New York Probate Lawyer Blog

The New York Probate process has many different aspects and requirements. The probate of a Last Will begins with the preparation of a Probate Petition which is to be filed with the Surrogate's Court. Many of the basic Surrogate's Court forms can be found online at www.nyccourts.gov/forms/surrogates. The petition is usually filed with the Surrogate's Court in the County where the decedent was domiciled i.e, where he or she maintained a primary home. So depending upon the decedent's home, there may be a Westchester County Probate or Nassau County Probate, etc.

The Probate Petition is required to contain: (i) information about the petitioner, who is usually the Executor named in the Will; (ii) information about the decedent such as date of death, address and citizenship; (iii) information about the purported Last Will such as its date and the names of the witnesses to the Will; (iv) the identity of the decedent's distributees i.e., next of kin; and (v) information about the value of the personal and real property comprising the estate.

In many instances the probate of the Will may be delayed. Probate is essentially the method by which the decedent's Will is validated as authentic by the Court so that the Will provisions control the disposition of the decedent's estate assets. This delay may be due to a number of circumstances such as difficulty in determining the decedent's distributees that raise issues regarding kinship or a Contested Will that might result in Surrogate's Court litigation lasting many months or years.

New York Trust and Estates attorneys are familiar with these types of delays and regularly counsel the named Executor to apply to the Court for appointment as Preliminary Executor. A Preliminary Executor is a temporary executor that can be appointed while other issues affecting the probate of the Will are resolved. Surrogate's Court Procedure Act 1412 entitled "Preliminary letters testamentary" provides for this type of appointment. A Preliminary Executor typically has most of the powers that an Executor would have after probate is complete. Thus, a Preliminary Executor can collect the decedent's assets, open an estate bank account, file estate tax returns, pay bills and expenses and generally engage in all aspects of Estate Administration. However, the Preliminary Executor does not have the power to distribute assets to estate beneficiaries.

The Court has the authority to deny the application for Preliminary Letters in the best interest of the estate. For example, if Objections were filed to such appointment and the Court found that the proposed Preliminary Executor's actions raised bona fide questions of undue influence, breach of fiduciary duties, or other wrongdoing, the Court could appoint someone other than the nominated Executor in the Will.

In most Surrogate's Courts such as Manhattan or Queens Surrogate's Court, the appointment of the Preliminary Executor is not a lengthy process. The Court must be advised as to the assets and liabilities of the estate and can require the appointee to obtain a Surety Bond.

Continue reading "New York Trust and Estate Lawyers Can Help Obtain Preliminary Letters Testamentary" »

The estate settlement process in New York involves a number of stages. The first stage is typically the appointment of the fiduciary. Where the decedent has left a Last Will, the Will must be probated. Throughout New York such as in Westchester or the Bronx, probate in the Surrogate's Court can involve kinship issues, Will contests or proving the validity of a lost Will.

When a person dies without a Will or intestate, the process of appointing a fiduciary is known as an Administration proceeding. Proper New York estate planning should be done to avoid intestacy. Where there is no Will, the decedent's estate is distributed to his or her next of kin or "distributees". Many of the problems that can be faced in Administration proceedings, such as kinship hearings, have been discussed in previous posts in the New York Probate Lawyer Blog.

After the initial stage of appointing a fiduciary, the next stage in estate settlement is the actual collection of estate assets and the payment of estate expenses such as taxes and debts. This stage involves many issues regarding the decedent's affairs including estate tax determination and possible Court proceedings regarding disputes with estate creditors or claimants. The numerous tasks involved in marshaling the decedent's assets and administering the estate affairs can take many months. Once this phase of the estate is completed, the time has come to distribute the estate assets to the beneficiaries.

This final stage typically involves the preparation of a full Accounting which specifies all of the transactions entered into by the Executor or Administrator during the course of the estate. An estate Accounting contains a number of parts called Schedules, each of which contains different information. One Schedule shows the assets that a fiduciary collected while another Schedule shows the various expenses that were paid. Another Schedule shows the amount of estate assets that are currently available for distribution.

After review of the Accounting, the estate beneficiaries often agree to approve the Accounting informally or without a separate Accounting Proceeding in Surrogate's Court. However, if estate beneficiaries do not agree, the fiduciary would then file the Accounting with the Surrogate's Court in Queens or Manhattan or whatever County the estate is being administered in. The estate beneficiaries can then file Objections to the Accounting and the Court will make the final determination as to the validity of the objections.

Objections to the Accounting can include such items as breaches of fiduciary duty for commingling assets or misappropriation of funds. Other objections can relate to improper payment of expenses or losses sustained due to the decline in value of an estate asset. Following the approval of the Accounting by the beneficiary or the determination of the Court as to any formal objections, the estate assets can be distributed and the estate settled. A recent case decided by Manhattan Surrogate Nora Anderson on March 6, 2012 and reported in the New York Law Journal on March 19, 2012 entitled Accounting of Chase Manhattan Bank, provides an example of the many types of issues that can be raised in a Surrogate's Court Accounting. Although this case concerned an accounting by Trustees of a revocable inter vivos trust, the issues included claims of underpayment of distributions and wrongful payments.

Formal Court accountings are typically long and complex proceedings. Most estates are settled out of Court. However, it is important that the fiduciary keep and retain good records and report the estate transactions to the beneficiaries in a clear and concise manner. Such actions by the fiduciary should result in a smooth ending to estate administration and distribution of assets to estate beneficiaries.

Continue reading "Estate Accounting In New York Finalizes the Settlement Process" »

New York Estates and Trusts Law Firms deal with issues regarding real estate all the time. The ownership of real estate can take many forms. Queens County estates and Brooklyn estates are likely to have interests in single family houses. Manhattan estates commonly contain condominiums and cooperative apartments.

Regardless of the type of real estate interest owned, estate planning and estate administration requires that these interests be handled properly. The first step in planning for probate with real estate is to determine basic facts about the property. These facts include the following:

1. Identify the owner(s) of the property. Deeds and other certificates of ownership need to be examined to be certain that the person planning his or her estate (the "Testator") has full right and title to the property. In many instances, a person may have inherited the property from another family member and the ownership interest may be held among a number of people.

In such a case, the testator can only transfer the share of the property he or she owns. Also, if the property is owned with others, say a spouse, in joint ownership, upon the death of the testator, title to the property passes directly to the joint owner and will not be controlled by the person's Last Will. Thus, provisions in a Last Will giving the property to third parties other than the joint owner would not be effective.

Any and all issues regarding title and ownership should be investigated and resolved at the time the New York estate plan is being developed. This will save time and avoid the hardship of attempting to solve issues during estate settlement when the testator has already passed away and is not available to provide information that could assist in resolving the title issues.

2. Determine whether the property is subject to any liens or mortgages. It is important to anticipate the effect of the owner's death on these outstanding obligations. For example, when the owner dies, will the decedent's estate have enough liquid assets available to continue to pay the mortgage until the property is sold. Similarly, if the property is meant to be given by the Last Will to a named beneficiary and not sold, how is the mortgage to be paid?

The type of mortgage on the property is also a subject for review. It has become more popular for senior citizens to obtain reverse mortgages which may greatly reduce the value of the property available to be given to the estate beneficiaries. Also, a reverse mortgage may be required to be paid in full upon the owner's death and the estate may not have the liquid funds to make this payment.

While mortgages and other liens reduce the amount of assets that the beneficiaries receive, such debt obligations are also estate tax deductions that can reduce the size of an estate for estate tax purposes. Understanding the value of the testator's real property and the equity available after the payment of all liens is essential to planning an estate.

3. Determine the appropriate manner to give the property to the intended beneficiaries. Real estate is not only one of the most valuable assets in an estate, it often has the most personal attachments among family members. The testator's home may have been owned by family members for generations and the decedent's children may have all grown up in the house. Selling such an asset or allowing a family member who still lives there to remain in the home for years to come can cause bitter controversies. Planning for these types of situations is important to avoid disputes that destroy family harmony and end up in probate court litigation.

The Hartford Courant recently reported in a story by Denise Buff dated February 26, 2012 about a decedent who changed her Last Will shortly before death and left the family home to only two of her four children. The two excluded children asserted that the newest Last Will did not reflect their mother's intent that the house be inherited by all four children and that the mother's dementia allowed the mother to be subjected to influence to exclude them.

While the best estate plan cannot always prevent unforeseen or improper conduct on the part of others, it is important to put into place a plan that you will be certain reflects your intent and maintains the family harmony to the greatest extent possible.

Continue reading "New York Real Estate Is An Important Part of An Estate Plan" »

The preparation of a New York Last Will is an important part of a person's overall financial plan. The initial step that should be taken is to fully assess and understand the goals that the person making the Will wants to achieve. This process can be summarized as formulating and clearly expressing the intentions that are to be spelled out in the Will provisions. For example, who are the persons that are to benefit from the Will provisions and in what manner or proportion are they to receive these benefits. Beneficiaries can vary from spouses and children to more distant relatives, friends and charities.

It is important at this juncture to keep the estate plan simple. The New York Probate Lawyer Blog recently discussed aspects of the Federal estate tax law such as "portability" of the marital deduction between spouses. While estate planning is essential, it is more important at the outset to develop the basic plan or intent regarding the individuals or organizations that the testator (the person to whom the Will belongs) wishes to benefit. The tax planning and Will structure can then be developed so as to promote or carry-out the basic intent. A Last Will that has complicated tax provisions and trusts may be a great legal document but it is not useful unless it gets the assets to pass to the intended beneficiaries in a clear and efficient manner. Simplicity has its virtues.

The recent death of pop-star Whitney Houston provides an example of a simple yet effective Last Will. It was recently reported by MTV in an article by Gil Kaufman dated March 8, 2012, that Whitney Houston's Will was written in 1993. In the Will, Ms. Houston's entire estate was left to her only child, her 19 year old daughter, Bobbi Kristina Brown. It seems that the Will provided for a Trust under which Bobbi is to receive some of the assets at age 21, then some at age 25 and the balance at age 30. Ms. Houston's mother is named as Executor and her brother and sister-in-law are named as Trustees.

This type of plan is typical for persons with young children and provides a straight forward map for the Trustees to make periodic payments to a young person over time as they get aclamated to handling and being responsible for large sums of money following the death of a parent. I have drafted many Wills for clients which contained similar Testamentary Trusts.

Part of the process in planning is to consider an appropriate payment period since the ages at which Trust Funds can be paid to the Trust Beneficiary are completely within the discretion of the Testator to determine in the Will provisions. Trustees should also be given discretion to make additional payments to beneficiaries which allows the trust to have more flexibility and accommodate unforeseen events.

Last Wills, Health Care Proxies, Living Wills, Living Trusts and Testamentary Trusts all have provisions that express the intent of the creator of these documents. Formulating and then expressing one's intentions is the first, and perhaps most important, step in creating an effective estate plan.

The extent to which a testator's intentions can be measured has recently been the subject of a major estate litigation occurring in Massachusetts. As reported in the Portland Press Herald on February 25, 2012, a Massachusetts Merchant left a Will 351 years ago that provided for the nation's oldest charitable trust in Ipswhich, Massachusetts to fund the local public schools. Recently, the trustees have attempted to forego the Will provisions and convert the local trust property comprised of cottages into condominiums. As reported in the article, the current residents have opposed this plan "saying it violates the sacred intent of Payne's Will. . . ." As shown by this controversy, even after 351 years, a testator's intent is still the foundation for the administration of the decedent's estate.

Continue reading "New York Last Wills Should Express The Testator's Intent" »