Administration of Small Estates in Malaysia: An Analysis of Distribution Mechanisms and Legal Issues

Abstract

The Federal Government is responsible for matters relating to probate and administration of estates, as stipulated in the Federal Constitution. The Estate Distribution Division under the Department of Director General of Lands and Mines (JKPTG), which functions under the Small Estates (Distribution) Act 1955 [Act 98], is responsible for managing the majority of petitions for the distribution of estates in Malaysia. Previous studies often focused on the difficulties involved in resolving complex estate cases, including legal ambiguities, lack of awareness, delays and disputes among beneficiaries. However, issues concerning the processes and distribution mechanisms implemented by estate administration agencies have received insufficient attention. Accordingly, this study analyses the distribution mechanisms generally applied in the administration of the small estates involving the estates of both Muslims and non-Muslims, including issues relating to the use of Islamic estate-planning instruments and customary land. This study adopts a qualitative approach based on doctrinal legal research involving both primary and secondary sources. Interviews were also conducted with two agency representatives from the Estate Distribution Division of JKPTG Putrajaya and Negeri Sembilan Estate Distribution office. The analysis identifies three distribution mechanisms in the administration of small estates: (i) an order for direct distribution or transfer of ownership; (ii) an order appointing an administrator or granting letters of administration; and (iii) an order for sale. The findings indicate that any dispute involving estate planning instruments or matters related to Islamic law must first be referred to and determined by the Syariah Court. Meanwhile, issues concerning customary land must be determined by the relevant authorities in accordance with the laws of the respective states. Once these issues have been resolved, the Estate Distribution Officer may determine the appropriate mechanism for administering and distributing the deceased’s estate. 

Keywords: Small Estates (Distribution) Act 1955, distribution mechanisms, small estates administration, faraid, transfer of ownership order, letters of administration