Death is inevitable, but have you considered what happens to your intellectual property (IP) after your demise? Do you need to include your IP in your Will? Understanding what happens after death will mean more peace of mind for those left behind.
There has, of late, been much discussion around what happens to your social media accounts once you have passed away, but many should consider what happens to their IP too.
When an individual chooses to file a trade mark in their own name rather than in the name of a company, it is important to know that this asset needs to be specified in their Will and appropriately bequeathed to a nominated third party as would be done in the case of immovable or movable property.
When a person passes away, in this instance the trade mark rights holder, an executor of their estate is appointed and their Will assessed. If a trade mark is bequeathed to a nominated beneficiary, reference to the mark and the value placed on it is included and referenced in the initial/provisional liquidation and distribution account of the estate.
Related: Registering a trademark
The provisional liquidation and distribution account will then be advertised in the Government Gazette for 21 days and lie open for inspection by the Master of the High Court. Assuming no objections are filed during that advertisement period, the trade mark will, in most cases, then be transferred to the nominated beneficiary at its expiration.
Transfer of ownership needs to be recorded
Like any normal assignment or transfer of ownership of an IP asset such as a trade mark, the transfer of ownership needs to be recorded on the Trade Marks’ Register. If steps are not taken to record the transfer, the trade mark will remain on the Register in the name of deceased person, despite the fact that the transfer has been effected by operation of law.
What this process will entail is the nominated beneficiary will have to request that the Executor of the Estate signs a Deed of Assignment on behalf of the deceased so that the record of the transfer can be effected by the Registrar of Trade Marks and the Trade Marks’ Register updated.
If the latter step is not taken timeously, difficulties can arise such as the beneficiary may not be able to locate the Executor years down the line to sign a Deed of Assignment.
Furthermore, if the record request is not lodged with the Registrar of Trade Marks within one year from the expiry of the advertisement period; the effective date of the transfer, the beneficiary will have to pay penalty fees for the late lodgement of the recordal request to the Registrar.
Another potential risk is that an interested party may attack the validity of the trade mark registration on the grounds that it is an entry wrongly remaining on the Register as it is recorded in the name of a deceased person, or on the basis that it appears to not have been used for a period of more than 2 years since the death of the deceased.
Related: Intellectual property registrations
Important steps for business owners to take
I suggest that IP rights that form an important part of your business be explicitly included in estate and succession planning initiatives, including if registered in your personal name.
Furthermore, you must not forget that a transfer of ownership recordal must be effected to avoid potentially invalidating the intellectual property right. Taking all the necessary steps canvassed above will ensure that such IP rights remain active and maintain their value beyond the death of the original rights holder.