The Process of Estate Administration generally takes 2 forms- 1. Estate Administration, 2. Probate of the Estate.
Estate Administration is for estates in which the decedent ( the person who died ) did not make a Will, or if he did, the Will is either determined to be not valid or for s0me reason is not offered for probate ( such as when a Husband and Wife each make a Will leaving everything in their estate to their spouse and/ or all property was held jointly ( in both the husband’s and the wife’ s name) , in which case the property passes automatically ” by Operation of Law ” to the ” surviving Spouse. Then when the remaining Spouse dies then that Will is usually probated.
Instead of an “Executor ” ( if there is a Will ) in an Administration proceeding there is an Administrator appointed by the Surrogates Court to administer the estate ( collect the assets and distribute them according to the laws of ” Intestacy “. The estate of a decedent who dies without a Will is called an “Intestate Estate “.
A Probate proceeding is a proceeding to administer the assets of an estate in which the decedent did have a valid Will and it is offered for probate.
In the Will the ” Testator ” ( the decedent who wrote the will ) “Nominates an Executor “ that he wants to administer the estate, and instead of the assets being distributed according to the laws of Intestacy the Executor must distribute them in accordance with the provisions of the will. This is the main reason to write a will.
In order for a person to be appointed by the court either as an Administrator or as an Executor, a written application is prepared ( usually by the proposed administrator or nominated executor’s attorney ) and submitted to the court and served upon the “Distributees “ ( people entitled to notice of the proceeding that would inherit in intestacy ) and “Beneficiaries “ named in the Will ( people entitled to notice of the Probate Proceeding and who are to receive property according to the Will ) and if no one objects in court to the person being appointed administrator or executor then the court will appoint that person by issuing a document ( “Letters of Administration to an Administrator or Letters Testamentary to an Executor ) that gives the person the authority to administer the estate.
Estate administration, whether in an Administration or a Probate proceeding, is substantially the same process, the details of which are beyond the scope of this article.
However, the jist of estate administration is that the” Fiduciary” ( Administrator or Executor ) after appointment by the court collects all the assets of the estate and distributes them either in accordance with the laws of Intestacy ( if no Will ) or with the provisions of the Will to the beneficiaries entitled to them, less a deduction of estate expenses ( filing fees, taxes, if any, burial expenses , executor’s commission, etc and attorney fees ). The estate is closed out by the Fiduciary filing a report that all assets were collected and distributed to the proper parties. This is usually done by the fiduciary preparing an “Accounting” ( which can be an Informal accounting- the usual procedure or a Formal accounting- done in cases where the beneficiaries do not accept an informal accounting and want the accounting approved by the court- this is also called a Judicial accounting ) showing the assets that were collected and subtracting the estate expenses and showing the amount remaining for distribution. In an informal accounting this is usually in a letter format and if all beneficiaries accept it as a true and accurate accounting then they each sign a ” Receipt and Release “ which is a document which states that the beneficiary has received what he is entitled to in the estate and releasing the fiduciary of any further obligation and thus the beneficiaries can not sue the fiduciary for not distributing the assets properly. The Receipt and Releases are then filed with the fiduciary’s report with the court which then considers the estate fully administered and thus closed. In a formal ( Judicial ) accounting instead of a letter the fiduciary ( usually the attorney for the fiduciary ) prepares a formal document, usually on forms with detailed schedules of assets provided by the court and serves it on the distributees or beneficiaries and files it with the court which schedules a court date for all interested parties to appear and voice any objections to the accounting. The court will review the proposed accounting and may hold a hearing and then make a decision either upholding the accounting or modifying it or ordering that the fiduciary submit a different accounting for approval. If the court approves the accounting it issues a document called ” a Decree on Accounting “ which then orders how the fiduciary is to distribute the assets of the estate. The fiduciary then makes the distribution and as in an informal accounting the beneficiaries sign Receipts and releases which are filed with the court which then closes the estate.
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