Texas Estates Code Chapter 308 is the portion of Texas law that discusses the notice that the personal representative of a deceased person’s estate must provide to beneficiaries and creditors of the estate.
Texas Estates Code Chapter 308.002 requires personal representatives to provide notice to every beneficiary that is named in the will 60 days after the date of an order admitting a will to probate. The notice must explain who has passed away, that their will has been admitted to probate, and that the beneficiary is named as a beneficiary in the will. Additionally, the notice must provide the personal representative’s name and contact information and either include a copy of the will or a summary of the gifts left to the beneficiary under the will along with specific case and court information.
Additionally, Texas Estates Code Chapter 308.051 requires a personal representative of an estate to publish a notice in a newspaper of general circulation in the county where the deceased person lived within a month of being appointed. The notice must advise the estate’s creditors to present their claims and provide the person and address to which a claim may be presented. Personal representatives must also issue notice to secured creditors directly and can provide notice to unsecured creditors if they choose to do so.
How Long Do Creditors Have to Collect a Debt from an Estate?
The length of time that creditors have to collect a debt from an estate depends on the type of debt and whether the creditor received notice from the personal representative and the type of estate administration. However, creditors cannot simply attempt to collect the debt from the estate. Rather, they either must present their claims to the personal representative or the clerk or file a lawsuit against the estate.
Secured creditors must present their claims within four months from the receipt of notice from the personal representative or six months from the date the personal representative’s letters are granted, whichever is later. If a secured creditor fails to present their claim by the deadline, they cannot receive money from the estate to cover the debt. However, the creditor can still have their claim satisfied by the property that was used to secure the debt.
If the personal representative sent notice to an unsecured creditor, they typically must present their claim before the 121st day after receiving the notice. However, if an unsecured creditor does not receive notice, they can present their claim at any time before the estate is closed as long as it is within the applicable statute of limitations.
Can I Contest the Executor Paying a Debt from an Estate?
Yes, if you are an interested party in an estate, you can object to the executor paying a debt from the estate.
Under Texas Estates Code Section 355.054, a person who is interested in an estate may object to the approval of a claim or part of a claim at any time before the court has taken action on the claim. A hearing will be scheduled on the written objection, and the court will consider evidence from witnesses and issue a judgment as in an ordinary lawsuit.
Additionally, Texas Estates Code Section 355.058 allows a claimant or a person who is interested in an estate to appeal the court’s action on a claim to the court of appeals.
Can Executors Sell Property Without Beneficiaries Approving?
Yes, executors can sell property without approval from the beneficiaries in certain situations.
For instance, Texas Estates Code 356.051 requires in certain circumstances, the personal representative of an estate to apply for a court order to sell all estate property that is liable to perish, waste, or deteriorate in value, or that will be an expense or disadvantage to the estate if kept.
Additionally, Texas Estates Code 356.101 allows the personal representative to apply for a court order to sell any of the estate’s personal property to pay for any of the following:
- Administration expenses
- Funeral and last illness medical expenses
- Claims against the estate.
Texas Estates Code 356.251 also allows the personal representative to apply for court for an order to sell any of the estate’s real property to pay any of the above expenses, or if selling the property is considered in the estate’s best interest. However, unlike with personal property, if the personal representative files an application to sell real estate, each person who is interested in the estate will receive notice and have the opportunity to file a written opposition to the sale.
Can Executors Contest Decedent’s Debts or Estate Debts?
Yes, executors can contest creditor claims that are submitted to the estate.
Under Texas Estates Code 355.051, a personal representative has 30 days from when an authenticated claim against the estate is presented to allow the claim, reject the claim, or allow part of the claim and reject the remaining portion. If a personal representative does not respond within this time frame, the claim is considered to be rejected.
If a claim is rejected in a dependent administration, the creditor must file suit against the estate within 90 days of the rejection in order to recover the debt. The probate court will then determine if the claim is valid. You should contact an experienced probate litigation attorney as soon as you suspect estate funds may be misused or misappropriated.
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RMO LLP serves clients in Los Angeles, Santa Monica, Ventura, Santa Barbara, San Francisco, Orange County, San Diego, Kansas City, Miami, and communities throughout California, Florida, Missouri, and Kansas. Our founder, Scott E. Rahn, has been named “Top 100 – Trust and Estate Litigation” by SuperLawyers, Trusts and Estates Litigator of the Year, and Best Lawyers in America for Litigation – Trusts and Estates. For a free consultation, call (424) 320-9444 or visit: https://rmolawyers.com.