The Five Avenues of Probate: Choose Wisely
1. Dependent Administration.
A Dependent Administration is typically the most expensive and most time consuming avenue of Probate. The “dependent” part of the title means the Executor is dependent on the Probate Court to approve and sign off on every probate decision and action the Executor takes. This means that every time the Executor needs to sell property in the Estate, pay a claim out of the Estate account, distribute funds to any beneficiary, they first have to make a formal request to the Probate Judge, who then either approves or denies the request. This avenue can be very tedious…so why would anyone take this avenue? Despite the costs in money and time, there are certain advantages to going through the Probate Process as a Dependent Administration.
First, the process is very clear in the Texas Estates Code. A lot of attorneys like the actions that can be taken and can’t be taken to be spelled out clearly in the Code. Judges have to approve everything so it adds more protection to the Executor.
Second, the Dependent Administration provides certain and definite timelines for filing a claim against the Estate or it is barred forever. This means that an Estate that is heavily in debt may receive a benefit by filing for a Dependent Administration and receiving the protections it provides from claims. In general, if a claimant does not file a claim within four months, their claim is barred…meaning the Estate doesn’t have to pay the claim, even if its valid and for a million dollars, provided certain required actions are taken by the Executor first.
2. Independent Administration.
An Independent Administration is the most common avenue taken in Probate. A Will often names an Independent Executor to serve without bond. The “independent” part of the title means the Executor can make decisions and take actions without the approval of the court. The Executor can act independently. The Executor is still required to file an inventory and a list of claims to the court, but once that is done, the Probate Court is no longer involved in the Estate. The Executor has a fiduciary duty to the beneficiaries to carry out the provisions of the Will and to pay the valid claims of the creditors. By not requiring the Executor to file a request of the Court and have it approved by the Judge for every action, it drastically saves the Estate money and time in Probate.
As more Estates move through Probate as an Independent Administration, the process becomes more defined both in case law and in the Texas Estates Code. However, a creditor’s claim is not as easily barred as it is in a Dependent Administration. In an Independent Administration, a creditor can file a claim at virtually any time, which can create some uncertainty down the road for beneficiaries. If the inheritance is distributed to the beneficiaries, and a valid claim is presented to the Estate a year later by a creditor, then the beneficiaries may have to pay the claim.
3. Muniment of Title.
A Muniment of Title is a unique Probate avenue to Texas. A Muniment of Title transfer property from the name of the deceased to the name of the beneficiary. No Executor is ever named. The Order signed by the Probate Judge in a Muniment of Title action acts as a deed, and will be filed in the deed of records for that county. A Muniment of Title is normally very fast, a few weeks normally, and is much cheaper than a Dependent or Independent Administration. However, a Muniment of Title can only be used in certain situations: the Deceased has to have died with a Will; the deceased does not need to file a last tax return or was filing jointly with their spouse; no life insurance proceeds are at issue; no bank accounts are at issue; there are no claims against the estate; and the Estate consists of really only real property (a homestead, for instance). A Muniment of Title is often not known by attorneys who don’t regularly practice in the Probate area of law, but it can be a great avenue.
4. Affidavit of Heirship.
An Affidavit of Heirship is a sworn affidavit signed by disinterested witnesses stating that they knew the deceased and swear as to who the deceased’s heirs are. An Affidavit of Heirship is normally fairly quick and inexpensive; however, it only becomes reliable after five years since it is filed. The rationale behind the five year rule is that it’s just affidavit, anyone can swear to anything. No judge is making a ruling in this process, there is no hearing. So the rationale is that if anyone is going to contest the affidavit they will probably do it within five years. If no one contests it, then it can be relied upon as true. Keep in mind, no Executor is appoint in this avenue, so if you are needing someone to collect assets from banks, life insurance companies, settle claims, then this is no great avenue for the Estate.
5. Small Estate Affidavit.
A Small Estate Affidavit is similar to an Affidavit of Heirship but differs slightly in that the Probate Judge actually signs an Order approving the Small Estate Affidavit, which lends more legitimacy and reliability to the Affidavit. However, the Estate must be valued at under $50,000.00.
Blaise Regan is a Partner at Regan & Frisbie, PLLC, a law firm focusing on Wills, Trusts, Probate, Contracts, Business Formations (LLC, Corporation, S-Corp Designation), Business Disputes, DTPA claims, and Consumer Litigation.
Regan & Frisbie, PLLC is located at 7160 Preston Road, Suite 100, Plano, Texas 75024.
Comments or questions, feel free to email him at Blaise@RFPlawfirm.com or call him at 469.200.4737.
*Nothing in this Article is to be considered as the rendering of legal advice for specific cases, or creating an attorney-client relationship, and readers are responsible for obtaining such advice from their own legal counsel. This article is intended for educational and informational purposes only, and no warranty or representation is made as to the accuracy or completeness of the information contained herein.