Is Probate Necessary When a Person Has Died?

A Last Will and Testament (“Will”) does not automatically go into effect upon a person’s death. Michigan law requires a Will to go through probate. If there is no Will, probate may still be required.

What is Probate?

Probate is a general term for the legal process for the probate court to determine if the decedent’s Will is valid or not. The probate court must also approve the person named in the Will as personal representative (referred to as the “executor”) to act on behalf of the deceased person (referred to as the “decedent”). If there is no Will, the probate court will still need to approve the appointment of a personal representative for the estate, usually from a request made by an heir of the decedent.

What are the duties of a Personal Representative?

A personal representative has a fiduciary responsibility to act in good faith on behalf of the heirs and beneficiaries of the decedent’s estate. As a fiduciary, a personal representative must:

• Collect all assets of the decedent and provide an accounting and valuation of the assets in the form of an “Inventory” to the probate court and provide a copy to all heirs and beneficiaries of the estate. The personal representative must also pay an estate fee to the probate court based on the value of the estate’s assets.
• Publish a Notice to Creditors in the local newspaper to inform creditors of the decedent about the decedent’s date of death and request all creditors to notify the personal representative about claims for payment.
• Obtain an employer identification number (“EIN”) for the estate’s bank account and, if necessary, for filing the estate’s tax returns.
• Properly manage the estate’s assets, verify and pay the decedent’s debts, including medical and funeral expenses and balances on expense and credit card accounts.
• Maintain detailed records of the estate’s accounts that include the account balances at time of the decedent’s death, all real estate and tangible personal property owned individually by the decedent and all debits and credits to the estate’s bank account.
• follow Michigan's Prudent Investor Rule when managing the estate’s assets and distribute the assets according to the decedent’s Will. If there is not Will, then distribute the estate’s assets according to Michigan’s Estates and Protected Individuals Code.
• Keep the heirs and beneficiaries of the estate informed about the personal representative’s administration of the estate and all documents filed with the probate court.

When is probate necessary?

Probate is usually necessary when a decedent owns assets and property which titled solely in their name such as:

• real estate
• bank, financial, retirement and investment accounts without designated beneficiaries or without payable-on-death (POD) or transfer-on-death (TOD) designations
• valuable personal property

Probate administration is also necessary for a personal representative of an estate to settle debts of the decedent, resolve disputes and bring lawsuits on behalf of the estate.

If probate administration is necessary, the process can be informal or formal. The formal process requires court hearings before the probate judge usually for disputes concerning the appointment of a personal representative or the Will. However, typically the informal probate process used, without court hearings which involves the court’s review personal representative’s administration of the estate.

When is probate avoided?

• When financial accounts and real estate are held jointly and ownership automatically transfers upon the death of one owner to the surviving owner or owners.
• When real estate is titled through an enhanced life estate deed (lady bird deed), title of the real estate automatically transfers upon the owner’s death to the person, or persons, named in the deed, often referred to as the named beneficiary of the property. It should be noted that with this type of ownership of real estate, the original owner retains full control of the real estate during their lifetime with the right to sell or transfer the property.
• When bank and financial accounts have payable-on-death (POD) or transfer-on-death (TOD) designations and life insurance, retirement and other accounts have designated beneficiaries.
• When assets and real estate are conveyed to a person’s living trust during their lifetime or at their death, probate is avoided because trust assets are managed and distributed by the trustee, not through the probate court.

• There are also procedures for small estates with limited assets and property that allow a decedent’s heirs to avoid both informal and formal court proceedings by using affidavit and petition forms for disbursement of the decedent’s property.

Work With an Experienced Probate Attorney.

The probate process can be complex and time consuming depending on the facts involved. Finding an experienced probate attorney can help insure the proper, efficient and cost-effective administration of an estate. In my practice at Ager Law Office, I help individuals and families throughout Washtenaw County with the probate process.

For a free no obligation consultation, call Bill Ager at (734) 649-0784, send an email to bill@agerlawoffice.com, or use the online contact form.