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The period after the death of a loved one is incredibly difficult, stressful, and emotional. Loved ones are busy making arrangements and other plans, leaving the probate process unattended. Oftentimes Wills contain provisions naming an executor (or personal representative) who is usually a close family member or friend. Unfortunately, this means that while loved ones are still mourning, they must go to court to start the probate administration process (also known as estate administration). Serving as an executor can come with a lot of responsibility and can be stressful and time-consuming. Luckily, executors can seek guidance and assistance from knowledgeable counsel to alleviate some of the burden and make sure everything is managed correctly and on time.

What is Probate?

Probate is the legal process which a Court recognizes that a person has passed away, and authorizes and oversees the administration and distribution of the decedent’s estate. The  probate process does not look the same for everyone:

  • Without a Will: An estate passes according to the state’s intestacy laws, regardless of what the individual wanted. “Intestate” means that the decedent died without a valid Will in place at the time of death.
  • With a Will: The Court confirms the validity of the Will, and seeks to implement the directions and bequests contained therein within the bounds of the law.
  • With a Trust: Court administration of a “Pour Over Will” to place an asset into the Trust post-mortem that was mistakenly left out of a Trust, if pouring it over into the Trust that was the decedent’s intent as evidence in a valid Will.

During the probate process, the court will either appoint or officially recognize a personal representative—this depends on whether the Will named someone or not. Once the personal representative has been officially recognized or appointed by the Court, the Court will issue what is often called “Letters of Administration” to the personal representative. These Letters are official documents used by the personal representative to prove their appointment to third parties such as banks, financial institutions, and medical providers to successfully carry out their main job as personal representative of the estate—to administer the estate. Part of this role includes notifying beneficiaries and/or heirs of the decedent’s passing, performing and filling estate accountings, and more.

Fiduciary Duties

In the probate process, the executor or personal representative is considered a  “fiduciary.” A fiduciary is bound to faithfully administer the decedent’s estate.  Failure to do so can result in personal liability. Unless the controlling document (usually a Will or a Trust) waives the requirement, every fiduciary must strictly comply with the following common law and/or statutory duties in handling their responsibilities:

  • Undivided Loyalty to the Estate
  • Avoid Engaging in Self-Dealing Unless Waived
  • Manage and Maintain Assets
  • Inventory Assets
  • File Accountings and Reports
  • Regularly Inform Beneficiaries, and any other Interested Parties
  • Prepare Tax Returns, Pay Taxes, Fees, Valid Claims
  • Defend and Prosecute Claims
  • Distribute Assets

After qualifying the executor for the estate and ascertaining that the deceased actually left assets (or debts) owned solely in their name, various documentation will need to be filed and strict deadlines complied with in order to legally administer the estate. Since the process of administering the estate requires time and energy, the executor is entitled to be compensated. The amount of compensation varies among states.  However, this is usually limited to 5% of the probate assets.  Also, it is often prudent to engage professionals to assist with the execution of the estate administration duties such as an estate attorney, financial advisor, realtor, and a certified public accountant who specializes in estate tax filings. 

Probate Litigation

Sometimes there will be a challenge to the Will, to the inventory of assets filed, or any other objections (also known as exceptions) to publicly filed documents in a probate proceeding. When there is a challenge, the length of time it takes to complete probate is often extended considerably, and usually at a significant loss of funds to the estate to cover the costs of litigation. Objections may be warranted when beneficiaries suspect the estate is not being well managed, to question the personal representative’s valuation of estate assets, and various other instances. Finally, if an heir was omitted from the Will, they may challenge the Will  to determine whether they were intentionally omitted from an expected inheritance.

Probate vs. Non-Probate Assets

Not all assets pass through a person’s estate under the terms of a Will during the probate process. The probate estate is made up on any remaining assets solely owned by the decedent at the time of death. Some assets pass automatically to a surviving beneficiary upon the decedent’s death, without the probate process.

  • Jointly Owned Assets—Assets that are jointly owned, such as bank accounts, homes, vehicles, or other personal property that is titled to two or more people are non-probate assets. These assets automatically pass to the co-owner upon the death of the first owner. When real estate is jointly owned with “rights of survivorship,” the deceased owner’s share of the asset automatically passes to the surviving owner upon the decedent’s death. As long as one owner is still alive at the death of one of the owners, the asset does not pass through the probate estate.
  • Insurance and pensions—Policies and benefits with a beneficiary are paid outright to the named beneficiary following the owner’s death. However, if a beneficiary is a minor or mentally incapacitated person, the probate process if often triggered to name a guardian on behalf of the beneficiary to accept the distribution.
  • Transfer on Death (TOD) or Payable on Death (POD) Assets—Some assets pass to a named beneficiary automatically upon the decedent’s death, outside of probate. Common examples are retirement or financial accounts where the owner makes a beneficiary designation and names a beneficiary or beneficiaries directly with the financial institution. Upon the decedent’s death, these assets will pass automatically to the named beneficiaries.
  • Trust Estates— Decedents who utilized Living Trusts as part of their estate plans often transfer many of their assets to the trust before death. Thus, the trust owns those assets, not the decedent, so when the decedent dies, these assets do not need to pass through probate. Instead, the assets pass according to the trust’s terms, outside of the probate process.

Debts and Other Claims Against the Estate 

Not all claims presented by purported creditors and others to the executor of the estate are necessarily valid. The executor needs to evaluate the evidence of the debt each party claiming to be a creditor has submitted. If there is a dispute, the matter could be negotiated with the personal representative, or could end up in probate litigation. If someone passed away without paying their debt to you, or you are owed services from the decedent which remained incomplete as a result of their passing, probate court could also be a venue to resolve that outstanding debt. Also, if the deceased was a defendant in a lawsuit, for example in a personal injury case, the estate cannot be settled until that case has been resolved.

Can I Avoid Probate? 

Many individuals aim to avoid having their estates go through the probate process; depending on the size of the estate, the formal probate process can be complex, expensive, and time-consuming. With comprehensive estate planning during life, a plan can be created that does not require probate. This often requires a Living Trust and reliance on transfer on death assets. An experienced estate planning attorney can help you carefully craft an estate plan to avoid probate after death if that is your desire.

Creating Order from Chaos: Probate Administration and Litigation Attorneys

Probate of an estate can become incredibly complex, and it is best undertaken with experienced legal counsel. The probate administration and litigation attorneys at the law firm of General Counsel, P.C. are experts in all matters related Wills, Trusts & Estates. We can assist you in your role as executor, or simply advise about the probate process, and provide guidance about your rights as a beneficiary or heir. Our estates and trusts lawyers will collaborate with you throughout the entire probate process, from having you appointed as executor by the court to dealing with creditors or other issues requiring litigation. Being an executor of an estate can be extremely stressful and labor-intensive. When you involve GCPC, we will ensure deadlines are met, court requirements are satisfied, and that estate obligations are managed as expeditiously as possible with an efficient distribution of assets. We would welcome the opportunity to provide professional guidance through the complex estate administration process, and help you protect your interests through probate litigation, if necessary. Contact us today at 703-556-0411, email intake@gcpc.com, if you are ready to have a conversation about how we can help!

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