Articles Posted in Estate Administration

The probate of a Last Will and Testament validates the provisions contained in the Will.  The various Will directions can take many forms.  There can be dispositions of specific dollar amounts to beneficiaries, as well as dispositions based upon a stated percentage or share of the estate or of all assets.  In addition, there may be directions to give a specifically identified asset to a specifically named beneficiary.  Estate settlement and the administration of an estate by the Executors is controlled by the various mandates found in a Will.

Specific dispositions of property may present issues in finalizing an estate.  As a general rule, an executor is not authorized to sell property that is specifically devised or bequeathed to a named beneficiary without authority from the Surrogate’s Court or authority set forth in the terms of a Will.  In the event a fiduciary needs to sell such specifically gifted property to pay estate expenses or other obligations, permission may be obtained from the Court.  It is interesting to note that Surrogate’s Court Procedure Act Section 1412 entitled “Preliminary letters testamentary” grants to a preliminary executor all of the powers of an administrator except that they do not have the power to sell or dispose of specifically devised or bequeathed property without the written consent of the person to whom it was gifted.

There may be situations during the course of estate administration where the restrictions regarding specific dispositions of property impact an estate.  Such a situation recently arose in a Bronx estate and was the subject of a decision by Bronx Surrogate Nelida Malave-Gonzalez in the Estate of Armstrong, decided on July 6, 2023.

The acceptance of an appointment as a New York estate Executor or Administrator requires that an individual carry out responsibilities.  The failure to act in a responsible manner could subject a fiduciary to damages for breach of fiduciary duty.  Provisions contained in the Estates, Powers and Trusts Law and the Surrogate’s Court Procedure Act describe various courses of conduct concerning which an executor or administrator should or could be engaged.  For example, EPTL Section 11-1.1 entitled “Fiduciaries’ powers” lists various powers which a fiduciary can exercise when administering an estate.  When a fiduciary does not use his authority in the best interest of the estate, a duty may be breached.  The New York Probate Lawyer Blog contains many articles describing estate administration and the conduct of administrators, executors and trustees.

One of the jobs of a fiduciary is to protect and collect assets.  Sometimes, the decedent’s property may be held by a third party or even misappropriated prior to the decedent’s death.  In these cases, it is the responsibility of the fiduciary to recover the assets for the benefit of the estate.  SCPA 2103 entitled “Proceeding by fiduciary to discover property withheld or obtain information,” provides a procedure for the recovery of estate assets.  My blog has discussed this estate law in a number of previous articles.  A recent Queens County estate case decided by Queens Surrogate Peter J. Kelly dated September 1, 2022 entitled Matter of Stanka Sucich involved a proceeding for the turnover of assets.  In Sucich, the estate administrator sought to recover assets from respondents who had been the decedent’s home health aide and a driver / chauffer.  The major assets sought to be recovered were funds in excess of $200,000.00 which had been transferred before death from the decedent’s individual bank account into an account in the name of the decedent and the home health aide.  When the decedent died, the entire fund was transferred by the home aide into her own name.

Sucich contains an excellent statement of the legal aspects involved in reviewing such a transfer.  For example, the Court noted that once there was a demonstration that the funds belonged to the decedent and were then transferred to a third party, the burden was on the third party to show that the transfer was a valid gift.  A gift requires a showing of intent.  Also, since there appeared to be a confidential relationship between the decedent and the home health aide, there was a need to show that the transfer was fair and understood and free from undue influence.

Probating a Will in New York requires that the document satisfy the Court requirements for authenticity.  In other words, a Last Will must be executed in the manner required by the Estates, Powers and Trusts Law.  This requires a writing and at least two witnesses.

In addition to the basic statutory directives, the Surrogate’s Court may be shown that a decedent had testamentary capacity and was not subject to undue influence.  Testamentary capacity typically concerns whether a person recognized that he was signing a Will and had knowledge concerning the natural objects of his bounty (i.e., his family and friends) and also was aware of his assets.  This basic knowledge reflects on a person’s ability to dispose of an estate.

When it comes to the area of undue influence, the effect of such a factor becomes much less defined and many times more difficult to determine.  Undue influence concerns influence which a person normally would not succumb to, absent other factors.  These other factors may be susceptibility due to old age or illness or even dependence.  The prevailing factual climate and circumstances surrounding a decedent at the time of signing a Will may involve numerous events.  Motive and opportunity are always considerations.  The New York Probate Lawyer Blog has many articles concerning Will contests and probate.

One of the most common questions that is raised following the death of an individual is whether there is a surviving spouse.  This is especially so in cases where a person dies intestate without leaving a Last Will and Testament.  In intestate estates, the decedent’s assets pass to his distributees or next of kin.  The persons who are entitled to inherit are specified in Estates, Powers and Trusts Law Section 4-1.1 entitled “Descent and distribution of a decedent’s estate.”  Pursuant to this statute, a surviving spouse receives at least the first $50,000.00 and one-half of the estate if there are surviving children or the whole estate if there are no children.  As a result, being a surviving spouse provides a tremendous financial benefit along with other rights.  A surviving spouse also has priority to be appointed the estate administrator pursuant to Surrogate’s Court Procedure Act Section 1001 entitled “Order of priority for granting letters of administration.”  The New York Probate Lawyer Blog has published many articles concerning estate administration and spousal rights.

There are many instances where two individuals cohabitate together for many years and essentially live their lives as if they were married.  Unfortunately, if there has not been a formal marriage ceremony as recognized by state law, a person’s inheritance rights may be in jeopardy, particularly in New York.

New York is one of the jurisdictions which does not recognize common law marriage.  As a result, if one of the individuals who engage in a non-marital relationship dies, the survivor will not qualify as a surviving spouse and cannot inherit from their deceased partner.  Of course, if the partner created a Will or left assets in a manner which passed directly to the survivor such as a joint bank account, the partner would inherit even though there was no marriage.

In most New York estates, there is no question or controversy as to which state law applies to estate administration.  When a person who lives and maintains his primary residence in New York, the provisions of New York estate law are looked to regarding estate settlement.  Thus, a probate proceeding or petition for letters of administration is filed in the county where the decedent resided.  The New York Probate Lawyer Blog has published dozens of articles concerning probate and intestate estates.

The fundamental principle which controls the jurisdictional law that applies to a decedent’s estate is known as domicile.  A person may have different residences in various states or countries.  However, there is only one domicile.  A person’s domicile is simply stated as being his primary home.  While the issue of domicile determination can involve an examination of various facts, seeing where a person files local taxes, maintains a business, has a driver’s license and considers his home to be are significant starting points.

Domicile is important because the laws affecting an estate may vary from state to state.  For instance, a New York domiciliary estate is subject to New York law which includes statutes contained in the New York Estates, Powers and Trusts law.  An example of one right that may be affected relates to a spouse’s right to avoid disinheritance commonly known as a right of election.  Under EPTL Section 5-1.1A, a surviving spouse has the right to obtain at least one-third (1/3) of a decedent’s estate.  However, Section 5-1.1A(c)(6) states, in part, that the right of election “is not available to the spouse of a decedent who was not domiciled in this state at the time of death.”  As a result, if a decedent was a domiciliary of a state other than New York, that state’s estate law would control any right of election for the surviving spouse.  Interestingly, the above statute allows a decedent to elect to have the New York statute apply.

A New York Executor or Administrator has many duties and obligations.  Among these matters is the necessity to identify, protect and collect estate assets.  The many powers granted to a fiduciary are set forth in Estates, Powers and Trusts Law Section 11-1.1 entitled “Fiduciaries’ powers.”

While collecting assets such as bank accounts and mutual funds is typically routine, there are many situations where asset collection can be difficult and time consuming.  For example, there are many cases where a decedent owned real estate such as a single or multi-family property.  Very often, in order to provide liquidity to satisfy estate debts such as a mortgage or to allow for distributions to a number of beneficiaries, the real property must be sold.  However, there are circumstances which can interfere with a property sale.  The property may be occupied by relatives or third parties who refuse to vacate.  This situation can result in potential damage to the property or a diminution in the value of a sale.  Sometimes real estate cannot be sold at all unless it is vacant.  The New York Probate Lawyer Blog contains many articles discussing the issues associated with estate real estate.

In other cases, property that may be owned by a decedent is held in the name of another party.  These matters necessitate Surrogate’s Court proceedings whereby the administrator or executor initiates proceedings in the Surrogate’s Court to obtain the turnover of the claimed property to the estate.  SCPA Section 2103 entitled “Proceeding by fiduciary to discover property withheld or obtain information,” provides the procedure to discover and enforce title to assets to which an estate claims ownership.

There are some very basic rules regarding the handling of a New York estate.  Initially, a determination needs to be made as to whether or not a decedent had a Last Will and Testament or died intestate.  If there is a Will, then a probate proceeding is filed with the Surrogate’s Court.  In the event there is no Will, then a petition is filed to obtain letters of administration.  The New York Probate Lawyer Blog provides extensive articles regarding both of these types of procedures.

Regardless of the nature of the proceeding that is being presented to the Surrogate’s Court, it is imperative that the information given to the Court be as complete and accurate as possible.  The primary document which contains the essential substantive information is the petition which would typically be either a probate petition or petition for letters of administration.

The above petitions require various items of data such as the name and address of the petitioner, the name and residence address of the decedent, and date of death.  Information is also needed as to the approximate value of the estate.  This is required so that the Court can assess, among other things, the amount of the filing fees and the amount of the surety bond to be required if the Court decides that a surety bond is necessary.  Bonds are most often required in intestate administration proceedings since most Wills contain a provision waiving the filing of a bond by the named executor.

One of the most important benefits from engaging in estate planning and creating a Last Will and Testament is that a testator can select and name an executor and alternate executor.  This is important since the person nominated to act as fiduciary is someone whom the testator trusts and intends to be in charge of settling an estate.  Additionally, by nominating a person to be an executor, the nominee has the right to be appointed as the Preliminary Executor in the event the probate of the Will is delayed due to issues such as a Will contest or locating a decedent’s next of kin.

When a Will is not created and a decedent dies intestate, the appointment of an Administrator is controlled by the estate laws.  New York estate lawyers turn to Surrogate’s Court Procedure Act Section 1001 entitled “Order of priority for granting letters of administration,” to determine which individual has the right to be appointed.  The New York Probate Lawyer Blog contains numerous articles regarding the estate administration process.

As can be expected, the priority for appointment as Administrator is given to a decedent’s surviving spouse, followed by children and then other descendants.  While the statute appears straightforward, its provisions inherently allow for controversy when there is more than one person who has a right to be appointed and the eligible parties do not agree to work together.  This situation is very common when the eligible parties are a number of children since each one has a right to act as Administrator but they do not get along.  Thus, the Surrogate’s Court may be confronted with competing petitions for appointment and allegations that competing parties are not qualified to act for one reason or another.  While a majority of the eligible parties may choose to elect one of the group, the ultimate resolution must be determined by the Court.

There are various types of fiduciary appointments granted by the New York State Surrogate’s Court.  The Court may appoint an Executor and issue Letters Testamentary.  This occurs in connection with the probate of a Last Will and Testament.  If the decedent dies intestate, the Court appoints an Administrator and issues Letters of Administration.  The New York Probate Lawyer Blog has published many articles discussing the probate and administration process.

Sometimes when the Court proceedings for the probate of a Will or an intestate administration proceeding is delayed, the Surrogate might appoint a Preliminary Executor or Temporary Administrator.  This may occur where there is a Will Contest or Kinship cannot be determined without a kinship hearing.

An important aspect of any fiduciary appointment is the extent of powers granted to the fiduciary by the Court.  Essentially, the fiduciary can only perform those functions which the Court or the estate laws allow.  Estates, Powers and Trusts Law Section 11-1.1 entitled “Fiduciaries’ powers” lists many types of authority which an Administrator or Executor might possess, such as the power to sell assets, invest assets, pay expenses, collect income and engage in litigation on behalf of an estate.  However, in many instances, the Court Decree appointing the fiduciary may restrict or limit the authority.

During the course of estate administration, the beneficiaries of an estate may need to wait many months or even years before their beneficial interests are paid.  In many instances a lengthy delay may cause a hardship to a beneficiary, especially when the beneficiary was dependent upon the decedent for support or the decedent’s death impacted the financial stability of the beneficiary.

In many cases of estate administration, the executor or administrator or preliminary appointee may voluntarily make an advance distribution to a person who is in need.  This tends to be a common occurrence when all of the interested parties are cooperative and there is no contentious estate litigation occurring.  However, when a fiduciary refuses to help a beneficiary who is in need, the Surrogate’s Court Procedure Act provides a procedure whereby an application can be made to the Court for an advance distribution.

SCPA 2102 entitled “Proceedings for relief against a fiduciary” contains a paragraph 5 which allows the commencement of a proceeding to force the payment in advance of an estate share when the estate “exceeds by at least one-third” the sum needed to pay other claims, debts and legacies.  The applicant must demonstrate that such payment is required for his education or support for him or his family.  This statute gives parties interested in an estate an important right to maintain financial stability during a long period of estate settlement.