BROTHERS FIGHTING OVER DAD’S MONEY: a recent Palm Beach estate litigation case deals with estate creditor’s claims
Spend Your Legal Dollars Wisely in Estate Disputes
Family feuds are common in Palm Beach County, particularly when a Florida resident passes away.
Brother suing sister, step mom versus stepdaughter, heirs versus the trustee, are, for good or for ill, commonplace in the world of the Palm Beach estate litigation and trust litigation throughout Florida.
While the Palm Beach probate process is set up to have an the estate run smoothly, sometimes there are disagreements between family members, beneficiaries, heirs, and the administrator of the Palm Beach estate. If you and your estate lawyers don’t monitor the probate process carefully, legal matters can get out of hand, driving up legal fees and costs in what may be an unnecessary way. The last thing you want to do, when you’re involved in a Palm Beach estate dispute, is to spend $1000 on an estate lawyer, fighting over something that’s worth only $100.
Have a litigation strategy for the probate process and the estate administration process. Don’t let attorneys fees or costs, or your emotions, or your feelings for your sibling, step mom, trustee or executor, spiral out of control.
Filing A Claim in Dad’s Estate- recent Palm Beach estate case (Dad owed me money !)
A very recent case from Palm Beach County, Florida involves the legal opinion of the appeals court, sitting in West Palm Beach, Florida, and the Palm Beach probate court — in the main courthouse, downtown West Palm Beach, Florida.
This Florida appeals court opinion, from the Fourth District Court of Appeal, reversed the probate court judge regarding an estate “claim.” Here’s what happened, and why this case is important for family members, or anyone who may be a “creditor” of a Florida estate.
If Dad Owed You Money, You Are a Creditor
Two brothers were fighting over dad’s money. Dad was a Florida resident who just passed away. A probate administration was “opened up” by the filing of probate papers in the main courthouse. One of the two brothers was appointed the Palm Beach executor, or, what we refer to as the “personal representative” of the Palm Beach estate.
One of the deceased Florida resident’s sons filed a “claim” with the Palm Beach estate. So, this son became a creditor of the Palm Beach estate.
Son as Estate Creditor?
Here’s a little bit of background for a family member filing a claim in the estate proceeding.
If, during the lifetime of a Florida resident, that Florida resident owed you money, then you are a “creditor” when that Florida resident passes away. The term “creditor” may seem a bit odd for a family member, but Florida estate law does not distinguish between a non-family member who is owed money, and a son, wife, husband, or grandchild who is owed money.
Because the Florida resident who owed you money is now dead, you have to collect your money from the Florida estate. That means that a Florida estate needs to be opened up. If a Florida estate is not opened up, and the probate process is not begun, you might never get paid.
Don’t sit on your creditor rights and expect to be paid years after a Florida resident dies. In fact, under Florida estate law, if you don’t make a claim within two years after the death of a Florida resident, you’re out of luck. Debts and legal obligation of a deceased Florida resident, called a “decedent”, and the rights of creditors to a decedent’s estate, are a subspecialty of Florida estate law, and the Florida probate process — often referred to as creditors rights.
Estate Creditors Have Rights
Yes, creditors have rights in Florida estates. In fact, valid creditors are paid before you see a dime of inheritance money. And let’s address a topic head on: a Florida estate cannot improperly refuse to pay a valid estate creditor. I know that some heirs and family members of a Florida estate may not want to pay dad’s debts or expenses, because that cuts into your inheritance — but you have to. This doesn’t mean that you can’t use the Florida probate process to enforce your inheritance rights. But the Palm Beach personal representative needs to pay dad’s final federal income taxes, his credit card bills, and any money he borrowed during the probate process– as long as the valid claims are properly filed within the proper time frames.
Technical Rules for Creditors Claims Against a Florida Estate
In this recent Palm Beach probate case, the personal representative filed two claims of his own for money advanced during his father’s lifetime. Evidently, dad borrowed about $65,000 from this son.
The other brother objected to the $65,000 claim. The filing of the claim, and the objection to the claim set in motion a number of technical rules and procedures for estate creditors under Florida probate law. This area of the law has a number of technical requirements, as well as very short time frames. If you miss your filing deadline, you can be out of luck unless there was some type of fraud, reliance, misrepresentation, or estoppel. Understanding the technical rules for making a claim to a Florida estate is an important role for a Florida probate lawyer.
More Estate Lawsuits
An “interested” person in a Palm Beach estate may object to a claim. In other words, the personal representative of a Florida estate is not the only person who can object to a claim or fight a creditor. Once an objection to a creditors claim is made in a Palm Beach estate, the creditor must file a new lawsuit, called an “independent action”, within 30 days. More legal action? Yes.
In this case, the brother making the claim did not file a separate lawsuit in the “civil division” of the Palm Beach County courts. He filed a “petition” in the probate action. The other son wanted the probate judge to dismiss or strike the petition, arguing that the petition was not the required separate lawsuit in the civil division. He was right and he won. The trial court dismissed the claims and also denied an extension of time to file a separate lawsuit, the independent action required by the rules.
5 Tips for an Estate Creditor
What can you learn from this estate creditor case in Palm Beach County, Florida? Here are five tips for somebody who is owed money from the Florida estate.
- if you are a creditor, file your claim immediately— don’t wait ! And don’t ignore probate documents that come to you or your estate lawyer. Those are meant to shorten the timeframe within which you may enforce your rights as an estate creditor.
- if a Florida estate is not already open, open the Florida estate yourself and start the probate process — and ask the probate court to put you in charge.
- know your filing guidelines, time frames, and statutes of limitations. The deadline for a creditor to file, or to preserve his or her rights in a Florida estate, can literally be days or a few months.
- if you are outside of a filing deadline, be cautious! You may have to file a motion to file a late claim, rather than simply filing a “statement of claim.”
- have your separate lawsuit, or “independent action”, ready to go. If your claim is objected to, you must file a lawsuit in the civil division within 30 days.
For Attorneys and Litigators
If you would like a copy of this opinion, or information about creditors rights in a Florida estate, or the Palm Beach probate process, please email Michelle@pankauskilawfirm.com.