When a personal representative finishes a decedent’s estate and either obtains either a certificate of completion or a court order from the probate judge, it is natural to assume that the entire matter is done forever. However, circumstances may arise where it may be necessary to reopen the decedent’s estate and begin the administration anew. Here are the most common reasons why an estate would have to be reopened:
- An unknown asset is discovered belonging to the estate. This is by and far the most common reason why an estate would have to be reopened. This can be a previously unknown bank account, retirement account, stocks, bonds or even real estate such as hunting property.
- A new and more recent version of the decedent’s will is discovered. This may have the effect of giving rights to new devisees or disinheriting heirs.
- A new heir is discovered. It is possible that the estate will have to be reopened to recalculate the share of assets distributed to all of the heirs and devisees.
- A new creditor debt is discovered. While it is likely most (if not all) creditor claims were dealt with or barred by the previous administration, there may be a previously unknown secured debt related to a significant piece of estate property or that there might be some tax advantage to paying the previous claim.
- There was fraud and mismanagement in the original administration. Evidence that the personal representative or any heirs and devisees stole or concealed estate assets can be grounds to reopen the estate for the probate court to investigate the issues.
- The estate was administratively closed and needs to be completed. The personal representative did not comply with the requirement to file a notice of continued administration after one year of being appointed or failed to perform other duties, so the probate court administratively closed the estate before all matters can be resolved. It is now necessary to reopen the estate can complete the work.
- The estate needs to file litigation. If the estate needs to bring a wrongful death lawsuit related to the death of the decedent, Michigan law requires that an estate must be opened (or reopened) so the action can be brought by the personal representative.
The Estates and Protected Individuals Codes states that, “[i]f estate property is discovered after an estate is settled and either the personal representative is discharged or 1 year has expired after a closing statement is filed, or if there is other good cause to reopen a previously administered estate, including an estate administratively closed, upon petition of an interested person and notice as the court directs, the court may appoint the same or a successor personal representative to administer the subsequently discovered estate.” MCL 700.3959. There are two ways the estate can be reopened:
- Reopening by Application: An estate can be reopened through the informal application proceeding if there is no dispute who will become personal representative by interested persons and the previous estate was not under supervised administration by the judge. “If there is good cause to reopen a previously administered estate, other than an estate that was terminated in supervised administration, any interested person may apply to the register to reopen the estate and appoint the former personal representative or another person who has priority.” MCR 5.312(A). “For good cause and without notice, the register may reopen the estate, appoint the former personal representative or a person who has priority, and issue letters of authority with a specified termination date.” Id.
- Reopening by Petition: If an estate is not eligible to be reopened by application or there are complications that necessitate a judge’s decision (e.g. contested will or contest appointment for personal representation), then a petition may be appropriate. “The previously appointed personal representative or an interested person may file a petition with the court to reopen the estate and appoint a personal representative.” MCR 5.312(B).
In either case, the interested person will have to file PC 607 – Application/Petition To Reopen Estate with other accompanying paperwork (e.g. Testimony to Identify Heirs, Notice Regarding Attorney Fees) so the probate court can reissue letters of authority for a new personal representative. “For purposes of determining when the inventory fee calculation, the inventory filing, the inventory fee payment, and the notice of continued administration are due, a reopened decedent estate is to be treated as a new case.” MCR 5.312(C). However, this does not “reset” the time period for creditors in the previous administration to file new claims if they allowed the original creditor period to lapse without taking action. “A claim previously barred shall not be asserted in the subsequent administration.” MCL 700.3959.
Some special rules apply if the estate was previously closed administratively (e.g. on the court’s own motion for inaction by the personal representative). “Upon petition by an interested person, with or without notice as the court directs, the court may order an administratively closed estate reopened.” MCR 5.144(B). However, the probate court may assess costs against the fiduciary or attorney for reimbursement of court fees. MCR 5.206. In Wayne County, the probate court will assess $100.00 for the reimbursement of court costs against the fiduciary and prohibits any individual with an outstanding order from court costs from filing ANY pleading with the probate court until it is paid.
If you believe you need to reopen an estate, you should consult with a knowledgeable probate lawyer to ensure it is both necessary and done correctly. A personal representative is absolutely entitled to hire an attorney to assist them (at the expense of the estate) to ensure that all duties are being completed according to law. If you have any questions about probate administration or need legal representation, do not hesitate to contact the experienced attorneys at Kershaw, Vititoe & Jedinak PLC for assistance today.