How is the estate of a deceased individual administered and who is responsible for collecting in assets, paying debts, and distributing to beneficiaries?
Private Client (2nd edition)
The estate is managed by an executor, or, in the absence of an executor, by the heirs. Prior to the appointment of an executor, the court can take any action it deems fit to preserve the estate or beneficiaries' rights in the estate. Executors are appointed by the court. If a testator named a person as executor in their will, the court will appoint that person, unless they refuse to act as executor or if the court or the Israeli Inheritances Registrar is convinced that there are special reasons not to appoint them.
The administration of an estate depends upon whether the deceased died testate or intestate.
Where the deceased died testate, the executors appointed under the Will are responsible for applying to the Probate Office to extract a Grant of Probate, which confirms the validity of the Will and the authority of the executors to deal with the estate. Once the Grant of Probate has issued, the executors are responsible for collecting in the assets of the deceased’s estate, paying the just debts and expenses of the estate, and distributing the assets of the Estate in accordance with the Will.
Where the deceased’s spouse has been left less than his or her legal right share under the terms of the Will, it is the duty of the executors to notify that spouse of his / her right of election (the right to choose whether to take the benefit under the Will, or claim his / her legal right share).
Where a person dies intestate, the person or persons entitled to the deceased’s estate pursuant to the rules of intestacy, may apply to the High Court for Grant of Representation, authorising that person or those persons to administer the estate according to the rules of intestacy.
Where the deceased’s personal representatives and the beneficiaries of the deceased’s estate are not resident in Ireland, the personal representatives are required to appoint an Irish solicitor as their agent to obtain a Grant of Representation.
The heirs automatically obtain possession of all assets, rights and claims of the deceased, subject to the obligation to pay all debts of the estate (‘saisine’). Transmission of the estate is therefore not subject to an administrative procedure (no probate).
If a testamentary executor is appointed in a will, he must ensure that the wishes of the deceased are executed. However, his rights are limited: in principle he does not have ‘saisine’, and cannot liquidate, nor divide the estate.
The estate of a deceased individual is administered through a process known as probate. Probate is a court-supervised process through which a decedent’s assets are collected, debts are paid, and remaining property is distributed to beneficiaries according to the terms of the decedent’s Will, or, if the decedent died without a Will, according to the intestacy statute of the state or states in which probate occurs. A court-appointed individual, called an executor or administrator or personal representative, is responsible for administering the decedent’s estate. Typically, a decedent’s Will names the executor, while an administrator is chosen by the court where no Will exists or where no executor is named in the Will.
Probate occurs in the state where the decedent was domiciled at death, as well as in any states in which the decedent owned real or tangible personal property. Generally, the law of the state where the decedent was domiciled at death governs the disposition of intangible property. The disposition of real or tangible personal property, however, is governed by the law of the state in which such property is located. Where such property is located in multiple states, ancillary probate may be required.
In Cyprus law, as in English law, the notion of direct succession is alien and the rights and liabilities attaching to the estate of the deceased are vested in the executor appointed by the will, if any, or the administrator of the deceased’s estate appointed by the court, referred to generically in the law as ‘personal representatives’, whose duty is to pass them on to the heirs. The executor derives his or her powers over the estate of the deceased from the will of the deceased, and the estate is vested in the executor at the time of the death of the deceased, whereas the administrator derives his or her powers from the order of the court appointing him or her as such, which is the time when the estate vests in him or her, but from the issue of such order the vesting operates as from the date of the death of the deceased. On the grant of probate or administration the personal representative steps into the shoes of the deceased for legal purposes. He or she acquires all the rights and obligations of the deceased and may sue and be sued in all matters concerning the estate of the deceased and his or her administration of it. Pending the grant of administration the estate vests temporarily in the court and, for small estates, the court may make an order for summary administration, in which case the probate registrar or such other public officer as the court may appoint will act as administrator.
The inheritance proceedings are managed by the court with the help of public notaries. Basically the administration of the estate of a deceased is done jointly by all heirs who have proved their right of succession. All decisions in this connection have to be done anonymously unless otherwise agreed. For extraordinary transactions the consent of the court of the Austrian inheritance procedure is needed. The respective court appoints a notary as court commissioner who invites the heirs to make their declarations of inheritance.
If a conflict situation caused by conflicting declarations of inheritance or conflicts among the heirs the court has to appoint a trustee to administrate the estate.
An appointment of a trustee by will is possible but of little importance since the heirs are not bound by the appointment and are entitled to dismiss the trustee at any time.
In the case of intestacy, as well as in the case of a testamentary disposition, the successors (or at least the one accepting the succession) must take care of collecting in assets, paying debts, and distributing the estate.
In the case of a testamentary disposition, the testator is entitled to appoint an executor of his will who will basically simply facilitate the execution of the will and will not have the right to alienate any property pertaining to the estate of the deceased unless need be and with the approval of the competent court.
The division of the estate can take place either voluntarily through a contract between the heirs or through specialized a judicial procedure.
The administration of the estate of a deceased individual should be carried out by an administrator.
The administrator could be designated by the testator in his will. If there is no testamentary designation, the heirs acting by majority may designate an administrator. The administrator must carry out conservatory acts regarding the assets comprised in the estate and any act linked with the normal course of the decedent business (administración judicial).
In order to transfer certain assets, the administrator must have the unanimous consent of the heirs, or failing this, judicial authorization.
However, if no administrator has been designated, any heir may undertake acts of conservation or urgent measures in order to preserve the estate. In order to undertake administration or disposition acts, he will need the unanimous consent of the other heirs (administración extrajudicial).
The administrator must give full account of their administration on a quarterly basis, except where the majority of the heirs have agreed to an alternative term. If no objection is made, the judge will approve the accounts.
Regarding distribution of the assets composing the decedent´s estate, this may be done privately (partición privada) which under Section 2369 CCC requires unanimity of the involved heirs, or within the court-based procedure (partición judicial) which is mandatory whenever any of the heirs is a minor and/or faces an incapacity (Section 2371 CCC). If the heirs cannot agree on a distribution of the assets, the courts will order its liquidation (sale and distribution).
Generally, the heirs have the right to administer the deceased’s estate. The heirs, unless they renounce the estate, are obliged to pay the debts and charges of the estate as well as any bequests made by the testator.
The testator may also appoint one or more testamentary executors.
In case of a Will trust established under Law 214, it is accepted that the executors and the trustees have the right to administer the estate.
A judicial administrator may be appointed by the court when the estate has not yet been accepted by the beneficiaries.
The party to succeed, either by law or by will, can either accept (expressly or implicitly) or renounce the estate. In the meantime, unless the deceased has appointed one or more executors by will, he/she is also entitled to administer the estate (if he/she does not, an administrator may be appointed by the court). The renunciation and the acceptance of the estate are retroactive as from the death of the deceased from both a civil and tax law perspective. The party to succeed can accept the estate with or without the benefit of the inventory. In the former case, the heir is liable for the debts inherited (and for the legacies) up to the value of the inherited assets.
Estate representatives have responsibility for administering the estate. If executors are named in a will they will become estate representatives once one or more of them obtain a Grant of Probate.
If there are no executors (either because none are named, the named executors fail or refuse to act, or no valid will is in existence), the Non-Contentious Probate Rules 1974 determine who may apply for a Grant of Letters of Administration.
17.1 The responsibility of administering the estate of a deceased individual falls on the personal representatives of the deceased. Where the deceased died having made a valid Will appointing executors, the personal representatives are those executors, who have the right to apply for a grant of probate, which will give them the right to deal with the deceased's assets. Where the deceased did not validly appoint executors who are able and willing to act, the personal representatives are the administrators, who are appointed under the intestacy rules (§16.2). Broadly, individuals who have an entitlement under the intestacy rules to assets of the deceased's estate have the right to apply for letters of administration, by which they will become administrators and gain the right to deal with the assets of the estate.
17.2 Where the deceased has left a valid Will governing the devolution of his estate, the personal representatives (§17.1) must distribute the assets of the estate in accordance with the terms of the Will. To the extent that the intestacy rules (§16.2) apply, the personal representatives must distribute the assets of the estate in accordance with those rules.
17.3 The administration of an estate proceeds broadly as follows. The personal representatives (§17.1) collect in the assets of the estate, pay all the debts and liabilities (including taxes), and then distribute the assets in accordance with the Will or intestacy rules (§16.2) (as applicable).
17.4 Personal liability of personal representatives (§17.1) is generally limited to the net value of the assets of the estate.
Under Colombian law, an estate executor is designated to administer the assets and insure the fulfillment of the deceased’s last will. The estate executor must accept such designation; however, if an executor is not designated, the heirs are in charge of administering the estate.
The estate executor is required to hold the estate assets under deposit. When the inventory and appraisals of the estate are final, the administrator may sell the deceased’s assets to cover any debts or payment of any taxes and fees.
The result constitutes the net estate available for partition between heirs, which must be performed in accordance with the rules on forced heirship and half of the estate that may be freely assigned by will.
The estate will be administered by the deceased’s personal representatives who will be responsible for collecting in assets, paying debts and distributing property to that person’s heirs.
The personal representatives will be the person’s executors if he or she has left a Will containing a valid appointment of executors who are willing and able to apply for grant of probate or, if not, his or her administrators (whose identity will be determined by the law).
The personal representatives will be appointed under by a grant of probate, a grant of letters of administration or by the resealing of a foreign grant.
The procedures for applying for a grant of probate, grant of letters of administration or resealing a foreign grant are set out in the Probate and Administration Rules (2008 Revision).
In the absence of an executor (see below), the estate is administered by the heir or the community of heirs (“Erbengemeinschaft”), if there is more than one. In this case the heir(s) are responsible for all actions mentioned above.
If an executor has been appointed by the testator, all rights and duties concerning the estate are exercised by him. There are only few exceptions.
For an individual dying with a valid Will, the executor(s) appointed in the Will would apply for a grant of probate in respect of the estate of the deceased. The executor(s) derives his / her authority to deal with the estate of the deceased (i.e. including collecting in assets, paying debts, and distributing to beneficiaries) from the grant of probate.
For individuals dying intestate, the courts may appoint an administrator by a grant of letters of administration. The grant entitles the administrator to deal with the estate of the deceased (i.e. including collecting in assets, paying debts, and distributing to beneficiaries).
The estate of a deceased individual is administered by a representative of the heirs (“cabeça-de-casal”), which may be, for instance, the spouse, a nominated executor or another legal heir.
Even if heirs inherit the deceased’s assets immediately on death without probate, French “notaires” are responsible for collecting assets, paying debts and preparing the “acte de notoriété” which identifies the persons who are entitled to inherit. Heirs can choose to remain co-owners or to allocate the assets between them.
The filing of the inheritance tax return as well as the payment of inheritance tax is the responsibility of the heirs.
The trustees may also be responsible for the payment of inheritance tax when the trust’s assets are not reported in the inheritance tax established by the heirs.
Under Liechtenstein law, the main administrator of the estate is the court. But prior to the devolution of the estate an heir may request that the court shall entrust him or her with the administration of the estate. If the heir is able to sufficiently prove his or her right to the inheritance, the court has to comply with this request. If the administration of the estate cannot be entrusted to an heir (or several heirs) due to a lack of confidence or because opposing declarations of inheritance are deposited, a curator must be appointed by the court. Likewise, if no heir exercises his or her right to administer the estate, the court must appoint a curator for this task, but only if an administration of the estate is necessary. In cases of inheritance by testamentary instrument, it is possible to appoint a testamentary executor who supervises the implementation of the last will.
The estate of a deceased person is administered by the executor (“albacea”), which is an auxiliary of the administration of justice in charge of liquidating the assets that form the estate of a deceased person (hereditary wealth), and that by the mandate of the law is empowered to perform all the acts necessary to guarantee such liquidation.
They have the capacity to be executors all the people who have the free disposition of their assets, so only who have legal age (more than eighteen years) and those who are not disabled can be executors. The executor may be appointed by the persons indicated in the following order: (i) by the testator; (ii) by the heirs; (iii) in certain cases by the legatees; and (iv) a lack of the previous ones, by the judge.
The executor is in charge of formulating the corresponding inventory, collecting the assets, paying the debts, legally defending the succession and carrying out the project of inheritance and asset allocation.
The administration of assets must be done under the fundamental principle that the estate of the deceased is an estate in liquidation, so that although the executor is allowed to perform new operations, these operations should not be an end in themselves, but rather they must be transitory and with the shortest possible duration (thus, if the deceased had immovable property, the executor can rent said assets, but only for a maximum period of one year).
Finally, it should be noted that the executor has powers for lawsuits and collections and administrative acts in relation to hereditary property by legal provision, without implying that he is directly someone's representative, but that he is an executor with powers to perform legal acts.
The executer of the estate may be appointed by the judge [if it is a judicial probate] ou by the heirs [if it is an administrative probate].
He will be responsible to administrate the assets, pay debts and collect earnings up to the moment the assets are distributed by a judicial order or agreement of the heirs if a judicial probate process is not mandatory.
The executer must be supervised by the judge [if it is a judicial probate] and by the heirs.