William T. Catterton, P.C. Attorney at Law Law Offices of William T. Catterton Wells Fargo Bank Building 6707 Brentwood Stair Road Suite 210 Fort Worth, Texas (817) PROBATE & GUARDIANSHIP April 2, 2016

PROBATE What is Probate? – Probate is the Court process by which a will is proved: 1)To be valid or invalid 2)To be the last will of the deceased person, and 3)To have revoked all previous wills. – When a will is proved in Court to be valid, it is “admitted to probate.” HOWEVER….(cont.) 1

PROBATE What is Probate? (cont.) However, the term “probate” usually includes all proceedings related to the administration of the estate of a deceased person. Most probate proceedings are started by filing an application to probate a will and require a hearing in Court. 2

PROBATE Is probate always necessary? – Probate is necessary if: 1)There are assets that are titled in your name that need to be transferred to person in your will (or your heirs-at-law if there is no will) 2)There are unresolved debts owed to creditors by the decedent at time of death 3

PROBATE You may direct how your assets are transferred upon your death by one of four ways: 1)By Will 2)By Beneficiary Designations 3)By Joint Tenancy with Right of Survivorship 4)By Trust Provision 4

PROBATE Is probate expensive? – Depends upon the nature of the assets and the complexity of the estate administration – Costs greatly reduced if will names an independent executor and has self-proving affidavit – Will can also eliminate the necessity for a bond 5

PROBATE What does the administration of an estate involve? – The administration of the estate involves: 1)Gathering the assets 2)Paying the decedent’s debts, and paying proper expenses of the administration and taxes 3)Distributing remaining assets 6

INDEPENDENT ADMINISTRATION Without Court supervision: – Named in will (Independent Executor [“IE”])(Letters Testamentary) OR – All beneficiaries agree, Court Approved (Independent Administrator [“IA”])(Letters of Administration) Advantages – reduced cost/more efficient Disadvantages – difficult/expensive for heir to force IE/IA to disclose information – Usually no surety bond, so problems if IE/IA mismanages. 7

DEPENDENT ADMINISTRATION Court appoints/supervises/controls Administrator’s actions Administrator must be bonded, file annual/final accounts Usually must have Court approval prior to acting Expensive, lengthy, but best protection 8

NO WILL (Intestate) Heirs and their shares of the estate are determined in a heirship determination proceeding. Court hears evidence identifying all heirs and their shares of the estate. Court-appointed attorney (AAL) represents the interests of unknown heirs, known heirs who cannot be located, heirs suffering from disability, and minors 9

ATERNATIVES TO FULL ADMINISTRATION OF ESTATE 1.Muniment of Title (“quiet title”) – “ Red flags” = significant assets, assets which must be managed, friction among beneficiaries, creditor problems 2.Heirship determination 3.Small estate affidavit (assets greater than liabilities; no will; filed within 30 days of death; estate no greater than $50K excluding homestead, exempt property; judge reviews) 4.Affidavit of Heirship (usually to transfer real estate)(also motor vehicles) 10

GUARDIANSHIP (Adult) Initiation of Adult Guardianship - - Any person -may hire an attorney certified by the Texas Bar OR -request the probate court to appoint a guardian for someone the person believes to be incapacitated 11

GUARDIANSHIP (cont.) Less restrictive alternatives to a guardianship must be investigated to avoid removing the rights and power of the incapacitated person. For guardianship purposes, a person may be incapacitated and placed under guardianship: when unable to provide food, clothing, or shelter for himself or herself, when unable to care for his or her own physical needs, or when unable to manage his or her own financial affairs, because of a mental or physical condition. 12

INCAPACITY IN GUARDIANSHIP CASES Different levels of incapacity – Doctor must set out in a Physician’s Certificate to the Court the mental or physical basis for the incapacity and the extent of the incapacity. Incapacitated person may retain some rights and powers Doctor answers specific questions concerning the person’s ability to drive, vote, make decisions regarding residence, manage money, etc. An incapacitated person who regains partial or full capacity can petition to have their rights restored. 13

TYPES OF GUARDIANSHIP Guardian of the Estate (“GOE”) Guardian of the Person (“GOP”) 14

WHO IS APPOINTED GUARDIAN (“Best Interest”) May designate who will serve (legally required format/execution) If no properly drafted designation – spouse, next of kin, any eligible person 15

GUARDIANSHIP PROCEEDING Proposed Ward (“PW”) represented by court appointed attorney (AAL), OR if… Costs include attys fees, filing fees, AAL fees, bond premiums How soon? As soon as Monday following expiration of 10 days after PW personally served Hearing – Applicant must prove incapacity by medical evidence, testimony. PW has right to present evidence, testify, speak to Judge, jury 16

GUARDIANSHIP QUALIFICATIONS/REPORTS Hearing, Oath, bond GOE – 30 days to file initial inventory/Annual Accounting GOP – annual report on location, condition, etc. Guardian cannot spend PW’s money/sell assets w/o prior approval from Court 17

IF IMMEDIATE NEED Temporary guardian if “imminent danger” AAL at hearing Temporary Guardianship for 60 days BUT… 18