New York Probate Lawyer Blog

As a New York Trusts and Estates and Real Estate Attorney for more than 40 years, I have come across many instances where fiduciaries must administer real estate.  When a person dies one of the most valuable assets which may be part of an estate is real estate.  This type of asset may be in the form of a decedent’s residence or commercial or business property.  Additionally, real estate may include real property in the form of a house or a condominium.  While cooperative apartments are technically not real estate since the ownership is a shareholder interest in the cooperative corporation, many of the same problems are associated with all similar types of real property interests.

The initial concern for an Executor or Administrator is to appreciate the type of appointment they have received.  An Executor or Preliminary Executor is going to be acting pursuant to a Last Will and Testament. may provide specific provisions as to whom the real estate is to be given.  Similarly, the document may provide that the property is to be sold and the net proceeds distributed to a number of beneficiaries.  Where there is a specific devise of real estate a fiduciary’s authority to dispose of such asset may be limited.

In situations where a decedent dies intestate without a Will, the decedent’s distributees would be the beneficiaries of the property.  In these cases, there may be complications since technically the distributees become owners of real property upon death.  However, an estate may be subject to claims, expenses and debts which may require an Administrator to take control over the property to satisfy these items.

When an individual dies, one of the first orders of business is to determine whether the decedent’s estate requires a formal settlement.  In this regard, a full understanding of a decedent’s assets and affairs is imperative.  The New York Probate Lawyer Blog has published many articles discussing the difference between assets which are subject to distribution by operation of law and those which require the formal appointment of an estate fiduciary such as an executor or administrator.

In essence, in the event a person owned assets such as bank or financial accounts, real estate or other similar items in his name alone, then an estate fiduciary is necessary to access and collect these items.  If a decedent had prepared a Last Will and Testament, then the Will must be probated in the appropriate Surrogate’s Court.  Typically, the person named as Executor in the Will initiates the probate process.  When a Will is admitted to probate, the Executor receives Letters Testamentary which show his official authority to act on behalf of the estate.

In situations where there is no Will, Letters of Administration can be applied for from the Surrogate’s Court by individual next of kin who have priority under the estate laws to be appointed as Administrator.  The persons who are entitled to receive a share of an estate are also the next of kin who have statutory priority.

The appointment of a fiduciary in New York can take many forms.  When a person dies and leaves a Last Will and Testament the document typically designates the appointment of an Executor.  After a Will is admitted to probate, Letters Testamentary are issued to the Executor.  If a decedent does not have a Will and dies intestate, then an Administrator is appointed after the conclusion of proceedings for Letters of Administration.  As to trustees, there are different types of trustees.  A testamentary trustee is appointed to oversee a trust which is created in a Will.  A trustee of an inter vivos trust is responsible for a trust created outside of a Will such as a revocable or living trust.

In all instances, fiduciaries such as Trustees, Executors and Administrators must act properly and uphold their fiduciary duties.  They have certain powers and authority which is granted by the document and also by New York estate and trust statutes.  Estates, Powers and Trusts Law section 11-1.1 entitled “Fiduciaries’ powers” provides many of the powers which can be executed.  Fiduciaries generally owe various duties which prevent conduct such as self-dealing or using funds for personal reasons.  When a fiduciary acts improperly they can be found to have breached their fiduciary duty.  Such a breach can result in a fiduciary being suspended or removed and also personally liable for any transgression.

One of the primary statutory provisions concerning misconduct by an Administrator, Trustee or Executor is Surrogate’s Court Procedure Act section 711 entitled “Suspension, modification or revocation of letters or removal for disqualification or misconduct”.  This statute lists 11 categories of conduct or situations in which suspension or revocation may occur.  Typically, a person interested in an estate or trust would file a petition with the Court seeking the appropriate relief.  The petition should be as specific as possible when describing the conduct or reasons whereby the Court should take appropriate action.

There are many different types of assets which may be a part of a New York estate.  When a person dies he may leave a Last Will and Testament.  In such event the Will needs to go through the probate process.  This means that the Will is filed with the local Surrogate’s Court along with a Petition for Probate and additional documents.  If there is no Will, then Letters of Administration need to be issued to the statutory person entitled to receive them.  This is typically a decedent’s next of kin.

The New York Probate Lawyer Blog has published many articles concerning Probate and Intestate Administration.  Estate assets come under the authority of the estate fiduciary which is either an Executor or an Administrator.  Among the various assets the estate may have control over, are a decedent’s cooperative apartment or condominium apartment.  Each of these properties present unique issues and problems which an estate fiduciary may need to resolve.

A cooperative apartment is not considered to be real estate.  The interest is the ownership of shares in a cooperative corporation.  There is also a proprietary lease which allows the shareholder to occupy the unit.  The issues that arise with a co-op relate primarily to the fact that any sale of the apartment must be approved by the cooperative management.  Not only must the co-op approve the purchaser, it must also certify that the estate administrator or executor provides proper authenticated documents showing the power to transfer the owner’s interests.  These documents may include updated certificates from the Surrogate’s Court, various affidavits of ownership and no estate debts and an estate tax Release of Lien which must be obtained from the NYS Department of Taxation and Finance and sometimes the IRS.  Also, the original stock and lease must be located and turned over to the management.  This may present a problem if these documents cannot be found among a decedent’s personal papers.  It may be necessary to obtain special title insurance to ensure against any misappropriation of these papers.

There are numerous marital rights and issues which may arise in Estate and Trust cases in New York.  These matters span a broad range of topics which include probate proceedings and intestate administration proceedings.  The New York Probate Lawyer Blog has published many articles concerning spousal matters.  This blog will discuss facts relating to some of these matters.

Probate Proceedings: The probate of a Last Will and Testament in Surrogate’s Court directly affects the interests of a surviving spouse in a number of ways.  To begin with, probate cases require that official notice be given to a decedent’s next of kin which includes a living husband or wife.  As an essential party of interest, the spouse would generally have the right to contest a Will if he or she would benefit monetarily.  Not only might there be a Will Contest, a surviving spouse is afforded a spousal right of election pursuant to Estates, Powers and Trusts Law section 5-1.1-A entitled “Right of election by surviving spouse”. This estate statute allows the wife or husband to elect to receive the benefits under a Will or receive a statutory share essentially equal to one-third of a decedent’s net estate.  The calculation of an elective share can be quite complicated since it includes assets which are transferred outside of the probate estate like joint assets which are referred to as testamentary substitutes.  The statute provides a formal procedure whereby a Notice of Right of Election is filed with the Surrogate’s Court and a copy is sent to an estate Executor or Administrator.  While there is no legal requirement to give a spouse any bequest in a Will, the Right of Election provides protection so that a spouse cannot be entirely disinherited.  If a third-party is named as a beneficiary on separate assets such as a NYCERS retirement account, a spouse may have a right to receive a share of such asset.

Intestate Administration Proceedings: Where a decedent dies without a Will, a spouse would also have a Right of Election to receive a share of a decedent’s estate.  This right is separate from a surviving spouse’s right to receive an intestate estate share.  Sometimes the intestate estate does not include assets such as joint accounts and other assets which pass directly to named beneficiaries.  The spouse can claim a portion of these items.