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Recovering Expenses in Probate Cases

It is quite common for a person named as a personal representative in a probate estate to incur certain costs and expenses related to the decedent and the decedent's estate prior to being officially appointed as the personal representative of the estate. Such costs and expenses can include, funeral expenses, burial expenses, utility bills for the decedent's homestead, legal fees, and other fees and costs related to the securing and maintenance of the decedent's home and other assets.

Many personal representatives are concerned about how they will be paid back these expenses that they often pay out of their own personal funds. The good news is that Florida law provides a statutory scheme for the personal representative to recover these out of pocket expenses.

The Florida Probate code provides that if the personal representative expends funds or incurs obligations to preserve, maintain, insure, or protect the probate property of the decedent then they shall be entitled to a lien on probate property of the decedent (and its revenues) to secure repayment of the expenses incurred. The expenditures paid by the personal representative actually become a debt owed to the personal representative by the estate. Finally this debt owed to the personal representative can be even charged against and secured by a lien on the decedent's protected homestead property.

The personal representative must petition the court to adjudicate the amount of the debt for expenses paid and formal notice must be provided to the persons appearing to have an interest in the property of the decedent.

Once the court has approved the expenses paid the personal representative may enforce payment of the debt as follows:

  1. By foreclosure of the lien;
  2. By offset of the debt against any other property in the personal representative's possession that otherwise would be distributable to any person having an interest in the protected homestead, but only to the extent of the fraction of the total debt owed to the personal representative the numerator of which is the value of that person's interest in the protected homestead and the denominator of which is the total value of the protected homestead; or
  3. By offset of the debt against the revenues from the protected homestead received by the personal representative.

The personal representative's lien shall attach to the decedent's property and take priority as of the date and time a notice of that lien is recorded. The personal representative's lien may secure expenditures and obligations incurred, including, but not limited to, fees and costs made before or after recording the notice. The notice of lien may be recorded before adjudicating the amount of the debt. The notice of lien shall also be filed in the probate proceeding, but failure to do so does not affect the validity of the lien. A copy of the notice of lien shall be served in the manner provided for service of formal notice upon each person appearing to have an interest in the property. The notice of lien must state:

(a) The name and address of the personal representative and the personal representative's attorney;

(b) The legal description of the property;

(c) The name of the decedent and also, to the extent known to the personal representative, the name and address of each person appearing to have an interest in the property; and

(d) That the personal representative has expended or is obligated to expend funds to preserve, maintain, insure, and protect the property and that the lien stands as security for recovery of those expenditures and obligations incurred, including, but not limited to, fees and costs.

A personal representative may also be able to recover their attorney's fees and costs incurred in the legal enforcement of their lien.

Although Florida law does provide a mechanism for personal representatives to be reimbursed for the expenses they incur before the probate administration begins, the law is complicated and if all of the required legal procedures are not followed correctly their claims may be denied by the court. It is important to seek legal counsel of an experienced attorney when dealing with any type of probate matter.

This article was written by attorney Matthew J. Monaghan. For more information on Matthew J. Monaghan please see his profile page on our website: http://www.cantwellandgoldmanpa.com

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