I wrote last week about the general requirements for serving as a personal representative in Florida.

Just to recap:

• In cases where the decedent leaves a Last Will and Testament, the law’s first preference for the estate’s personal representative is the person nominated in the Will.
• If the decedent dies intestate, the surviving spouse is the first choice, followed by the person selected by the heirs, then the decedent’s nearest relatives.

Today I want to take a look at what happens when the wrong personal representative is named in the Will or has otherwise been appointed by the probate court.

Appointment of a Different Personal Representative

There are many situations in which an honest family member may disagree with the decedent’s choice of personal representative.  While the Florida Probate Code ordinarily defers to that first choice, the probate court has the power to override the decedent’s apparent wish, even before the personal representative breaches his duty to the estate.

Even in cases where it is obvious one person is legally entitled to be the personal representative (for example, where a man dies intestate and his spouse survives him), the court may appoint a substitute personal representative, called a “curator.”

Curators can be appointed even before any wrongdoing occurs, and are allowed to take any action that a personal representative could take, and are entitled to reasonable compensation for their services based on the Probate Code’s schedule of personal representative fees.

Often more than one person is legally qualified to act as a personal representative. In such cases, the probate court may select the one it considers “best qualified.”

Removal of a Personal Representative

A personal representative owes a high duty to the estate he or she is charged with administering. If for any reason the personal representative abuses his or her authority, or becomes incapable of performing, the court can remove him or her and appoint a successor.

The Florida Probate Code lists 12 causes for removal. They are:

1. Adjudication that the personal representative is incapacitated.
2. Physical or mental incapacity rendering the personal representative incapable of performing his or her duties.
3. Failure to comply with any order of the court, unless the order has been superseded on appeal.
4. Failure to account for the sale of property or to produce and exhibit the assets of the estate when so required.
5. Wasting or maladministration of the estate.
6. Failure to give bond or security for any purpose.
7. Conviction of a felony.
8. Insolvency of, or the appointment of a receiver or liquidator, any corporate personal representative.
9. Except for surviving spouses, holding or acquiring conflicting or adverse interests against the estate that will or may interfere with the administration of the estate as a whole.
10. Revocation of the probate of the decedent’s will that authorized or designated the appointment of the personal representative.
11. Removal of domicile from Florida (unless the domicile requirement does not apply).
12. The personal representative would not now be entitled to appointment.

Any “interested person” can petition the court for removal. This is quite a low bar, and means that anyone who stands to lose something due to the personal representative’s actions (usually a person who anticipates receiving assets of the estate) can file a petition. Alternatively, the court can initiate removal proceedings on its own.

Once removed, the removed personal representative must file a final accounting of his or her administration and surrender any assets of the estate in his or her possession to the new personal representative appointed by the court.

Any legally competent person who was a resident of Florida at the time of the decedent’s death is qualified to act as the estate’s personal representative in a Florida probate proceeding. This residency requirement is waived for family members and most in-laws.

In addition to the residency requirement, a prospective personal representative may not have a felony conviction, must be at least 18 years old, and must be mentally and physically able to perform the duties required of him or her.

Ideally, the decedent will have left a Last Will and Testament specifying his or her own preference as to a personal representative. If so, Florida law gives a preference to the person designated in the Will as personal representative.

When there is no Will, the Florida Probate Code lays out an order of preference for determining who will act as the personal representative of an estate. The preferred personal representative is the surviving spouse. The second choice is a person selected by a majority in interest of the heirs, and the third choice is the heir nearest in degree to the decedent.

If more than one of these preferences apply, the Florida Probate Code gives the probate court the ability to choose the personal representative. This could happen, for example, if there is no surviving spouse, and the person selected by a majority of the heirs is different from the heir nearest in degree.

If no one applies to be the personal representative of an estate, the probate court “shall appoint a capable person.”  The person can be anyone of the court’s choosing, except people employed by the court.

After a personal representative is selected and the estate is opened, Letters of Administration are issued to the personal representative.  These Letters can be revoked, and new Letters granted, if a “preferred” personal representative steps forward that has not already been served with formal notice.

Letters can also be revoked, and new Letters granted, if a Will is later found that names a personal representative and that Will is admitted to probate.

We are sometimes asked about whether Florida probate is required to access the contents of a safety deposit box in Florida.

If there are no known probate assets, knowing what’s in the safety deposit box can often determine whether Florida probate is required.  And if the Last Will and Testament could be in the safety deposit box, the contents of the box can affect the entire Florida probate process.

The Florida Probate Code allows access to the contents of a decedent’s safety deposit box if certain requirements are met.  Specifically, two people must be present when the box is opened. The first is an employee of the institution where the box is located (usually a bank).

The second person can either be the estate’s personal representative or his or her attorney. The personal representative is entitled to take possession of the contents of the box.

Banks will usually require a death certificate before granting access to the safe deposit box.

Once the box has been opened, these two parties are then required to make and sign an inventory.

The personal representative is responsible for filing with the probate court this inventory, along with a copy of the box entry record.

Note that the Florida laws pertaining to financial institutions also allow the decedent’s spouse, parents, and adult descendants to open and examine (but not to keep) the contents of safe-deposit boxes.

Even if all procedures are complied with, a bank may require a court order in some circumstances before allowing access to the safety deposit box. Feel free to contact us about any specific questions.

Wills are sometimes unclear.  Whether due to sloppy work by an attorney or a do-it-yourself approach, there is sometimes a need for a court to step in to help clarify what a Florida Last Will and Testament actually means.

But what if there is no ambiguity to the will?  Can the court still step in to change the terms of a person’s Last Will and Testament if there is no question about what those terms mean?

Historically, the answer has been “no.”  Florida probate law restricted the courts’ ability to make changes to the unambiguous terms of a will.   If a person could read the will and understand what it says, the court could not change the terms of the will even if there was clear evidence that that, in spite of what the will said, the testator intended something else.

For example, suppose that a mother sits down with her son, telling him that she is near death and is unsure how to dispose of her rare automobile when she dies. The son tells his mother that his sister did not want the car, which is not true, and the mother executes a will leaving the car to her son.

Under prior law, the court would not have been able to change the will even though the mother was operating under a mistaken assumption.  The sister may would have a case against the son for fraud, but since the will was clear the court could not change it.

But Florida probate law was recently amended to address this scenario.  Under the new law, anyone can ask a court to change the terms of a will. The court may (but is not required to) change the will if it is shown by “clear and convincing evidence” that a mistake of fact or law caused the will to reflect something other than the testator’s true intent.

This may sound confusing, but just remember that the underlying purpose to probate law is to give effect the true intentions of the decedent, who obviously cannot be asked what he or she meant.

The new law simply recognizes that even a clearly-drafted will can be based on a mistake or fraud and gives the court flexibility to consider these issues.

As with any change in the law, there are tradeoffs.  On the positive side, the new law does get at the underlying intent of the testator, which is clearly the correct standard to apply.

But one could argue that the old law has compelling justifications as well.  Specifically, it prevented a “he said, she said” situation where the court had to look to testimony outside of what the terms of the will.  The legislature simply assumed that if someone went through the trouble of meeting Florida requirements for a valid will, the will would reflect the person’s intent, without any need to consider external evidence.

The new law may reflect the legislature’s recognition that the Florida probate judges are intelligent enough to pinpoint attempted fraud in the probate process.  By giving these judges the right to consider external evidence even when the will is clear, the law now allows testimony that will help the courts understand the testator’s true intent.

Insolvent estates can be tricky.  In most cases, you shouldn’t open an insolvent estate.  At the end of the day, all of the assets will end up with the creditors.  The attorney will get paid and the personal representative may be entitled to a reasonable fee, but the decedent’s heirs or beneficiaries will not receive the assets.

But what happens if you do not know that the estate is insolvent?  It is not uncommon to open an estate expecting only blue skies ahead, only to find that unexpected creditor claims exceed the value of the estate.

The answer depends in large part on the laws of your state.  Many states don’t have an “early out” process that would allow you to prematurely terminate the estate proceeding. This is especially true in states that don’t provide an option for independent administration (administration without court supervision).  The courts treat the personal representative as an officer of the court, with full duties to see the estate through to the end.

In most situations, the best bet is to immediately take whatever steps are necessary to close the estate.  For example, under Illinois law, you would need to take the following steps to close the estate:

1. Put together a list of the estate assets and their value.
2. Put together a list of the creditors of the estate and the amount of the debts. (Note: Some creditors have priority over others, so be sure to categorize them by priority.)
3. Prepare the final report required to close the estate. The final report should include a plan for payment of the estate debts and a representation that “all administration expenses and other liabilities of the estate have been paid and that administration has been completed, or to the extent not completed has been provided for as specified in the report.”
4. File the final report with the court, then set a hearing for closing the estate.  Be sure to leave at least 42 days between the date of that the final report is filed and the date of the hearing.
5. Notify creditors and interested parties. A copy of the final report should be mailed to each creditor and each heir or legatee that was named in the original petition.  You should mail the notice within 14 days of filing the final report. This is necessary to give all interested parties an opportunity to object to the final report.
6. Attend the hearing.  If all goes well, no one will object and the judge will close the estate. Otherwise you will need to sort it out before the estate can be closed.

The order closing the estate will authorize you to take whatever steps necessary to zero out the account.  Creditors are paid in order of priority (with your attorneys’ fees and other administrative expenses coming off the top).  Creditors of lower priority receive pennies on the dollar for their claims.

Some states allow you to pay creditor claims before the judge issues an order closing the estate and approving the creditor payments.  The rationale is that, once the judge closes the estate, the personal representative doesn’t really have the power to act on behalf of the state (including paying the creditors).  On the other hand, paying the creditors without prior court approval could open the personal representative up to liability if it turns out that the claims were improper.

In this situation, it is usually best to obtain an order that approves the payment of the expenses and conditions the final closing of the estate upon the personal representative’s completion of the acts anticipated by the order. In other words, the order might provide that the estate will be closed (and the personal representative discharged) only after all acts required by the order have been taken.  Once all appropriate steps have been taken, the personal representative may file a statement of compliance or similar document just to finalize things with the court.