An executor must undertake these responsibilities subject to a fiduciary duty to the estate. This includes a non-delegable duty to collect and preserve the estate. As the fiduciary of the estate, an executor owes a duty to act on behalf of the estate, and not for the executor’s personal interests. In the management of estate assets the executor must abide by the principle that an executor acts primarily in the interest the estate and its beneficiaries. A beneficiary of the estate has legal rights to hold an executor to these standards. The beneficiary’s rights include seeking the removal of an executor from office, and court oversight of the estate administration, and sanctions.
Often, without action by the beneficiaries the executor will continue to do little or nothing to administer an estate. It is important that action be taken to enforce these rights as quickly as possible. The longer the delays, the more likely waste and damage may affect an estate. The first step is to know your legal rights and the options that best fit your situation. When most people think of executing a will, they might think only of delivering inherited assets to beneficiaries. However, there are actually several steps of the probate process that the executor must complete before transferring any assets. As a beneficiary, it’s natural to wonder how long it will take before the process ends and you receive any inheritance coming your way. Unfortunately, every estate is different, and that means timelines can vary. A simple estate with just a few, easy-to-find assets may be all wrapped up in six to eight months. A more complicated affair may take three years or more to fully settle. There are some deadlines written into state code for some parts of the probate process, and these might compel the estate’s executor to complete certain steps by a given date. We’ll review some of these rules in this guide. However, these deadlines are far from uniform, so it’s important to read up on how your state and even your county handle things.
Filing the Will for Probate
Submitting the deceased’s will to the proper probate court is the first step in any probate process. Doing this and receiving the court’s approval is what allows the executor to act as executor in the first place. So how long does the executor have to submit the will after the deceased passes away? As with just about every step in the process, the answer varies from state to state. Some states have no stated time limit for an executor to submit the will. That being said, the executor’s fiduciary duty to the estate, and therefore the estate’s beneficiaries, prevent him or her from just sitting on the will without good reason. The estate will continue to accrue expenses like property taxes regardless of whether or not anyone has filed the will, so it’s almost always in the estate’s best interest to get the probate process started sooner rather than later. If you’re a beneficiary and the executor named in the will has no plans to file the will or start the probate process, you likely have an argument that she’s violating her fiduciary duty to the estate.
One of the first parts of the probate process is conducting an inventory of an estate’s assets. After an executor receives authority from the probate court, he or she is in charge of collecting all the assets in the estate and giving each a valuation. This is necessary to determine several things. One is if the estate will be subject to estate taxes. Another is if the estate will remain solvent – that is, whether the estate’s assets exceed its debts. Some states have deadlines for an initial inventory written into state code. Both Maryland and Texas, for example, require executors to conduct an inventory within three months of the decedent’s passing. Other states leave it to the probate courts to judge on a case-by-case basis. If you’re the executor of a complex estate, be sure to find out whether there are any states or county laws regarding the timeline for conducting the inventory.
Paying Debts and Taxes of the Estate
The amount of debt associated with an estate is arguably the variable that can have the biggest impact on how long the probate process takes. This is partially because creditors against the estate need time to become aware of the process and make any claims against the estate. Some states have required windows of time to allow creditors to make claims. The tax burden that your estate has is another factor that could prolong the probate. This is particularly true if you have to deal with estate taxes. If the estate has real estate in multiple states, you may have to go through separate probate processes, which may or may not delay the distribution of assets.
First and foremost, Executors have a duty to collect in the assets of the Estate and settle any liabilities, which are the debts of the deceased person, including the funeral bill. After all liabilities have been settled, whatever is left may then be distributed, but in a strict order of priority:
• Pecuniary legacies (gifts of specific sums of money)
• Residuary Estate (the remaining money in the Estate)
If the deceased left a Will which set out gifts of specific sums of money, then these must be paid first. The remainder of the Estate (known as the ‘residuary estate’) is everything left over after these gifts have been paid. So Beneficiaries who are entitled to a share of the residuary Estate will be paid after those who are receiving specific cash gifts. However remember that all liabilities must be settled before any payments are made to Beneficiaries. So even cash gifts included in the will should not be prioritized over liabilities of the Estate. There is a legal rule that pecuniary legacies should be paid out within a year of the death of the deceased. This is known as the ‘Executor’s year’ and if it is not possible to pay the pecuniary legacies within the time period referred to, the Beneficiaries concerned are entitled to interest. An Executor would be expected to demonstrate a basic level of competence during the Estate administration and they should not act with undue delay. However, there are certain issues that can arise during the administration period that may cause a delay in distribution. Examples of the potential issues include:
• A missing Beneficiary – this is where the whereabouts of someone who has been named as a Beneficiary in the will is not known. In these circumstances reasonable investigations should be carried out, usually by using a tracing agent in an attempt to find them.
• Selling a property – if a property needs to be sold, a Grant of Probate needs to be obtained before contracts can be exchanged. It can take 3-6 months to obtain a Grant of Probate. Additionally, it can be difficult to anticipate the length of time it takes to market and find a buyer for a Probate property, which can often cause delays.
• Dealing with foreign property or assets – if a foreign property needs to be dealt with, this may also extend the length of time it takes to make payment to Beneficiaries. In most cases, the Executor will have to sell the property by instructing foreign estate agents and lawyers, complying with the legal requirements of that country and obtaining the necessary permissions to sell the property.
• Investigation by the DWP – another common reason for distribution to take a long time is if the Department for Work and Pensions (DWP) makes an investigation into any benefits the deceased received. This will usually add a further 6 to 9 months before the final sum due back to them is confirmed as a liability of the Estate.
• Statutory advertisements –This notice will give creditors two months from the date of publication to notify the Executors of any claim they may have against the Estate. Executors who advertise in this way are protected from personal liability for the debts should a valid claim arise later. Again this can prolong the process, as the minimum time given for people to come forward is two months. Six month limit to bring a claim – in other cases, it can be sensible for the Executors to make no distribution until at least six months after the date of receiving the Grant of Probate. This is because there is a six month time limit whereby claims can be brought against the Estate, under the Inheritance (Provision for Family and Dependents) Act 1975. This timeframe runs from the date of the Grant of Probate. If a claim were to be brought, it would be far better that the Beneficiaries have not received the money rather than being asked to repay the money.
It is important to note that Executors should not pay cash gifts out of their own money and should never mix their own money up with monies comprised in the Estate. If the majority of the Estate assets have been received and there’s enough money in the Estate account, an interim payment could be made to the Beneficiaries with Executors holding back enough funds to cover any potential costs. These payments should be recorded by asking the Beneficiaries concerned to sign a written receipt, acknowledging receipt of the interim payment. On payment of the final costs or disbursements, the remaining funds would then be distributed to the Beneficiaries. If there is unreasonable delay, a Beneficiary should contact the Executor, pointing out their obligation to keep all Beneficiaries updated on the progress of managing the Estate. As a Beneficiary, you can also demand that the Executor provide an account of the Estate which should outline how much you are due to receive and the progress made in the Estate administration. If refused, there is a relatively straightforward process for obtaining a Court order so the Executor must produce an inventory and an account of the transactions of the Estate.
Guidance From State Law
It’s up to the probate court to appoint an administrator if one is needed. But how does the court, without guidance from a will, choose someone? The answer is found in state law. Every state sets out an order of priority for judges to follow when appointing an administrator. For example, here is the priority list for serving as an administrator in Utah:
• Surviving spouse or a person the spouse nominates
• Mother or father
• Brothers or sisters
• Next of kin entitled to inherit under state law
• Any legally competent person
So when a Utah resident dies without naming an executor, the surviving spouse is first in line to be appointed as administrator. If the spouse doesn’t want the job or isn’t able to do it, he or she can nominate someone—in essence, the surviving spouse stands in the place of the deceased person. If the survivor doesn’t name someone, then the court moves on to the children, then the parents, and on down the list. Courts do not, by the way, automatically appoint the oldest sibling as administrator. All children of a deceased person on are an equal footing. Some states priority list includes:
• Spouse or domestic partner
• Other heir (person entitled to inherit under state law)
• Any other person
Factors The Probate Courts May Consider
Even if someone is nominated in a will to serve as executor, or is entitled to priority for appointment in a state statute, the court has the final say over who actually serves as the personal representative. Only the court can issue the document (commonly called “letters of administration” or just “letters”) that gives someone authority over the assets in a deceased person’s estate. Certain people who would otherwise be entitled to serve as personal representative are disqualified under state law. (The same factors apply to persons nominated in a will.) Here are some factors that may or may not serve as reasons for disqualification:
• Age: No state allows persons under 18 to serve as a personal representative; many set the minimum age at 21.
• Criminal history: Some states forbid persons convicted of serious crimes from serving. Others require only that anyone who has been convicted of a felony inform the probate court.
• Business relationship: In Utah, if the deceased person was a member of a partnership at the time of death, the surviving partner must “in no case” be appointed as administrator.
• Residence: All states allow persons who don’t live in the state, under certain circumstances, to serve as personal representatives. A few states allow this only if the person is a close relative. Many others require a non-resident to post a bond or appoint an in-state agent for service of process (that is, to receive communications from the court).
• Citizenship: There isn’t much law on this, but the courts that have considered the question have ruled that noncitizens may serve as executors. Courts are usually more concerned about who’s actually a resident of the state; the court wants to be sure is has jurisdiction over the personal representative.
What is The Personal Representative’s Responsibilities?
Executors, or Personal Reps, have to:
• Take care of the property which the deceased person owned and which was a part of the estate.
• Receive payments which are owed to the deceased’s estate, including dividends from investments, interest payments, and other types of income which are earned by estate assets.
• Collect on debts which are owed to the deceased.
• Collect on outstanding notes due to the deceased person.
• Determine who all heirs are, including their names, the degree of their relationship with the deceased person, and the contact information for heirs.
• Determine who all beneficiaries named in a will are, including their names, addresses, and ages.
• Investigate any and all claims which are made on the estate in order to determine if claims are valid.
• File tax returns as required and pay any and all taxes which are due.
• Follow the instructions of the probate court related to transferring assets and managing the affairs of the deceased
An executor has a legal duty to respect the wishes of the deceased and to follow Ohio law. An executor is a fiduciary, which means that the duty he owes is the highest under the law. Executors must put the interest of the estate and beneficiaries over their own interests and must avoid any activities which could be considered a conflict of interest. If an executor fails in this duty, there are serious consequences.
Free Initial Consultation with Lawyer
It’s not a matter of if, it’s a matter of when. Legal problems come to everyone. Whether it’s your son who gets in a car wreck, your uncle who loses his job and needs to file for bankruptcy, your sister’s brother who’s getting divorced, or a grandparent that passes away without a will -all of us have legal issues and questions that arise. So when you have a law question, call Ascent Law for your free consultation (801) 676-5506. We want to help you!
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States
Telephone: (801) 676-5506