WHAT IS IN THE ESTATE AND HOW THE PERSONAL REPRESENTATIVE FIND AND MANAGE IT?
PROBATE ESTATE ADMINISTRATION
Probate Asset Inventory & Collecting – If a person passes away leaving money or property there may need to be a probate court administration of the estate. If there is a living trust and all of the deceased person’s assets have been placed into the living trust prior to death, there is no need for a probate court administration and the procedures discussed in this article would not be applicable to a living trust situation. The point of a probate court administration is to get somebody appointed as the administrator or executor of the estate (also known as the personal representative) who has authority of the court to handle to inventory and handle the money and property and accounts of the deceased person. Upon appointment by the court, the administrator will obtain a form signed by the court entitled letters of administration. The personal representative will then take the letters of administration over to all banking and securities institutions and have the accounts transferred out of the name of the deceased and into the name of the personal representative.
COLLECTING AND INVENTORYING THE ASSETS
In probate estate terminology the personal representative’s initial and most important responsibility is the “marshaling” of all assets and property interests held in the decedent’s name and/or owned by the decedent. This would include the decedent’s separate property and one half interest in community property held with his or her spouse. “Marshaling” is further described as the process of discovering, identifying, and taking possession and control of the decedent’s assets so that they can be used to pay the taxes, creditors claims, and expenses of administration and ultimately distributed to the estate beneficiaries.
Probate Asset Inventory & Collecting – Identify ALL Real & Personal Property
COURT POWERS ARE AVAILABLE
Since a probate case is a legal proceeding under the probate division of the California Superior Court, the personal representative has certain powers available to assist in marshaling. Where third persons are withholding estate property or withholding information about the property of the decedent, including a possible will, the court may cite a third person to provide written answers to interrogatories/questions and or to appear before the court to testify and be examined under oath. The questions and examination would be concerning any suspected wrongful taking, concealment, or disposition of estate property or a third person’s knowledge about or possession of any deed of conveyance, bond, contract or other writing that contains evidence that might disclose the decedent’s interest in or claim to property or lost will of the decedent. If these procedures don’t work to discover what the personal representative is looking for, he or she can always use other discovery procedures normally used in civil litigation such as depositions, subpoenaing of witnesses and documents and request to identify documents. Also, if necessary, the personal representative can file lawsuits to obtain possession or establish ownership to estate property held the claimed by others.
PROPERTY IN POSSESSION OF HEIRS AND DEVISEES
The law allows the personal representative some discretion and flexibility choice to avoid disrupting the devisees’ or heirs’ possession whenever possible. For example, if an heir has possession of jewelry or furniture that according to the will is ultimately to go to that person it may be left with the person who has possession. However, it still has to be accounted for as part of the overall inventory and value of the estate. Also, if the personal representative in his sole judgment decides that possession of an asset is necessary or desirable for administration, the heir or devisees must surrender the asset to the personal representative upon request. The deceased spouse and children and domestic partner are legally permitted to temporary possession of a family dwelling and its contents. However, the temporary possession rights end 60 days after the estate inventory is filed.
ABANDONMENT OF TANGIBLE PERSONAL PROPERTY
The personal representative may decide to dispose of or abandon tangible personal property that is not specifically mentioned in the decedent’s will where the cost of collecting maintaining or safeguarding it would exceed its fair market value. However, before abandonment, the personal representative must give written notice and opportunity to object to persons interested in the estate. If an objection is made, the abandonment or disposition may ordinarily proceed only after obtaining a court order.
INVENTORY & APPRAISAL FORM
The personal representative is required by law to fill out and file with the court an inventory and appraisal form DE-161 listing out the various assets in the estate. This form becomes public record and is one of the main objections to the probate procedure. If the decedent had a living trust, there would be no public record for filing of any forms listing out the decedent’s money and property. There is a person known as a probate referee who is appointed by the court for each probate case at the same time that the personal representative is appointed. After the personal representative filled out the inventory and appraisal form, it is sent to the probate referee for appraisal. All of the non-cash assets such as real estate are actually appraised by the probate referee and the values resulting from appraisal are listed on the inventory and appraisement form before filing with the court. The personal representative may choose to engage an independent expert appraisal to appraise items that are unique or special such as jewelry and furnishings. By law, the inventory and appraisal must be filed within four months after issuance of the representative’s letters. If the entire form cannot be finished within the four months then a partial inventory and appraisal is filed stating what there is at that point. An extension of the four-month deadline can be applied for but typically the court will accept later filed inventory and appraisal forms after the deadline. Technically, the personal representative can be removed for failure to meet the four-month deadline so that is a tool available for beneficiaries who believe that the personal representative is not acting properly.
Below is the Probate Form DE-161
In decedents’ estates, inventory and appraisal attachments must conform to Probate Form DE-161 that is approved by the Judicial Council of California.
These reporting requirements are where many Personal Representatives work with a Probate Lawyer for Probate administration help, advice and guidance. The probate courts allow you to pay for legal help from the decedent’s estate.
REPORTING REAL ESTATE TO THE COUNTY
A change in ownership must be filed with
the County assessor for each county were any real property reported on the inventory and appraisal is located. This will result in the property taxes being increased unless there is an exemption available. A typical exemption would be a transfer from husband to wife on account of the husband’s death.
CALL (949) 229-7034 to speak with Lawyer David L. Crockett
OBJECTING TO THE INVENTORY
Any interested person is entitled to file written objections to any appraisal up until the time for hearing on the petition for final distribution. The court hearing on the objection would be held and it would be up to the objector to prove that the items complained about are wrong.
Conveniently located in Newport Beach near the John Wayne Airport
We are located near the Orange County California John Wayne Airport. My office is catty-corner from Fletcher-Jones Motorcars; —right behind the rear entrance of Newport Lexus on Dove Street. Here is a picture of my office building and a Google Map to get your bearings.