In cooperative housing societies, nomination is often misunderstood as ownership. When a member passes away intestate (without a Will), disputes may arise—especially when there are multiple nominees and one of them also passes away.
This article explains the legal status of nominees, especially in complex cases involving death of a nominee, and the correct procedure to establish ownership rights.
What Happens When a Member Dies Intestate?
When a member dies intestate:
- The society transfers shares to nominee(s) based on nomination records
- This transfer is not ownership transfer, but only for administrative convenience
Under the Maharashtra Cooperative Societies Act, 1960, nomination helps the society identify who can temporarily represent the deceased member’s interest.
Do Nominees Become Owners of the Flat?
This is the most important legal clarification:
- Nominees do NOT become absolute owners
- They hold the property in trust for the legal heirs
- They cannot:
- Sell the flat
- Create third-party rights
- Transfer ownership
Ownership is determined only through succession laws.
Impact of 2019 Amendment – Section 154B-13
Post-2019 amendment, the law has become stricter:
- Nominees are admitted as “provisional members”
- They must submit:
- Succession Certificate, or
- Legal Heirship Certificate, or
- Other valid legal documents
Without these documents:
- Final transfer of shares, rights and title cannot be completed
What Happens If One Nominee Dies Intestate?
In your case:
- Original member had four nominees
- One nominee has also passed away intestate
The legal implications are:
1. Deceased Nominee’s Share Does Not Vanish
- The deceased nominee’s interest passes to her legal heirs
- Her family can legally make a claim
2. Legal Heirs Step Into the Nominee’s Position
- The heirs of the deceased nominee must:
- Establish their rights under succession law
- Submit valid legal documents
3. Society Cannot Decide Ownership
- The society’s role is limited and administrative
- It cannot adjudicate disputes between:
- Surviving nominees
- Legal heirs of deceased nominee
Applicable Succession Law
In absence of a Will, succession is governed by:
- Hindu Succession Act, 1956 (if applicable based on religion)
Under this law:
- Legal heirs inherit proportionate share
- Nomination does not override inheritance rights
Procedure to Resolve the Situation
To ensure proper transfer, the following steps are required:
1. Obtain Succession / Heirship Certificate
- All surviving nominees and heirs of the deceased nominee must obtain:
- Succession Certificate, or
- Legal Heirship Certificate
2. Submit Documents to Society
- Submit certificates along with:
- Application for transfer
- Indemnity bond (if required)
3. Society Grants Final Membership
- Society will:
- Replace provisional status
- Transfer shares and interest legally
Key Legal Takeaways
- Nominee = Trustee, not Owner
- Ownership flows through legal heirs, not nomination
- Death of a nominee transfers rights to their legal heirs
- Society cannot bypass succession laws
Common Mistakes to Avoid
- Assuming nomination equals ownership
- Ignoring need for succession certificate
- Delaying legal documentation
- Attempting transfer without proper legal basis
Conclusion
In cases where a member and subsequently a nominee pass away intestate, the situation becomes legally layered but clear in principle. Nominees only act as custodians, and their rights—if they pass away—further devolve upon their legal heirs. Final ownership can only be established through proper succession documentation under applicable laws. Housing societies must strictly follow statutory provisions and avoid transferring ownership without valid legal proof.
