A personal representative’s job is to carry out the wishes of the deceased according to the instructions in his or her will and according to California law. If a person dies without a will, then the personal representative appointed by the court to handle the estate is called an “administrator,” while someone named by the will is called an “executor.” If you’re deciding whether to accept appointment as a personal representative – or thinking about who to nominate in your own will – then you need to know what a personal representative’s duties are during probate and how to fulfill these obligations without putting your personal assets in jeopardy.
Recently, much has been made about the many deals struck by the executors of Michael Jackson’s estate. The Los Angeles Times reports on agreements for a movie, television special, tribute concert, merchandising, a high end clothing line, “digital apparel,” and a traveling memorabilia exhibition. Just as they should have, the executors (who are also the trustees of Jackson’s trust), worked fast to secure these deals while demand soared high for anything related to the King of Pop. This is because personal representatives (and trustees) have the duty to invest and manage assets. For example, when there’s a large amount of cash left behind, the executor may need to invest the money as permitted by the will and California law to prevent losing income that can be earned for the estate. Otherwise, the executor could be liable for the loss.
Besides investing money, personal representatives also need to make the most out of the assets already in the estate, sometimes this requires selling property or renting out empty real estate. Executors and administrators also need to find and collect all of the deceased’s assets, such as personal items, life insurance, partnership interests, and bank accounts. Known creditors must be given notice and legitimate debts need to be paid off, so you have to make sure the estate will have enough money to pay for bills, costs, and expenses. Federal and California taxes must be paid, and as the personal representative, you’re potentially liable for the value of distributed assets if there’s a deficiency. Don’t assume that only fraudulent transactions and lying will get a personal representative into trouble, because at times mistakes can also lead to personal liability.
The bottom line is that you are a fiduciary, and everything a personal representative does needs to be in the best interest of the estate, which also means you have to be careful not to favor individual beneficiaries. As assets are managed and distributed, we’ll consult with you about investments, handle title transfers, prepare and file required documents, work to resolve disputes, advise you on potential legal issues, and appear on your behalf in court. Make sure you’re handling your responsibilities properly, speak with San Diego Law Firm’s knowledgeable probate attorneys at (619) 794-0243.
