Have you been named the executor of a will in California? If so, you need to start off on the right foot. Here are ten things you need to know as you take on this vital new role.
Learn Your Duties as Executor
Gathering information about your duties is your first priority. Learning what it takes to perform your executor function is extremely important. As executor of a will, you will be seeing to the administration of an estate. You also have a fiduciary, or heightened, duty to provide reasonable care and skill in dealing with the property. You must also administer the estate in the interest of the beneficiaries and not for your own benefit.
Understand How a Bond Works
As an executor of a will in California, you will dealing with property that belongs to the estate and ultimately the beneficiaries. To protect the estate, you will probably have to be bonded. If something goes wrong and you lose the property under your care or it loses value, the bond will replace the value in the estate. But that will not be the end of the issue. The bonding company will have a right to seek reimbursement from you. Make sure you understand how a bond works and what your obligations are to the estate and under the bond.
Take No Action Before the Court Appoints You
Just because the court names you as executor of a will in California does not mean that you automatically have the authority to carry out the terms of the will. The court must first appoint you. You will file a petition for probate, and the court will issue a court order naming you executor. The court will also issue Letters Testamentary, which is the document that gives you authority to gather assets and make transfers. Because the court names the executor of a will, it is possible that someone might challenge your appointment. Therefore, it is best not to act on any terms of the will until you have official sanction from the court.
Ask the Court for Full Powers
As the executor of a will, you are given the authority to gather, liquidate, and distribute property. Before you take any action, however, the law requires that you obtain court permission. You can avoid those repeated (and expensive) trips to the courthouse by asking the court to grant you “full powers.” This will:
- alleviate the need for multiple court orders,
- save much time and estate resources, and
- facilitate the transfer of significant assets like real estate.
Be Mindful of Your Duty to Creditors
In addition to the fiduciary duty you owe to the beneficiaries, you owe a duty to the creditors of the estate. In fact, you could say that probate exists primarily to serve as an orderly liquidation to ensure that the creditors are properly paid. You will have to notify all known creditors of the deceased. You must also provide them with a form they can use to make their claim against the estate for what they’re owed.
Inventory the Property and Have It Appraised
As one of your first duties as executor of a will, you will inventory all the property in which the decedent had an interest. The court will appoint a probate appraiser who is charged with the duty of fixing a value on all of the property in the estate. You must act on this quickly, because under California law you will only have 120 days after your appointment in which to file the inventory and appraisal.
Obtain a Court Order Before Distributing to Beneficiaries
This is very important. Even though you have been issues Letters Testamentary that give you the authority to act for the estate, you cannot transfer any property to any beneficiary without express approval of the court. This is true even if the the estate has a sole beneficiary or if a beneficiary is suffering a hardship.
Do Not Pay Yourself Without a Court Order
As an executor of a will in California, you have the right to receive payment for the work you put into gathering, liquidating, and transferring property and paying creditor claims. Just because the court grants you full powers does mean you have the authority to pay yourself or any other professional, like an attorney you hire to advise you. For that, you will need an order from the court.
File an Account and Final Report With the Court
When possible, you should not take any longer than a year to wrap up the estate. If you are able to carry out administration within that period, you can file at the same time your final report and an accounting of the liquidation of assets, payment of claims and transfer of the remainder to the beneficiaries. If, however, you have not finished administering the assets, you will file a report with the court detailing your progress and what you have left to accomplish. At that time you can ask the court to allow you to distribute some of the assets or pay yourself out of the estate. The report requires a filing fee. So, the sooner you can finish the administration, the fewer filing fees will come out of the estate.
Make Distributions From the Estate
Even when the court approves your final report and accounting, you are not yet free. You still have to make distributions to the creditors according to their claims, and then to the beneficiaries according to the terms of the will. Obtain receipts from all parties receiving money or property so that you can file those with the court. Once you have discharged all of those duties, you can file an application for discharge with the court. When you enter the order, you’ve fulfilled your duties as an executor of a will in California.
If You Are Executor of a Will in California, Contact the Legacy Lawyers
An executor of a will has many responsibilities, some of which can be costly if not handled correctly. The Legacy Lawyers are experts in probate administration and can help you every step of the way. Call 714-503-0089 for an appointment to discuss your options and duties.