When a family member or friend passes away, it often triggers a series of legal procedures related to their property. These proceedings can be time-consuming and complex. Having a professional guide you through this process can help you avoid frustrating challenges and unnecessary delays. As both an attorney and a real estate broker, I understand that there are numerous questions and issues that require clear explanations. With experience as a Realtor specializing in probate court sales and a probate attorney, Marc Grossman brings an unparalleled level of expertise to clients of Grossman Real Estate.
As an executor of a will, you are entrusted with a vital role that requires honesty and impartiality. Your duties involve reviewing the deceased person’s will, managing their estate, ensuring the payment of debts and taxes, and ultimately distributing the remaining property to the legally entitled beneficiaries following the wishes of the deceased. These duties are considered fiduciary responsibilities, which represent the highest duty the law can impose on an individual to act in the best interests of others. All the responsibilities of an executor are subject to scrutiny and fall under the jurisdiction of the probate court.
In your role as an executor, you must make initial determinations, such as determining the necessary legal proceedings and identifying who is entitled to receive notices. Additionally, you’ll need to notify specific relatives and possibly government agencies like Medicare, Social Security, or the Post Office. You will be responsible for gathering all estate assets, managing any estate properties, and handling the payment of the estate’s debts and taxes for the final year of the decedent’s life. Identifying the rightful heirs, providing appropriate accountings, and ultimately distributing any remaining property after covering the estate’s expenses are also part of your responsibilities. You’ll need to collect the necessary documents to properly administer the estate, including the last will, income records, bank statements, asset and debt schedules (including medical bills), investment account statements, appraisals, deeds, titles to real estate, and possibly records for personal property.
In some cases, a deceased person may appoint an individual as their personal representative for their estate. However, even if such an appointment is made, the selection of this person must be approved by the court and can be contested by interested parties. A personal representative’s duties are broader than those of an executor, and they are mainly defined by California Probate Code Section 8404. The Probate Code also outlines a personal representative’s liabilities and allows the court to require them to post a bond to serve in this capacity.
To ensure that a personal representative fully comprehends their duties and liabilities, the court typically requires them to acknowledge the receipt of the “Duties and Liabilities of Personal Representative” as defined in Probate Code Section 8404. This acknowledgment states, in part, that “An attorney is best qualified to advise you about these matters” to prevent holding the personal representative accountable. A personal representative’s obligations encompass all real and personal property assets of the estate, outstanding estate taxes and debts, and duties to the beneficiaries and the court. This includes responsibilities such as notifications, accountings, inventories, appraisals, managing expenses, and distributing assets. Personal representatives are also obliged to send legally required notices to all creditors within four months of their appointment.
A personal representative is responsible for managing estate property and investments in a responsible manner. This entails maintaining funds in interest-bearing and insured accounts, managing risks and investments to meet their fiduciary obligations to the beneficiaries, and effectively overseeing real estate assets of the estate. Commingling of accounts is prohibited, and court approval is necessary for any expenditures and investments. Personal representatives must locate and take possession of all estate property and determine its value. They must then file an inventory and appraisal with the court within a statutorily prescribed time frame. Changes in property titles should be properly executed through the appropriate deeds, filings, and recordings.
In summary, there is no strict requirement to enlist the services of a Realtor or a lawyer, and you can manage the processes yourself if you have the capacity to do so. However, the probate process involves navigating statutes, regulations, rules, timelines, and requirements, and any failure to do so properly can lead to significant consequences. While other probate realtors can provide some insights into the process, they cannot offer legal advice due to their lack of qualifications. Probate real estate matters have distinct requirements related to forms, disclosures, pricing criteria, and notices. If legal issues or problems arise during a sale, a broker is unable to provide legal advice and will recommend that clients consult with a real estate attorney. Similarly, if you have a probate attorney, they may not possess all the answers regarding the real estate transaction and related disclosure requirements that a real estate broker can provide. Although neither an attorney nor a realtor is mandatory for a real estate transaction, Real Estate Broker and Attorney Marc Grossman can assist you in ways that other Realtors are not qualified to do. Whether you are already serving as an executor or will become one in the future, you bear the responsibilities of handling all estate properties, real and personal. Grossman Real Estate possesses the crucial experience to guide you through this process.
Standard Probate Fees for Attorneys and Personal Representatives
The fundamental minimum fee structure for a probate attorney is established by Probate Code § 10810, which prescribes a fee based on a percentage of the probated estate’s value. The formula outlined in Probate Code §10810 is as follows:
In this context, the estate’s value, as accounted for by the personal representative, encompasses the total amount derived from the property appraisal listed in the inventory. This value is further adjusted for gains over the appraisal value from sales, along with additional receipts, and is reduced by losses stemming from the appraisal value on sales, without regard to encumbrances or other estate property obligations (Probate Code §10810(b)). Mortgages and other loans are not factored into the fee calculation base, nor are disbursements for debts or expenses.
Both the probate attorney and the personal representative are entitled to this fee, and the court is not empowered to reduce the fee amount. The sole exception to this rule is if the personal representative unreasonably delays the estate’s closure or engages in mismanagement, in which case they may be subject to surcharges by the Court. Additionally, any fees received by the personal representative must be reported as income on their personal tax return. They may choose not to accept a fee if they are set to inherit property from the estate, as such an inheritance is not considered taxable income.
Fees may not be disbursed without a Court Order, although reimbursement for expenses advanced by the Personal Representative or the Attorney, such as filing fees, publication costs, and the like, may be reimbursed without requiring a Court Order.
Extraordinary Compensation
California Rule of Court Rule 7.703 authorizes the Probate Court to grant additional compensation, referred to as extraordinary compensation, to both the Personal Representative and the Attorney for specific services rendered. The awarding of these fees is at the discretion of the Court and necessitates prior court approval for payment. When determining an appropriate and reasonable amount for extraordinary fees, the court may consider the statutory compensation amount.
Examples of extraordinary services for which a personal representative may be compensated include:
Examples of extraordinary services for which an attorney may be compensated include:
