Estate Creditors and Claims Against an Estate
Today Your Legal Corner will discuss "estate creditors."
There is nothing more painful than the loss of a loved one. It is often during this time, when we ponder if there is an afterlife, and if so, are there indeed signs of our loved ones still present with us? I vividly remember, a bird that persistently sat outside my parent's home after the passing of my mother. We believed the bird was there to make sure we all took great care of my dad.
Whether you believe or not, when this topic is discussed with friends, numerous similar accounts emerge. Knowing the signs and what to look for is exactly how the estate of a loved one should be addressed as well.
Most Surrogate offices within the county have compiled a checklist, to ease in the handling of an estate matter when a loved one has passed. Additionally, another viable option is to retain an attorney who will also provide legal assistance for a fee.
In deciding how best to approach an estate matter, it is important to be aware of how the estate creditors are to be paid.
Consider (1) to whom a payment should be made, (2) in what order, (3) if the claim is valid and (4) whether or not the estate has the funds to make the full payment requested.
Estate creditors and payment
Generally, estate liabilities are paid in the following manner: reasonable funeral expenses, estate administration, taxes, medical, debts presented, judgments entered against a decedent as well as any other claims.
Payments are made from the estate of the decedent by check. A cover letter is to accompany payment. The cover letter states the amount of the check, and that the check represents payment in full. The account number of the bill should be listed on the check or other form of payment.
Estate creditors and limited funds
After a personal representative has completed an initial review of an estate and it appears there may not be enough funds to pay all valid estate creditors, a document entitled "Notice to Limit Creditors" may be filed with the Surrogates office. This is a notice for creditors to present their claims to the estate within six months from the date of the order of the notice. N.J.S.A. 4:80-8 requires a notice of general publication in a local newspaper and by ordinary mail to the last known address of the creditor.
Estate creditors may be accepted or denied
Important to note, is that all claims presented need not be paid. It must be a valid claim for the estate to be required to make payment. A personal representative of an estate has three months after receiving a claim to accept or deny the claim.
When a claim is denied, the claimant/creditor may commence an action in court to make claims against an estate within three months of denial of the claim. In the event a creditor fails to commence a claim within the three-month time period, the fiduciary will usually not be liable for that particular claim.
So, when dealing with an estate matter after the loss of a loved one...know the signs!
Till next week, God bless, keep smiling, when Your Legal Corner will provide information regarding "employee termination after filing a worker's compensation claim."
Victoria M. Dalton is an attorney with the law firm of Hoffman DiMuzio.
For questions, contact Victoria at email@example.com or contact an attorney. Be sure to Like us on Facebook for all our future articles and much, much more.
Your Legal Corner was created to provide educational articles about the law and is not legal advice.