High Court says no to using sale proceeds to pay estate expenses

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The High Court has denied an estate administrator’s motion to approve the sale of estate land to pay for expenses related to pending litigation involving the estate.

The High Court ruling issued earlier this month stems from a petition by Kaio Ah Hing to sell land in the estate of Salevai Ah Hing.

The estate is currently involved in pending litigation regarding the conveyance of portions of the estate property.

The estate administrator, Ah Hing, stated at a hearing on April 18 this year,  he plans to use the proceeds of the sale of the land to pay for estate expenses related to the pending litigation, such as attorney fees.

His motion was denied by Acting Associate Justice Elvis Patea and Chief Associate Judge Mamea Sala Jr.

The judges cite that under the American Samoa Code Annotated, real property in an estate may be sold only upon an order signed by the Trial Division of the High Court.

The court may not grant an application to sell real estate until all the personal property has been exhausted and the proceeds found insufficient to pay the estate debts.

According to the judges, “here the proceeds from the sale of estate land are intended to be used to pay the estate’s litigation expenses which may be considered debts of the estate.

“However the court may not grant the application to sell real estate until all the personal property has been exhausted and the proceeds thereof  found insufficient  to pay the estate debts.”

The court said the record of this case is inconsistent regarding the existence of any personal property of the estate.

The first and only accounting states that two houses on estate land are the personal property of the estate.

Yet the final report filed by an interim administrator states that the estate has no personal property.  Kaio Ah Hing on the other hand didn’t file any accounting of real property under the estate.

The court pointed out that Kaio Ah Hing has failed to file annual accounting reports of the estate property so the court is apprised of the status of the estate’s assets.

The judges pointed out this  failure to comply with statutory requirements was one of the reasons why an earlier appointed administrator, Fefiloi Ah Hing, a son of the estate owner, was removed.

The court ruling said, “Until we received an accurate accounting of the estates property and proof that all the personal property has been exhausted, and the proceeds are insufficient to pay the estate debts, we decline to approve the sale of estate land.”