What is Probate?

In every legal jurisdiction in America there exists a special court which concerns itself with the administration of estates. Sometimes called the "orphans," "surrogate," or "chancery" court, its most common name is "probate court."

A properly drawn will should state your wishes as to the disposition of your property and name an "executor" whose duty it will be to see to it that your instructions are carried out.  The executor will present your will to the probate court with an inventory of the assets and liabilities of your estate.  The court will determine that the document is legal in both form and execution and will "accept" it for probate.  Through the medium of a court-ordered legal notice inserted in a local newspaper, your creditors will be notified of your death and given an opportunity to present their claims.  The notice will also serve to alert interested parties who may wish to enter a legal objection to the disposition of your estate in accordance with the terms of your will.  The court will hear the claims of all such parties and rule upon their validity. If the terms of your will are unclear, the court will "construe" them, deciding officially what you meant.

If you have died intestate-that is, without leaving a valid will, the state will write your will for you.  By this is meant that, in the absence of a legal and valid will, your estate will be distributed in accordance with the law of the state in which you live.  That distribution may bear no resemblance to the one you would have specified had you elected to spell out your wishes in a will.  The probate court will appoint an "administrator" whose duties will approximate those of an executor who would have attended to the details of probating your estate if you had left a proper will. 

If through illness or senility an individual becomes incompetent to handle his own affairs, relatives or other persons responsible for him may appeal to the probate court to appoint a "conservator" over his assets to protect them against loss.  In the case of a minor legally disqualified by reason of his age from acting on his behalf, the court may appoint a "guardian" to act for him if he owns, or is to receive, property in his own right.

If under the terms of your will, you establish a trust for the benefit of your heirs naming as trustee an individual or a bank, the probate court might be called upon to appoint a successor trustee if the individual trustee dies or the corporate trustee resigns or goes out of business.

The probate procedure attracts publicity.  Every newspaper has a reporter assigned to cover the probate court.  If the decedent is at all known in the community, or if there is anything unusual about the size of the estate, the nature of the assets, or the identity of the heirs, these private matters become newspaper headlines.  This not only provides grist for the gossip mongers but also attracts the attention of unscrupulous persons who regularly prey upon beneficiaries to separate them from their financial security.  On the basis of probate court records, lists of widows are compiled and sold to such persons.

The probate procedure is costly.  In an article in a national magazine, a well-known estate attorney answered questions about probate.  Asked to estimate the costs of estate administration, he replied:

On small estates of $10,000 to $20,000 they are likely to be on an average of 20%.  On medium sized estates of say $100,000 they probably would be around 10%.  On larger estates they would be  smaller percentage.

Avoiding probate does not mean avoiding taxes.  Taxes are something else again.  What we are talking about avoiding here is the expense, the delay, and the publicity of probating.  So far as the expense is concerned, a leading legal reference service gives the following estimated costs of estate administration (the figures include lawyers, executors, appraisers and probate court costs but do not include taxes):

Several months after completing his duties and being discharged by the probate court, an executor received a check for three cents from the Internal Revenue Service with a note explaining that it represented a refund of an overpayment resulting from an error in addition which an audit had uncovered on the tax return he had filed. Wanting to be perfectly correct, he stopped in at the probate court and asked what he should do with it. The procedure was simple, he was told. They would reopen the estate, instruct him officially to pay the three cents to a specified heir, and then close the estate again. All this was done and a few days later he received his instruction from the court to pay the three cents to the heir. Enclosed with it was the probate court's bill for $8.78 for reopening the estate. There being no money left in the estate, he had to pay it out of his own pocket.

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