Everything a person owned or owed makes up part of something known as her estate after she dies.
A person’s estate must be dealt with when she dies, either according to her wishes as defined by a will, or according to state law.
Because this takes work, every estate needs one or more personal representatives, known more specifically as executors when there is a will, and administrators when there is no will.
Personal representatives play a crucial role in keeping the bureaucratic ball rolling throughout the process of opening, administering and eventually settling the estate.
To accomplish this, personal representatives are granted a good deal of legal power to deal with everything in the estate. This includes the right to open and close accounts, take steps to protect estate assets, and sell off or transfer title to property.
With these powers come great responsibility; a personal representative owes a legal duty—known as a fiduciary duty—to any of the estate’s beneficiaries. When personal representatives violate this duty, whether through fraud or by being clueless, they can be held personally liable for the consequences.
The work of a personal representative follows a general pattern. First, he must open the estate and swear an oath. Then, he must advertise the opening of the estate in local newspapers. This allows potential creditors to make a claim for repayment of anything the decedent owed prior to her death.
After opening the estate, the personal representative must identify and account for everything of value that the decedent owned.
In addition, the personal representative must pay off any of the decedent’s debts. In doing this, the personal representative is responsible for compiling an inventory of the estate’s valuable assets, and preparing an inheritance tax return itemizing all estate assets and debts.
Finally, the personal representative oversees the distribution of any property left in the estate after any debts have been satisfied. Depending on whether there is a will, this can occur according to any explicit instructions contained in the will, or according to state law.
A personal representative is legally responsible for each of these steps.
Coupled with the personal representative’s fiduciary duty to all estate beneficiaries, this can entail a great deal of legal risk and also a great deal of work.
Because of this, personal representatives should rely on the counsel of an attorney as much as possible throughout the process of guiding an estate through probate.
(This article is intended as a discussion of legal topics that are often confusing to many laypeople; it is not, and should not be relied on, as legal advice. Attorney Jesse White is licensed to practice solely in Pennsylvania and any information discussed relates solely to Pennsylvania law.)