 | John Gibson
is a senior partner in the Wichita law firm of Gilliand & Hayes. He has been practicing law for nearly 30 years. In addition to healthcare law his practice includes wills, trusts, estate planning, probate and general representation of individuals and small business. Contact information: Phone:
316-264-7321; Fax: 316-264-8614; and e-mail: jgibson@boyerds.com |
Legal
2001-09-01 11:30:00
Settling estate problems
Question: My two sisters and I don't agree on a timetable to settle dad's estate. My sister Doris is the court appointed executor of dad's will. My other sister, Lucy, has many thousands of dollars in her account that dad put there before his death since he had no access to the bank. Mom died several years before dad died. Dad and his beneficiaries (us 3 girls) agreed that the money would be put in Lucy's name only for safeguarding. I know I must be reasonable about all of this, but how long should I wait until the home is marketed and sold? I am so afraid this home will remain unsold and a shrine to my dad. What about the thousands being held by my sibling? Lucy agrees all of the money in her account is to be divided 3 ways between us, but is slow in getting it done. In addition, I feel the executor is dragging her feet.
Answer: A lot of questions, and potential problems, are raised by the question. Let's first deal with the money that has been put into Lucy's account by your father for convenience. Legally, once this money was put into Lucy's name by your father, it belongs to Lucy, and she may have no legal obligation to give any of it to you or your sister. If Lucy were to claim it all belonged to her, you may be faced with a difficult situation. You could try to compel Lucy, through court action, to divide the money based upon an implied trust or oral agreement to do so. As the third party beneficiary of such an oral agreement, however, it is not guaranteed you could enforce this agreement. Fortunately, Lucy agrees that the money is to be divided evenly, and apparently is going to do so. As far as a timetable, you are pretty much at her mercy. There is no legal requirement that she distribute the money to you on your demand or within a specified period of time. You and your sisters are going to have to work out a timetable for the distribution of the money that is in Lucy's account. The lesson to be learned from this situation is that it is dangerous to attempt estate planning by putting money into an account in the name of a child or in a joint account with a child, where other children or heirs are involved. The actual owner of the money, in the above case the father, loses a certain amount of control over the money during his life. Further, upon his death there is no guarantee that the account holder will not claim the money as his or her own, and refuse to distribute to others as desired by the parent. Putting money or investments into joint tenancy with another, or into the name of another for purposes of convenience, with the request that the account holder distribute the property a certain way upon death, is poor and dangerous estate planning.The second question posed relates to the property that remains in your father's estate, and how soon the estate can be settled. Of particular concern is the question of whether the house which is part of the estate can be timely sold. Kansas law provides several deadlines relating to the administration of an estate, including deadlines for producing and filing a will, deadlines for claims to be made against the estate and deadlines for tax returns to be filed. A bench mark for the completion of an uncomplicated estate in Kansas is 9 months from the date of death. Unless unusual problems exist, it would be expected that an estate can be completed and closed, and distribution made soon after the 9 month period is passed. The soonest an estate can be closed is 6 months. For complicated estates it may take several years.Sale of a house can occur before the estate is closed, primarily because sale is necessary to pay bills. Unless there are unusual problems or there are objections by some of the heirs, the executor of an estate has the ability, in order to pay bills and with court approval, to sell the real estate. Or, if the will specifically allows the executor to sell real estate then the executor may do so with court approval. Otherwise, real estate is usually not sold by the executor and a house is simply distributed to the heirs when the estate is closed. The attorney that is handling the estate should be consulted about this. Finally, you should be aware that the law allows for early distribution of a portion of the estate assets in proper circumstances. If all demands against the estate have been paid, the tax obligations have been resolved, and there is not a reason to hold back all of the estate assets until closing, the executor may, with court approval, make an earlier partial distribution. Again, the attorney representing the estate should be consulted about this.
