South Carolina Probate Lawyer » S.C. Code of Laws: Title 62

Personal Representative’s Duties: Duty to Inventory Assets

Tiffany Provence — Mon, 10 May 2010 01:54:18 +0000

Once serving as the Personal Representative, it will be necessary to take an inventory of all assets owned by the decedent at the time of his or her death. These items have to be recorded on the state approved form 350 PC (located here).

Before attempting the paperwork, it’s essentially that the Personal Representative follow some general guidelines. South Carolina Code Section 62-3-709 explains that “every personal representative has a right to, and shall take possession or control of, the decedent’s property, except that any real property or tangible personal property may be left with or surrendered to the person presumptively entitled thereto unless or until, in the judgment of the personal representative, possession of the property by him will be necessary for purposes of administration.” In essence, this means it is the responsibility for the Personal Representative to collect the assets UNLESS they are in the possession of the person who will ultimately receive them.

As you might imagine, this duty causes a great deal of friction between Personal Representatives and heirs. Imagine that your husband passes away and that your step-son (his son) is the Personal Representative. You could potentially return home to find ½ of your home furnishings gone because the Personal Representative “took possession” of them to administer the estate. Again, Personal Representatives should walk a fine line between performing their duty and using their powers unwisely. Meanwhile, heirs who are in possession of property belonging to a decedent must cooperate in ensuring that the Personal Representative is aware of the properties location.

Once the Personal Representative has a general grasp on the decedent’s assets, he must list them according to the type of asset and include information about any joint owners. Before attempting the paperwork, a good Personal Representative can prevent a migraine by making a list and collecting the information as follows:

REAL PROPERTY – You will need a copy of the deed to determine who the exact owners are and whether or not the property is held jointly, or jointly with a right of survivorship. You will also need a value for the inventory. This can be the tax assessed value or the fair market value as determined by an appraisal or cost market analysis (available from a real estate agent). Please note that in an effort to reduce estate costs and fees, Personal Representatives will often make the huge mistake of undervaluing the property which can have negative tax consequences on those receiving the property from the estate. Tread carefully in this area, the courts can not and will not give you advice on the value for this reason. If you are unsure how to value, discuss this issue with your attorney or CPA before filing the value with the court.

PERSONAL PROPERTY – The courts don’t expect you to list every piece of stuff owned by the decedent; however, if an heir begins to contest your management of the estate, a more detailed list may be required. Initially, it’s safe to group items in to large categories and give them a resale value (i.e. – what could you get for them if you had to sell them at a garage sale). Common categories include household furnishings, clothing, electronics, collectibles, etc. Sentimental values do not go on an inventory. For example, while your mother’s china may be the prized possession every heir is after, it should only be valued by it’s actual resale value. EBay or other online resources are very helpful in this regard. Kelly Blue Book or Edmunds are great for placing a value on cars (which also fall in this category).

BANK ACCOUNTS – In South Carolina, there are essentially three ways to title a personal bank account. Sole ownership (decedent was the only person with his/her name on this account), joint ownership (account was held by two or more people), and joint ownership with rights of survivorship (more than one person was on account and ownership shifts automatically to other owners upon death). It is essential that you contact each bank where the decedent held an account and determine the form of ownership. The type of ownership determines not only where it goes on the inventory form, but also who has the right to the funds.

IRA’S – The court will need to know if the decedent had any IRA accounts. If so, you are only required to give detailed information on the account if the estate was named as the beneficiary. Otherwise, most courts just want to know that the account existed and that it named a specific beneficiary to receive the proceeds.

DEBTS – The court will need to know any debts held by the decedent. This does not include consumer debts or debts incurred after death (such as funeral expenses). The debt reported to the court is essentially the debt related to other assets. For example, if a car appears in the personal property, this is where the car loan will appear. If a home appears in the real property, this is where the mortgage would go.

List in hand, it’s time to tackle the official inventory form which must be submitted to the court within ninety (90) days. Having your items sorted as stated above will go a long way in getting you prepared for the inventory form. Another tip – the first page should actually be done last so start with page 2.

And, if for some reason, you just can’t get it done in time, you can use the form 352 (located here) to file for an extension. Good luck!

Personal Representative’s Duties: Duty to Inform

Tiffany Provence — Fri, 12 Mar 2010 02:32:13 +0000

Even if there was a contest about who was to serve as Personal Representative, once a party has been appointed by the court they have certain rights and duties that they owe all of the interested parties (even those who did not agree with their appointment). Not understanding, or simply choosing to ignore these duties, often gets Personal Representatives in trouble with the law. This post, and many that will follow, will outline the duties of being a P.R. and how to handle them properly.

Immediately upon appointment, the P.R. agrees to accept certain duties. These duties can be found in Article 3, Part 7 of the S.C. Probate Code for those interested in reading them in depth. The first specific duty you will find is 62-3-705 – the duty to inform heirs and devisees of your appointment.

DUTY TO INFORM – Within 30 days of your appointment, you should have notified all heirs (those who receive if there is not a will) and devisees (those who are named in the will) of your appointment. South Carolina courts provide you with Form 305PC for this purpose which can be downloaded here. Promptly complete the form, send it to everyone who is an heir or devisee. Then, complete the proof of delivery form to notify the court you have complied with this requirement. This seems easy enough, but this simple task is often handled improperly or ignored, which simply sets the stage for future disputes. Be aware of the following mistakes:

1) “I don’t have to inform them, they aren’t in the will.” – The first fatal mistake made by P.R.’s is assuming they only have to send this form to people who will actually be receiving from the estate. This is not true. The purpose of this form is to put everyone on notice, even those who have been disinherited, that the estate has been opened. The opening of the estate triggers numerous deadlines for interested parties to bring an actions including will contests, elective share claims and others. Because of this, everyone who has an interest in this person’s estate is to be notified. In cases where there is no will (intestacy), you will only have one group to notify – all intestate heirs. If; however, there is a will you may have two separate groups. The first group are those listed in the will (whether they are family or not) and the second group are those that would have received it the will was not in place (intestate heirs). Failing to notify someone can cause great delays in the estate. Furthermore, completing the form to say that you have notified someone when in fact you have not is considered perjury.

2) “I am close with my family and they already know I am in charge.” – Despite the fact that everyone may already know of your appointment, you still must follow the court process for giving them “official” notice. People often assume that they don’t need to do this because they have already verbally communicated with everyone to let them know. Keep in mind that this form contains information essential for others to contact the court, including the case number and actual date of your appointment. It’s unlikely that these details are mentioned in casual conversation and even if they are, it’s just easier to follow the rules then to make assumptions that will later get you in trouble.

3) “I’m not sure where this person lives.” – The Probate Courts hear this excuse all the time and unfortunately for the new P.R., they are uninterested in hearing it again. If you have taken on the duty to serve as P.R., it will be essential for you to establish communications with the parties interested in this estate. Very frequently, people who offer this excuse know exactly where the person is, they just hope that this will somehow eliminate the need for keeping them involved. It does not. So, before telling the court that you can’t find an heir or devisee, you must ensure that you have used every available resource to locate them. This includes letters to other interested parties to determine their location, an exhaustive internet search, certified mail sent to their last know address, a public records search, etc. In the end, it is very very rare that an heir actually can not be located. And, if you truly can’t find them you will need an attorney to assist you on their behalf. So, know before you go to court with this excuse that it’s unlikely to work and if it’s in fact true, the court will expect the resources of the estate to be used to resolve the problem.

4) “I didn’t think I had to let them know because they are minors.” – Even children are entitled to be informed. When dealing with heirs or devisees who are minors, it is appropriate to address information to them through their legal guardians. The same is true of adults who may be incapacitated.

5) “I sent it in the mail but they must not have gotten it.” – As much as we love to complain about the U.S. postal service, in reality it is rare that they loose mail. And, it’s not a coincidence that the one piece of mail that gets lost is always the one to the heir or devisee that no one likes. Don’t use this excuse, be a smart P.R. and use certified mail for any heir or devisee who you know is likely to claim that you aren’t doing your job. While the S.C. Code allows for delivery by ordinary mail, most lawyers will always use certified mail in cases where we know we may be asked to prove delivery.

The bottom line is that you can not hide out from the duties you have undertaken, so quickly establishing a line of communication with the heirs and devisees is essential. Having a database or spreadsheet with their current addresses, emails, and phone numbers will make this process easier in the long run. And, if there is someone in this group that you don’t get along with, understand that this means you should communicate with that person more, not less, to ensure you stay out of trouble.

Pick Me, Pick Me! Who gets to be the Personal Representative of the estate? (Part I)

Tiffany Provence — Sat, 12 Dec 2009 19:06:23 +0000

For an estate to be opened, there must be someone named as the Personal Representative (formerly called an Executor or Administrator). This person is responsible to the court, creditors of the estate and the heirs to ensure that the estate is properly managed and distributed.

Luckily, there are many estates where the court does not have to get involved in choosing the appropriate person. For example, when you write your will, it should always state whom you wish to serve as the Personal Representative. It’s also wise to name an alternate in case your first choice is not available.

However, when you die without a will (this is called “intestacy”), the court will have to determine who should be in charge. South Carolina Code Section 62-3-203 determines who has the priority to serve, but the Judge may use his/her discretion to determine if someone with priority is not suitable (or disqualified) for the appointment. Some examples will help explain who gets to serve but remember again that these only apply if you don’t name someone in your will.

The Spouse – Your spouse will be the top pick to serve as Personal Representative (P.R.) if you are lawfully married at the time of your death. This can seem clear but a lot of confusion can arise when couples are separated, estranged, or allegedly common law married. S. C. Probate Code Section 62-2-802 outlines what actions will terminate a spouse’s rights to serve. A spouse serving can also cause problems when the children involved are from a previous marriage. Despite the possibility for future conflicts, the spouse is entitled to serve and will be appointed by the court unless it can be shown that he/she is unfit to serve. A person may be unfit to serve if they are incarcerated, have serious financial problems (check fraud, bankruptcy, history of financial wrongdoings), or are incapacitated. Even if the spouse can’t serve, they are entitled to nominate someone to serve on their behalf.

The Children – If there is no spouse, or the spouse is unable to serve (or chooses not to and doesn’t name a nominee to serve in their place) then the children are the next in line. If there is only one child, the court will appoint that child. The debate usually begins when there are multiple children. Since all children have equal priority to be the P.R., the court will choose unless all of the children can agree. When left to the court, the Judge will consider many factors including the opinions and nominations of the heirs, financial stability, criminal history, proximity to the court and many others.

While these two rules will address the majority of cases, there are more complicated issues that arise with minor children, divorced spouses, and those with no children or spouse that will be discussed in Pick Me, Pick Me Part II.

What exactly is probate?

Tiffany Provence — Mon, 07 Dec 2009 17:31:36 +0000

Technically, the word Probate means “to obtain the official approval of, as of an instrument purporting to be the last will and testament.” (Thanks Webster!) However, in the common sense, probate describes the process by which the Probate Court oversees the transfer of assets from someone who has passed away (the “decedent”) to those entitled to receive them. The word probate has become tainted by all the “avoid probate” propaganda used when financial planners or others are trying to sell trusts. In reality, what you are really trying to avoid is taxes and creditors, not “probate,” so don’t fear the court. In fact, as Probate Court Judges are the only elected members of the judiciary in the state, they generally strive to be as helpful as possible.

A review of assets belonging to the decedent at their time of death is required in order to know whether or not you will need to go through probate. For example, if the decedent owned any real property (real estate) or titled assets (cars, vehicles, boats, mobile homes) in their name alone, you will definitely be required to go through the probate process. Additionally, if the decedent held bank accounts, investment accounts, CD’s or other assets in their names alone, probate is the only way to get access to this property. Even if the decedent didn’t own any assets, probate may still be required as only a Personal Representative appointed by the Probate Court may act on behalf of the decedent to bring a lawsuit. So, now that you realize your probably can’t “avoid probate”, what do you need to know?

A decedent’s estate must be probate in the county where they are domiciled. In most cases, this is their place of residence. However, it is possible to have more than one residence but you can only have one domicile. If your loved one lived in multiple places, a probate attorney or the court may be able to assist you in determining which court is appropriate. Each county in South Carolina has a Probate Court which is almost always located in the county courthouse. Once you have determined which court you must file in, it is wise to contact that court for specific office hours and to determine if you must have an appointment to open an estate. In some cases, if you are particularly internet savy or have an attorney assisting you, you may not have to appear in the court at all.

To open the estate in South Carolina, you must have proof of death. This is generally accomplished with a death certificate but in unusual circumstances proof from another government agency can be provided. If the decedent had a will, you will also need to deliver the original to the court (where it will remain). The minimum fee to open the estate is $25, made payable directly to the probate court. Additional court costs will be due once the court determines the extent of the decedent’s assets.

Last, but not least, the person who appears at the court should be the person who intends to serve as the Personal Representative (a general term in South Carolina which includes Executors and Administrators). The will should name the Personal Representative. If there is not a will, S.C. Code determines who has priority to handle the decedent’s affairs. In general, priority when no will exists is as follows:

Spouse of the decedent
If there is no spouse, children of the decedent (minor children present unique issues)
If no spouse or children, other heirs of the decedent
After 45 days, a creditor of the estate may ask to be appointed

People often wonder how quickly they should go to the court to begin the process and there isn’t a perfect answer to that question. The law requires that any person holding the original will of another who has passed away should present it to the court within 30 days; therefore, waiting beyond that period isn’t recommended. Meanwhile, heading to the court before you have the death certificate is premature. In some cases, the only assets available to bury the decedent may be held solely in the decedent’s name which means moving quickly is required. In general, how quickly you go is likely determined by the unique circumstances in your case.