If a deceased person has assets that have to pass through and be administered by the probate court, then one of the most common questions asked by personal representatives, heirs and devisees is how long the process is going to last. The answer is: it depends. There is no statutory deadline that determines when an estate must be completed. However, the length of time is affected by the size of the estate, the type of assets within, and the resolution of any legal challenges by heirs, devisees and creditors.
MINIMUM TIME PERIOD TO RESOLVE A DECEDENT’S ESTATE
The earliest than an estate can be distributed is approximately five months. “[U]pon appointment a personal representative shall publish, and a special personal representative may publish, a notice as provided by supreme court rule notifying estate creditors to present their claims within 4 months after the date of the notice’s publication or be forever barred.” MCL 700.3801(1). If there are no claims (or all claims have been satisfied) and the rest of the administration is complete, then the personal representative can file a sworn statement asking the probate register to close the estate. If no objections to the sworn statement are made within 28 days, then the probate register can issue a certificate of completion indicating that administration is complete and the estate is closed.
In practice, most estates are resolved within nine months to twenty-four months of the personal representative’s appointment. The personal representative is usually responsible for filing the decedent’s final tax returns and that cannot occur until the close of the tax year in which the decedent died. There is often real estate or other property that has to be sold or liquidated to satisfy the estate’s debts and distribution to the heirs or devisees. Finding the right buyer to the estate property can take time.
FACTORS THAT CAN PROLONG ESTATE ADMINISTRATION
In addition to the issues affecting probate that were already stated, other factors than can prolong estate administration include, but are not limited to:
- DISAGREEMENT ON APPOINTMENT OF PERSONAL REPRESENTATIVE: Before the actual administration can begin, there can be a battle among heirs and devisees as to who will serve as the personal representative. If there was no one nominated in the will, then a great number of people may have priority to the position. There may be litigation to determine which of these individuals are suitable or appropriate to serve as personal representative over several months before letters of authority are issued to anyone.
- THE ESTATE IS INTESTATE AND HEIRS MUST BE LOCATED: If the decedent died without a will and did not have a surviving spouse, children or parents, then the personal representative (or proposed personal representative) may have to undertake an heir search to locate distant relatives that may be entitled to notice of these proceedings.
- WILL CONTESTS HAVE TO BE LITIGATED: If any heirs or other interested persons contest the decedent’s last will and testament, then there may be a jury trial that takes place to determine whether the will should be admitted to probate. It could take a couple years or more for these issues to be fully litigated.
- THE ESTATE IS VERY LARGE: A decedent’s estate with ample real property, significant personal property and complicated financial accounts or trusts can take much longer to administer than simpler estates. Appraisals and valuation estimates must be completed on all these assets. Furthermore, it can be time-consuming to sell all of this property on the market or determine how to fairly divide it among the heirs and devisees.
- VALIDITY AND PAYMENT OF ESTATE DEBTS: The personal representative has to determine if the claims presented against the estate are valid. If not, he or she can file a notice of disallowance of claim to the creditor, which forces said creditor to decide whether to file suit against the estate within 63 days or be barred forever. These claims can also take a significant amount of time to sort out in court.
- FEDERAL ESTATE TAXES: If the estate is large enough, then the personal representative may have to file Form 706 (United States Estate (And Generation-Skipping) Tax Return) to report and pay any federal estate taxes. The document must be filed and the taxes must be paid within nine months after the decedent’s death (although an extension could be requested). The personal representative may also take advantage on an alternative valuation period and determine the gross value of the estate based on the fair market value six months after death. These tax returns are very complicated and it may take significant time to marshal all assets and determine the value.
- ANCILLARY PROBATE OR TRUST ADMINISTRATION PROCEEDINGS: The estate may be complicated by having to be administered in tandem with the decedent’s trust which may be involved in its own litigation. Furthermore, the decedent’s estate may have property out-of-state that is subject to ancillary probate under those state’s laws regarding disposition of the property. Additional proceedings in other courts will take significant time.
Estate administration can be held up under other more unusual circumstances. A fiduciary or beneficiary stealing or embezzling from the estate could create additional civil or even criminal proceedings that have to be dealt with. A fire or other casualty to estate property may require dealing with an insurance company to pay the value of the damaged or destroyed property. In 2020, the entire world ground to a halt when it shut down to combat against the COVID-19 virus which held up probate estate proceedings across the state. There is no limit to the various legitimate reasons why an estate may be delayed in its thorough and complete administration.
NOTICE OF CONTINUED ADMINISTRATION
“If the personal representative does not complete estate administration within 1 year after the original appointment…, the personal representative shall file with the court and send to all interested persons a notice that the estate remains under administration and specifying the reason for continuation of administration.” MCL 700.3951(1). “This notice of continued administration must be filed not later than 28 days after the anniversary of the personal representative’s appointment and, if administration remains incomplete, not later than 28 days after each subsequent anniversary of the appointment.” Id.
The personal representative can file PC 587 (Notice of Continued Administration) each and every year that it is necessary to keep the estate open. If the notice is not filed, “an interested person may petition the court for a hearing on the necessity for continued administration or petition for a settlement order…”. MCL 700.3951(2). “In response to such a petition, the court may issue appropriate orders to assure prompt estate settlement.” Id. If there is no notice or no petition from an interested person, then “the court may notify the personal representative and all interested persons that the court will close the estate administration and terminate the personal representative’s authority within 63 days” unless a notice for continued administration is filed or an interested person files a petition. MCL 700.3951(3).
PERSONAL REPRESENTATIVE HAS DUTY TO ACT DILIGENTLY
The personal representative has a duty to act diligently in discharging his or her responsibilities in administering the estate. Failing to do so may amount to a breach of fiduciary duty which can cause the judge to remove the personal representative in the best interests of the estate under MCL 700.3611. If the unreasonable delay has financial consequences to the estate, the personal representative could be personally liable.
EXPEDITED PROCEDURES FOR SMALL ESTATES
if the value of the decedent’s property minus the funeral and burial expenses is less than a certain threshold ($24,000.00 in 2021), then the estate may qualify for small estate proceedings. The petitioner can fill out and file PC 556m (Petition for Assignment) with the local probate court. An Order of Assignment is signed by the judge (sometimes the same day as filing) and distributes the decedent’s assets according to intestate succession laws. The $25.00 filing fee plus the inventory fee are both due at filing, no personal representative is appointed, and no Letters of Authority are issued. No notice to creditors is required to be published, although an heir that receives property from the estate is responsible for any of the decedent’s unsatisfied debts for 63 days after the Order of Assignment is granted, up to the value of the property received (unless it was the surviving spouse or child).
THE BOTTOM LINE
Waiting for an estate to be fully administered and receive your inheritance can be long and frustrating. The reasons for the delay may be perfectly legitimate, but in some cases they may not. The only way to be sure is to consult with a skilled probate lawyer to determine your rights.
If you or a loved one have any further questions or need legal representation, then do not hesitate to contact the experienced attorneys at Kershaw, Vititoe & Jedinak PLC for assistance today.
