One of the most important fiduciary duties of an Executor or Administrator is locating and recovering estate property. The assets of the decedent must be secured so that they can be distributed to estate beneficiaries. Assets are also needed to pay estate expenses such as deb
Sometimes it is difficult to collect the items that were owned by the decedent. This may be due to a number of factors. One issue that arises quite often is that assets are transferred to third parties shortly before death. This raises questions as to the validity of the transfer. It may be that the decedent lacked the capacity to enter into the transaction or was unduly influenced or the subject of a fraud. In all cases, the fiduciary is obligated to investigate the circumstances behind the transfer and, where appropriate, attempt to recover the assets for the benefit of the estate. This usually involves estate litigation in the Surrogate’s Court. The New York Probate Lawyer Blog has posted many articles concerning recovery of assets and estate litigation.
A recent Queens estate case decided by Queens Surrogate Peter Kelly on October 18, 2019 entitled Matter of Kokotos, provides a good example of the issues presented when there are pre-death transfers. In Kokotos the decedent owned an interest in a Limited Liability Company which owned real estate. Shortly before the decedent’s death, her son, by using a Power of Attorney with a Statutory Gifts Rider, transferred the decedent’s interest in the LLC to the son’s wife. Thus the entire real estate interest was not a part of the decedent’s estate at death.
The decedent did not leave a Last Will. The decedent’s daughter commenced a turnover proceeding in the Surrogate’s Court to have the deed transfer voided. A number of grounds were advanced, including the invalidity of the Power and Rider as to proper execution and that the transaction was improper and void due to self-dealing.
Surrogate’s Court Procedure Act (SCPA) section 2103 entitled “Proceeding by fiduciary to discover property withheld or obtain information,” provides a method whereby a fiduciary can recover estate assets.
The issues presented to the Court were in the context of a motion for summary judgment brought by the daughter. After reviewing the evidence provided, the Court denied the motion and found that there were issues of fact that needed to be determined at a trial.
I have represented many clients in estate litigation and turnover cases. These matters can be very involved especially with pre-death asset transfers. Call me now for a free review if you have a question or issue regarding estate assets or probate or an intestate estate. We provide reasonable and flexible fee arrangements and personal representation.
New York Trusts and Estates Attorney Jules Martin Haas has helped many clients over the past 30 years resolve issues relating to probate and estate settlement throughout New York City including the Bronx, Brooklyn and Manhattan. If you or someone you know has any questions regarding these matters, please contact me at (212) 355-2575 for an initial consultation.