When many people think about wills, probate, or the administration of someone's estate, they typically think about what property has been left and the beneficiaries to whom it has been bequeathed. However, as this blog has touched on before, in the context of a discussion about the role of a personal representative, there are a few other steps that go in finalizing a Florida estate's administration. One of these steps is dealing with any creditors who may be owed money from the estate.
According to the Florida Bar, the association responsible for regulating the legal profession in the state, one reason for the probate process is to organize the payment of an estate's creditors. This responsibility, as previously noted, falls on the personal representative, who may have hired an attorney to help with the process.
The personal representative's duty is first to make certain that any creditors who are known or can be reasonably determined receive actual notice of the estate's existence and that it is in probate. Those creditors can then file a claim within three months with the clerk of court. Then, any beneficiaries or other parties who have an interest in that estate may object to a creditor's claim. If this occurs, the creditor will need to file a separate lawsuit to press the validity of its claim. The important thing to remember is that the estate will generally not be closed, and therefore paid out to the beneficiaries, until all creditors' claims have been paid or disposed of in some other fashion.
As we have discussed in the past, probate can sometimes be a lengthy and complicated process. There may be ways to minimize these problems, or avoid probate altogether, with a comprehensive estate plan. Further, sometimes there are possible steps that can be taken to shield an estate's assets from creditors. Anyone who has questions about these strategies or other estate administration issues may want to consider contacting an experienced Florida estate planning attorney.