# General Business Category > Business Online Forum > [Question] Close Corporation Deceased member

## Jeanine

My husband and his father had a 50/50% membership in a closed corporation business. His father passed away early 2021.  According to his will his wife inherited the one 50% membership.  She is not working in the business.  Is she only entitled to 50% of the profit or is she intitled to the amount of money her husband received from the business while he was still alive?

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## Dave A

"Saying "amount of money" is far too broad. It is important to distinguish between the different channels of remuneration, such as salary as a working member, remuneration as a member (it's a cc and as minimum every member should be involved in the top level decisions of the cc), and distribution of profits according to ownership share.

It's a bit easier to distinguish in a company setup, where there will be shareholders, executive directors and non-executive directors.

I suggest a meeting of the members of the cc be held where the issue of the differing levels of participation and remuneration is thrashed out.
Good luck. Not easy at the best of times and sometimes even more difficult in a family setup.

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## Andromeda

> My husband and his father had a 50/50% membership in a closed corporation business. His father passed away early 2021.  According to his will his wife inherited the one 50% membership.  She is not working in the business.  Is she only entitled to 50% of the profit or is she intitled to the amount of money her husband received from the business while he was still alive?


Did his dad's wife inherit the 50% as determined by an executor? Did he have a loan account? Section 35 of the Close Corporation Act says as follows:

35. Disposal of interest of deceased member.  Subject to any other arrangement in an association agreement, an executor of the estate of a member of a corporation who is deceased shall, in the performance of his duties 

               (a)  cause the deceased members interest in the corporation to be transferred to a person who qualifies for membership of a corporation in terms of section 29 and is entitled thereto as legatee or heir or under a redistribution agreement, if the remaining member or members of the corporation (if any) consent to the transfer of the members interest to such person; or

               (b)  if any consent referred to in paragraph (a) is not given within 28 days after it is requested by the executor, sell the deceased members interest 

to the corporation, if there is any other member or members than the deceased member: 

to any other remaining member or members of the corporation in proportion to the interests of those members in the corporation or as they may otherwise agree upon; or

to any other person who qualifies for membership of a corporation in terms of section 29, in which case the provisions of sub‑section (2) of section 34 shall mutatis mutandis apply in respect of any such sale.

So the wife inherits her part of the cc despite not being actively involved. She is therefore only due a share of profits as determined by the members of the CC. A resolution in this regard requires a majority vote of the members, within a 50 / 50 scenario it is perhaps difficult. Your husband should perhaps consult an attorney, or at least a competent company secretary.

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