Probate Estate Personal Representative Duties
The best interest of the estate is of great concern to this Court. The Personal Representative duties is subject to the power of the Court.
This Court will not review or supervise the actions of the Personal Representative unless an interested party files a written request to the Court. In Arizona, if the personal representative is a beneficiary of an estate, they are expected to protect their own interests in the estate. The Personal Representative is required to provide sufficient information to the beneficiary to permit the beneficiary to protect his or her interests. The Court may hold a Personal Representative personally liable and responsible for any damage or loss to the estate resulting from a violation of the Personal Representative’s duties. The following is an outline of some of the duties of a Personal Representative:
DUTIES OF THE PERSONAL REPRESENTATIVE: The duties of the Personal Representative are found in Chapter 3, Title 14 of the Arizona Revised Statutes (from now on called “A.R.S.”). A personal representative is responsible for knowing and executing their duties according to these statutes. Some of the duties are as follows:
- GATHER, CONTROL AND MANAGE ESTATE ASSETS. A Personal Representative has a duty to gather and control all assets that belonged to the decedent (the person who has died) at the time of his or her death. After the valid debts and expenses are paid, they have the duty to distribute any remaining assets according to the decedent’s Will or, if there is no Will, to the intestate heirs of the decedent. The Personal Representative has the authority to manage the estate assets, but they must manage the estate assets for the benefit of those interested in the estate.
- FIDUCIARY DUTIES. The Personal Representative is a fiduciary. This means that the Personal Representative has a legal duty of fairness and impartiality to the beneficiaries and the creditors of the estate. A Personal Representative must be cautious and prudent in dealing with estate assets. As Personal Representative, the estate assets do not belong to them and must never be used for their benefit or mixed with their assets or anyone else’s assets. Arizona law prohibits a Personal Representative from participating in transactions that are a conflict of interest between the Personal Representative in their capacity as Personal Representative, and themselves in their capacity as an individual. Other than receiving reasonable compensation for their services as Personal Representative, they may not profit from dealing with estate assets.
- PROVIDE NOTICE OF APPOINTMENT. Within 30 (thirty) days after the Letters of Appointment as Personal Representative are issued, the personal representative must mail notice of their appointment to the Arizona Department of Revenue and to the heirs and devisees whose addresses are reasonably available to them. If the appointment is made in a formal proceeding, there is no need not give notice to those persons previously noticed of a formal appointment proceeding. See A.R.S. §14-3705.
- PROVIDE NOTICE OF ADMISSION OF WILL TO PROBATE. Within 30 days of the admission of the Will to informal probate, the personal representative must give written notice to all heirs and devisees of the admission of the Will to probate, together with a copy of the Will. The personal representative must notify the heirs that they have 4 (four) months to contest the probate. See A.R.S. §14-3306.
- MAIL COPIES of the Order of Personal Representative. Within 30 days after their letters of personal representative are issued, the personal representative must mail a copy of the Order to all the heirs or devisees of the estate and to any other persons who have filed a demand for notice. See A.R.S. §14-3705.
- FILE PROOF OF COMPLIANCE. Within 45 days after the Letters of Appointment as Personal Representative are issued, the Personal Representative must file with the Court a notarized statement swearing or affirming that a copy of this Order was mailed to each devisee, to each heir in intestate (no will) estates and to any other persons who have filed a demand for notice.
- PUBLISH NOTICE. Unless a predecessor personal representative already has fulfilled this duty or the Personal Representative was appointed more than two years after the decedent’s date of death, the Personal Representative must publish a notice once a week for three (3) consecutive weeks in County in a newspaper of general circulation that announces their appointment as Personal Representative and tells creditors of the estate that, unless they present their claims against the estate within the prescribed time limit, the claims will not be paid. In addition, the Personal Representative must mail a similar notice to all persons they know are creditors of the estate. See A.R.S. § 14-3801.
- PROTECT ASSETS. The Personal Representative must immediately find, identify, and take possession of all the estate assets and make proper arrangements to protect them. See A.R.S. §14-3709. All property must be re-titled to show ownership in the name of the estate –such as “Estate of (decedent’s name), by (their name) as Personal Representative.” Estate assets should never be titled in the Personal Representative’s name, anyone else’s name, joint accounts, trust accounts (“in trust for”), or payable on death (“POD”) accounts. The Personal Representative should never list themselves or any other person as joint owner or beneficiary on any bank accounts or other assets belonging to the estate. Estate assets should never be mixed with their own assets or anyone else’s assets.
If the authority of the Personal Representative has been limited by the Court, they must promptly protect the estate assets as ordered, and file a Proof of Restricted Assets with the Court. They may not sell, encumber, distribute, withdraw or otherwise transfer restricted assets without first obtaining permission from the Court.
- DETERMINE STATUTORY ALLOWANCES. It is the Personal Representative’s responsibility to determine whether any individuals are entitled to statutory allowances under A.R.S. §14-2402, 2403, and 2404. Statutory allowances include a homestead allowance, exempt property allowance, and a family allowance.
- INVENTORY ASSETS. Unless a predecessor personal representative already has fulfilled this duty, within 90 days after the Letters of Appointment as Personal Representative are issued, the Personal Representative must prepare an inventory or list of the decedent’s probate assets and their values as of the date of death. See A.R.S. § 14-3706. The inventory must be either (1) filed with the Court and mailed to all interested persons who request it, or (2) not filed with the Court, but mailed or delivered to: (a) each of the heirs if the decedent died intestate or to each of the devisees if the decedent’s will was admitted to probate; and (b) to any other interested person who requests a copy of the inventory.
- STANDARD OF CARE. In administering estate assets, the Personal Representative must observe the standards of care applicable to a trustee, including the prudent investor rules. See A.R.S. §§14-10801 et. seq. and 14-10901 et seq.
- KEEP DETAILED RECORDS. The Personal Representative must keep detailed records of all receipts and expenses of the estate. The Personal Representative is required to provide an account of their administration of the estate to all persons affected by the administration. See A.R.S. §14-3933.
- PAY VALID DEBTS AND EXPENSES. The Personal Representative must determine which claims and expenses of the estate are valid and should be paid. The Personal Representative must provide to any creditor whose claims are not allowed prompt written notification that they will not be paid or will not be paid in full. See A.R.S. §14- 3806. To the extent there are enough assets in the estate, the Personal Representative is responsible for the payment of any estate debts and/or expenses they know about or can find out about. If there are not enough estate assets to pay all debts and expenses, the Personal Representative must determine which debts and expenses should be paid according to the law. See A.R.S. §14-3805. The Personal Representative may be personally liable if they pay a debt or expense that should not be paid.
- PAY TAXES. It is the Personal Representative’s responsibility to determine that all taxes are paid and that all tax returns for the decedent and the estate are prepared and filed.
- DISTRIBUTE REMAINING ASSETS. After payment of all debts and expenses of the estate, the Personal Representative must distribute estate assets as directed in the Will or, if there is not a Will, to the intestate heirs. If there are not enough assets in the estate to make the gifts as set forth in the Will, it is the Personal Representative’s responsibility to determine how the distributions should be made as required by law. See A.R.S. §§14-3902 and 14-3907. The Personal Representative may be personally liable if they make an improper distribution of estate assets.
- CHANGE OF ADDRESS. Until the probate is closed and the Personal Representative is discharged, they must notify the Court in writing if they change their home or mailing address.
- PAYMENT AS PERSONAL REPRESENTATIVE. The Personal Representative is entitled to reasonable compensation. See A.R.S. §14-3719 and Maricopa County Local Rule 5.7. Arizona statutes do not designate percentage fees for the Personal Representative’s work or say how much a Personal Representative should be paid. The Personal Representative must keep receipts to prove out-of-pocket expenses. In determining whether a fee is reasonable, the Court will consider the following factors:
- The time required (as supported by detailed time records), the novelty and difficulty of the issues involved, and the skill required to do the service properly;
- The likelihood that their acceptance as Personal Representative will preclude other employment;
- The fee normally charged in the area for similar services; (continues on next page);
- The nature and value of estate assets, the income earned by the estate, and the responsibilities and potential liability assumed by the Personal Representative;
- The results obtained for the estate;
- The time limitations imposed by the circumstances;
- The experience, reputation, diligence and ability of the person performing the services;
- The reasonableness of the time spent and service performed under the circumstances; and,
- Any other relevant factors.
- COURT INVOLVEMENT. Usually, to reduce estate expenses, estates are administered and estate claims and expenses are paid, including the fees to the attorney and Personal Representative, with little Court involvement. The Court does not supervise informal probates or the conduct of a Personal Representative. However, if any interested party believes that the estate has not been properly handled or that the fees charged by the attorney or Personal Representative are not reasonable under the circumstances, that party may request that the Court review the account for the Personal Representative’s administration of the estate. Any additional Court involvement may result in additional delay and expenses. If appropriate, the Court may assess the additional expense against the estate or the non-prevailing party.
- CLOSE THE ESTATE. After the Personal Representative has administered the estate and all the assets of the estate have been distributed, the estate must be closed, either formally or informally. In an informal closing, a copy of the Closing Statement is filed with the Court and must be sent to all persons receiving a distribution from the estate. See A.R.S. §14-3933. For a formal closing, see A.R.S. §§14-3931 and 14-3932. Usually, the estate should be completely administered and closed within two (2) years of the initial appointment of the Personal Representative.
This is only a general outline of some of the duties of Personal Representative. It does not describe all of the duties and is not a substitute for obtaining professional legal advice. This is a general outline of duties only. If you have any questions about the duties of a Personal Representative, we are happy to meet with you and discuss how we can help.
Contact our office at 602-952-9000 or by e-mail at email@example.com. We will be pleased to meet with you, review your circumstances, answer questions about the duties of the personal representative, and help you decide if a probate is needed or if there is a better option for the speedy administration of an estate.