Unfortunately, the death of a relative or friend can bring about unexpected reactions from beneficiaries–some of which can cost the estate a good deal of money, resulting in losses for other beneficiaries. Fortunately, in the event of unnecessary litigation attempts, probate courts can provide remedies.
Significant Administrative Expenses
Ruling on the Estate of Beverly Howe (Mich Ct App March 9, 2023), the Court of Appeals examined and upheld two tactics used by the probate court to address “a litigious beneficiary whose claims were causing the estate and trust to incur significant administrative expenses.” The first tactic, as Warner Norcross+Judd report, required the beneficiary to fund investigation of a potential malpractice claim:
First, the probate court fashioned a remedy in which the beneficiary had to personally fund the investigation of an estate claim. The beneficiary wanted the estate to pursue a medical-malpractice claim. The personal representative did an initial investigation and concluded there was no claim worthy of pursuit, but the beneficiary wanted to invest more estate funds into an additional investigation. The probate court struck a balance by ordering the beneficiary to pay $5,000 to fund the additional investigation, and if a meritorious medical malpractice claim resulted from those efforts, the beneficiary would be refunded. The probate court’s order was upheld as reasonable by the Court of Appeals.
The Michigan Court of Appeals also upheld the bond requirement that the probate court had mandated in a second effort to curtail litigious action by a beneficiary. Probate law experts point out that the decisions by the Michigan Court of Appeals
“may have a significant impact for similar probate cases with beneficiaries who are causing an estate and trust to incur exorbitant expenses,” and share:
The probate court granted a motion that required the beneficiary to secure a bond that could fund the payment of anticipated estate and trust administration expenses to address the beneficiary’s claims. Under Michigan Court Rule 2.109(A), “[o]n a motion of a party against who a claim has been asserted in a civil action, if it appears reasonable and proper, the court may order the opposing party to file with the court clerk a bond with surety as required by the court in an amount sufficient to cover all costs and other recoverable expenses that may be awarded by the trial court, or if the claiming party appeals, by the trial and appellate courts. The court shall determine the amount in its discretion.” The probate court’s order granting the bond motion was also upheld.
Understanding Probate Litigation
Reminding us that assets intended for beneficiaries cannot be distributed until legal challenges to the estate plan are resolved, attorneys at Frank & Kraft report that despite the evidentiary burdens involved in probate litigation, “The frequency with which probate litigation occurs has been increasing in recent years…”.
Kennedy and Rusham explain that probate litigation “refers to lawsuits filed in probate court — and the legal proceedings associated with resolving these lawsuits.” Specifically, according to these attorneys, examples of probate litigation include: “contesting a will; disputing a trust; highlighting undue influence; disproving false claims from creditors; and, removing an executor for breaching their fiduciary duties.” During probate, fiduciary bonds, referred to as probate bonds, are often required. When the court requires a bond, it is essential to obtain it quickly, to meet deadlines and avoid delays. That’s why Colonial Surety makes it easy and speedy to obtain all types of probate bonds via our direct, digital service. At Colonial, the steps to securing probate bonds are simple: get a quote online, fill out the information, and enter a payment method. Print or e-file the bond even before leaving court.
Keep In Mind
Probate litigation cases are unfortunate, but it’s important not to confuse them with probate itself. Justia points out that complications during probate generally stem from “high-risk factors” such as “sibling rivalry, second marriages, and dysfunctional families.” Routinely, probate is simply the legal, public process that settles our affairs when we die. Most states offer expedited processes depending upon the level of assets involved. When families are communicating and have had a chance to get organized, probate generally proceeds smoothly.
Probate and Estate Law?
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