When someone passes away, their affairs must be settled. This involves paying their outstanding debts and transferring their assets to others. In New York, the Surrogate’s Court serves as the probate court and has jurisdiction over matters related to the estates of decedents. SCPA § 201. There is a Surrogate’s Court in each of the 62 counties in New York.
If the decedent left a will, the process starts with the will being submitted to the Surrogate’s Court and validated. Next, the estate is administered and assets distributed according to the terms of the will. Whether the decedent had a will or not, the ultimate goals are to pay debt and distribute assets.
New York Probate and Estate Administration Process
The process of settling the estate of a decedent involves a number of tasks performed by the personal representative under the supervision of the Surrogate’s Court:
- File petition, death certificate, and will. To initiate probate and the estate administration process, a petition, the death certificate, and the original will, if any, must be filed with the Surrogate’s Court in the county in which the decedent lived at the time of their death. If there is a will, a Petition for Probate must be filed, while if there is not a will, a Petition for Letters of Administration must be filed. A fee is required that is based on the value of the estate.
- Appointment of personal representative. Part of initiating a probate or administration proceeding is petitioning for the appointment of the personal representative. The personal representative is a fiduciary who is responsible for the day-to-day tasks of managing the affairs of the estate. EPTL § 1-2.13. Executors and administrators are types of personal representatives. The term “executor” is used when the person is named in the decedent’s will. The term “administrator” is used if there is no will or if someone other than the person named in the will is appointed. In all instances, before the personal representative has the legal authority to act on behalf of the estate, the Surrogate’s Court must formally appoint the personal representative and issue the person “letters testamentary” or “letters of administration.”
- Inventory of assets. Because both the Surrogate’s Court and the personal representative must understand what the decedent’s estate consists of, the personal representative is required to file an inventory of assets with the Surrogate’s Court within 9 months of appointment. Uniform Rules § 207.20
- Payment of debts. The personal representative is required to notify the decedent’s creditors. The notification must include the timeframe for filing claims and the manner of filing claims. The personal representative can either pay the claims or reject them. If a claim is rejected, the claimant can petition the Surrogate’s Court to make a determination on the validity of the claim. The personal representative is required to pay all valid claims that are filed within the claims period to the extent there are assets in the estate to pay them. If the personal representative fails to do so and instead distributes the assets, the personal representative may be personally liable for paying any timely filed claims that were not paid. If there are not sufficient assets, then debts and expenses are paid in the following order of priority (SCPA § 1811):
- Decedent’s reasonable funeral and burial expenses
- Administration expenses and attorneys’ fees
- Estate and personal taxes owed by the decedent
- Medical bills relating to the decedent’s death or any illnesses that was the cause of death
- Secured debts such as mortgages or car loans
- Unsecured debts such as credit card bills
- Asset distribution. Note that because payment of debts takes priority over distribution to beneficiaries or heirs, all claims should be addressed before asset distribution. If the decedent had a will, then the terms of the will control how the personal representative distributes estate assets. If there is no will, then New York law of intestate succession controls how assets will be distributed.
- Closing of the estate. After assets have been distributed, the personal representative can petition the Surrogate’s Court to be discharged. In New York the probate and administration process generally takes at least 7 months. Complications such as probate disputes will lengthen the process.