2018 TEXAS ADVANCED PARALEGAL SEMINAR

PROBATE AND PROBATE ALTERNATIVES What is Probate Court? What is the Probate “Process”? But what if I do not want to go to Probate Court?!

What is Probate Court? Tarrant County (Where I am from!!) Statutory Probate Court Number One Judge Steve King (Retiring Dec. 31, 2018) Statutory Probate Court Number Two Judge Brooke Allen Jurisdiction and Venue over matters related to Decedent’s Estates (with a couple of exceptions) Not a Criminal Court…………

What is Probate Court? Determines the Validity of a Last Will and Testament Appoints Personal Representatives of Estates Determines Heirship Determines questions of law as the law relates to the Last Will and Testament, Trust and property. And much more

What is the Probate “Process”? We are assuming the Decedent died with or without a Will and there is a necessity for an administration: Retain an Attorney (Fiduciaries in Texas must be represented by counsel in Court) File either Application to Probate Will or Application to Appoint Administrator and Determination of Heirship

What is the Probate “Process”? In most circumstances, when you file a Will for probate you do not need to notify beneficiaries until AFTER the will has been admitted to probate However, if Decedent died without a Will, then the court will require consent of the alleged heirs prior to appointing a specific person as administrator* *NOTE: CONSULT COURT REGARDING NOTICE REQUIREMENT

What is the Probate “Process”? Independent or Dependent Administrator Did all alleged heirs consent? Debts? Any other issues? If Independent, then: File Inventory w/t 90 days File Notice to Creditors File Notice to Beneficiaries (if not already required)

What is the Probate “Process”? If Dependent, then: Court permission to spend estate cash Court permission and approval to sell estate property Court permission to make distributions Court permission to pay debts Plus: File inventory, notice to creditor, notice to beneficiaries and annual accountings (until the estate is closed)

What is the Probate “Process”? In a situation where you have a valid will but no necessity for administration then you can file the Will for probate as a Muniment of Title. Primary Requirement: No unpaid debts, other than debt secured by a lien on real estate; Check for Medicaid Estate Recovery Claim

What is the Probate “Process”? No Administration necessary but No Will?? Heirship Determination: Court determines who the heirs of the Decedent are and property passes to the heirs pursuant to the laws of the State of Texas Attorney Ad Litem appointed to represented unknown heirs (including minors and incapacitated persons) Court does not determine the nature of the property with this type of hearing (only heirs)

But what if I do not want to go to Probate Court?! Small Estate Affidavit Value (excluding homestead and exempt property) does not exceed $75,000.00 30 days since date of death No application for administration has been filed or granted Must exceed known liabilities (except for liabilities secured by homestead or exempt property) Sworn to by two disinterested witnesses

But what if I do not want to go to Probate Court?! Small Estate Affidavit (cont’d) Must be sworn to by each distributee who has legal capacity List of all known assets/liabilities Name and address of each distributee Relevant family history facts NOTE: CONSULT COURT FOR PROCEDURE SOME COURTS REQUIRE HEARING (MAYBE?)

But what if I do not want to go to Probate Court?! Affidavit of Heirship Recorded Statement of Facts Concerns the identity of the heirs Established as prima facie evidence of Heirship if: Statement is contained in an affidavit and sworn to; and Affidavit has been on record for five years or more in the deed record Typical practice: One interested party and two disinterested parties

But what if I do not want to go to Probate Court?! Affidavit of Heirship cont’d Title companies will require these in lieu of letters of administration Can also be used to transfer title to motor vehicles See DMV website

But what if I do not want to go to Probate Court?! Transfer of Death Deed Individual may transfer his/her interest in real property to one or more persons effected on transferor’s death Deed is Revocable (regardless of contrary language) Non-testamentary (not a Will) Capacity to execute = capacity to execute a contract

But what if I do not want to go to Probate Court?! Transfer on Death Deed cont’d: Power of Attorney may NOT created a transfer on death deed Requirements: Essential elements and formalities of a recordable deed; State that the transfer is to occur at the transferor’s death; and Be recorded before the transferor’s death in the deed records in the County where the real property is located.

But what if I do not want to go to Probate Court?! Transfer on Death Deed cont’d Do not have to give notice to the intended beneficiary or consideration Deed can be revoked A Will may NOT revoke a TODD Divorce will revoke a TODD Designated beneficiary must survive decedent by 120 hours Does not eliminate a lien secured by the property

But what if I do not want to go to Probate Court?! Bank Accounts/Brokerage Accounts/Insurance Policies Designate a beneficiary Joint Tenancy with Right of Survivorship Keep them updated as beneficiaries may pass away and then your account will be subject to the probate “process” Keep in line with your estate plan (Will/Trust) Hare v. Longstreet, 531 S.W.3d 922 (Tex. App. - Tyler 2017)!!!!!!

But what if I do not want to go to Probate Court?! Intervivos Trust Created to hold real and personal property for the benefit of Settlor/Trustor (person who creates trust) or another person Property in the Trust passes outside of probate and pursuant to the terms of the Trust Trustee is appointed to administer the property in the Trust for the benefit of the beneficiary May be irrevocable or revocable

But what if I do not want to go to Probate Court?! Intervivos Trust cont’d Traps: If you do not put all of your property into the Trust then you might have to probate your Will However, can create a “pour-over” will Trustee is a fiduciary and can step in to some unwary traps

Questions/Thoughts?