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Rights of beneficiaries to an unclaimed pension of a deceased employee

Probate is simply the general administering of a deceased person’s Will or the estate of a deceased person without a Will. Chapter 2, Section 1(1), Administration of Estates Act provides that all property to which a deceased person was entitled to an interest not ceasing on his death shall, on his death notwithstanding any testamentary disposition thereof, devolve from time to time on the personal representatives of the deceased.

A pension is simply a fund into which a sum of money is added during an employee’s employment years and from which payments are drawn to support the person’s retirement from work in the form of periodic payments. Section 4 (1) of the Pension Reform Act 2014 provides that an employer shall contribute a minimum of ten percent and the employee shall contribute a minimum of eight percent.

Administration of Estates Act identified ‘’probate’’ as ‘’probate of a will’’ in section 58. It has no specific mention or definition of the word pension. Pension Reform Act 2014 did not identify or define ‘’pension’’. However, it referred to the phrase ‘’pensions asset’’ means all assets set aside as retirement benefits in section 120. Section 4 (1) of the Pension Reform Act 2014, and Chapter 2, Section 1(1) Administration of Estates Act give a basic clarification and statutory backing to the definitions of probate and pension.

Probate and pension are regulated majorly by two different laws and agencies; the Administration of Estates Act and the courts, and Pension Reform Act 2014, and the Nigerian Pension Commission respectfully. Both may have alliances and collaborations with other agencies and organizations in Nigeria.

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Section 58 of the Administration of Estates Act recognized securities – stocks, funds or shares, property – lands, or buildings, personal effects- carriage, horses, stable furniture, cars and accessories (not used for business purposes), etc. as a form of asset that can form part of the asset of a deceased employee.

The type of an asset determines the requirements, and organizations that would be involved in accessing and administering the asset in the estate of the deceased employee. For pension, it is the Pension Fund Administrators and Nigerian Pension Commission.

Every asset that forms the estate of a deceased can be accessed and administered by the beneficiaries. From the above understanding, particularly, the provisions of section 120, Pension Reform Act 2014, pension is an asset. The unclaimed pension can be accessed and administered by the administrators, executors, or beneficiaries of the estate of a deceased employee.

However, the existence of an unclaimed pension for a deceased employee and the right to access and administer the unclaimed pension by the executors, administrators, or beneficiaries are not automatic. They must satisfy some statutory and administrative requirements of the law and Pension Fund Administrators in order to have full access to the unclaimed pension.

Section 8(2) Pension Reform Act 2014 recognizes the rights of the beneficiaries to access and administer the amount standing in the retirement savings account of a deceased employee. It provides that upon beneficiaries providing letters of administration or grant of probate to a Pension Fund Administrator, it shall with the approval of the commission release the amount standing in the retirement savings account of the deceased employee to his personal representatives.

Hence, the basic requirements of letters of administration where the employee died without a Will, or grant of probate where there is a Will by the various Pension Fund Administrators found its basis from the above provisions of the Act. Other requirements like application form, death certificate or certificate of registration of the death, passport photographs of deceased and named administrators or executors, Police report where the employee’s cause of death was by accident, means of identification, indemnity form, and a whole lot of general and specific requirements.

The right of beneficiaries of a deceased employee to claim a deceased employee’s unclaimed pension is provided for by law with requisite documentation, and overlapping heavy reliance on probate: letters of administration or grant of probate.

Adekola is a Legal Practitioner and Head, Probate Services, Greenwich Registrars and Data Solutions Limited. You can reach him on 08165299774 and 08150373535.

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