Thursday, March 12, 2009

What Is Probate?

Although many of our clients are sophisticated, we are providing explanations of the terms that are commonly used in an estate and trust practice.

What is Probate? Probate is a legal proceeding that is used to wind up a person's legal and financial affairs after death. In California, probate proceedings are conducted in the Superior Court for the county in which the decedent lived, and can take at least six months and sometimes as long as several years.

After a person dies, ownership (the legal title) of his or her property, assets and personal effects must be passed on (legally transferred) to the beneficiaries (heirs). "Probate" is the legal name given to this process.

The term "probate" is also used in the larger sense of "probating the estate." In this sense, probate means the process by which the decedent's property and assets are gathered and accounted; debts, creditors and estate taxes are paid, and how the remaining property, assets and cash are distributed to the beneficiaries.

Probate is a very time consuming and paperwork intensive process. Most people hire a probate attorney to help them with the probate administration process. Some probate estates can be administered in one year or less, but many take longer.

One of the disadvantages of probate is that the cost is usually much higher than would be required for the administration of a trust for an estate valued at the same amount. Another disadvantage is that it usually takes longer to probate an estate than to administer a trust. Most estates don't need the supervision of the court unless disputes occur.

Probate is concerned with:

• Cataloging all property of the deceased

• Paying any debts, claims or taxes that are due

• Collecting rights to any income (royalties, stock dividends, etc.) to which the deceased was entitled

• Settling financial and property disputes • Liquidating property (real or personal) of the deceased

• Distributing or transferring the remaining property to heirs

A personal representative is appointed by the Court to administer the decedent's estate. A personal representative can have various names (Executor, Administrator, etc.), depending on the type of probate estate, but each personal representative has similar duties and responsibilities, which include managing the probate estate.

Usually, in a will, the decedent names an "Executor" to act as personal representative. If there is no will or decedent failed to name an Executor, the court will appoint a personal representative called an Administrator. The Executor or Administrator will fulfill many of the same duties listed above.

For regular probate, attorney fees are set by statute (California Probate Code Section 10810) and payable at the conclusion of probate. The California Probate Code sets the maximum statutory fees that attorneys can charge for a probate. Higher fees can be ordered by a court for more complicated cases. We typically ask clients to pay a small costs retainer for the filing fee and related costs to open a probate matter. In more complicated matters, there may be a retainer for legal fees depending on the issues involved.

The descriptions above are merely simple explanations of the probate process. Each case is different and some probates require sophisticated legal expertise. Our firm is very experienced in probate matters. We have three attorneys who routinely handle probate as a regular part of our practice. Should you wish to schedule a consultation involving a probate matter to be opened, already on-going or engage in a probate litigation matter, you may contact our offices or one of the attorneys directly.

If you do not have a living trust for your assets, think about getting a trust in place to minimize the time, costs and emotional burden of probating your estate. In California, a living trust is easier to administer and almost always saves the estate untold attorneys' fees and costs.

Any questions or comments should be directed to: hm@moravecslaw.com or (626) 793-3210 for a complimentary telephone consultation. Henry (Hank) Moravec is a partner at Moravecs, A Professional Law Corporation. He focuses his practice on Estate Planning, Trust and Probate Administration, Beneficiary and Trustee Representation, Tax Law, and Nonprofit Law.

With respect to probate, Hank Moravec has over 20 years' experience as one of the best Los Angeles probate attorneys and Los Angeles probate litigation attorneys with an excellent tax law background and is available should you need legal advice regarding your own or a family member's situation.

The firm website is http://www.moravecslaw.com/. The firm is located at 2233 Huntington Drive, Suite 17, San Marino, California 91108. There is ample free parking adjacent to the firm's office.

The office is located in San Marino, California, a suburb of Los Angeles in the San Gabriel area located 20 minutes from downtown Los Angeles. The firm represents clients throughout California and its attorneys appears in probate court throughout Southern California.