Upon the passing of a family member, their estate may require a filing with the court process called probate or estate administration, where certain assets are managed and distributed. The probate process creates a clear chain of title for the ownership of assets to pass from the decedent to the beneficiary. A proper estate plan, including a Will, should help clarify what portions of the estate will pass through the probate process.
Below we have provided answers to many of the common questions that we are asked about the probate process. If you would like more information please do not hesitate to call us at 508.655.5980 or e-mail us.
Mediation is often overlooked as a method to address estate conflicts, perhaps because the Court is already a part of the initial probate process, and Court filing deadlines and statutes of limitations lend themselves to the immediacy of litigation. Mediation, however, can be a valuable process in resolving estate conflicts, even if the probate has already been filed in Court.
The mediation process provides a forum where surviving relatives and beneficiaries can maintain their relationships with each other and jointly craft a solution without the prolonged time frame or expense of probate litigation. The solutions derived through the mediation process can be tailored to address the concerns of the parties, as well as creative in ways that would likely not be expected through a Court decision.
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When someone dies intestate, it means that he or she did not have a validly executed Will in place at the time of death. The disposition of property in an intestate estate is governed by statute, and the specific distributions depend on the number and relationship of the decedent’s surviving heirs.
The length of the probate process depends somewhat on the complexity of the probate assets owned by the decedent. A probate estate cannot be fully officially closed until one year after the date of death because that is the statute of limitations for creditors to file claims in the estate. However, in some cases the administrative work and even distributions to beneficiaries may take place sooner, leaving just the estate closure until the statute of limitations period is over. If the probate is contested, resulting in litigation, the length of the process will depend on the length of litigation.
The assets in an estate that are probated are all assets that do not otherwise pass to others by contract or survivorship. Assets that are probated may include real estate, cars, boats, bank accounts, and personal property. However, a particular asset may be probated in certain circumstances and not in others. For example, real estate with two owners holding title jointly with a right of survivorship will automatically pass to the surviving owner upon the death of one owner. In this instance, the real estate is not a probate asset. If the real estate was only owned by the decedent, then it will need to be probated in order to pass to the beneficiaries of the decedent’s estate.
There is a simplified process called voluntary administration for small estates with no real estate and personal property valued under $25,000, exclusive of one motor vehicle. Estates with probate property valued over $25,000 are probated either by the informal or formal process. The informal process is typically used for uncontested estates and involves very little court oversight. If there are any issues requiring court involvement, such as a will contest or request for a determination of beneficiaries, the estate must be filed using the formal probate process.
An objection to a Will, also known as a “Will contest,” is not uncommon and can be incredibly costly to litigate. In order to contest a Will, one has to have legal “standing” to raise objections. There are certain circumstances which may be more likely to lead to a Will contest, such as if the decedent’s children are treated disproportionately or if there is disagreement over who will be appointed as Personal Representative of the estate.
Personal Representatives are reimbursed for all legitimate out-of-pocket expenses incurred in the process of management and distribution of the estate. In addition, the Personal Representative may be entitled to statutory fees or specific compensation directed by the Will.
The Personal Representative is appointed by the Probate Court to fulfill certain fiduciary duties relating to the decedent’s estate. These duties include, but are not limited to, taking an inventory of the assets, paying legitimate debts of the estate, responding to creditor claims, preparing estate accounts, and distributing any remaining estate assets pursuant to the decedent’s Will, or by statute if there was no Will.
Life insurance on the life of the decedent may or may not be a probate asset. For example, if a life insurance policy has a designated beneficiary, the life insurance payout passes by contract to the named beneficiary and would not be considered a probate asset. If, however, the named beneficiary predeceases the insured, the policy contract may direct the payout to the insured’s estate, thereby making the proceeds probate property.
There are pros and cons to having an estate as the beneficiary of a life insurance policy. Generally, it is preferable to have life insurance proceeds pass outside of a probate estate, as the payout is usually available to the beneficiary fairly quickly, and without any potential delays or creditor claims which may result from the probate process. In specific individual circumstances, however, it may be critical for the estate to have the type of immediate liquidity that life insurance proceeds can provide, such as with certain buy-sell agreements.
A guardianship nomination in a Will is only considered if all of the parents or existing legal guardians of a minor are unavailable, incapacitated, determined by a Court to be unfit, or have voluntarily relinquished parental rights. The Court would then look to the next nominated guardian. If this is you, you can petition the Court to appoint you as guardian, or if you are unable or unwilling to assume the role, the Court would look to the next nominee. The Court would perform a criminal history background check, consider evidence provided by any individuals contesting your appointment, if any, and determine whether the appointment is appropriate. If the child is at least 14 years old, s/he can consent to or withhold consent from the appointment of the nominated guardian, or nominate a guardian of his/her own choice.