Today, we continue our discussion of probate and the executor’s duties. In Part I, we discussed what happens if a named executor does not want to serve. In Part II, we discussed inventories, the executor’s duty to control the estate’s assets, and the potential for the estate representative to suffer personal liability. In this post, we will discuss what happens if the beneficiaries take assets before they are authorized to do so, and what remedies a landlord may have if a renter dies during the lease term.
Beneficiaries Taking Assets Before Authorized
Are you a beneficiary of a will? Do you want to take property before the executor or the state gives it to you? Don’t. Doing so will possibly subject you to civil penalty.
Most state procedures are generally the same. Once an executor or personal representative is appointed, this person has the right to possess and control all estate assets, including those taken before the appointment. Virginia law even specifically states that the personal representative can make a claim against a beneficiary for “taking or carrying away” any estate assets prematurely.
Maryland and Pennsylvania statutorily protects certain heirs. In Maryland, if an heir already holds property to which she is entitled, she only needs to give it back if the representative reasonably needs it for valuation or other purposes. In Pennsylvania, an heir occupying any real estate with the decedent’s permission may stay.
What does all of this mean? — You do not have a right to any of the decedent’s property until it is released to you by the estate representative. If you take any property before this time, even if no representative has been named, you will be subject to civil suit.
While in real life, you can attempt to work something out with the representative, it is much better to establish an open line of communication, keep clear records of what you have taken, or at the very least, try to establish a value of the property that you took.
Estate Creditors’ Rights
All creditors are entitled to notice of the decedent’s death and probate. Too many times, beneficiaries will attempt to avoid paying estate debts to creditors under justifications such as “the credit card company is so big, it won’t miss this $3,000” or “the landlord was a jerk, so he doesn’t deserve his two month’s rent”. Unfortunately, such arguments are rarely convincing to a court. Instead, just about the only time a debt is released is when the estate’s liabilities exceed its assets.
Landlord’s Claims for Lost Rent – A landlord owed rent is an estate creditor. If a renter dies in the middle of a rental term, any terms stated in the rental agreement will rule what the landlord may claim against the estate. If the lease is silent, then state law governs. In most states, death does not end the lease – the renter’s estate will still owe the landlord through the end of the term. However, the landlord must do his or her best to find a new tenant during this period to limit (or “mitigate”) the debt.
Differing state laws covering the landlord’s specific rights to re-enter the property, to keep, store, or sell off renter’s personal property, and the notice required to terminate the lease are beyond the scope of this post. However, be aware that your state does protect the landlord in these or other ways.
In practice, your best course as personal representative (or beneficiary) is to keep an open line of communication with the landlord so that the estate does not suffer any unnecessary damages.
- Probate in Real Life I: Named Executors Declining to Serve (estateplanninginfoblog.com)
- Probate In Real Life II: The Executor’s Duties and Liabilities (estateplanninginfoblog.com)
- What To Do When Someone Dies: Debts and Bills (www.imortuary.com)
- The Golden Rule: He Who Has The Gold Makes The Rules (www.florida-probate-lawyer.com)
- Turmoil Continues Over Estates of Dead OH Mayor, His Sister (www.estateofdenial.com)