Probate 101

Man looking at three people at glass table with laptop and white coffee cups
What is probate?
Probate is when the court supervises the processes that transfer the legal title of property from the estate of the person who has died (the "decedent") to his or her beneficiaries.
Usually, you have to fill out court forms and appear in court to:
  • Prove to the Court that the Will is valid (this is usually routine),
  • Appoint a legal representative with authority to act on behalf of the decedent,
  • Identify and inventory the decedent's property, and have that property appraised,
  • Pay debts and taxes, and
  • Distribute the remaining property according to the terms of the Will or to the decedent's heirs.
Is probate necessary?
If the person who died did not have any property to transfer, probate is usually not necessary. The deceased person’s survivors may decide to open a probate if there are debts owed or if there is a need to set a deadline for creditors to file claims. When there is property to transfer, the probate process also provides for the distribution of the estate's property to the decedent's heirs.

Does all property go through probate when a person dies?
No. The term "probate estate" refers to any property subject to the authority of the probate court. Assets distributed outside the probate process are part of a person's “non-probate estate.” California has "simplified procedures" for transferring property for estates worth under a certain amount (from $20,000 to $150,000 depending on the circumstances and the kind of property). There is also an easy way to transfer property to a surviving spouse, property held in Joint Tenancy or Community Property with Right of Survivorship, and life insurance and retirement benefits

Do living trusts go through probate?
No. When a living trust holds title to some of the decedent's property, that property also passes to the beneficiaries without probate

How much does probate cost?
The cost of probate is set by state law. When all the costs are added up – these may include appraisal costs, executor's fees, court filing fees, and certified copies, costs for a type of insurance policy known as a "surety bond," plus legal and accounting fees--probate can cost from 4% to 7% of the total estate value, sometimes more. If someone contests the Will, there could be thousands of dollars of litigation costs.

How long does probate take?
California law says the personal representative must complete probate within one year from the date of the appointment unless s/he files a federal estate tax. In this case, the personal representative can have 18 months to complete probate. If probate has not been completed by that time, the personal representative must file a status report to the court to explain what still has to be done and how much time that will take.

If the personal representative does not report to the court, the beneficiaries can ask the court to order him or her to file an accounting or take other actions to close probate. The court can remove the personal representative and appoint someone else. Sometimes there are circumstances that can make probate take longer.

If there is a Will contest (a claim filed with the court that all or part of the will is not valid), or the size and complexity of the estate requires extra time, or it is hard to find beneficiaries, the process can drag out. Some probate cases take years to resolve.

Who is in charge of the probate process?
If there is a Will, the person named as executor will usually be appointed as the personal representative – this means s/he is responsible for managing the estate and following probate Rules of Court and procedures. The executor has no authority to act as a personal representative until s/he is appointed by the court and formal "Letters Testamentary" are issued by the Court Clerk.

If there is no Will, or if the Will doesn’t name an executor or the person named as executor in the Will is unable to be the executor or does not want to be executor, the probate court appoints someone called an administrator to handle the process. The Court usually chooses the closest living relative or a person who will inherit some portion of the decedent's assets.

Who can be the personal representative?
The personal representative does not have to be a legal or financial expert. But, s/he must have reasonable prudence and judgment and be very careful, honest, loyal, impartial and diligent. This is called a "fiduciary duty" -- the duty to act with good faith and honesty on behalf of someone else.

The personal representative should have good organizational skills and be able to keep track of details. It is preferable if he or she lives nearby and is familiar with the decedent's finances. This makes it easier to do tasks and find important records.

If I am named as executor in a Will, do I have to serve?
No. If you choose not to serve, the Court will probably appoint the alternate executor to be the personal representative. If there is no alternate executor, or if that person doesn’t want to serve, the Court will appoint someone to serve. The Court usually appoints a capable family member or an independent professional fiduciary.
If you decide to be the personal representative, you can resign at any time. But, you may have to give an "accounting" to the Court for the time 

What if there is no Will?
If a person dies without a Will (known as dying "intestate"), the probate court appoints a personal representative (known as an "administrator"). The major difference between dying testate and dying intestate is that an intestate estate is distributed according to state law (known as "intestate succession"). A testate estate is distributed according to the instructions left by the decedent in his or her Will.

What happens if we cannot find a Will?
If a Will is lost or can’t be found, the specific facts and circumstances and state law will determine what happens. For instance, if the Will is missing because the decedent intentionally revoked it, an earlier Will or the laws on intestate succession would determine who gets the decedent's estate.
Or, if a Will is missing because it was stored in a bank vault destroyed in a fire, the probate court may accept a photocopy of the Will (or the lawyer's draft or computer file), if there is evidence that the decedent properly signed the original.

If I am a beneficiary and the estate does not have enough money, do I have to pay creditors out of my own pocket?
Generally, no. The law says you cannot be made responsible for others’ general debts without your consent. Unless the decedent gave away his or her assets to someone shortly before dying, or otherwise acted in concert with them to defraud the creditors, the beneficiaries should not have to pay the creditors just because they are beneficiaries.

There may be nothing left in the estate for the beneficiaries after paying the creditors. But, the beneficiaries will not owe the creditors money. Still, if the children or beneficiaries took property or benefits from the decedent or the estate, or assumed liability for care given the decedent, or guaranteed payment, they can be liable for some or all of the decedent's debts separately.

Source: The Superior Court of California