Protecting Heirs From Improper Estate Administration
As a result, heirs must often ensure that an estate is administered properly and that a decedent’s wishes are honored while the estate’s financial affairs are resolved. Beneficiaries can remove from office administrators who fail to meet their duties. Estate beneficiaries can also hold administrators liable for financial losses incurred as a result of mismanagement. The experienced probate attorneys at Hackard Law can help you determine whether administrators are protecting your property rights in the administration of an estate.
Who Administers an Estate?
The probate court appoints a personal representative to manage and control the estate of a person who died without a will. A person who makes a will can also nominate someone to serve as the executor or estate administrator upon his death. The rights and responsibilities of this office are the same (regardless of whether the person is titled an estate administrator, executor, or personal representative).
Section 9600 of the California Probate Code requires the executor to use ordinary care and diligence to manage the estate. This standard is determined by the particular facts and circumstances of each estate. Ordinary care and diligence also determine which powers an executor should or should not exercise in the course of performing the office’s duties.
One of the most important duties of an estate administrator is to maintain and secure property within the estate until its distribution to heirs or its sale. Real estate in particular requires ongoing maintenance to avoid depreciation. Overgrown yards, leaking water sources, algae-infested pools, and other poorly maintained features can reduce the value of a home. Security issues such as graffiti, theft, and trespassing can also result in depreciation. An executor who fails to use ordinary care to prevent such issues can be responsible for compensating the heirs for any depreciation that occurs.
Real estate is not the only asset that an executor’s negligence can deplete. An executor, for example, who places cash in a bank that is not federally insured could face liability for the loss of that money when the uninsured bank closes. These and many other acts of negligence fall within the scope of ordinary care and diligence.
When Estate Administrators Act Improperly
Of course, negligence is just one thing that can expose heirs to financial losses. Intentional acts of fraud, theft, or self-dealing can also depreciate the value of an estate. This devalues each heir’s property interest in the estate.
Such acts can also expose the executor to criminal liability. In New Jersey, an attorney was found guilty of stealing nearly half a million dollars from a trust fund over which he was the trustee. According to The Sacramento Bee, the trust fund was established as the result of a wrongful death lawsuit and was intended to compensate a child for the loss of a father he never really knew. Instead, the lawyer hired to protect the trust assets stole them. He agreed to be disbarred as a result of this case and other instances of stealing client assets. As of this writing, he awaits sentencing and faces as many as 10 years in prison.
Even if executors do not commit crimes themselves, they may face civil liabilities for negligently entrusting estate affairs to the care of someone who does commit a crime. Such a case occurred in New York, where an attorney stole nearly $600,000 from the estate of a former client. The New York Times reports that the lawyer was hired by the estate administrator to assist in the sale of the former client’s real estate holdings. The proceeds from the sale were placed in the lawyer’s trust account, and the attorney spent the next two years writing himself checks from that same account. As a result, the estate lost more than $600,000 of the sales proceeds. The case was vigorously prosecuted by the assigned Brooklyn district attorney. Both the identity of the victim (who had been a prominent local judge) and the property at issue (a historic theater that became the site of civil rights gatherings) were key issues that weighed against leniency in the defendant’s sentence.
A Probate Attorney Can Help Protect Your Loved One’s Wishes (and Your Legal Rights)
Many legal remedies are available to heirs whose property rights are impaired by improper estate administration. California probate law allows beneficiaries of an estate to petition for the removal of an executor who has acted improperly. Beneficiaries can also sue an executor in civil court for the financial losses they have sustained as a result of improper management.
In cases of criminal misdeeds, beneficiaries can also contact law enforcement to launch a criminal investigation of the matter. In the event of a criminal conviction, beneficiaries can seek compensation through a criminal restitution order. Criminal restitution orders have provisions that make them easier to enforce than civil judgments against an executor who has committed fraud or theft.
The court can apply important administrative consequences to an executor. It was crucial, for example, to revoke the bar license of the New Jersey attorney who stole money from the trust fund of his child client to protect other innocent clients from engaging his services. Accountants, banking officials, and others can also lose professional licenses. Public officials can be removed from office. All of these actions prevent additional criminal acts against other innocent victims.
Find the Right Probate Litigator to Protect Your Legal Rights
If you believe that an estate administrator is acting improperly, consult with an attorney as soon as possible about your legal rights. The experienced attorneys at Hackard Law focus on probate litigation. They have the skills necessary to hold administrators accountable for mismanagement that devalues the property rights of beneficiaries. To schedule your free consultation with one of our probate litigators, call us at (916) 313-3030 or (213) 357-5200, or write us online today.