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Probate-300x201It is well known that writing an estate plan is essential to have an effectual distribution of assets at death.  A lot of time and effort can be expended creating a Last Will, Living Will, Health Care Proxy and Power of Attorney that reflect a person’s desires and intentions.  The New York Probate Lawyer Blog has published numerous articles examining the planning of estates.

Additionally, it should be recognized that in order for a Last Will to be put into effect, the Will must be validated through the probate process.  This process requires that the Will be filed with the Surrogate’s Court and subjected to the review and procedures mandated by the Surrogate’s Court Procedure Act and the Estates, Powers and Trusts Law.  One of the most essential aspects involved with probating a Will is the necessity to provide the proper notice to a decedent’s next of kin or distributees.  This requirement has been reviewed on many occasions in this blog and it is important to bear in mind.  A decedent’s next of kin must be given notice because they have a right to contest the Will.  In many cases if the purported Will is found to be invalid, the distributees are entitled to receive an intestate share of the estate which may be much greater than their interest under the Will.

The usual course of a probate case involves the issuance of a Citation by the Surrogate’s Court.  A Citation is like a Summons and informs the parties to whom it is directed to appear in Court on a date certain and provide any Objections to the Will.  The Citation must be served on the distributees in a manner provided by the statutes and Court directions.  Once proper service of the Citation occurs, the Court has jurisdiction to hear and rule regarding probate.

shutterstock_1123004039-300x199After the death of an individual, the usual course is to proceed to have a fiduciary appointed to represent the decedent’s estate.  This is necessary in order to have someone who has the legal authority to collect the decedent’s assets, pay estate expenses and obligations and ultimately, distribute the net estate to beneficiaries.

In some cases the individual would have left a Last Will and Testament, which must be probated.  This results in the appointment of an executor.  If there is no Will, a proceeding needs to be commenced to have an administrator appointed.  Whether an executor or administrator is given authority by the Surrogate’s Court, someone receives the right to act on behalf of the estate.

It is not always known that a decedent’s estate, at least in New York, is not recognized as a separate legal entity.  The nature of a decedent’s post-death proceedings flow from the existence and authority given to the appointed fiduciaries.  Without the appointment of a representative for the estate, there is no one to act for the decedent and no one against which actions can be taken regarding the decedent’s affairs.

original_1074565532-300x107Fiduciaries in New York such as executors, administrators and trustees are obligated to account to the beneficiaries.  This means that estate and trust beneficiaries can request that they be provided with a financial accounting of the fiduciary’s activities.  An account typically has specific information contained in various schedules showing the assets and income received, the investments made, the expenses and debts that are charged against the assets and the balance of funds or assets remaining on hand.

Depending upon the nature of the trust or estate, the accounting may be simple or complicated and encompass dozens or more pages.  Most often, a beneficiary will receive an informal accounting meaning that the accounting will not be part of a formal accounting proceeding in the Surrogate’s Court.  In this context, the fiduciary and beneficiary can discuss the issues and information presented in the account and reach an accommodation and settlement which approves the account.

In other situations, a formal accounting proceeding may be needed.  These matters involve extensive estate litigation such as discovery in the form of document production and witness testimony.  Objections to the account must be filed by the beneficiary.  These can be based upon breach of fiduciary duty such as misappropriation of assets or other improper acts.

shutterstock_330039464-300x200Preparing and probating a New York Will is important in order for a testator to effectuate an estate plan.  There are many considerations that an individual needs to consider when planning an estate such as how assets are to be distributed and the identity of the beneficiaries who are to receive dispositions under the Will.  Guidance from an experienced estate lawyer regarding these matters should be sought.

There are many subtle and not generally thought-of issues which may have some impact on a plan and the ultimate probate of a Will.  A few of these matters are discussed in this blog post.  One such issue concerns the proper execution of a Last Will.  Estates, Powers and Trusts Law Section 3-2.1, entitled “Execution and attestation of wills; formal requirements,” provides the basic rules regarding execution.  Among these guidelines is that there must be at least two (2) attesting witnesses.  Nowadays many people prepare a Will from online forms and without the assistance of legal counsel.  An important rule to know is that if an attesting witness receives a disposition in the Will, he may need to forfeit his inheritance unless there are two other witnesses who do not receive a benefit under the Will.  This rule is provided in EPTL 3-3.2 entitled “Competence of attesting witness who is beneficiary; application to nuncupative will.”  The statute provides a number of additional rules and exceptions.  However, in view of the general prohibition, it is always best to have completely disinterested persons act as attesting witnesses so as to avoid any possible problems when it comes time to probate the Will.  The New York Probate Lawyer blog has many articles dealing with probate issues.

Another matter that should be recognized is that sometimes a Will contains what is known as a No Contest Clause or in terrorem clause.  This language in a Will provides that a beneficiary forfeits his disposition if he contests the Will.  Many individuals include this type of provision in a Will in the hope that it would discourage a discontented party from filing a Will Contest due to the prospect of forfeiting their inheritance if they lose the Court case.  The use of a no contest clause is controlled by EPTL 3-3.5 entitled “Conditions qualifying dispositions; conditions against contest; limitations thereon.”  However, the statute provides certain exceptions to the general rule of forfeiture.  For example, if there is probable cause, the condition does not apply if there is a contest based upon forgery or to show that a decedent left a later Will.  Also, a no contest clause does not prevent the initial discovery allowed by Surrogate’s Court Procedure Act Section 1404 which permits the examination of the Will witnesses, the Will draftsperson and the nominated executor and Will proponent.  In view of these and other exceptions to a no contest clause, a testator may want to consider other alternatives to avoid a Will challenge such as setting up asset beneficiary designations or a Living Trust.

shutterstock_1021207423-300x200In New York there are many different types of residences that may have been occupied by a decedent.  The settlement of an estate may be impacted by the nature of such home.  For instance, a person may have been living in a rental apartment, or in a cooperative or condominium unit.  Another possibility is that a decedent owned and resided in a single or multi-family home.

An estate attorney in New York who is also experienced with landlord-tenant and real estate issues can assist with administrating such properties.  Where a decedent lived in a rental apartment, the estate does not own any equity in the apartment and it does not have any value that can be sold or collected.  However, some apartments, such as rent-stabilized or rent controlled units, are given certain rights which allow designated family members to continue to live there.  Such rights are called succession rights and these can be very valuable especially where the rent is low.

The protection of residence rights can be complicated.  In a recent Brooklyn case entitled College Apartments, LLC v. Gedeon decided by Civil Court Judge Hannah Cohen on December 18, 2020, a landlord had commenced a non-payment of rent eviction case against the tenant.  As it turned out, the tenant had died before the case was commenced.  The son of the decedent tried to settle the case with the landlord and alleged that he was entitled to succession rights.  After reviewing the case following a settlement, the Court dismissed the proceeding since the death of a defendant prior to the commencement of an action results in the action being a nullity.  Fortunately for the son, he was able to retain counsel who sought to dismiss the case even after the settlement.

Fiduciary-300x185The appointment of a fiduciary is essential for the administration of a decedent’s estate.  Assets that were owned solely in a decedent’s name at death are not accessible unless the Court appoints a duly authorized representative.  Such representative can be an administrator if the person dies intestate or an executor if there is a Last Will and Testament.

Both executors and administrators have duties and responsibilities.  Their primary job is to identify, protect and collect estate assets.  They must also determine the existence of any claims or debts and, ultimately, distribute the net estate to the estate beneficiaries.  The New York Probate Lawyer Blog contains many articles discussing the administration of estates.

Upon receiving a Court appointment, the fiduciary is held responsible for carrying out the above duties.  If he fails to do so, the Surrogate’s Court has the power to remove him from office and revoke the letters testamentary or letters of administration which were issued to him.  Such was the outcome in a case entitled Matter of the Estate of Lewner which was decided by Manhattan Surrogate Nora Anderson on December 16, 2020.  In Lewner, a son of the decedent had been appointed Preliminary Executor of the decedent’s estate.  A petition to remove the son was filed due to the son’s failure to properly perform his fiduciary duties.  Among other improprieties, the Court found that the son did not file estate and income tax returns relating to the decedent resulting in liability to the estate for interest and penalty charges.  It was also reported that the probate proceeding was not prosecuted for years which delayed the settlement of the estate.  Based upon the above, the Court revoked the son’s Preliminary Letters Testamentary and appointed the Public Administrator as Temporary Administrator.  The son was also directed to file an account of his activities as fiduciary.

Probate-2-300x200A Last Will and Testament in New York must comply with the basic statutory requirements provided by the estate laws.  The primary statute regarding the fundamental aspects of Will preparation and execution is Estates, Powers and Trusts Law Section 3-2.1 entitled “Execution and attestation of wills; formal requirements”.

According to the statute, a Will is to be in writing, the testator is to sign at the end, and there must be at least two witnesses attesting to the signing.  The New York Probate Lawyer Blog has published numerous articles discussing the requirements for the due execution of a Will and different issues that might arise, particularly in the context of a Will contest.  In order for a Will to be admitted to probate, there must be a determination in the Surrogate’s Court that the document was duly executed.

The recent occurrence of the COVID-19 virus has made the ordinary execution of a Will difficult at times.  In the past, once an individual was ready to sign a Will, he or she would gather, usually in an attorney’s office along, with the witnesses and the signing ceremony would be conducted.  However, the COVID situation has created certain obstacles to the normal procedures due to lockdowns and social distancing.  A recent Orange County estate case decided by Orange County Surrogate Timothy McElduff, Jr. on December 7, 2020 entitled Matter of Estate of Bowen demonstrates the type of problems that the COVID pandemic can produce.

House-Keys-300x200Upon the death of an individual, the process to administer the estate commences.  Sometimes a person leaves a Last Will and Testament.  If there is no Will, then the person dies intestate and the distribution of the estate is subject to the laws of intestacy.  A primary function in administering an estate is to collect and protect estate assets.

One type of asset that is commonly owned by a New York decedent, especially in New York City, is a cooperative apartment.  Ownership of a coop apartment is reflected in the registered name that appears on the stock certificate and also on the proprietary lease.  Therefore, the first consideration in these cases is to examine these documents to determine the nature of the decedent’s ownership.  The stock certificate may be held in the decedent’s name alone or it might be owned along with another person as a joint owner or as a tenant in common.  The nature of the ownership will direct the next steps to be taken.  For example, if the stock is owned as a joint tenancy with rights of survivorship then the ownership of the entire coop will transfer to the survivor on death and no interest in the apartment will be subject to estate administration.

A second consideration concerns the appointment of an executor or an administrator if the coop ownership is part of the decedent’s estate to be administered.  The cooperative management typically will not allow anyone access to or information about the apartment until they are authorized through a Court appointment.  Often the management will not even accept payment of monthly maintenance charges if they are not being paid by an authorized party such as an estate fiduciary.  As a result, it is important to try and obtain letters testamentary or letters of administration as soon as possible.

1216424_supreme_court_new_yorkIt is not unusual that after an executor or administrator is appointed by the Surrogate’s Court that he or she finds out there is estate litigation to contend with.  For instance, the decedent may have left numerous debts which are unpaid and the creditors may decide to bring lawsuits to collect what is claimed to be due.

In other cases, a decedent may have been involved in a business or real estate transaction in which complex issues regarding claims or estate assets may be involved.  Problems arise when lawsuits are initiated or have been pending in Courts other than the Surrogate’s Court.  While creditors are allowed to file claims against an estate in the Surrogate’s Court, there are many instances where lawsuits might be instituted in other Courts, such as the New York State Supreme Court.

The problems faced by an estate fiduciary is that a law action that is pending in a Court different than the Surrogate’s Court may involve issues directly related to the administration of a decedent’s estate.  Moreover, if there are a number of related lawsuits going on in different Courts, there may be overlapping and duplicative Court proceedings such as discovery or motions or even trials and hearings.

shutterstock_96626983-300x300The procedure and terminology in a case involving a New York estate can be perplexing to those unfamiliar with this area of the law.  Surrogate’s Court matters typically involve statutes that are part of the Surrogate’s Court Procedure Act (SCPA) and the Estates, Powers and Trusts Law (EPTL).

The Surrogate’s Court is the forum in which matters such as the probate of a Last Will and Testament or the administration of an intestate estate are presented.  This kind of a case is a separate proceeding.  There are numerous additional types of proceedings, most of which concern the affairs of a decedent.  For example, there are accounting proceedings, kinship proceedings, turn-over proceedings and proceedings to remove an executor or administrator from office.  Since each proceeding is like a separate lawsuit, it is necessary for the Court to be certain that jurisdiction is obtained over all of the interested parties.  In this manner, the Court is assured that when it makes a decision in the case, its ruling will bind all of the interested parties and all of the interested parties will be given the opportunity to be heard and to protect their interests.

In each proceeding, the initiating party must provide the Court with full information regarding the identity and address of all interested parties.  If any of his information is unknown, the Court must be advised as to the missing information and the efforts made to obtain these facts.

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