FAQs
FAQs—Probate Process / OverviewProbate is the court process needed to prove the validity of a will and to process the estate of a deceased person. Once the will is submitted to the court and found to be valid, the court oversees the administration of the estate, including the collection of the estate assets, the payment of estate debts, and the distribution of assets to the beneficiaries named in the will. 1.2 What time frames does probate involve? The probate process usually takes between six and 18 months to complete, although that can vary depending on the facts of each case. 1.3 Is probate needed for all estates? No. Whether an estate administration is necessary is decided by the probate court. Probate is necessary to transfer title to certain assets. For example, a probate administration is usually needed to transfer title to real estate or to transfer ownership of securities such as stocks and bonds. The Probate Code requires an administration if there are two or more debts against the estate, if the court needs to partition estate property between the people receiving it, or if the administration is needed to receive or recover assets due to the estate. Probate Code § 178. 1.4 How soon does a will have to be probated? Within four years after the date of death, unless special circumstances exist allowing the will to be probated later as a “muniment of title.” Probate Code § 73. 1.5 Are attorney’s fees incurred during probate paid by the estate? Yes, attorney’s fees incurred in probating the estate are payable by the estate. Probate Code § 242.
FAQs—Types of Probate ProceedingsThere are multiple forms that a probate proceeding can take. There is the typical full proceeding to probate a will, a shorter will probate called a muniment of title, a small estate by affidavit proceeding, and heirship determinations, among others. 2.1 Standard Probate (Independent Administration) By far, the most common form of probate involves the judge approving the will and appointing an executor to administer the estate. This is called an independent administration of a will. The clerk issues letters testamentary for the executor to use in conducting estate business, the executor works essentially independent of the court to conduct the estate business, and the court approves a final inventory of estate assets and a list of claims owed to the estate. 2.2 Probating a Will as a “Muniment of Title” This is a scaled down probate proceeding that is available in limited circumstances. The will is still proven valid at a hearing in the probate court, but no executor is appointed. This procedure is only available if the estate has no unpaid debts (other than liens on real estate) and there is no necessity for administration. An order admitting a will to probate as a muniment of title is legal authority to all relevant persons that the beneficiary named in the will is entitled to receive the asset in question without any administration. In other words, the order entered by the court functions as legal confirmation, documentation and notice that the beneficiaries of the decedent’s estate are the legal owners of the property. Probate Code § 89C. 2.3 Probate by a “Small Estate Affidavit” This is another scaled down probate proceeding that is available in limited circumstances. This procedure is available if the decedent did not leave a will and there is no other type of probate proceeding already pending, and if the value of all of the estate assets, not including homestead and exempt property, is $50,000 or less. Two disinterested witnesses are required to file sworn affidavits concerning heirship. Once the final order is entered by the probate court, the persons dealing with the estate are in the same position as they would have been in if there had been a full probate. However, this procedure does not transfer title to real property, except for a homestead (and then only in limited circumstances). Probate Code § 137.
2.4 Proceedings to Determine Heirship If the deceased did not leave a will, the assets pass to those persons defined by statute to receive them. Probate Code § 37 et. seq. A proceeding to determine heirship will likely be filed, in which the identity of the heirs and the shares of the estate that each heir is entitled to receive are determined. Probate Code § 48 et. seq. 2.4.1 If a person dies without a will and leaving a spouse, who inherits? If the deceased person had no children, his or her surviving spouse will inherit all of the decedent’s interest in the community property, all of the decedent’s separate personal property, and one-half (or sometimes all) of the decedent’s separate real property. If the decedent is survived by children or descendants of children all of whom were also descendants of the surviving spouse, the surviving spouse will inherit all of the community property, but only one-third of the separate personal property and a one third interest for life in the decedent’s separate real property. If the decedent is survived by children or descendants and at least one child who was not also a descendant of the surviving spouse, the surviving spouse will inherit none of the decedent’s community property, one-third of the decedent’s separate personal property, and a one-third interest for life in the decedent’s separate real property. 2.4.2 Will I receive notice of a proceeding to determine heirship? Yes. All heirs of the deceased must be served with notice in a proceeding to determine heirship. If the original will cannot be located, there is a strong presumption that person who made the will revoked it by destroying it. As a result, it is always better to have the original copy of a will rather than relying on a copy. Nonetheless, the Probate Code provides a method by which a copy of a will can be proven up and used in place of a signed original in some circumstances. Probate Code § 85.
FAQs—Estate Assets and Liabilities3.1 What assets pass by probate? Not all of the assets of the deceased person go through the probate process. The ownership to some assets passes by contract rather than through the probate court. Some of the most common non probate assets are insurance policies, annuities, pension plans, and 401k type retirement accounts. The ownership of these assets passes to the beneficiary designated by the deceased in the applicable insurance or securities contract. Also, certain bank accounts are set up in forms that pass outside of probate, such as pay on death accounts and joint tenant with right of survivorship accounts. Probate Code § 436 et. seq. 3.2 What property belongs to the estate? If the deceased is not married, all of the probate assets of the deceased are part of the estate. If the deceased is married at death, the property that belongs to the deceased’s estate is (1) all of the deceased’s separate property (property possessed before marriage or property acquired during marriage by gift or inheritance); and (2) one half of the community property in the marriage. The other half of the community property belongs to the surviving spouse, and is not a part of the deceased spouse’s estate. 3.3 What liabilities does the estate have? For a deceased person who leaves a surviving spouse, the estate of the deceased is liable for all of the separate property debt of the deceased as well as half of the community property debt. Probate Code § 156. 3.4 What if the estate liabilities are greater than the probate assets in the estate? If there are insufficient assets to pay claims within a certain class of debts, the claims are paid on a pro rata basis. Probate Code § 321.
3.5 What if the estate lacks enough liquid assets to pay the debts? If the estate has enough probate assets to pay debts, but those assets are not in a liquid form, then assets may have to be liquidated to pay the debts. 3.6 Can the estate remain liable on a note or mortgage? Yes. The applicable loan documents control this issue, and any obligation of the deceased on a note, lien or mortgage survives to the estate unless the loan contract provides otherwise.
FAQs—Executor’s Role4.1 What duty does the executor owe? The executor owes a fiduciary duty to the estate as well as to all beneficiaries named in the will. The executor may also owe a duty to the creditors of the estate. A fiduciary duty involves a very high degree of trust and responsibility. In short, the executor has the duty to handle estate property in the way in which a “prudent” person would handle his or her own property. Probate Code § 230. The executor is also the person who acts in a legal capacity on behalf of the estate. Since the estate is a legal entity and is not an individual, the executor is the individual by and through which the estate is represented in court. 4.2 What tasks does the executor perform? A good list of the specific tasks that executors are required to perform can be found on the web site of the Tarrant County Probate Court No. 1 at the following link: (link). 4.3 Is the executor entitled to be paid? Yes. Sometimes the will provides for the amount of compensation or a formula by which the compensation is calculated. If the will is silent or if there is no will, the Probate Code typically allows a commission of 5% of all sums received in cash or paid out in cash, not to exceed 5% of the total value of the estate. However, no 5% is earned on funds which were held at the time of death in a financial institution or brokerage firm, including cash or a cash equivalent held in a checking account, savings account, certificate of deposit, or money market account, nor for collecting life insurance proceeds. The executor can also petition the court for payment above the 5% commission in extraordinary circumstances. Probate Code § 241. 4.4 What if the executor is also a beneficiary under the will? In that event, the person serving as executor will be wearing two hats, so to speak, and acting in two roles. The executor must take caution not to incur estate expenses when pursuing things that are solely for the benefit of the executor in his or her capacity as a beneficiary. 4.5 Who is disqualified from serving as an executor? Persons disqualified to serve as executor include a minor, a person lacking legal competency, a convicted felon, a non-resident of Texas who does not have a resident agent for service here, a corporation not authorized to act as a fiduciary in Texas, or a person whom the court finds unsuitable. Probate Code § 78. A person named as executor in a will is given first priority to serve. The burden is on the party opposing the proposed executor to establish the person’s disqualification. Powell v. Powell, 604 S.W.2d 491, 493 (Tex. Civ.App.-Dallas 1980, no writ).
FAQs—Estate AdministrationThere are many steps in the probate process, and some recurring issues that arise. 5.1 What notices to creditors do executors have to give? The type of notice required depends on whether the creditor is secured (whether there is a lien or security interest against the property, most commonly a house or a vehicle) or whether the creditor is unsecured (most commonly for other types of credit such as credit cards.) For unsecured creditors, the executor gives a general notice to creditors that is published in the local newspaper. Probate Code § 294. However, this notice leaves a period of up to four years (the statute of limitations for a breach of contract) for the creditor to make a claim. Civil Practice and Remedies Code § 16.004. This time frame can be shortened to four months by giving direct notice to unsecured creditors. Probate Code §294(d). For secured creditors, the executor must give notice by certified or registered mail so that the creditors will be on notice to present their claims against the estate. Probate Code § 295. 5.2 In what priorities do creditor claims get paid? Once a creditor’s claim has been legally established as a debt of the estate, the Probate Code classifies the debt for payment according to the following priority system: Class 1 - Funeral expenses and expenses of last illness not to exceed $15,000, with any excess to be classified as unsecured debt. Class 2 - Administration expenses and expenses incurred in preservation, safekeeping and management of the estate. Class 3 - Secured claims to the extent they can be satisfied out of the proceeds of the collateral. Class 4 - Claims for delinquent child support. Class 5 - Claims for taxes, penalties and interest due the state of Texas (U.S. taxes likely take priority over all claims). Class 6 - Claims for the cost of confinement in the Texas Department of Criminal Justice system. Class 7 - Claims for repayment of medical assistance payments made by the state of Texas on behalf of the decedent. Class 8 - All other claims. Probate Code § 322, 320. 5.3 What homestead and exempt property rights exist? The surviving spouse and certain other family members have rights regarding the homestead and exempt personal property in the estate (exempt property is property that is exempt from creditor’s claims by Texas law). The surviving spouse has a right to occupy the homestead, even if the homestead was the separate property of the deceased spouse. The surviving spouse and certain other family members are entitled to receive certain exempt property free of creditor’s claims. The executor can set an allowance or set aside property for the benefit of qualified family members to satisfy these homestead and exempt property protections. Probate Code § 270 et. seq.
5.4 What do the terms “per stirpes” and “per capita” mean? “Per stirpes” means taking a reduced share “by representation” or “by class,” instead of taking equal shares as would apply in a per capita distribution. This distinction most frequently comes up when an original beneficiary in the will pre-deceases the person whose will is being probated, and the issue is whether the descendants of the original beneficiary (now deceased) take only the portion originally allocated to their deceased parent or whether they take an equal share with all beneficiaries surviving the person who made the will. For example, Dad’s will has three children included in it: Child 1, Child 2 and Child 3, each to receive 1/3 of the estate. However, Child 2 predeceases Dad, leaving Grandchildren 1 and 2 surviving Child 2. In a per stirpes distribution, Grandchildren 1 and 2 both share equally in Child 2’s original share (they would each receive ½ of Child 2’s 1/3 share, or 1/6 of the overall estate). The per stirpes distribution allows Grandchildren 1 and 2 to each share the 1/3 share of Child 2, with Child 1 and Child 3 still taking their full 1/3 shares as originally intended by Dad. However, in a per capita distribution, Grandchildren 1 and 2 would share equally with surviving Children 1 and 3, each of the four of them would take 1/4 of the overall estate (and Dad’s original intent to leave 1/3 to Children 1 and 3 is thus reduced to ¼ for each of them). 5.5 What is a letter testamentary? Letters testamentary are issued to the executor of the estate by the clerk of the probate court. These letters serve as proof of the executor’s legal authority to act on behalf of the estate, and can be used to authorize the executor to engage in business transactions on behalf of the estate with banks and other business entities.
FAQs—Probate DisputesThe most common disputes in the probate process involve challenges to the validity of the will sought to be probated, disputes over the interpretation of the will, disputes over the property included in the estate, challenges to the ownership of property in the estate, and challenges to the work done by the executor of the estate. 6.1.1 What grounds are there for contesting a will, trust or deed? Wills, trusts and deeds can be invalidated if the correct formalities were not followed in executing them, if there is a later dated document that replaces the document sought to be used, if the maker of the document lacked legal and/or mental capacity to execute it, or if the maker of the document was unduly influenced to make it. 6.1.2 What is undue influence? To invalidate a will because of undue influence, it must be shown that the influence: 1) existed and was exerted; 2) effectively operated to subvert or overpower the mind of the person who made the will; and 3) caused the execution of a will that the maker of the will would not have made but for the influence. See Rothermel v. Duncan, 369 S.W.2d 917, 922 (Tex.1963). Essentially, undue influence is a form of fraud, and involves the wrongful use of influence, such as through force, intimidation, duress, or deception, to cause the execution of a will which is contrary to the maker’s desire for the distribution of his or her property after death. Id. Not every influence is undue influence; courts look to whether the free agency of the maker of the will was destroyed and whether the will that resulted expresses the will of the one exerting the influence. Id. 6.1.3 Who has the burden to show undue influence? The burden of proving undue influence is on the party challenging the validity of the will. See Rothermel, 369 S.W.2d at 922.
6.1.4 What is the mental capacity needed to make a will? The legal and mental capacity to make a will or other estate planning document and the capacity to execute a contract are similar, but not exactly the same. The mental ability to execute a will has been defined as “sufficient mental ability, at the time of the execution of the will, to understand the business in which the person is engaged, the effect of his or her act in making the will, and the general nature and extent of his or her property.” Hoffman v. Texas Commerce Bank Nat’l Ass’n, 846 S.W.2d 336, 340 (Tex.App.—Houston [14th Dist.] 1992, writ denied) (citing Lowery v. Saunders, 666 S.W.2d 226, 232 (Tex.App.—San Antonio 1984, writ ref’d n.r.e.)). 6.1.5 Who can contest a will? Any “interested” person has standing to contest a will, which usually is a person who would either take under the will if the will was upheld or a person who would take by statute or by another will if the will was found to be invalid. Probate Code §§ 10 and 93. 6.1.6 When can a will be contested? Any time before a will has been probated, or within two years of when the will was admitted to probate. Probate Code §§ 10 and 93. 6.1.7 When is the best time to contest a will? Strategically, the best time to contest a will is before the will is admitted to probate. This is because the burden of proof to establish the validity of the will is on the party admitting the will to probate, and the burden of proof to establish the invalidity of the will shifts to the party contesting the will once it is admitted to probate. Thus, those who wait to contest a will until after the will has been admitted to probate must shoulder a burden of proof that they would not have had if they had acted sooner. Also, contesting the will before it is admitted to probate can slow down or stop the administration of the estate under the allegedly invalid will. 6.1.8 Attorney’s fees in will contests: recovered from the estate? Yes, assuming that the contest was brought or defended in “good faith” and with “just cause.” Probate Code § 243
6.1.9 What is a “no contest” or “forfeiture” clause? Are they enforceable? These clauses typically provide that any persons who contest or challenge the will are to forfeit what they otherwise would have received under the will. These clauses can be enforceable and should be given consideration if the person contemplating a will contest is subject to such a clause. However, the clauses are strictly construed to avoid forfeiture if possible. Also, arguments can be made that the forfeiture clause should not apply if the will challenge is being made with probable cause of success and in good faith. 6.1.10 Who receives notice of a will being probated or challenged? All interested persons do not necessarily receive actual notice that actions potentially impacting them are taking place in the probate court. The court will post a notice in a public place in the courthouse, but those are largely ineffective in making people aware of estates being probated in which they may have an interest. If you are a beneficiary in a will admitted to probate, the executor of the estate must give you written notice of that fact within 60 days of the will being admitted to probate. Probate Code § 128A. If you are otherwise a beneficiary of a will that is not being admitted to probate or if you are a person who would inherit from the deceased by statute in the absence of the will, no notice is necessary. 6.1.11 Do all interested persons have to be joined as parties in a will contest? The Probate Code does not require joinder of all interested persons in a will contest. See Jones v. LaFargue, 758 S.W.2d 320, 323 (Tex.App.-Houston [14th Dist.] 1988, writ denied). Nor does it generally require service of citation, or even notice. The Probate Code states that no person need be joined as a party or given notice of proceedings under the Probate Code unless the Probate Code expressly so provides. Probate Code § 33(a). Texas is one of a handful of states in this country with a will-contest statute that does not require notice to interested parties. See Petty v. Call, 599 S.W.2d 791, 793–94 (Tenn.1980) (noting that Tennessee was one of seven states at that time whose will-contest statute did not require that will contestants join or notify interested parties). 6.1.12 Can children be disinherited in Texas? There is no forced inheritance, and makers of wills in Texas can disinherit their own children or anyone else whom they choose. Probate Code § 58 (b). However, if the person making the will excludes the “natural objects of his bounty,” which usually includes the spouse, descendants and parents of the person making the will, it can be evidence that would support a will challenge based on undue influence or lack of testamentary capacity. 6.2 Executor and Trustee Challenges Challenges can be made to who the executor is and to whether the executor is properly discharging his or her duties.
6.2.1 Can executors and trustees be removed? On what grounds? Executors and trustees owe heightened legal duties called fiduciary duties to the beneficiaries of the will and of the trust. These duties include an absolute duty of loyalty, a duty to fully disclose and account, and usually a duty to avoid self dealing. The executor and the trustee owe the duty to manage the affairs of the estate or the trust with the judgment and care that persons of ordinary prudence would use in the management of their own affairs (the care “as a prudent man would take of his own property”). Probate Code § 230 The Probate Code provides specific grounds on which an executor can be removed. Probate Code §§ 149C, 222. 6.2.2 Are executors and trustees required to account? Yes. Interested parties can demand and receive an accounting of the assets and liabilities of the estate and the trust at appropriate times. Probate Code § 149A. Sometimes the language in a will is subject to more than one interpretation, and litigation is necessary to determine which interpretation of the will prevails. If the will is found to be ambiguous, the court will hear evidence to resolve the ambiguities. If no ambiguity is present, the court will examine the will itself (the “four corners” of the will) and will determine which interpretation prevails. Issues can arise regarding the ownership of property in an estate, and whether that property passes under the will and to whom it passes. Often these issues involve whether the property in question is community property that would pass under the deceased’s will, or whether the property is separate property of a surviving spouse that does not pass under the will. 6.5 Settled Disputes: the Family Settlement Agreement A family settlement agreement is commonly used to settle disputed estate issues. The family settlement agreement is a document signed by all parties interested in the estate (heirs, those listed in a will as beneficiaries, etc.), in which all parties release any claims that they have against each other, and in which the assets and liabilities being assumed by each party are listed. If a dispute later arises and the agreement needs to be enforced, the agreement has to be filed with the court. However, if no dispute arises, the attorneys will sometimes retain the original agreement in their files and will not file it with the court so that the contents will remain confidential.
6.6.1 What county has venue for a will contest? Wills are probated in the county of the deceased’s “domicile”, or fixed place of residence, at the time of the death. Probate Code § 6. If the deceased had no domicile, other permissible counties may apply. 6.6.2 What county has venue for trust challenges? Challenges to trusts are generally filed in the county in which the trustee resides or in the county where the trust is being administered. Property Code § 115.002. 6.6.3 What court has jurisdiction for trust challenges? The district court has original jurisdiction in all trust proceedings. Property Code § 115.001. 6.6.4 What court has jurisdiction for will challenges? The first step in determining what court within a given county has jurisdiction for will challenges is to determine if that county has a court created by statute that has probate jurisdiction (these are usually referred to as statutory probate courts, and they generally exist only in the more populous Texas counties). If the county in question does have a statutory probate court, the contested probate matter (including will challenges as well as other disputes) should be filed in the statutory probate court. If the county does not have a statutory probate court, the case should be filed in the county court (commonly referred to as the constitutional county court since the Texas Constitution provides one for each county), and the contested part of the case has to be transferred to the district court if either party so requests. In that event, the district court presides over only the contested issues, with the county court retaining jurisdiction over the remainder of the case and disposing of the entire case consistent with the district court’s rulings once the contested portion is determined. Probate 6.6.5 What rules of procedure apply? Texas Rules of Civil Procedure apply to will contests only to the extent they do not differ from the procedure established by the Probate Code. See TEX.R. CIV. P. 2; Cunningham v. Parkdale Bank, 660 S.W.2d 810, 812 (Tex.1983); see also Johnstone v. State, 22 S.W.3d 408, 409 (Tex.2000) (”[W]hen a rule of procedure conflicts with a statute, the statute prevails unless the rule has been passed subsequent to the statute and repeals the statute as provided by Texas Government Code section 22.004.”).
6.6.6 Can records be obtained by subpoena? Yes. Records can be obtained by subpoena through depositions on written questions and otherwise through the subpoena power of the probate court as in any other court. 6.6.7 What state’s law applies? For the transfer of real property, the law of the state in which the land is located controls. For personal property, the law of the state in which the deceased was living at death controls.
FAQs—GuardianshipsA guardianship is a procedure supervised by the probate court where the court gives one person (the “guardian”) the legal authority to make personal or financial decisions for a person (the “ward”) who can no longer make such decisions for himself or herself. Common situations in which guardianships are used include older persons suffering from severe dementia or other mental illness that precludes them from managing their own affairs, persons who suffer from mental disabilities or cognitive deficits, and minors who own assets in need of adult management. Before a guardianship can be established for an adult, a physician’s evaluation documenting the need for the guardianship must be filed with the court. The physician’s evaluation must cover certain topics, and it must be dated within 120 days of the guardianship application being filed. Two of the topics that must be specifically addressed by the physician are the ward’s ability to drive a vehicle and to vote. Probate Code § 687. The appointment of an attorney to represent the proposed ward is mandatory in guardianship proceedings. This attorney, called the attorney ad litem, is appointed to represent and advocate on behalf of the proposed ward. Probate Code § 646. In addition to the attorney ad litem, some guardianship cases also involve the appointment of a guardian ad litem. The guardian ad litem differs from the attorney ad litem in several respects: 1) guardian ad litems are not appointed in all cases, only some cases; 2) the guardian ad litem is not always an attorney; 3) the guardian ad litem is appointed to represent the best interests of the ward (which may be different from the desires of the ward – the attorney ad litem is to advocate the desires of the ward, even if those desires may not necessarily be in the ward’s best interest). Probate Code § 601 (12). Guardianships can be expensive, and many of the expenses are charged to the estate of the ward. The expenses include payment of the fees for the attorney ad litem (Probate Code § 755), the guardian ad litem (Probate Code § 645), and other fees needed for the overall management and operation of the ward’s estate. If the attorney’s fees for the attorney ad litem and the guardian ad litem cannot be paid from the ward’s estate, they become the county’s responsibility. Probate Code § 665A.
7.5 Alternatives to Guardianship Guardianships can take away significant legal rights and privileges of the ward. As a result, the legislature has mandated that, if there are less restrictive alternatives to a guardianship available, they are to be used. Probate Code § 602. A commonly used alternative to guardianship is a power of attorney over the proposed ward. Venue for a guardianship is in the county in which the proposed ward resides. Probate Code § 610. Guardianship jurisdiction is similar to the will contest jurisdiction discussed earlier. If there is a statutory probate court in the county, jurisdiction is in the statutory probate court. If there is not a statutory probate court, jurisdiction is in the county court, with disputed issues transferred to the district court. Probate Code § 606. There is no such thing as a “stealth” guardianship. In all guardianships, the proposed ward must be served with notice so that the ward can come forward and oppose the guardianship if the ward desires. In order to establish a guardianship over an adult, the court must find that the person is an “individual who, because of a physical or mental condition, is substantially unable to provide food, clothing, or shelter for himself or herself, to care for the individual’s own physical health, or to manage the individual’s own financial affairs.” Probate Code § 601 (14) (B).
FAQs—Elder Exploitation / Financial AbuseElder exploitation takes place when a person in a position of trust takes advantage of a vulnerable elder to gain control of their money or property. This can occur directly, or indirectly through a power of attorney, a trust, marriage, adoption, or inheritance. The elder need not be incapacitated. Fraud can come from multiple sources: friends and family, new “best friends,” “thieving caregivers,” and religious con artists. Unfortunately, family members are often the source of financial abuse of their elderly relatives. Texas law defines exploitation as: “The illegal or improper act or process of a caretaker, family member, or other individual who has an ongoing relationship with the elderly or disabled person using the resources of an elderly or disabled person for monetary or personal benefit, profit, or gain without the informed consent of the elderly or disabled person.” Texas Human Resources Code § 48.002 (a) (3). Two handouts to assist in avoiding being a victim of financial elder abuse can be found at (link)
|
