When a parent dies, the adult children often ask if they are responsible in any way for the debt that is left behind. The quick and easy answer is, no, you are generally not responsible for the debts of your loved one who passed away. There are exceptions however, and it is important that you take the next steps properly after someone passes to ensure that you are not liable for any debts they may have. In many cases a parent or other loved one who passes away has debts that exceed their liabilities. Even if you are named as an executor in a will, no one can require you to administer the estate, pay their debts, or otherwise deal with estate assets. However, there may be sound reasons why you want to do so. Once you are sworn in as an executor, you are required to handle the assets according to law, and you are liable if you mishandle assets.
You are only responsible for handling the assets correctly.
In many cases when we look at the assets and debts of a person who has passed away, we find that their estate is essentially bankrupt—that is, that there are not enough assets to sell in order to pay off any debts of the estate. Typical debts of someone who has passed away include medical bills, credit card bills, past due rent, or mortgage and foreclosure debts. Of course, if there are assets and they have any value, we can sometimes salvage the estate.
By opening an estate, you are not personally liable for more than what is in the estate. As a very simple example, suppose this is the estate:
$60,000 Assets
$100,000 Debts
In this example, if you open the estate, you are only responsible to liquidate the $60,000 in assets (that is, sell the house, stocks, car, etc. that makes up that $60,000 in value) and pay the debts you are able to (more on that below). You are not responsible to personally pay for the other $40,000 in debt as long as you follow the law.
How do you decide which debts to pay?
Deciding which debts to pay is not difficult in most cases because the law already provides for what order creditors are to be paid off. As an executor, your job (in consultation with an estate attorney) is to ensure that the top-priority creditors are paid. As long as you do that in the proper order, you are not liable for the debts that are not paid.
Why would I open an estate if I’m just going to pay off some debt?
The advantage to opening an estate that will not pay all of its debts is that we can pay the executor a fee (this is a top-priority debt) and reimburse family for funeral expenses (also a top-priority debt). A good estate attorney can help you to ensure that you are following the rules and that you will not be personally liable in the end.
However, if you open probate and misappropriate the assets or if you take assets for yourself out of probate and chose not to pay all the creditors, then you will be liable for the amount of the property that was misappropriated. You can also be liable to the Department of Revenue if you have failed to pay the taxes on the assets involved. This is why it is important to consult with a probate attorney.
Guarantors and Co-signers are still liable.
Of course, we should also take note that an individual’s death does not change your obligation to pay any debt you are a co-signer on. If you co-signed on the decedent’s student loans or their car loan, you will still be responsible for that debt, personally. This is true whether you open an estate or not—but it may be an additional reason to open an estate and see if estate assets can lawfully be used to pay off that debt.
Finally, children can be liable for misappropriating their parents’ assets during their lifetime if those assets should have been used to pay for medical care. The Department of Human Services sometimes seeks contribution for costs that were incurred by the government for medical care if the children misused or failed to preserve assets in certain situations. Once again, this would be true regardless of whether an estate is opened.
Conclusion: Call a probate attorney at Cornerstone Law Firm today
As with many legal issues, there are many complications that can arise out of an estate. If you have any particular concerns or want to get in contact with an attorney regarding an estate, give us a call at Cornerstone Law Firm.
Cornerstone case granted appeal by SCOTUS
/in First Amendment, Updates /by Cornerstone LawIn 2020, Cornerstone Law Firm attorney David Crossett represented a mail carrier from Lancaster named Gerald Groff. Mr. Groff sued the United States Postal Service for their failure to accommodate his religious beliefs regarding working on Sundays. The case eventually ruled in favor of the USPS, citing a precedent set by the 1977 Supreme Court case “Trans World Airlines v. Harding.”
Mr. Groff later brought the case before the Supreme Court and asked them to reconsider the original ruling from the Harding case. His case was the 4th in recent years to push back on Harding’s precedent, and SCOTUS has granted certiorari in regards to this case. (Certiorari is the process of a higher court reviewing a decision made by a lower court.)
The SCOTUS appeal is not being handled by a Cornerstone attorney, but we are interested to see how this plays out as the original case was brought to trial by one of our own. It’s rare that a case is heard by the Supreme Court, as they only review about 60 cases per year. Depending on the ruling, Groff v. DeJoy has the potential to set a new precedent for similar religious liberty cases.
If you’re interested in learning more about this case, here are some resources:
SCOTUS Blog Post #1
SCOTUS Blog Post #2
SCOTUS Blog Post #3
Advisory Opinions Podcast
An early press release about this case
Adult Adoption in Pennsylvania
/0 Comments/in Family Law /by Cornerstone LawWhen we think about adoption, we tend to picture a loving couple adopting a baby or young child, but we rarely think about all the adult children in need of the love and care of a parent. You are never too old to need a parent. As adult children, we regularly call our parents to ask why the yellow light in our car is flashing or whether we can mix the darks and the whites in the wash (wash it on cold!). By legally adopting another adult you can ensure that parent/child relationship is legally protected.
1. Who Can be Adopted?
PA Statute 23 § 2311 states that any individual may be adopted, regardless of age or residence. Any adult 18 and older may adopt another adult 18 and older. It does not matter that the adoptive parent is younger than the adoptee (the person being adopted) if both are 18 and older.
Because adult adoptions involve two adults, there is no need to terminate the birth parents’ rights as both are consenting adults. However, State law does require that the adoptee consent to being adopted. This can look like writing a statement or checking a box and confirming the same at any adoption hearing in front of a Judge.
2. How Can I Adopt an Adult in Pennsylvania?
When you adopt an adult in Pennsylvania, you are not required to go through the lengthy process at an adoption agency, complete a home study or submit to numerous background checks. All that is necessary is for the adoptee or adoptive parents to file a petition, an original birth certificate, and the filing fee. The adoptee may also choose whether or not to change their name.
It’s important to note that each county has a slightly different process for submitting paperwork. For example, Montgomery County, Chester County and Bucks County have Adoption Packets online that provide templates for the adoptee/petitioner to use and file with the Court. Berks County offers no such templates. Additionally, Chester County, among others, requires acknowledgment or proof that the adoptee is currently a resident of Chester County. These form templates are a good place to start to determine what information the Court requires for submission.
3. Do I Have to Change my Name?
This question might have an obvious answer, but you also may be pleasantly surprised to learn that changing your name is entirely up to the adoptee. The adoption process makes no requirement upon the adoptee to change their name. However, if you decide to change your name, the Courts require that you submit to a criminal background check through fingerprinting, which must accompany your Petition for adoption. Additionally, the adoptee/petitioner must also perform a lien search. Once the paperwork is filed, a hearing will be scheduled that both the adoptee and adoptive parent(s) must attend. Courts will also ask that you advertise the notice of hearing to ensure others who wish to contest the name change have a right to be heard.
4. When is an Adult Adoption Prohibited?
The Court is likely to grant most, if not all, adult adoptions that pass through their doors. The following are circumstances where an adoption will not be granted:
If you are considering adult adoption, contact an attorney at Cornerstone Law Firm today. We can help you decide whether adult adoption is right for your family.
Am I Responsible for My Parent’s Debts?
/in Estate Administration, Wills /by Cornerstone LawWhen a parent dies, the adult children often ask if they are responsible in any way for the debt that is left behind. The quick and easy answer is, no, you are generally not responsible for the debts of your loved one who passed away. There are exceptions however, and it is important that you take the next steps properly after someone passes to ensure that you are not liable for any debts they may have. In many cases a parent or other loved one who passes away has debts that exceed their liabilities. Even if you are named as an executor in a will, no one can require you to administer the estate, pay their debts, or otherwise deal with estate assets. However, there may be sound reasons why you want to do so. Once you are sworn in as an executor, you are required to handle the assets according to law, and you are liable if you mishandle assets.
You are only responsible for handling the assets correctly.
In many cases when we look at the assets and debts of a person who has passed away, we find that their estate is essentially bankrupt—that is, that there are not enough assets to sell in order to pay off any debts of the estate. Typical debts of someone who has passed away include medical bills, credit card bills, past due rent, or mortgage and foreclosure debts. Of course, if there are assets and they have any value, we can sometimes salvage the estate.
By opening an estate, you are not personally liable for more than what is in the estate. As a very simple example, suppose this is the estate:
$60,000 Assets
$100,000 Debts
In this example, if you open the estate, you are only responsible to liquidate the $60,000 in assets (that is, sell the house, stocks, car, etc. that makes up that $60,000 in value) and pay the debts you are able to (more on that below). You are not responsible to personally pay for the other $40,000 in debt as long as you follow the law.
How do you decide which debts to pay?
Deciding which debts to pay is not difficult in most cases because the law already provides for what order creditors are to be paid off. As an executor, your job (in consultation with an estate attorney) is to ensure that the top-priority creditors are paid. As long as you do that in the proper order, you are not liable for the debts that are not paid.
Why would I open an estate if I’m just going to pay off some debt?
The advantage to opening an estate that will not pay all of its debts is that we can pay the executor a fee (this is a top-priority debt) and reimburse family for funeral expenses (also a top-priority debt). A good estate attorney can help you to ensure that you are following the rules and that you will not be personally liable in the end.
However, if you open probate and misappropriate the assets or if you take assets for yourself out of probate and chose not to pay all the creditors, then you will be liable for the amount of the property that was misappropriated. You can also be liable to the Department of Revenue if you have failed to pay the taxes on the assets involved. This is why it is important to consult with a probate attorney.
Guarantors and Co-signers are still liable.
Of course, we should also take note that an individual’s death does not change your obligation to pay any debt you are a co-signer on. If you co-signed on the decedent’s student loans or their car loan, you will still be responsible for that debt, personally. This is true whether you open an estate or not—but it may be an additional reason to open an estate and see if estate assets can lawfully be used to pay off that debt.
Finally, children can be liable for misappropriating their parents’ assets during their lifetime if those assets should have been used to pay for medical care. The Department of Human Services sometimes seeks contribution for costs that were incurred by the government for medical care if the children misused or failed to preserve assets in certain situations. Once again, this would be true regardless of whether an estate is opened.
Conclusion: Call a probate attorney at Cornerstone Law Firm today
As with many legal issues, there are many complications that can arise out of an estate. If you have any particular concerns or want to get in contact with an attorney regarding an estate, give us a call at Cornerstone Law Firm.
Modifying Custody
/in Custody, Divorce, Family Law /by Cornerstone LawIf you’ve reached a custody agreement with someone, it’s not set in stone forever. Circumstances change, people change, and of course custody arrangements have to change. This is especially true if you reach a custody agreement with someone when the child is young. As the child grows older, changes will need to be made.
Custody agreements are never really final, and neither are court orders regarding custody. Either party may move at any time for a reconsideration of custody. Of course, immediately after a trial, when a judge has made a decision on the merits, changes are unlikely to be seriously considered or granted. Judges look for a change of circumstances when considering motions to modify custody.
So what sort of change of circumstances might bring about a new custody order? If a judge previously found that one of the parties was not fit to have as much custody time because of a drug problem, mental illness, or a past history of being unwilling to care for the child, then showing that one of these issues has been carefully addressed may result in a change of custody. Showing a course of rehab, having witnesses able to speak about the change of the party, or showing that the party has taken classes for anger management or other types of counseling that might help them can all be part of showing a change of circumstances. Perhaps the judge previously refused to give overnights to one party because their house was not in a good condition to live in or because they were homeless. Once a person has established residency and has an acceptable place for a child to spend overnights, the custody order can be modified.
Other examples of change in circumstances can be because the child, as they grow, needs something different from each parent. Perhaps the child is an athlete and has an opportunity by spending more time with one parent to improve their chances at an athletic scholarship. In other cases, courts have found a change of circumstances where one parent is able to help them with academic challenges that the other parent struggles with.
As you can see, there are a number of ways that a change of circumstances can be found by a court. Understanding the significance of these changes and preparing to prove them is all an important part of litigating custody matters, even after a custody order came down in a trial or other hearing. Whether you’ve reached a custody arrangement by agreement or by court order, there are ways to modify the agreement.
Of course, in all circumstances the best approach is to go to the other party and see if you can work it out as co-parents. Courts appreciate efforts that have been made to do this by co-parents and do not generally smile upon someone who comes into court without having tried to first work it out with the other parent. But when an agreement can’t be reached, going to court for a modification of custody is the next step.
If you have questions about how to approach a custody change, contact the custody attorneys at Cornerstone Law Firm regarding your situation. Our family law attorneys can help you figure out the best way for you to move forward with your custody matter.
When Winning Feels Like Losing
/in Custody, Divorce, Family Law /by Cornerstone LawThere is nothing more important in life than your kids. Fighting over who will have custody of your kids is the most stressful thing that most people will ever go through. From the first conversation with your lawyer to the last, you will be talking about “winning.” At the end of the process, what does winning really look like?
At Cornerstone Law Firm we work hard to help parents make decisions that will help them live peacefully with their co-parent and do what is best for their child. The hallmark inquiry in a child custody battle is what is in the best interest of the child. Unfortunately, two parents fighting over their child is never in that best interest, but it is all too common.
Even when you try to de-escalate with the other parent, the frustration of dealing with someone at their worst can cause you to lash out, to make mistakes, to say things you don’t mean, and to widen the gap with the other parent. Litigation costs a lot of money for both parents, and this also causes people to get their backs up against the wall and make bad decisions. Many parents feel they don’t have any option but to make it more personal as time goes on because the other parent is being unreasonable about their demands.
But as a parent, it’s important to “play the long game” when it comes to custody. Part of “winning” in a child custody dispute means making sure that your children don’t feel caught in the middle and don’t see you and your co-parent fighting. Winning means teaching your child to respect the other parent, even when they are not at their best. Winning means making your children feel safe. It is hard sometimes to control your frustration, but it is absolutely vital to helping your child feel safe.
This is why a lot of times winning looks like compromising. It looks like reaching a resolution. It looks like going further than halfway for the other parent.
None of this means that you shouldn’t fight for your kids. It doesn’t mean you shouldn’t litigate a custody dispute. But it does mean that your strategy should take into consideration building the new family arrangement that will be in place until your child reaches adulthood. At Cornerstone Law Firm, our attorneys are here to help you work through this painful process. We work hard to make sure that what we arrange is in the best interest of you and your kids and will help create a better world for them going forward.
If you’re in a custody fight, contact one of the lawyers at Cornerstone Law Firm so we can help you navigate this time in your life. Our attorneys are here to help you as you make these decisions for your children and your family.
Adopting your Stepchildren
/in Custody, Family Law, Wills /by Cornerstone LawThe Brady Bunch was meant to be a humorous show about the difficulties of merging two families with kids. But 50 years after the show debuted, there isn’t really any joke about it. Merged families are the norm, and for parents working to ensure that their kids feel part of a new family unit, there can be unique challenges.
When you’re acting as a stepparent, you’re familiar with the challenges of providing parental guidance in a substitute role. If the child’s biological parent is absent or unknown, the stepparent usually feels more free to take an active role.
Many stepparents choose to go the extra mile in adopting their stepchild. The adoption process can be sticky, but here are four things to keep in mind if you choose to adopt a stepchild.
1. For estate planning purposes, the stepchild is now your child.
If your will leaves things split “between my children,” this includes both biological and adopted children. You can, of course, disinherit (or limit the inheritance of) a specific child. This means that you may still adopt a child without allowing them the same inheritance as your children. For stepparents adopting a child, this often isn’t a concern. If you want to treat them like your kids during life, you may wish to treat them like your kids after death. But you should still be aware that, absent clear language in your will, the adopted stepchild becomes your “issue” for all legal purposes. And if you don’t have a will, the adopted stepchild will inherit by default. (And if you don’t have a will—get one!).
2. Adoption will require the biological parent you’re “replacing” to terminate parental rights.
In the event that the “original” parent is still involved in the child’s life, that parent will have to terminate parental rights for you to adopt your stepchild. Your spouse’s co-parent may have good reasons to agree to terminate rights, however. For example, the co-parent who terminates their rights will not have to pay child support and will not have obligations as a parent. If the co-parent is far behind on child support to begin with, it may benefit all parties for the stepparent to adopt.
If the biological parent you are replacing has passed away or was never known, then the process is simpler. You can step into that role with the consent of the biological parent.
3. In the event of a divorce, both of you will have custody rights.
One more thing you should consider when adopting your stepchild is that you will acquire legal rights as a parent. This means you can make decisions about the child’s schooling, rearing, discipline, religious instruction and more. In the event that you and the child’s parent separate, you’re entitled to custody rights the same way a biological parent would be. An adoption is a permanent mechanism, and it doesn’t dissolve just because the parental relationship does.
4. Adopting a stepchild can help the stepchild feel part of a “real” family.
Not every child will feel the same way about being adopted by a stepparent. There can be a feeling of loss for the child who loses connection, even in an intangible way, with the “original” biological parent. And the adoption by a stepparent can change the relationship from a more “fun-loving” relationship to one that is more serious. But many children express happiness about the family situation normalizing. Some stepchildren want the opportunity to see their stepparent as their “real” parent and claim a sense of normalcy in the process.
Obviously, depending on the child’s age, it’s important to speak with the stepchild together as a family and see how he or she will feel about this step. A child’s preferences should not be disregarded lightly, and it might make sense to let the process take some time as all of you adjust to the idea of an adoption before taking the steps to formalize the relationship.
Conclusion: Adopting a stepchild is a big decision
In conclusion, adopting your stepchild can be a beautiful and loving thing to do. It also requires some effort to accomplish. Most importantly, everyone involved in the situation needs to understand that it is permanent. If you’re considering adopting a stepchild, call the family law attorneys at Cornerstone Law Firm so we can help you through the process and help you consider all of the options. Our attorneys love adoptions, and we’re here to help you figure out the process.
My Case is Easy: Do I need a Lawyer?
/in Civil Law /by Cornerstone LawShouldn’t law just be common sense? We hear this question all the time. If your case is easy and straightforward, do you still need a lawyer? The answer is yes. If you are going to court, you should have a lawyer by your side. But what if your case is easy? What if it’s open and shut?
Lawyers do more than “win hard cases,” or explain things that are complicated. A lawyer can help you understand the past cases that have been decided about your issue and can review the laws that the legislature has passed regarding your situation. A lawyer can also help you gather and organize the evidence that you have to make sure it is presented in a clear way.
Furthermore, the rules of evidence that govern what a judge or jury is allowed to even hear about are complex, and you need to be prepared to make sure you “get your evidence in” when you are at court.
The most important thing that lawyers do for you is to help you understand the type of judge that will be deciding your case. If your case is a jury trial, a lawyer will also have experience in knowing how juries make decisions. Although the case may seem simple to you, you may be surprised at how the other side paints it as more complicated or confusing. Having a good lawyer means having someone who can keep the case simple and explain it to the decision makers in your case.
Having a good lawyer also means having someone on your side who can show you the weaknesses in your case. No case is ever really easy—and it’s important to understand all the things that can go wrong as you proceed.
If you’re going to court, as either a plaintiff or a defendant, call Cornerstone Law Firm today to talk to one of the attorneys about how we can help you to present your case.
What is the penalty for filing a false PFA in Pennsylvania?
/in Civil Law, Custody, Divorce, Family Law /by Cornerstone LawWhen someone lies in a Protection from Abuse petition, an incredible amount of consequences follow for everyone involved. The person who is named as the defendant in a PFA temporarily loses access to their guns and is often evicted from their home pending the outcome of the case. Sometimes the defendant is even evicted from a home where the victim did not live. Furthermore, the defendant named in a PFA is sometimes barred from seeing his or her own children during the pendency of the PFA.
For as long as courts have existed (and longer, of course), people have lied to get what they want. In Pennsylvania, some people have learned that they can lie on a petition and wreak these consequences on a defendant. So what are the consequences to the person who filed the PFA if what they said in the PFA is a lie? Can you pursue the person who filed and seek to have them punished for what they said in the PFA?
First, it is important to win the PFA. The initial step in seeking consequences is to win the battle over the PFA. This means going to the court appearance, hiring an attorney to defend you, and having the petition for a PFA dismissed. A good family law attorney can help you with this process and it’s important not to try it alone. If the judge does not believe your side of the story, the judge can enter a three-year PFA order against you, and at that point it will be all but impossible to pursue any action against the person who filed the PFA because the judge will have found the filing to be true.
Do not underestimate the potential danger in a PFA petition. PFAs are granted everyday in Pennsylvania, in every county, and often on nothing more than the word of the alleged victim who filed the PFA. Gathering evidence, preparing your defense, and having the right attorney to defend you are vital in this step of the process.
Review any false statements in the PFA. Once you have won the PFA action, the next possible step that you can take is to review whether there are any statements in the PFA that are factually false. It’s important to note that we are referring now to factually false statements and not merely opinions. Someone who says in a PFA, “I feel very afraid of this person,” is not likely to be prosecuted for perjury or face any other consequences. This is a statement of feeling or opinion, and even if it’s not “true,” or even if it’s not based on any objective facts, the alleged victim is generally entitled to their own opinion of the situation.
But of course, statements that can be proven to be lies or which are later contradicted under oath at the hearing can be the subject of a perjury charge. PFAs are filed under oath. The person who is sworn in and said the petition was true and correct to the best of their knowledge can face criminal charges for lying in the petition where specific facts are later disproven by video, physical evidence or by contradiction by the alleged victim at a hearing.
Consider whether the PFA petition was filed to set up custody or divorce, to lay the groundwork for a separate civil law action. Most importantly, in considering a PFA that was filed against you, you should consult with your attorney about what other moves you believe the alleged victim is going to make in this matter. For example, did they merely file a PFA in order to surprise you with a divorce or custody petition? Did they file a PFA to put a cloud over your job or bring some sort of civil action against you claiming damages? Or was it just a moment of vindictiveness after a bad breakup? Understanding what the alleged victim’s next move is will be important in preparing to defend yourself against any other actions that they may take against you. In most cases, the best offense is a good defense: it is important that you beat the PFA charges. Whether you actually want to take action against the person who filed may depend on what other actions you think they may try to take against you. Playing this chess game can be exhausting, but it is important to think through it with an attorney who can give you good advice on your specific situation.
Conclusion: seek a family law attorney today. If you have questions about a PFA that’s been filed against you, contact one of the family law attorneys at Cornerstone Law Firm to discuss your case. Our attorneys have experience defeating PFAs, walking people through custody and divorce actions, and more. Call us today!
How do I subpoena a police report?
/in Berks County, Car Accident, Civil Law /by Cornerstone LawWhen you are trying to get ahold of a police report after a car accident, an assault, a neighbor dispute or for any other reason, you may find that the process is very confusing. Police departments do not always produce their reports upon request, and some will tell you that you have to file a subpoena.
Unfortunately, under Pennsylvania law, to subpoena a document you must have an active case that you are a part of. This means either that you are the criminal/defendant in the case or you are a party to a civil action where you are suing or being sued. Accordingly, if you are trying to serve a subpoena on a police department, you must be a party to one of those actions. Additionally, government entities have the power to serve subpoenas in certain types of investigations, but private parties do not have similar power.
If you are not a party to one of these actions, you can consider whether you should file one in order to subpoena the documents that you need. This might mean suing the neighbor or the individual that you are in a dispute with, or in extreme cases, suing the police department if you think that you have grounds to do so. In most cases and for most people, rather than subpoenaing a police report, you should consider one of two other options.
FILING A RIGHT TO KNOW REQUEST
A Right To Know is a request under Pennsylvania law to a government entity to produce records that are in their possession. This is the state law equivalent to a Freedom of Information Act request (FOIA). Some states call these Open Records laws. Simply put, the Right To Know request allows you to request documents that the police may be holding onto, including police reports.
However, police departments routinely refuse to produce police reports claiming that they are part of “an active criminal investigation.” This is sometimes true, even after they have said there will be no charges from an incident. Although this is not technically correct, it often practically results in a brick wall in trying to obtain these police reports.
PAY FOR A POLICE REPORT
If you have been a part of a car accident, you may have the right to obtain the police report by paying the police department for it. In addition, there are a number of websites that offer this service. At Cornerstone Law Firm, we routinely retrieve these as part of personal injury cases for clients. The difference and the reason that you can obtain it here is because investigating a personal injury is one exception that most police departments will properly recognize as a reason to obtain a police report.
CONCLUSION
If you are trying to obtain a police report as part of an investigation or as part of a personal injury case, call the experienced attorneys at Cornerstone Law Firm to talk about how best to go about obtaining the police report and also to discuss whether there are any other ways to get the information that you are after. Our attorneys can help determine the best course of action and figure out your next steps.
What can I do with a short certificate?
/in Estate Administration, Probate, Wills /by Cornerstone LawWhen you obtain a short certificate for an estate, what does it empower you to do? The short certificate is the document granted by the Register of Wills in a county to the Executor of an estate. The Executor, having named and granted these “letters of administration” is given power to sell assets belonging to the deceased person, pay their bills in the proper order, list real estate for sale, negotiate with creditors, give notice to beneficiaries and more.
For many people, the first interaction after a loved one’s death that gives rise to the need for a short certificate is the bank. Having gone to the bank to try to get their family member’s bank account they hear that the bank needs this short certificate to obtain the money. Short certificates must be honored by banks, who accept them as proof from a court that you are the designated person to deal with the assets after death and ensure that the creditors are paid. When you take the short certificate in and submit it to the bank, they can give you a check to be placed in an estate account. Often, a bank will offer to open the estate account there if you don’t already have one set up.
Additionally, if listing a house, the realtor will need the short certificate to prove that you have the right to list it. This will also be required at closing when a buyer’s agent will need to see it to verify that you have the proper authority to transfer title to the home. Once again, the short certificate is the only way to prove conclusively that you are the proper administrator of the estate.
Most creditors will accept payment even if you don’t have a short certificate, after all, who doesn’t want to get a check? But short certificates are still important when negotiating with creditors for a lessor claim. In some cases, not all creditors can be paid, and the Executor will be called upon to pay debts in their proper order and to attempt to reasonably compromise some debts to ensure that more creditors are able to get money. Please note that this should be done with the guidance of counsel, as there are several legal issues that can arise if you don’t handle this correctly. Nonetheless, the short certificate is the document that demonstrates your authority to settle the claims on behalf of the estate.
Why is it called a short certificate? What is the short certificate “short” for? Technically, the short certificate is a one-page version of the Grant of Letters, which is a long document issued by the Register of Wills. In most cases, the Registers of Wills don’t even issue these documents anymore. They are kept on file in case one is needed, but the short certificate is all that is used in practice. The “short certificate” is the stand in for the longer court order.
Opening an estate comes with many responsibilities and also empowers the Executor to make decisions on behalf of the estate. But in closing, here’s an important point: opening an estate is not always the right decision. In fact, in some cases it is a major mistake. There are tax consequences to how estates are handled and there can be personal liability on the Executor who opens the estate. Accordingly, it is strongly recommended that you seek legal counsel if you’re thinking of opening an estate for a loved one who has passed away.
If you have questions about these issues, or about how to use the short certificate once you’ve obtained it, call Cornerstone Law Firm for a consultation so that we can help you take your next steps.