RM40bil in assets stuck

WEALTH PRESERVATION

PETALING JAYA: Some RM40bil worth of assets and property left behind by deceased persons continue to be unclaimed due to poor administrative procedures in the distribution of estates to the rightful Muslim heirs.

The unclaimed estate is mainly in the form of EPF contributions and bank savings, vehicles, real estate and insurance benefits.

Deputy head in the Syariah advisory division of the Attorney-General’s Chambers, Mahamad Naser Disa, said the “loose” and inconsistent Syariah laws relating to inheritance of wakaf (religious or public endowment), ar-rahnu (mortgage) property and hibah (awards), coupled with the constraints of existing laws, complicate the process of managing inherited properties.

In Malaysia, estate administration laws used by Muslims are the Probate and Administration Act 1959 and Small Estate (Distribution) Act 1955.

The practice of “hibah” involved gifts to either people in need or those who are well-to-do.

The awarding of gifts, including for charity, is commended as it helps to improve the lot of the community.

In “ar-rahnu”, a valuable item is collateralised (or pawned) to a debt which may be utilised as payment should the debt not be repaid within the agreed period.

Agencies like Amanah Raya Berhad (ARB), Amanah Hibah and Warisan Mukmin provide professional services in inheritance management and administration.

Mahamad Naser said the absence of specific laws in states on estate management transactions by Muslims made it harder for Syariah judges to hear cases.

“This can result in different judgments being delivered for similar cases as the judges may be referring to different ulamas (religious scholars) and kitabs (religious books),” he said.

Mahamad Naser said: “The aspect of managing and administrating the estate of Muslims, living or dead, is rather poor.

“The RM40bil figure, released by ARB as recently as mid-2009, is alarming,” he said in a paper presented recently at a convention on the planning and management of assets in Islam at the Universiti Kebangsaan Malaysia here.

Mahamad Naser said the problem was also due to indifference and lack of awareness among the Muslims themselves on how to manage their properties.

The unclaimed assets, such as the EPF and bank savings, vehicles, properties and insurance benefits, may be frozen if the heirs continue to tussle over the ineritance.

Should this happen, it could have a grave impact on the country’s economic development as they would not be used in any productive manner, said Mahamad Naser.

He said the Muslim community appears to be confused over the different roles and functions of agencies like the state Islamic councils, the Syariah courts, land office (minor inheritance unit), civil High Courts and ARB.

“For example, when a Muslim dies, the deceased’s beneficiaries would not know where to go for the distribution of the estate, whether it is the Syariah court, the land office or the ARB,” he said.

Besides the judicial conflicts, he said, the absence of concrete laws and other legal constraints in the implementation of matters related to wills, wakaf and hibah, had also caused many problems.

He said the conflict in jurisdiction between the civil and Syariah courts were obvious although an amendment had been made to Article 121(1A) of the Federal Constitution in 1988.

The article states that the High Court has no jurisdiction in respect of any matter within the jurisdiction of the Syariah courts.

“The main intention of amending Article 121 by including clause 1A is to prevent Syariah court decisions being challenged or set aside by the civil courts.

“Unfortunately, what we had hoped for did not materialise. The conflict of jurisdiction between the two courts still continues,” said Mahamad Naser.

By ROZAID A. RAHMAN and MOHD AL QAYUM AZIZI
newsdesk@thestar.com.my