Estate Administration

Question 1

What is meant by independent administration?

Answer 1

An executor does not need court supervision or involvement. Executor can do anything a dependant administrator can be authorized to do with a court order.

Question 2

When is independent administration authorized under the Estates Code?

Answer 2

Independent administration authorization occurs when:

1. provided for in the will (any words, no matter how informal are sufficient - “without any of that court stuff”)
2. if all distributees agree

Question 3

How can an independent executor secure privacy of inventory, which otherwise would be of public record when filed within 90 days?

Answer 3

An independent executor can secure the privacy of inventory by filing an affidavit that states all debts have been paid.

Copies of the full inventory must be given to beneficiaries who have (i) been given $2,000 or less,(ii) received distribution of their interests, or (iii) waived entitlement to inventory in writing.

Question 4

If an interested party wants to demand accounting from the independent executor, the independent executor must:

Answer 4

have received the demand for accounting within 15 months after will admitted to probate; successive accountings can be demanded 12 months after last accounting

Question 5

If an interested party wants to know why the estate has not been distributed yet, what can the interested party do?

Answer 5

The interested party can petition for distribution of the estate within 2 years after the independent executor was appointment. This permits a show cause hearing to figure out why the estate has not been distributed.

Question 6

What actions must be taken within 120 days after appointment as a personal rep/executor/administrator?

Answer 6

A personal rep/executor/administrator must:

• post fiduciary surety bond within 20 days (unless will waives this)
• publish notice of administration in county newspaper within one month
• file inventory or affidavit of inventory within 90 days
• give notice and copy of will to named beneficiaries within 60 days after appointment (unless property given is under $2,000)
• file certificate that notice to beneficiaries was given within 90 days

Question 7

What happens to an independent executor if his whereabouts are unknown or he is eluding service?

Answer 7

If an independent executor is AWOL, the court may remove the independent executor ex parte without notice and hearing if independent executor cannot be served with process.

Question 8

What happens to an independent executor who fails to qualify by posting bond, failing to file inventory (or affidavit in lieu of inventory) within 90 days, fails to make an accounting demand, fails to give notice to beneficiaries within 60 days, is guilty of gross misconduct or mismanagement, or he is sent to jail/mental institution?

Answer 8

An independent executor that fails in his duties or cannot perform them can be removed after notice and hearing.

Question 9

Where do probate proceedings have jurisdiction?

Answer 9

All probate proceedings must be filed and heard in county court.

Question 10

What is the process for when there is a contested will in county court?

Answer 10

If a contested matter arises, on motion either

(i) a statutory probate judge is assigned OR
(ii) matter is transferred to district court and returned to county court for further administration when the contested matter is resolved

Question 11

TX law favors what type of administration of estates?

Answer 11

TX law favors informal administration of estates (if doesn’t need to go to the courts, don’t involve the courts). This is referred to as family settlement. To dispute this, there must be an affirmative showing that an administration of the estate is needed.

Question 12

What is muniment of title?

Answer 12

Muniment of title is a link in the chain of title (has been recorded).

Question 13

Who carries out the estate administrator?

Answer 13

• personal representative
• if person named in the will, then called executor
• if appointed by court, an administrator

Question 14

When must a will be admitted to probate?

Answer 14

A will must be admitted to probate within 4 years after testator’s death UNLESS it can be shown that the applicant was not in default in failing to present the will earlier.

Question 15

All of the following are true regarding the family allowance EXCEPT:

A: It is paid before all other claims except funeral expenses and expenses of last sickness up to $15,000 each.

B: Nonprobate assets passing to the surviving spouse are taken into account in determining the amount.

C: The surviving spouse’s separate property is taken into account in determining the amount.

D: It is a community obligation payable one-half out of the surviving spouse’s one-half community interest.

Answer 15

For family allowance, nonprobate assets passing to the surviving spouse are not taken into account in determining the family allowance.

The family allowance is paid before all other claims except funeral expenses and expenses of last sickness up to $15,000 each and is a community obligation payable one-half out of the surviving spouse’s one-half community interest. The surviving spouse’s separate property is taken into account in determining the amount.

Question 16

Who is entitled to occupy the homestead after the decedent’s death?

Answer 16

If the decedent is survived by a spouse or by minor children, the spouse is entitled to occupy the homestead as long as she chooses.

The right to occupy is independent of title; if the property has been devised to some other person, such person takes title subject to the right of homestead occupancy. If the occupancy right is not claimed by the surviving spouse, a guardian of the decedent’s minor children may use and occupy the homestead under a court order. The right of homestead occupancy is terminated when the homestead ceases to be the spouse’s principal residence.

Question 17

If a decedent is survived by a spouse or minor child, the homestead descends free of debts and creditors’ claims (subject to state and federal statutory and constitutional exceptions):

Answer 17

The decedent’s homestead passes to any devisee free of debts and creditor’s claims

Question 18

How do homesteads relate to mechanic and materialman’s liens?

Answer 18

The homestead is exempt from an unrecorded mechanic’s lien.

But mechanic and materialman liens incurred in connection with improvements on homestead are valid only if:

(i) written contract is entered into prior to improvements or the furnishing of supplies;
(ii) the contract is signed by both spouses; and
(iii) the contract is recorded.

Question 19

The following people have priority to be appointed personal representatives of an estate:

A The surviving spouse has priority over persons named as executors in the will.

B The principal beneficiary named in the will has priority over other beneficiaries named in the will.

C The creditors of the decedent have priority over the decedent’s next of kin.

D A person of good character has priority over the creditors of the decedent.

Answer 19

The principal beneficiary named in the will has priority over the other beneficiaries named in the will.

Persons are given priority of appointment as personal representative are: (i) persons named in the will as executors; (ii) surviving spouse; (iii) principal beneficiary named in the will; (iv) any other beneficiary named in the will; (v) decedent’s next of kin as determined by the intestacy statute; (vi) creditor of the decedent; and (vii) any other person of good character.

Question 20

When an undisclosed heir is discovered subsequent to the transfer of title to a homestead under a small estate affidavit:

Answer 20

When an undisclosed heir is discovered subsequent to the transfer of title to a homestead under a small estate affidavit, the deed is valid but the undisclosed heir can sue the heirs who received the consideration.

Question 21

What does a small estate affidavit cover?

Answer 21

Title to a homestead that is the only real property in a decedent’s estate (whose value not including the homestead and exempt property does not exceed $75,000) may be transferred using a small estate affidavit.

This affidavit if recorded in the county in which the homestead is located will protect bona fide purchasers for value of the homestead against lawsuits brought by heirs not disclosed in the affidavit. The undisclosed heir’s remedy is against the heirs who received consideration for the transfer of the homestead to the bona fide purchaser.

Question 22

When a person dies intestate leaving a probate estate whose value does not exceed $75,000 not including homestead and exempt personal property:

Answer 22

When a person dies intestate leaving a probate estate whose value does not exceed $75,000 (not including homestead and exempt personal property), court may distribute the personal property and homestead without administration if the homestead is the only real property in the estate.

If the decedent owned nonhomestead real property, a small estate affidavit cannot be used to clear title.

If the value of the estate, not including homestead and exempt personal property, does not exceed the family allowance, the court may set aside the allowance and order that no administration is necessary. There is no rule that small estates exceeding the family allowance must be subject to administration.

Question 23

When a person dies intestate, a statutory heirship proceeding:

A Must be commenced within four years after the decedent’s death.

B May be commenced more than four years after the decedent’s death for good cause.

C Will not protect the named heirs from claims brought by omitted heirs.

D Will not protect bona fide purchasers from claims brought by omitted heirs.

Answer 23

A statutory heirship proceeding will not protect the named heirs from claims brought by omitted heirs. The statutory heirship proceeding establishes, by court order, that the person is deceased, that he left no will, and that he was survived by named persons as heirs. No statute of limitations applies to the commencement of statutory heirship proceedings.

Bona fide purchasers of the decedent’s property from the named heirs are completely protected from lawsuits filed by heirs omitted from the statutory heirship proceeding. Heirs participating in the statutory proceeding, however, may be sued by non-participating heirs for their intestate share.

Question 24

Upon the death of one spouse, what property is subject to estate administration?

A One-half of the community property as well as the deceased spouse’s separate property.

B All of the community property as well as the deceased spouse’s separate property.

Answer 24

The death of one spouse dissolves the community entity, compelling a division of the community estate. Therefore, ALL of the community property is subject to administration. The deceased spouse’s separate assets are also subject to administration. Community obligations are paid, and what is left is partitioned between the surviving spouse and the deceased spouse’s successors (through his will or by intestacy).

Question 25

A person or entity that declines appointment as independent executor:

Answer 25

A person or entity that declines appointment as independent executor may still be appointed as administrator in a court-supervised administration by court’s discretion. There is no requirement that all heirs of the estate agree to the appointment + no requirement that the person or entity must be appointed as administrator in the court-supervised administration.

Question 26

When a will provides that there shall be no independent administration:

Answer 26

When a will provides that there shall be no independent administration, the court cannot authorize independent administration even if all distributees consent and independent administration would be in the estate’s best interest.

Question 27

Can a will be submitted to probate more than 4 years after testator’s death?

Answer 27

A will can be admitted to probate more than four years after the testator’s death ONLY if the party applying for probate was not in default by failing to present the will within the four years after the testator’s death (because he or she was unaware of the will’s existence) and the will can only be probated as a muniment of title. Moreover, the person named in the will as executor cannot be appointed, nor can there be an administration of the estate.

Question 28

How can an independent executor be disqualified?

Answer 28

Deemed unsuitable if he has an interest adverse to the estate; reluctance to pursue effective administration

Question 29

Husband has Wife and two kids. Husband dies. What does Wife get?

Answer 29

Wife gets all community property with no administration necessary. She can only sell community property to pay off community debts. The children get the other half (each 1/4).

Question 30

How does an independent executor formally close the estate administration?

Answer 30

File a closing report or a notice of closing, verified by affidavit, showing:

1. property
2. debts have been paid
3. no litigation
4. names of distributees

*Considered closed 30 days after filing.

Question 31

T/F: The court cannot enter a muniment of title unless it finds that there are no unpaid debts owned by estate.

Answer 31

True.

Question 32

What’s the effect of a muniment of title?

Answer 32

It establishes beneficiaries’ ownership rights and they can use property as their own.

Question 33

How can a surviving spouse collect decedent’s last paycheck?

Answer 33

Give decedent’s employer an affidavit stating that there is no appointed executor or administrator of estate

Question 34

What are the 4 steps of a dependent administration?

Answer 34

petition, notice to interested parties, hearing, and subsequent judicial confirmation

Question 35

What is a temporary administration?

Answer 35

It is when court appoints a temporary administrator (up to 180 days) to carry out powers granted by court.

Question 36

What’s HEF?

Answer 36

Homestead
Exempt personal property
Family allowance

Question 37

What’s homestead?

Hint: HEF

Answer 37

Residential property (200 acres if rural; if single, 100 acres rural and 10 acres urban). Its protection is lost if claimant leaves it (ceases to use as personal residence).

• spouses must join in conveyance
• *Decedent’s residence qualifies as homestead only if had wife or a minor child; who are entitled to occupy for life (spouse) or until 18 (minor child)

Question 38

What’s exempt personal property?

Hint: HEF

Answer 38

limited to $100,000/family (or $50,000 for single person who is not member of a family)

Question 39

What’s family allowance?

Hint: HEF

Answer 39

When decedent has surviving spouse or children and did not have exempt property. If no homestead, allowance up to $45,000; if no exempt personal property, $30,000.

Surviving spouse, minor children, and incapacitated adult children are supported and maintained for one year. Allowance is treated as community obligation and is payable out of community estate.