/she has a will, their ready
response is usually “do you wish me dead, why do I need a will?”.
Such statements are actually proof of ignorance, as preparing a will does not
in any way add or remove a day from anyone’s life.

Others however have many questions about
wills and their validity usually because they may currently be beneficiaries in
a will or are contesting the provisions of a will in court. This article aims
to shed more light on Wills in general.

A WILL simply helps a person to determine
what happens to his properties after his death; it also helps him to give any
instructions he may wish to be carried out if he is no longer alive.

In preparing a will, a testator (person
making his will) must have capacity to do so, meaning he must be of legal age
(above 18yrs) and have mental capacity (he must be of sound mind). Furthermore,
for a will to be valid it must be;

1. In writing. (either typed or hand
written)

2. Signed by the testator, and

3. The signature of the testator must be
acknowledged by at least 2 witnesses (please note, it is advised that a
beneficiary to a will must not act as a witness to the will).

In probate courts today, there are many
parties in legal battles contesting the provisions of a will, the court is
likely to set aside a will if there is conclusive proof that the testator did
not have the mental capacity to understand what he was doing at the time the
will was made or if the testator was unduly influenced to dispose of his
properties as he did in the will.

A person who dies without
making a will is described as a person who died intestate, in such situations,
certain members of the family shall apply to the probate registry of
the High Court to be granted letters of administration of the deceased’s
estate.

Upon the grant of Probate or Letters of
Administration, the executors or administrators, as the case may be are legally
and formally empowered to deal with or distribute the properties of the
deceased among the beneficiaries.

Adeolu Adesuyi

Solicitor/Counsel at Adeolu Adesuyi &
Co.

Ed’s Note – This article was first
published here

Overview Of Wills And The Necesssary Requirements Under Nigerian Law | Motunrayo Olaleye

by Legalnaija | Jun 28, 2017 | Uncategorized

INTRODUCTION

The aim of this Article is to give a basic,
brief and easy to read explanation of the fundamental requirements that are
must know for every person with respect to Wills. This Article also intends to
correct the notion that Wills are unnecessary or trivial and gives a clear
suggestion on the significance of writing and keeping a Will.

DEFINITION OF A WILL

A Will is defined as “a document by which a
person (called the testator) appoints executors to administer his estate (his
assets and properties) after his death, and directs the manner in which it is
to be distributed to the beneficiaries (the people who are to benefit from the
Will, such as family and friends).

DEFINITION OF AN EXECUTOR

An executor is the person appointed or
nominated by the maker of a Will to administer or manage his Estate after his
death. He is responsible for ensuring that any debts and creditors that the
deceased have are paid off and that any remaining money or property is
distributed according to the wishes of the deceased.

CHARACTERISTICS OF A WILL

Every Will must have certain
characteristics for it to be valid. If a Will is not valid, it will not be
legally binding after the death of the maker of the Will (Testator). The
following are some of the characteristics of a Will:

It must be made voluntarily

The testator must be of sound mind

It must name the beneficiary or
beneficiaries

It must be in the presence of witnesses

It must identify the property.

TYPES OF WILL

There are different types of Will, such as:

Oral Will: This is a Will made orally
before two or more credible witness.

Mutual Will – This is where two or more
persons execute the same Will, conferring mutual benefit or reciprocal benefits
on each other. It is common between husband and wife. In this, none of the
testators can revoke or amend without the consent of the other.

Prenuptial Will – This is a Will made by
any of the spouses before marriage

Conditional Will – This is a Will that is
executed by a testator and made subject to a condition.

ADVANTAGES OF MAKING A WILL

There are many advantages of making a Will.
It is important and a smart choice to make a Will so that the maker of the Will
can protect his family, relatives, friends and any other person he may wish to
inherit his assets.

In our society, some people get upset when
their spouses ask if they have a Will. However, there is nothing to get upset
about and it does not mean your spouse is trying to kill you. In fact, it is a
way to protect your wife and children from suffering if the unexpected happens.

It
is merely superstitious and unnecessary to think that making a Will means you
will die soon. That is not true. Many people have Wills and still live very
long.

Some other advantages of making a Will are:

·
The
testator will be able to order his affairs before his death

·
The
testator will be able to share his assets and properties amongst his family and
friends in the way he desires

·
The
testator’s property will not be shared under customary law since he has already
decided how he wants it to be shared

·
The
testator has the benefit of appointing people he trusts as his executors, and
they have the duty to carry out his wish.

·
Trusted
persons can be appointed as guardians of testator’s infants (young children).

·
It
gives the testator the opportunity of showing generosity to other people
e.g. donation for charitable purposes

·
The
testator is given the opportunity to give his funeral directives.

WHO CAN MAKE A WILL

Every person of requisite statutory age
(above the age of 18), with a sound disposing mind and memory can make a Will
notwithstanding his tribe, religion, or physical status. Thus, a blind or disabled
person can also make a Will.

TESTAMENTARY CAPACITY OF A TESTATOR

It has been stated above that every person
can make a Will, however such a person must have testamentary capacity.
Testamentary capacity means legal capacity to make a Will. The law requires
that a testator must have a sound disposing mind both at the time of giving
instructions and execution of the Will. The purport of this is to ensure that
the Will was made voluntarily and without undue influence. The criteria for
deciding that a testator has testamentary capacity are as follows:

·
The
testator must understand the nature of the act that he is making his will and
its effect.

·
He
must understand and recollect the extent of the property of which he is
disposing.

·
He
must understand and appreciate the nature and extent of the claims upon him by
both of those whom he is including from his Will.

·
The
manner in which the property is distributed must be rational that no disorder
of the mind has poisoned his affection or perverted the exercise of his will.

VALIDITY OF A WILL

For a Will to be valid, it must be duly
executed. Therefore, the following conditions must be met:

·
It
must be in writing;

·
It
must be signed by the testator or his representative, and dated;

·
The
signature of the testator must be witnessed by at least two witnesses;

·
The
witnesses must attest and subscribe the Will in the presence of the testator

AMENDMENT OF A WILL

Can you rewrite your Will? The answer is
yes. A will can be revoked or amended by the maker during his
life time as many times as he wishes. Thus, the last Will and Testament is the
one that is made by the Testator before his death and the last will revokes all
previous wills. Where the Testator just intends to add some things, correct a
clerical error or replace or appoint new executors he might just prepare an
addendum. This is called a codicil.

WHO CAN BE A WITNESS

Anybody can be a witness to a Will.
However, it is advisable that beneficiary of a Will is not a witness to the
Will. This is because a witness who benefits under a Will loses any property or
benefit that he is given by the maker of the Will, and this is irrespective of
if the Testator is your spouse.

However, in cases where there are at least
three (3) witnesses to the Will, the beneficiary can still keep his gift if the
Court discountenances the attestation of the beneficiary so that there will be
at least two (2) witnesses to validate the Will.

HOW TO WRITE A WILL

A Will can be written by the Testator
himself. It is however good to consult a lawyer who is skillful in the art of
writing a Will so that it conforms with the requirements of a valid Will.

DIGITAL ASSETS

Digital assets can be defined as digitally
stored content or an online account owned by an individual. (www.thedigitalbeyond.com) It can
also be referred to as something that has value and can be owned but has no
physical presence. Digital assets include but are not limited to documents,
websites, books, media, designs, digital currency, data and art.
(simplicable.com)

It is needless to say that we are at a time
where many people have turned small businesses to global businesses with the
help of the Internet, mobile marketing, telecommuting, smart phones and social
media.

It is therefore apt for a Testator to consider how these tools
may be managed in the event of his demise.

WHERE IS A WILL KEPT?

After a Will has been written, it can be
kept in the custody of the lawyer, in the house of the testator, bank vault or
probate registry.

The best option is for it to be kept at a
probate registry which is located in every state’s High Court premises. It is
the safest place for the Will and makes it easier to prove. After the death of
the testator, the family members can approach the probate registry after 7 days
with a copy of the death certificate.

Subsequently, the probate registrar
contacts all beneficiaries and sets a date for the reading of the Will. On that
day, the probate registrar breaks the seal of the Will and reads out its
contents.

WHAT IS PROBATE?

Probate is the legal process whereby a will
is proved in a Court and accepted as a valid document that is the last true
testament of the deceased. (en.m.wikipedia.org).

The process of obtaining probate is the
first step in the adminstration of the estate of a deceased and can be done by
the Exceutors of the Estate. It is however usually a cumbersome and tasking
prodedure for persons who are unfamiliar with the process and it is advisable
to employ the services of a Legal Practitioner.

CONCLUSION

It is imperative that people embrace the
idea of writing a Will once adulthood is attained. Furthermore, it is also
pertinent to modify the Will when more assets are attained to avoid excluding
the additional assets from the Will.

If you put your house in order, your
dependants will not be left to suffer if the inevitable happens.

By- Motunrayo Olaleye
Legal Counsel at B. Ayorinde & Co.

Photo Credit – www.davidfreedman.ca

Argyle & Clover – Obtaining Letters Of Administration (Without Will) At The High Court Of Lagos State

by Legalnaija | Jul 15, 2016 | Uncategorized

When
a person dies intestate i.e. without leaving a Will, no person is allowed under
the administration of estate law to administer the estate of the deceased
without obtaining Letters of Administration. To do so will amount to
intermeddling with the Estate of the Deceased.

The
Letter of Administration empowers the persons named therein to administer the
Estate of the Deceased. Prior to obtaining the grant of a Letter of
Administration on an Estate, the properties of the deceased are deemed to vest
in the Chief Judge of the State.[1]

Who
can apply for a grant of Letters of Administration?

The
Administration of Estate Law of Lagos State[2], states in order of priority,
persons who are beneficiaries of a Deceased Estate and thus can apply for a
grant:

1. The Surviving spouse

2. The Children of the deceased or the issues of any
child who predeceased the deceased

3. The Deceased’s Parents

4. Brothers and Sisters of the Deceased

5. Half Brother(s) and sister(s) of the Deceased.

6. Grand Parents

7. Uncles and Aunts.

Procedure
for Obtaining Letters of Administration

STEP
1

Apply for
Grant At the Probates Registry

1. An Application letter shall be submitted at the
Probates Registry. The Application letter shall contain the following
information:

1. Full names of the Deceased

2. Date of Birth of the Deceased

3. Last known address of the Deceased

4. The Profession of the Deceased

5. Marital Status of the Deceased

6. Name of Deceased’ spouse and children (if any)

7. Date and Place of Death

8. Names of 2 Proposed Administrators

9. Relationship between the Deceased and the proposed
Administrators

The
following documents shall be submitted with the Application Letter:

1. Death Certificate of the Deceased

2. Passport photographs and valid means of
identification of the Proposed Administrators

Obtain
Application Form from the Probates Registry

After
submitting the application letter, an applicant shall purchase an Application
Form from the Probates Registry which shall be completed and executed by the
Proposed Administrators. The Application Form is made up of the following
documents:

1. Inventory of moveable and immovable Bounties/Assets
of the Deceased

2. Statutory affidavit of next of Kin. (This is to be
signed by the Next of Kin)

3. Oath of Administration

4. Administration bonds

5. Justification of sureties (2 Sureties one of whom
one must possess real property while the other must own a valid means of
identification shall execute this form). It is also important to ensure that
the sureties are available to appear in person when called upon by the Probate
Registrar.

6. Bank/Share Certificate (Details of the Deceased’s
Bank Account and monies therein and Shareholdings be stated here)

7. Particulars of Freehold/Leasehold property owned by
the Deceased.

8. Schedule of debts owed by the Decease

9. Schedule of funeral expenses.

Submission
of Bank/Share Certificate at the Bank(s)/Registrars of the Companies where
the Deceased owns Accounts/Shares

1. The Bank(s)/Registrars shall state details of monies/shares
and the value thereof.

Return of
Duly Completed & Executed Application Form to the Probates Registry,
Payment of Publication Fee, Assessed Fee and Obtaining Approval of the
Probates Registrar

1. Upon completion and execution of the Application Form,
same will be submitted at the Probates Registry.

2. The Probates Registry will proceed to assess fees
payable on the Estate based on the information contained in the Application
Form.

3. The Proposed Administrators shall proceed to make
payment of Assessed fee and Newspaper publication fee with bank draft at a
pre-designated bank and evidence of payment i.e. Bank teller shall be furnished
to the Probates Registry.

4. The Proposed Administrators may also apply to the
Probate Registry to have the estate assessment fee drawn from the deceased’s
account if there are sufficient funds therein.

5. The Probates Registrar shall meet with the Proposed
Administrators & Sureties to verify that they meet the requirements to be
Administrators & Sureties.

6. The Probates Registrar approves the application and
orders the Proposed Administrators to depose to the Oath of administration.

Publication
of Notice of Application for Letters of Administration

1. The application is published in a newspaper to
notify anyone interested in the estate of the deceased that a grant of letter
of administration has been sought by the Proposed Administrators.

2. Once the publication is done, a period of 21 days
will be given for any-one who wishes to contest the application of the proposed
administrators to present such contest/opposition.

3. At the expiration of the 21 days, if there are no
oppositions, the Probates Registry shall proceed to draft and issue the Letter
of Administration.

The
entire process of obtaining Letters of Administration of an Estate can be
cumbersome and grueling especially for persons not familiar with the process.
Chances of being exploited as a result of ignorance are pretty high. It is
therefore advisable to seek the services of a Legal Practitioner.

[1]
Section 10 of the Administration of Estate Law Cap. 3 Laws of Lagos State 1994

[2]
Section 49 (1)

This
article is written by Betty Tokurah an Associate Counsel with the Law Firm of
Argyle & Clover Attorneys at Law

Ed’s Note- This article was originally published here.

Can a Director of a private company be appointed by a Will? by Teingo Inko-Tariah

by Legalnaija | Apr 15, 2016 | Uncategorized

Mr Arrowhead, a very prominent Nigerian suffered a stroke and was flown abroad where he received medical attention for several months. Unfortunately, he died abroad and his body was flown back to the country for burial which was celebrated in grand style. Although Mr Arrowhead left a will, there was serious contention among family members over the content of the will especially as some of the family members felt disappointed over what was bequeathed to them. Typical of a polygamous family, the will was contested in court. However, that is not the main thrust of this paper. It was discovered that in the will, the testator purportedly appointed his wife as a director of one of his companies. This is a real life situation and raises the question which this paper seeks to address. Can a director of a company be appointed by a will?

Who is a director?

S 244(1) Companies and Allied Matters Act (CAMA) 2004 defines directors as “persons duly appointed by the company to direct and manage the business of the company”. s. 567 CAMA further describes the term director to “include any person occupying the position of director by whatever name he may be called and includes any person in accordance with whose directions or instructions the directors of the company are accustomed to act”. Directors are officers of a company who are appointed to operate the business for the benefit of the shareholders. According to s. 567 CAMA, ‘officer’ in relation to a corporate body includes a director, manager or secretary. There are two broad categories of directors in modern corporate practice and governance. They are executive directors and non-executive directors. Executive directors are those directly engaged in the day to day management of the business on a full time basis while non-executive directors are external board members who act as a check on the executive management. They are usually appointed on part time basis and they have become more prominent with the development of corporate governance. There are various types of directors: shadow, alternate, independent, and life director.

Appointment of directors

The authority to act as a director of a company comes from due appointment. Thus a person who acts without such appointment commits an offence under s. 244(3) & 250 CAMA and he would be personally liable for his actions. Where the company holds out a person not duly appointed as a director to carry out responsibilities in that capacity, the company will also be liable to a fine s. 244(4) CAMA. However, although a director may not have been duly appointed in accordance with the law, his actions in that capacity may still bind the company as if he were a de jure director (i.e. one who was duly appointed) if it is the company that holds him out as a director. Therefore appointment is a fundamental criterion which validates the position and authority of a director of a company.

In Nigeria, the law provides for the manner in which the director of a company may be appointed: who can appoint and how to appoint a director. For the first directors, the law provides that they should be appointed by the subscribers to the memorandum of association of the company, a majority of them or they may be named in the articles of association of the proposed company. For subsequent appointments generally, it is the shareholders in a general meeting who are empowered by law to appoint directors by ordinary resolution. The board of directors of a company could also appoint other directors subject to the approval of the shareholders at the next annual general meeting where a vacancy arises from death, resignation, removal of a director. This is referred to as filling a casual vacancy and where the newly appointed director is not approved by the shareholders in a general meeting, he would cease to be a director. Where all shareholders and directors of a company die, any of the personal representatives may apply to court to convene a meeting of all personal representatives of the shareholders entitled to attend and vote at a general meeting to appoint new directors to manage the company. Where the personal representatives of the deceased shareholders fail to do so, the creditors of the company, if any, shall be able to appoint a director.

What role does the Articles of Association play in appointment prescriptions? Life director, share qualification.

The AOA is the document that makes provision for the internal management of a company. It is a part of the constitution of the company which sets out the rules for running the company. Typically, the article of association should contain provisions relating to share capital, classes of shares, rights and restriction to each class of shares, allotment, transfer and transmission of shares, meetings, resolutions, directors, auditors, company secretary, the seal, winding up. With regards to directors, the articles of association prescribes the appointment, removal, disqualification, remuneration, tenure of office, rotation, filling of casual vacancy of directors and also provides for life director where the company so wishes. Usually, in corporate practice, where the law is silent on an issue, it is the articles of association that would provide direction on such issue thus, for instance, in Nigeria; the CAMA, 2004 is silent on the issue of alternate directors although the practice is recognised in the corporate sector. Therefore, companies that wish to have alternate directors would make such provision in the articles of association as the basis for adopting the practice. Another instance is meetings via conference calls.

What is a will and what kind of bequest can be made by a will?

A will is a voluntary expression of the intention or wishes of a person of sound mind wherein the person states or gives directives of how his property should be disposed of in event of his death. Property given by a person in a will is referred to as legacy and could either be chattels i.e. movable items such as wrist-watch or car; realty i.e. immovable items such as land or buildings; or pecuniary i.e. money.

Conclusion

Directorship in a company is not a type of property and does not fall under the types of properties that can be bequeathed by a will. A person who dies automatically ceases to be a Director of the Company and so loses the power to bind the company which is a separate entity from the owners & Directors. Any subsequent director can only be validly appointed by due procedures laid down by statute. Thus, any purported appointment by a will goes to no issue as it cannot be recognised except due process has been followed. At best, it can serve as an expression of intention of the deceased director as to who he wishes to be on the Board of the company. This intention can only be executed by the living Directors, if any and until so executed, it is invalid.

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