By Abigail Neal, Scottsdale Probate Lawyer
The first step in the probate process is determining who will serve as the personal representative. The personal representative (known as the executor in some states) is responsible for administering the estate, dealing with the probate court, gathering and distributing assets, notifying and paying creditors and filing the deceased person’s final tax return.
Who Can Be Appointed Personal Representative?
Regardless of the type of proceeding (informal, formal or supervised), the following people may serve as personal representative, in order of priority:
1. The person with priority as determined by a probated will including a person nominated by a power conferred in a will.
2. The surviving spouse of the decedent who is a devisee of the decedent.
3. Other devisees of the decedent.
4. The surviving spouse of the decedent.
5. Other heirs of the decedent.
6. If the decedent was a veteran or the spouse or child of a veteran, the department of veterans’ services.
7. 45 days after the death of the decedent, any creditor.
8. The public fiduciary.
A personal representative cannot be:
1. Under the age of 18.
2. A person whom the court finds unsuitable in formal proceedings.
3. A foreign corporation.
What Are The Personal Representative’s Duties?
The personal representative is fiduciary of the estate. Among other things, this means that the fiduciary must deal with the beneficiaries of the estate in good faith and fair dealing. As a fiduciary, the personal representative must also account to the beneficiaries regarding the debts and assets of the estate. Finally, a fiduciary may not engage in self dealing. A personal representative also has a duty to settle and distribute the estate accordance with the terms of any probated and effective will, and as expeditiously and efficiently as is consistent with the best interests of the estate and the successors to the estate. A.R.S. § 14-3703(A).
Provide Notice to Heirs and Devisees
A personal representative also has a duty to provide notice to all heirs and devisees of the estate. No later than 30 days after the appointment of a personal representative, the personal representative must notify the heirs and devisees of the appointment. The information shall be delivered or sent by first class mail to each of the heirs and devisees whose address is reasonably available to the personal representative. The information must include the name and address of the personal representative, indicate that the notice is being sent to persons who have or may have some interest in the estate, indicate whether a bond has been filed and describe the court where papers relating to the estate are on file. The personal representative’s failure to give this information is a breach of the personal representative’s duty to the persons concerned but does not affect the validity of the appointment or the personal representative’s powers or other duties. A.R.S. § 14-3705.
Inventory and Appraisal of Assets
A personal representative must also take inventory of the decedent’s assets and determine a value for the assets. Within 90 days of being appointed, the personal representative must prepare an inventory of all property owned by the decedent at the time of death, listing it with reasonable detail, and indicating the fair market value of each item valued as of the date of the decedent’s death, the nature of the property as community or separate property and the type and amount of any encumbrance or lien that may exist on any piece of property. The personal representative may file the original of the inventory with the court and send a copy of the inventory only to interested persons who request it; or, if he elects not to file the inventory with the court, he must deliver or mail a copy of the inventory to each of the heirs in an intestate estate, or to each of the devisees if a will has been probated, and to any other interested persons who request it. A.R.S. § 14-3706.
Take Possession of Property
The personal representative must also take possession of all of the decedent’s property, except as otherwise provided in the decedent’s will or any property already in the possession of the person who is presumptively entitled to it unless the personal representative determines that his possession of the property is necessary for administration purposes. The personal representative must pay taxes on the property and take all steps reasonably necessary for the management, protection and preservation of, the estate in the personal representative’s possession. The personal representative may maintain an action to recover possession of property or to determine its title. A.R.S. § 14-3709(A).
Provide Notice to Creditors
A personal representative is also required to give notice to the creditors of the decedent. When the personal representative is appointed, he or she must publish a notice to creditors once a week for three successive weeks in a newspaper of general circulation in the county announcing the appointment and the personal representative’s address and notifying creditors of the estate to present their claims within four months after the date of the first publication of the notice or be forever barred. If the personal representative is aware of any creditors, he or she must give written notice by mail or other delivery to all known creditors, notifying the creditors of the personal representative’s appointment. The notice must also notify all known creditors to present the creditor’s claim within four months after the published notice, or within sixty days after the mailing or other delivery of the notice, whichever is later, or be forever barred. A.R.S. § 14-3801.
Complete Required Training
All persons wishing to serve as a personal representative in Arizona must complete the required training found at www.azcourts.gov/probate/Training.aspx.
Read more details about the duties of a personal representative.
Does the Personal Representative Need to Post a Bond?
A bond is required of a personal representative unless either:
1. The will expressly waives the bond.
2. All of the heirs if no will has been probated, or all of the devisees under a will which does not provide for waiver of the bond, file with the court a written waiver of the bond requirement. A duly appointed guardian or conservator may waive on behalf of his ward or protected person unless the guardian or conservator is the personal representative.
3. The personal representative is a national banking association, a holder of a banking permit under the laws of this state, a savings and loan association authorized to conduct trust business in this state, a title insurance company which is qualified to do business under the laws of this state, a trust company holding a certificate to engage in trust business from the superintendent of financial institutions or the public fiduciary.
4. The petition for formal or informal appointment alleges that the probable value of the entire estate will permit summary procedures under section 14-3973 and the surviving spouse, or the nominee of the surviving spouse, is applying for appointment as personal representative.
A.R.S. § 14-3973 (for summary procedures) reads:
If it appears from the inventory and appraisal that the value of the entire estate, less liens and encumbrances, does not exceed allowance in lieu of homestead, exempt property, family allowance, costs and expenses of administration, reasonable funeral expenses, and reasonable and necessary medical and hospital expenses of the last illness of the decedent, the personal representative, without giving notice to creditors, may immediately disburse and distribute the estate to the persons entitled thereto and file a closing statement…
There are exceptions to the bond requirements:
In any case where a bond is not required pursuant to subsection A (above), the court may, upon petition of any interested person and upon reasonable proof that the interest of the petitioning person is in danger of being lost because of the administration of the estate, require a bond in such amount as the court may direct to protect the interest of the petitioner or of the petitioner and others. An heir or devisee who initially waived bond may be a petitioner under this subsection. A.R.S. § 14-3603(B).
If a bond is not initially required because the petition for appointment alleges that the probable value of the entire estate will permit summary procedures under section 14-3973, and it later appears from the inventory and appraisal that the value of the estate will not permit use of such procedures, then the personal representative must promptly file a bond unless one is not required for some other reason under subsection A (above). A.R.S. § 14-3603(C).
How Much is the Bond?
If bond is required and the provisions of the will do not specify the amount, the personal representative must file a statement under oath indicating his best estimate of the value of estate and any income expected during the next year. He shall then execute and file a bond with the registrar in an amount equal to the estimate provided. However, the amount of the bond may be reduced by the amount of any real estate, less encumbrances thereon, if the letters issued to the personal representative contain the restriction that sales of real property by the personal representative are subject to court confirmation. On petition of the personal representative or another interested person the court may excuse a requirement of bond, increase or reduce the amount of the bond, release sureties, or permit the substitution of another bond with the same or different sureties. A.R.S. § 14-3604(A).
Can the Personal Representative be Compensated?
A personal representative is entitled to reasonable compensation for his services. If a will provides for compensation of the personal representative and there is no contract with the decedent regarding compensation, he may renounce the provision before qualifying and be entitled to reasonable compensation. A personal representative also may renounce his right to all or any part of the compensation. A written renunciation of fee may be filed with the court. A.R.S. § 14-3719.