Do I Need a Will, Or if I Have One, Do I Need to Have It Probated?

Yesterday an elder asked me the question, “Do I really need a Will?” The answer may seem obvious, since every authoritative source (if you google that question, you will see what I mean) responds in the affirmative. However, I have had elder clients who after careful consideration (and despite my warnings) have chosen either not to create a Will, or in a couple of cases where one already exists, not to submit it to probate.

A lawyer has several good reasons for recommending that all of his clients (not just the wealthy ones) execute a Will and after death submit it for probate. A Will allows the client to choose exactly how his/her property should be divided, who should be in charge of the estate, who should be the guardian of minor or disabled children, how their remains should be handled, etc.

For this discussion, however, we will assume that the client no longer has young children or disabled family members to care for, and has already placed all of his or her property in a form that makes a Will unnecessary. This can be done by using beneficiary deeds for real property, revocable living trusts, pay-on-death bank accounts and joint ownership.

The client who called yesterday, can’t think of a single reason why they should pay even a small amount of money to create a Will, that will need to then go through Arizona’s simplified probate process, which entails publication fees, fees for Death Certificates, probate filing fees, notary fees and some amount of paper work by the person designated as personal representative or executor (PR). Why should this lady bother with all the fees and effort to create a Will and then subject her son to more fees and paper work, when he will get all of his mother’s property automatically the moment she dies? This is indeed a worthwhile question.

If all property passed automatically at death what value is probate?

One answer is finality. By going through the probate process (which usually starts with the presentation of a Will to the probate court and the designation of a PR), the claims of creditors are fully extinguished. In Arizona the cut-off date for creditor claims is 120 days after the first date of publication of a formal death notice. Once the 120 day period expires the estate can shortly thereafter be “closed” by the court (upon application by the PR) and at this point the opportunity for any challenge, such as from unhappy family members, also ends (re-opening an estate is possible, but only in limited circumstances usually involving fraud or mistake by the PR).

I am currently acting as estate counsel for a modest sized estate (having less than one million dollars of net worth) which is going through Arizona’s simplified probate system, and was initiated in the summer of 2013 by the publication of a death notice. Last week I received a phone call from a very polite gentleman, who I believe was telling me the truth, saying that he had a check signed by “Miss M” (for whom I had drafted a Will just weeks before her death a year ago) for four hundred dollars, which was three years old!

This gentleman wanted to submit the stale check as a bill to the estate and he had gotten my name from the probate court. He explained that he had misplaced the check (for almost 3 years) and thus failed to have it deposited in a timely way. For the sake of argument I will assume that the signature on the check was that of Miss M.

I informed him that the time period for filing claims against the estate expired 120 days after the first day of publication of the death notice, thus he was already several months too late to make a claim. I further explained that even a personal plea to the PR will do no good, since the law requires the PR to reject any bills submitted after the 120 day cut-off (because the remainder of the estate belongs to the various beneficiaries at that point) and the PR can actually be sued personally by other beneficiaries of the estate for paying tardy claims. Miss M’s estate benefited from the probate system by having claims such as this one barred forever. Had the bill been for a larger amount, and had there been no probate filing, the claimant could very well have taken the matter to court and won a judgment against the estate.

Choosing Not to File for Probate

Another recent client chose not to file for probate. This lady’s domestic partner had just passed away after ensuring that my client had title to all of his assets. He left a Will, which set forth that my client would inherit everything, but my client now wanted to know whether she would get into trouble if she simply paid the final bills (except for one which she had grounds to dispute) and not put the estate through probate.

In Arizona, a person having custody of a Will is liable to any person damaged by his or her failure to deliver the Will for probate. However, where the custodian of the Will is the sole beneficiary thereof, there is no duty on the custodian’s part, even if they are designated as PR, to submit the Will to probate. Thus the short answer to her question was, “you are under no legal obligation to go through probate… but are you sure you want the risk?”

The risk for her is that the obligation to the creditor who was not paid, could linger for years. As the beneficiary of her partner’s estate (which scarcely had enough funds to pay the remaining bills) she could potentially be sued years later (although this is unlikely because of the small size of the estate). The benefit for her, she believes, is that by failing to open probate and publish a death notice, the creditor may not learn about his death and thus may never pursue its claim against the estate.

Against my conservative advice I understand that she decided to refrain from probate. Although the final result will not be known for at least 6 years (the statute of limitations for contract claims), she may be successful in saving herself at least $500-$1,000 in legal fees and expenses as well as the amount of the bill which is no doubt still outstanding against her deceased partner.

The probate system does the family a favor by closing the estate and cutting off claims. Lawyers are sometimes in the uncomfortable position of having to recommend their clients pay fees to make this happen, even though the family sometimes feels that the expense is unwarranted, and viewed in hindsight the family may sometimes be proven correct.

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