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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.

shutterstock_571088005-300x200The consideration of estate matters in New York always involves a number of variables.  New York, as well as the country as a whole, is comprised of a diversity of personal relationships controlled by numerous laws that are evolving all of the time.  A recent article written by Sarah O’Brien entitled “If you live with your partner and are unmarried, this is what happens when you die,” which appeared at CNBC.com on February 27, 2020, highlights just one of many problematic areas of personal concern.

In New York, as elsewhere, the formalization of a partnership through marriage creates certain spousal rights that have a direct impact on inheritance.  The New York Probate Lawyer Blog has published numerous posts talking about these matters.  For example, if a person dies intestate without a Last Will, his administration estate is, according to estate laws, (Estates Powers and Trusts Law section 4-1.1), going to be distributed to his next of kin.  An unmarried partner is not included in this class.  As an estate lawyer, I have seen many situations where upon the death of an unmarried partner, the surviving partner cannot share in the estate despite the longevity of the relationship.

Ms. O’Brien’s article discusses these types of issues.  Of course, there are some relatively simple solutions which require some thought and time and effort to complete.  First and foremost, each partner should complete a Last Will which names the other as primary beneficiary and executor.  It is also important to designate alternate beneficiaries and fiduciaries so that the creator’s intentions and desires can be fully carried out.  Living Trusts can also serve the purpose of having a valid document delineating the individuals who are to receive benefits upon death.

shutterstock_96626974-300x225After the death of a decedent, a proceeding may be commenced to probate a Last Will and Testament.  Probate proceedings are filed in Surrogate’s Court in the county where the decedent resided.

Various individuals may want to contest the Will.  Most commonly, objectants are the decedent’s distributees or next of kin who feel that the Will is invalid for one reason or another.  Surrogate’s Court Procedure Act (SCPA) Section 1410 entitled “Who may file objections to probate of an alleged will” delineates the persons who have such rights.  Clearly, an heir at law may engage in a contest since they most likely would be adversely affected by a Will which may diminish or eliminate their intestate share.

The New York Probate Lawyer Blog contains many posts about Will contests and Surrogate’s Court litigation.  These types of cases are usually very difficult because the Surrogate’s Courts tend to prefer that a decedent’s wishes as expressed in a written Will be given effect.  Also, a document that is prepared and signed under attorney supervision is given certain presumptions of legitimacy.  A recent Manhattan estate case decided by Manhattan Surrogate Nora Anderson on October 30, 2020 provides a simple example of such a situation.  In Estate of Memeh, the Court dismissed objections to the probate of the Will.  The various points made by the Court included the following:

shutterstock_548780089-300x200Time after time, estate executors and administrators seem to be confronted by a common problem – the sale of estate realty occupied by a family member.  The duty or obligation of the estate fiduciary is to collect and protect the estate assets and satisfy the decedent’s debts and obligations and finally, to effectuate distribution of estate assets according to the provisions of a Last Will and Testament or the laws of intestacy.  The many facets of estate settlement have been discussed in numerous articles posted in the New York Probate Lawyer Blog.

Real estate, typically the residence of the decedent, is the largest asset in an estate.  Very often after the death of the decedent, the residence continues to be occupied by a family member or a third party.  When the real estate must or should be liquidated to allow an estate to be administered and finalized, the individuals remaining in occupancy must be evicted.  As is commonly known, evicting persons from their homes is neither pleasant nor easy.

In the case of a decedent’s estate, commencing summary proceedings in the local landlord tenant Court may be the most efficient avenue as to non-related third-party occupants.  However, when a case involves relatives or estate beneficiaries, the Surrogate’s Court procedures often offer a more accommodating forum.  Depending upon the preferences of the local court, a proceeding to remove an occupant from estate property may be commenced in the form of a turn-over proceeding or possibly as an ejectment case.  Article 19 of the Surrogate’s Court Procedure Act entitled “Disposition of Real Property” also provides a procedure to have the Court direct a sale or disposition of the realty.  My Blog, referred to above, has discussed these eviction matters in earlier posts.

shutterstock_1465659569-300x201Article 81 of the Mental Hygiene Law provides the procedures and requirements regarding guardianship of an incapacitated person.  The statute allows for the appointment of a guardian for property management and for personal needs.  Whether or not a person requires a guardian is determined by the Court after a hearing.  One of central inquiries when determining incapacity is the extent to which the alleged incapacitated person can perform activities of daily living such as caring for personal hygiene, banking and financial affairs and other ordinary and regular daily living functions.  The New York Probate Lawyer Blog has published numerous articles about guardianship and the Court proceedings for appointment.

A guardian, like all fiduciaries, has duties and responsibilities.  If any of these obligations are breached, the guardian may be held personally responsible.  The guardian can also be discharged.  There is a duty to provide the Court with a full annual accounting of guardianship activities.  MHL Section 81.31 entitled “Annual report” states that the guardian must file a report with the Court every May.  The statute delineates the information that must be included in the report.  The Court, through a Court Examiner, reviews each accounting and either approves it or asks the guardian for additional information.  The Court Examiner may seek Court intervention if the guardian is not acting or reporting properly.  The Court’s primary goal is to insure that the interests of the incapacitated person are protected.  The Court Examiner typically will review all of the guardian’s information including bank statements and financial records to make certain that the information in the report is accurate and authentic.

The guardian’s duty to account and the Court Examiner’s review were recently discussed in a Queens guardianship case entitled Matter of Soifer.  This case was decided by Queens Supreme Court Justice Bernice Siegel on October 29, 2020.  In Soifer, the incapacitated person’s cousin had been acting as guardian.  The Court Examiner raised a concern with the Court because the cousin was also a trustee of a trust that was created for the incapacitated person’s benefit under her mother’s Last Will.  The cousin was a remainder beneficiary of the trust.  The Court Examiner felt that the cousin’s role as Court appointed guardian and trustee / beneficiary under the Will created a conflict of interest.

shutterstock_538370872-300x200The settlement of an estate typically focuses on the protection and collection of estate assets.  These assets may include bank accounts, retirement funds and other financial holdings.  However, the major asset in most estates is an interest in real estate.  Real estate may be in the form of a single family home, a multi-family residential building, commercial property or even a condominium unit.  While a cooperative apartment is not real property, since the interest is in the cooperative corporation, its value and ownership are generally equivalent to real estate holdings.

The decedent’s interest in real property is determined by the ownership document existing at the time of death.  This is typically a deed.  A deed can show different types of ownership interests.  The decedent may own a property as a joint tenant with a right of survivorship or he may just own the property in his name alone.

Problems arise when an estate property is held in the name of a number of owners as tenants in common.  In such a case, the decedent’s interest passes to his beneficiaries who then own the property along with the other owners, all as tenants in common.

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