Probate and estate administration

Question 1

What is probate?

Answer 1

Probate refers to the proceeding in which an instrument is judicially determined to be the duly executed last will of the decedent.

• At the probate proceeding, a personal representative is appointed to carry out the estate administration
• The PRs authority to act on behalf of the estate is evidenced by letters of administration issued by the probate court

Question 2

What court has exclusive jurisdiction?

Answer 2

The circuit court.

Question 3

Where is venue proper?

Answer 3

Probate proceedings must be commenced in the county in which the decedent was a resident at the time of his death.

• In the case of a nonresident, venue is proper in any county where he owned property
• If the decedent was neither a Florida resident nor owner of property in Florida, venue is proper where any debtor of the decedent resides

Question 4

Presumption of death

Answer 4

Death of the decedent is a prerequisite to probate jurisdiction. A person is presumed to be dead if:

1. she is absent from the place of her last known domicile for five continuous years, and
2. the absence is not satisfactorily explained after diligent search and inquiry

Question 5

Production of the will

Answer 5

The custodian of the will must deposit the original will with the clerk of the court having venue of the decedent’s estate within 10 days after receiving information that the testator died

Question 6

Option of arbitration

Answer 6

A provision in a will requiring the arbitration of disputes, other than disputes of the validity of all or a part of a will, is enforceable

• unless specified otherwise, presumed to require binding arbitration

Question 7

Proof of wills

Answer 7

To prove a will (which is not self-proving) in Florida, the petitioner must file the oath of one of the witnesses to the will, which must be sworn to before the circuit court, its clerk, or a commissioner appointed for that purpose.

Question 8

What if the witness is dead or cannot be found?

Answer 8

The will may still be proved by the oath of the personal representative or any other person not interested in the estate who states that he believes the writing that has been offered for probate is the will of the decedent.

Question 9

Florida Self-Proving Will

Answer 9

A self-proved will may be admitted to probate without further proof. To make a will or codicil self-proving, the testator and witnesses must sign an affidavit made before an officer authorized to administer oaths in Florida to the effect that: “The testator signed the instrument as his las will or directed another to sign for him and that each of the witnesses in the presence of the testator, at his request, and in the presence of each other, signed the will as a witness.”

Question 10

Electronic Self-Proving Will

Answer 10

For an electronic will, the qualified custodian who has custody of the will at the time of the testator’s death must certify under oath that, to the best of his knowledge, the electronic record that contains the will was at all times in the custody of a qualified custodian and that the electronic will has not been altered in any way since its execution.

Question 11

Who serves as the PR if the decedent left a will?

Answer 11

If a decedent left a will, the order of preference is:

1. the person nominated in the will;
2. the person selected by a majority in interest of the persons entitled to the estate; and
3. a devisee under the will

Question 12

What is the general rule for the PR if the decedent left a will?

Answer 12

A testator has the right to name the person who shall administer her estate.

• ordinarily, the court has no discretion but to issue letters testamentary to the person nominated in the will, unless the person is disqualified by statute

Question 13

Exception to the general rule

Answer 13

An exception is made if, after the will is executed, unforeseen circumstances arise that would have affected the testator’s decision had she been aware of the circumstances.

Question 14

Who serves as the PR if the decedent died intestate?

Answer 14

If the decedent did not leave a will, the order of preference is:

1. the surviving spouse,
2. the person selected by a majority in interest of the heirs, and
3. the heir nearest in degree of kinship to the decedent

Question 15

What are the qualifications to act as PR?

Answer 15

A person is qualified to be a PR if he is age 18 or older, has mental capacity, has never been convicted of a felony, and is a resident of Florida. Other companies authorized to exercise fiduciary powers may also serve.

Question 16

What is the rule for nonresidents serving as PR?

Answer 16

The only nonresidents who are qualified to serve as personal representatives are:

1. a grandparent or descendant of a grandparent of the decedent;
2. an adopted child or adoptive parent of the decedent;
3. the decedent’s spouse or a person related by lineal consanguinity to the decedent’s spouse; or
4. a spouse of any of the foregoing

Question 17

What happens when a PR is no longer qualified?

Answer 17

A PR who knows or should know that she is no longer qualified to serve must promptly file and serve a notice setting forth the reasons for her inability to serve.

• If the PR fails to comply and is subsequently removed, she is personally liable for costs incurred in the removal proceeding

Question 18

PR’s duty to secure assets and preserve estate

Answer 18

The PR has a right to take possession or control of the decedent’s property.

• However, any real or tangible personal property may be left with, or surrendered to, the person presumptively entitled to it unless possession is necessary for administration
• The PR must take all steps reasonably necessary for the management, protection, and preservation of the estate and may be required to insure uninsured assets of the estate

Question 19

PR: preserving homestead property

Answer 19

The personal representative is authorized (but not required) to take possession of protected homestead property, to preserve, insure, and protect it for a person having an interest in the property if it is not occupied by the heir or devisee.

• If he expends funds or incurs obligations in doing so, he is entitled to a lien on the property and its revenues to secure repayment.

Payment may be enforced by:

1. foreclosing on the lien;
2. offsetting the debt against any other property over which the PR has possession that would otherwise be distributed to the heir or devisee of the homestead; or
3. offsetting the debt against any revenues from the protected homestead received by the PR

Question 20

Duty to keep assets separate

Answer 20

The PR must keep the decedent’s estate separate from his own or from the estate of another person.

• the PR may not comingle assets of the decedent’s estate and should open a separate bank account in the name of the estate

Question 21

Duty to file inventory

Answer 21

The PR must file an inventory of property of the estate, listing each item and its estimated FMV as of the date of the decedent’s death.

Question 22

Amended or Supplemental Inventory

Answer 22

The PR must file an amended or supplemental inventory if he learns of any property not included in the original inventory, or if the estimated value or description listed in the original inventory is erroneous or misleading.

Question 23

Safe Deposit Box Inventory

Answer 23

The PR must file any safe deposit box inventory within 10 days after the box is opened.

• the inventory must be accompanied by a box entry record that is dated no earlier than six months before the decedent’s date of death, and must be signed by each person who was present at the opening of the safe deposit box and verified its contents

Question 24

General duty of PR-Overall standard of care

Answer 24

The PR is held to a general standard of care identical to that of a trustee

• if he has special skills or is named PR on the basis of representation of special skills or expertise, he is under a duty to use those skills

Question 25

PR Powers exercisable without court order?

Answer 25

Unlike the statutes of many states, the Florida statute provides a broad grant of authority to the PR to perform many transactions without a court order….assume that if a fee simple owner may do it, a personal representative may do it without court order

Question 26

PR power to continue decedent’s unincorporated business limited to four months

Answer 26

The power of a personal representative to continue the decedent’s unincorporated business without court order is limited to a period of four months from the date of his appointment.

• after that period, the PR must get approval from the circuit court

Question 27

PRs Power to Sell Real Property

Court approval NOT required if will grants power of sale?

Answer 27

If the decedent’s will confers a power of sale, the PR may sell, mortgage, or lease real property WITHOUT court approval and WITHOUT showing that the sale is necessary. The sale can be for cash or on credit, and can be secured or unsecured.

Question 28

PRs Power to Sell Real Property

Is court approval required if NO power of sale?

Answer 28

If the PR believes it is in the estate’s best interest to sell real property, but the testator has not conferred a power of sale or has conferred a power so limited that it cannot be conveniently exercised, the PR nevertheless may sell the property at a public or private sale. HOWEVER, no title passes until the court authorizes or confirms the sale.

Question 29

PRs Power to Sell Real Property

Transactions involving a conflict of interest

Answer 29

Any sale or encumbrance to the personal representative or his spouse, agent, or attorney, or any corporation, other entity, or trust in which he, or his spouse, agent, or attorney has a substantial beneficial or ownership interest, or any transaction affected by a conflict of interest is voidable by any interested person except one who has consented after fair disclosure unless:

1. the will or contract entered into by the decedent expressly authorized the transaction, or
2. the transaction is approved by the court after notice to interested persons

Question 30

Powers of Joint Personal Representatives

Will executed before October 1, 1987

Answer 30

The concurrence of all personal representatives is required on all acts connected with administration of the estate.

Question 31

Powers of Joint Personal Representatives

Will executed after October 1, 1987

Answer 31

The concurrence of a majority of the personal representatives is required

Question 32

Powers of Joint Personal Representatives

When the above rules do NOT apply

Answer 32

Do not apply if:

1. the will provides otherwise;
2. emergency action is required to preserve the estate and concurrence of the others cannot readily be obtained; or
3. one personal representative has been delegated to act for the others

Question 33

Powers of Joint Personal Representatives

What must a dissenter do to avoid liability?

Answer 33

A PR is NOT liable for the consequences of an act in which he joins at the direction of the majority if he expresses his dissent in writing at or before the time of the joinder.

Question 34

Liabilities of Personal Representatives

Generally not liable for contracts

Answer 34

Unless otherwise provided in a contract, a PR is not individually liable on a contract except one for attorney’s fees properly entered into in his fiduciary capacity in the administration of the estate, unless he fails to reveal his representative capacity and identify the estate in the contract.

Question 35

Liabilities of Personal Representatives

When is a PR liable for torts?

Answer 35

A PR is individually liable for obligations arising from ownership or control of the estate or for torts committed in the course of administration of the estate if he is personally at fault.

Question 36

Liabilities of Personal Representatives

Improper exercise of a power

Answer 36

If the PR improperly exercises a power or exercises a power in bad faith, the PR is liable to interested persons for the resulting damage or loss to the same extent as a trustee of an express trust.

Question 37

Liabilities of Personal Representatives

Improper exercise of a power

Those Dealing with PR Protected?

Answer 37

Except for the sale of real property without court order or confirmation, a person who in good faith either assists a PR or deals with him for value is protected as if the PR properly exercised his power.

• the fact that a person knows that he is dealing with a PR alone does not require the person to inquire into the existence or limits of his power or the propriety of its exercise

Question 38

Liabilities of Personal Representatives

Not liable for losses resulting from reliance on professional advice

Answer 38

A PR has the power, without court order, to hire attorneys, accountants, investment advisors, and others and is entitled to rely on their advice without independent investigation.

• if the advice turns out to be erroneous, the PR is not liable for any resulting loss as long as he acted prudently in employing and taking the advice of the professional

Question 39

Exculpation of Personal Representative

Answer 39

An exculpatory clause attempts to relieve the PR of liability for breach of duty in the administration of the estate or lowers the standard of conduct required of him. Void if they:

1. relieve the PR of liability for breach of duty committed in bad faith or with reckless indifference; or
2. appear in the will as a result of the PR’s abuse of a confidential relationship with the testator