Welcome back to lunch with a lawyer. I think this is our 10th show. We certainly welcome everybody back. We’re going to be talking about what is probate. We would ask that if you would, like us on Facebook. That always helps us. If you share, then we can reach some other folks that may have some questions or be interested in listening to myself or sometimes in the past, we’ve had both myself and, an attorney here, with me that we have a, go back and forth. Today I’m here by myself, but if you have any questions about anything, please send it to us on Facebook. We have our producer here is Josh, and he’s going to go live and tell us your first name and what your question is. Our associate producer, Zach, he’s over here monitoring and making this all happen.
Before I get into what is probate, I wanted to go over some of the questions that have come in since the last show. Jeff said, “What if a rental lease ends and the tenant stays after the end date without a lease? Can they continue to stay without a lease?” That’s what they call a hold over tenant. If the landlord does not renew the lease and then continues to take the monthly rent, well the tenant, then, is a month to month tenant. They can continue in that vein, and a month to month tenancy can be by giving 15 days notice prior to the next rent coming in. If a landlord wishes to get out vacate, all he has to do is give the 15 days notice. Likewise, if the tenant wants to exit, they give 15 days notice before the next rent payment is owed and they are able to leave the property as far as not breaching any lease agreement.
Some leases, particularly you find it commercial leases and I believe it’s under the landlord tenant statute, if a tenant remains in possession after the termination of the lease without the landlord’s consent, then they can be obligated to pay twice the rent, double the rent. This is usually when notice is given by the landlord to the tenant that says, “Look, if you stay after your lease expires, you owe twice the rent.” Hopefully Jeff, that gives you some guidance about your tenants and if they’re hanging around after their lease expires.
We also had a question here from Terry. “If a husband and wife own commercial property and the husband quitclaimed part of his interest to his son and the son fails to pay any taxes, fees, upkeep et cetera, how can the husband get his interest back to the son if the son refuses to sign a deed returning the property?”
That raises a couple of questions. Number one, if the husband and wife own the property as husband and wife, neither can convey any interest in the property to any other party without the joiner of the spouse. That’s first the deed to the son if the title was held as husband and wife was not effective and the son has no interest in the property.
Let’s assume that the husband has a half interest and wife has, they hold it as tenants in common, or each of them own a half interest. The husband then conveyed to the son a portion of interest, say, half of it. Then the son didn’t pay his share of the expenses, upkeep or whatever. That presents a real problem in that you’ve got a problem with the getting the interest of the property back.
The only way to force is to file what they call a ‘Partition action’, which is a lawsuit and ask that the property be sold, which is a sort of a drastic remedy, but there’s no way to just force the son to convey the property back. Trying to file an action for cancellation, you have to have a basis for that. You’ve got a real problem if in fact you did convey away a portion of the property to a relative, son, or anyone and they don’t fulfill their obligation then you have to, then you’re stuck.
Before you start gifting property or you might put a string on it and have them execute a mortgage and then simply forgive it over time if it’s a relative. However, if they act up you can make it a demand note and then you’re in a position to foreclose and take their interest back. Hopefully I’ve answered that question for Terry as far as how to deal with that.
Bank accounts. Whenever you have a bank account you make it payable on death, a POD account, that would ordinarily, that will pass outside of probate and go to whomever you designate whether it be heirs or otherwise.
Another example is a brokerage account. Those can be set up to transfer on death, in that way they would pass to whoever you designated that they would go to.
The other asset that we do with estate planning in order probate is to set up what they call a life estate deed, it’s slang, or the slang for that is sometimes referred to as a ‘Ladybird Deed’ which says that if you own the property at your death that it automatically passes to whoever you designate in a deed.
Those are some of the ways that you can pass assets to whomever you would like upon your death without going through a probate proceeding, which again we’ll talk about what probate is and the process and what it covers once we get done with all the questions came in. By the way, I really appreciate folks sending in questions. That way we’re talking about something that you want to hear about rather than me just talking about something that I think you want to hear about.
Zach had another question here. “Can a guardianship case be settled between the parties if the defendant is accused of stealing money from ward?”
No, a guardianship is a procedure wherein you, pardon me, wherein you have to have the ward or the person adjudicated incompetent. That is a separate proceeding. If there been some alleged allegation of elder abuse and you repay the money, that aspect of the case or any kind of criminal proceedings or civil litigation to recover the money can be resolved between the guardian of the ward and whoever the person is who is being sued or prosecuted. Of course it’s up to the state attorney’s office whether or not they drop the charges if restitution or if the money is repaid to the ward or the older person. Hopefully that answers your question, Zack.
Jennifer writes, “If you have a will, do you still need the payable on death beneficiaries named on the account?”
The answer to the question is if you want to avoid probate, the answer is yes. Because you have a will, you do not avoid probate. The will simply directs who the beneficiaries are in a probate proceeding, whereas putting the beneficiaries on the account, a payable on death says who receives the account upon your death. Those assets do not go through probate.
Jennifer had a question. Says, “Can you title a deed the way you mentioned if there’s a mortgage on the property?”
I’m assuming that what we were talking about are these life estate deeds or ‘Ladybird deeds’. The answer to your question is yes, you can still do a life estate deed even if there’s a mortgage on the property since that’s merely a lean and there is no present interest in the property that’s been conveyed. I don’t believe that that would trigger a transfer on death clause or a transfer of the property under the mortgage that would trigger acceleration as far as that’s concerned.
Let me see. I think that pretty well covers that. Josh, do we have anybody that’s sent in any questions?
Josh: No questions at this time.
Mr. Waller 1: All right. Thank you, Josh.
I’ve had some folks, I try and explain what probate is but probate is the definition or I don’t know if it’s defined this way, but it’s the process that’s evolved from someone passes away with assets titled in their name alone and they pass through to the beneficiaries.
In any estate proceeding you have three interested entities or persons. The first entity is the taxes. Is there any taxes that are owed to the Federal Government or to the state of Florida? The Federal Government has done a pretty good job of eliminating that for most folks and that there’s no estate taxes that are owed upon someone’s death unless their assets include, are over five million dollars. That value, five million includes of course, life insurance, any and all jointly owned assets, whatever assets you may have. Even so, that usually takes care of most of my clientele, but if it’s over five million dollars, there may be, and it’s even higher than five but I don’t know the exact amount, then you may have to file a federal state tax return and there may be some taxes that have to be paid.
The state of Florida has done away with estate taxes, so there’s no estate taxes due to the state of Florida. If however, you own real estate outside the state of Florida, that state, let’s say if it’s New York or North Carolina or wherever it may be, they may have some estate taxes which they asses on the value of the real property.
The next category of folks that are, they’re normally usually not folks, they’re entities, are creditors. You look at the creditors and a probate proceeding, the executor, which we now call a personal representative has a duty to notify creditors to file their claims or an estate who are reasonably ascertainable. A good way to try and figure out who the creditors are is simply look at mail and that the invoices come in. You’ll look at Medicare statements, they usually say who the providers are. The creditors have a, if you give them notice, you send them the notice to creditors in a probate proceeding. They in turn then file their claim, but they have to file it within three months to date of the first publication in the newspaper of the notice to creditors, period of three months to file, but it’s the duty of the personal representative or executor to send them notice.
If they don’t receive notice, the claim is good. They have up to two years before their claim is no longer viable as far as that’s concerned. We have creditors is another category which has to be addressed. You have estate taxes have to be paid or not if there’s no estate isn’t large enough, you do away with that and you need to see that the creditors are paid and then the last group is the beneficiaries. The beneficiaries, the will dictates who receives these assets.
There is an exception in as far as having to pay creditors if the only asset in the estate is the homestead property of the decedent, a petition to determine it to be homestead can be filed in a probate proceeding and given notice to all the creditors. That passes to any heirs free of any claims or creditors. It does not pass to third parties who are not related, so that sub to claims or creditors. If you leave it to a friend, that could be a significant problem if it’s a significant other and you leave your estate to a significant other.
Those are the categories or folks that the probate process is designed to protect. The will is the one that says who you want to receive your assets that are titled in your name alone. The will does not control assets that have a designated beneficiary such as on a POD account, payable on death account, any IRAs, individual retirement accounts, a life insurance, those are all designated beneficiaries. Transfer on death or brokerage accounts, even the life estate deeds or the ladybird deeds. The will doesn’t control any of these where there’s a designated beneficiary.
If you do have a will it also designates who you want to be in charge of paying the bills and liquiding the assets or inventorying them, liquidating them, and then paying the bills and distribute the money among the beneficiaries. The personal representative has to follow the directions of the will as far as distributing the assets.
It’s good to have a will if you leave any assets behind in that if you die without a will, then the Florida statutes say who receive your assets. If you die and you’re survived by a spouse, with a spouse on the title just in a percentage or entire estate and then it goes on to your children. Then we can talk about who else it would do, but it Josh question for us.
Josh: We have actually two questions. The first question is, “Will probate of a home stop property tax sale?” That questions is from Zach.
Mr. Waller: Zach, no so if they’re not paid, that the property will be sold, the clerk of the court is challenged by sending notice out to all interested parties which are all the heirs of the decedent so that the heirs have an opportunity to pay the back due taxes to save the property, but it will not stop a tax deed sale.
You have another one for me Josh?
Josh: Yep, the question from Jeff, “If a will was created in Florida but the person moves to a new state, does a new will need to be created?”
Mr. Waller: The answer to that is I suggest you talk to an attorney in the new state where you’ve resided. Usually a will that’s drafted in whatever state is going to be recognized by that state. Florida has some peculiar laws or different laws and that under Florida law, if you designate someone who is not related to you and who does not live in the state of Florida, they are not qualified to serve as an executor. Since I don’t practice in any other state, I don’t know if there’s any other nuances as far as any other state that you may reside in, but usually the will would still be valid. Now, most wills are self-proving so they should still be effective. However, in conjunction with estate planning, it’s always good to talk to the, to an attorney in whatever state you’re in because you need to talk to them about a power of attorney, about a healthcare surrogate, which is, in essence, a healthcare power of attorney, and living will, and to be sure that they are compliance with that states law as well as having the attorney look at your will and also talk to you about if there is any changes as far as your marital status, as far as your children or your beneficiaries or your status as far as whom you want to receive your assets.
Are we all set Josh? Okay.
Basically the probate process is it starts with the personal representative petitioning the court to be appointed representative, the one that they’ve ordered may waive that can still order that they that through our insurance agent cost two or three hundred dollars depending on the size of the bond. They also have to sign an oath and a designation of resident agent, which has to be an attorney which we certainly are designated since if we’re handling the estate.
Once that’s done then the letters of administration are issued which gives the personal representative the authority to act. The personal representative then is charged with sending out the notice of administration to all the beneficiaries and heirs giving them a notice that they can challenge the will if they would like. They give a certain time period which I believe is four months.
I mentioned previously where the personal representatives also publishes a notice to creditor in a local newspaper as well as sending this notice to creditor to any reasonably ascertainable creditor. After 60 days the personal representative files an inventory with the court, letting them know what assets are in the estate. They can also file petitions to have certain assets exempt from claims to creditors such as up to two automobiles. The personal property is, I believe is $2,000 or $2,500 for personal property, but all these things are done during the administration. The administration has to stay open long enough for the creditors period to expire. Once that expires, the personal representative can then pay the administration cost, and also pay any creditors and then distribute the assets. It’s usually not quite that quick. I estimate the simple administration of an estate to be in the neighborhood of about six months rather than three or four months right after the notice to creditors.
That’s sort of the probate process in a few minutes. If you have any questions about probate, don’t hesitate to give my office a call. We’ll be happy to set up an appointment and help you out with it. My phone number is 727-847-2288. We don’t have any more questions. We’ll look forward to seeing you next month, the second Tuesday of the month at 11:30. If you’re viewing this afterwards, send your questions in as far as that’s concerned and we will certainly try and address them on my next show. If you like what you see, if you’d ‘Like’ and ‘Share’, that would really be terrific as far as this video is concerned.
Josh: You can also email questions to email@example.com and we will present those first at the next meeting.
Mr. Waller: Why don’t you say that a little slower, Josh, because Josh is the voice behind that so say it a little slower.
Josh: The email address is firstname.lastname@example.org. It’s also posted in the comments and people to go the website. We have archived videos of many, many topics.
Mr. Waller: Rdwaller.com, and we have about 300 videos on topics on real property, elder law, probate, landlord tenant, any number of things. Look forward to helping you with any of your legal needs. If we don’t do it, we’ll send you to somebody that does know how to do it. Thank you and see you next month. Thanks.