PROBATE: WHAT IS IT?It is common to hear the statement, "I want to avoid probate" or, "I don't want my family to go through the horrors of probate." When you ask these same individuals what probate is, many do not have an answer.
Probate is one of the least understood of court processes. However, it is a procedure that can affect the family and heirs of every mature adult following his or her death.
Simply stated, probate is a special state court legal process for settling the debts of someone who has died, and distributing the remaining property to rightful heirs.
In a probate, the person who is authorized by the probate court to administer the estate of a deceased person is called a "personal representative," whether appointed by a will or by the court. More than one person can serve as personal representative. In some states with an older probate system and formerly in Utah, the personal representative was referred to as an "executor" if there was a will, or as an "administrator" if there was no will. However, under Utah's more recent probate system, the decedent's representative is referred to as the "personal representative" in all probate proceedings.
A primary purpose of the probate process is to have a personal representative appointed for the deceased individual. The personal representative must be appointed in order to sign the decedent's name after death.
During life, a person signs a deed or bill of sale to transfer property. When a person dies, it is still necessary to have some document to show a transfer of title. In other words, a signature of the decedent is necessary. The probate process provides one method of doing this. By appointing a personal representative, the court authorizes that person (or persons) to sign for the deceased individual.
As was explained in an earlier article in this column, a revocable living trust provides another method. The revocable living trust provides for a successor trustee upon the death of the person who originally created the trust. In so doing, the court-appointed personal representative is not necessary if assets have been properly transferred into the name of the trust.
Many people believe that if they have a will there will be no probate. Nothing could be further from the truth. Whether you have a will or do not have a will, your estate must go through a probate proceeding, unless it falls within some exceptions (a few of these exceptions such as property owned in a trust or in joint tenancy have been discussed in earlier articles in this column).
The only difference between dying with a will and dying without a will is that if you die with a will, you tell the probate court how you would like to have your property distributed after your death. If you die without a will, the state legislature tells the probate court how to distribute your estate. In either case, probate will take place.
Another important matter related to probate is that probate proceedings are different in all 50 states. For example, Utah and Arizona have adopted the Uniform Probate Code. This is a newer version of probate. It is much simpler, less expensive and does not take as much time as the older systems. Nevada, on the other hand, has an older, much more complex probate process.
When considering whether to avoid probate or not, it is important to understand what is being avoided. Although it is true that in most cases the use of a revocable living trust will require less overall expense than the administration of an estate through the probate court, you may not want to spend more money while you are alive to have a fully-funded revocable trust prepared as compared to waiting and allowing the estate to pay for the probate fees.
In all cases, it is important to be educated about the different estate planning tools. After you have reviewed the different estate planning possibilities, you can then make a decision as to what is best for you.
Jeffery J. McKenna
Attorney licensed and servicing
clients in Utah, Nevada and Arizona
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