Practice Areas - Estate Administration & Probate

In its simplest terms, Estate Administration is the official process by which the assets of a deceased person (the "decedent") are collected, final bills and debts paid, and the assets remaining after the payment of such bills (the "net estate") are distributed to those persons entitled to take. In the case of a decedent who has left a document serving as a Last Will and Testament the estate administration will generally entail the probate of such document. If a will is probated the decedent is then often referred to as the "testator" (one who makes a will). If a person is named in the Last Will and Testament to serve as the personal representative of the estate (the person appointed to administer the estate), such individual is titled the Executor. In the case of an estate which is opened without a will, the personal representative is referred to as the Administrator.

After a personal representative has been appointed, the first duty of the personal representative is to collect the assets of the estate. In many instances this will involve closing the personal accounts of the decedents and establishing new estate accounts. Decedents may have several personal checking, savings or money market accounts, which are often combined into one single estate account. Stock and mutual fund accounts, are often re-established in the name of the estate. The estate will have it's own tax id number which serves as a substitute decedent social security number.

Another duty of the personal representative is to ensure that the just debts of the decedent are paid. First and foremost on the list will be the funeral bill. Additionally, however, there will be medical bills, credit card bills, final utility bills, along with other existing miscellaneous debts. Part of the job of the personal representative is to discern which debts are and should be deemed valid and should be paid and which debts and claims should be denied. The personal representative owes a duty of trust and care in this regard to the estate beneficiaries. (This is one of the numerous reasons that in preparing a will ones personal representative should be carefully selected)

Finally, after collecting assets, and disbursing monies to pay the debts of the decedent and other claims against the estate, that property remaining (the net estate) is distributed to the beneficiaries according to their respective interests in the estate. If the will of the testator was appropriately drafted, the executor will have little trouble discerning what personal property should go to the estate beneficiaries. Decedents passing without a will, or for persons who choose to make general bequeaths of properties, the distribution may require that the personal representative make choices for beneficiaries to the extent the beneficiaries of the estate cannot agree on a property division. After the last assets of the estate are distributed to beneficiaries, a "final accounting" will be filed with the Clerk's office demonstrating where and to whom the assets of the estate were given.

In North Carolina estates are administrated by the Clerk of Superior Court who serves as the "Ex Officio Judge of Probate." North Carolina eliminated the separate probate courts from the judicial system decades ago. As such, the Clerk of Court has primary jurisdiction over the administration of estates. This includes reviewing inventories and accountings to ensure the payments are made to creditors and the assets are properly distributed. As a fee for this oversight, the Clerk of Court's office is paid .40 cents per $100 of probate assets. Probate assets will typically include all assets coming into the hands of the personal representative, real property and accounts passing through survivorship provisions are not typically deemed probate assets, and hence are excluded from this fee.

One advantage to the formal administration of a decedent's estate, even in the presence of a living trust, is the shortened statute of limitations available when notice to creditors is published in a local newspaper in accordance with North Carolina statutes. Under provisions contained in Chapter 28A of the General Statutes, when proper notice is published and creditors are give a period of at least 3 months from the date of first publication to file a claim in the estate, if no claim is filed within such period the creditors will be forever barred from making a claim. In the absence of administration and this publication, the statute of limitation would typically continue for a period of 3 years.