In the State of New Jersey, probate is handled by the Office of the Surrogate (also known as the Surrogate’s Court) established in each county. Unlike many states, the probate process is very simple. Filing requirements and appearances before probate judges are generally atypical.
Notwithstanding, it is imperative to understand the probate process in New Jersey from the planning and administrative perspectives. Although the Office of the Surrogate generally enforces few requirements regarding the administration of an estate, a competent professional should adhere to a variety of steps in order to ensure that the interests of the estate and its personal representative are properly asserted. The purpose of this article is to discuss the manners in which filing an estate is initiated in the Surrogate’s Court.
The probate process handles the administration of an individual’s assets at the time of his or her death. It is imperative to understand not only what the probate process covers but what it excludes. Contrary to popular opinion, the executor under a Will or the administrator of an intestate estate does not handle all of a decedent’s assets. There are a variety of assets which are not subject to probate. These include the following:
– Contract assets (e.g. retirement plans, individual retirement accounts, annuities and life insurance policies).
– Transfer on death (TOD) and payable on death (POD) accounts. (typically, bank accounts and brokerage accounts which have affirmative designations as to post-mortem beneficiaries).
– Property held jointly with a right of survivorship. (With the exception of the aforementioned contract assets, such title can be established for virtually any asset.)
– Assets which are owned by a living trust.
A fair number of estates can actually avoid the probate process if all assets fall into the aforementioned categories.
Many individuals choose to retitle or designate all of their assets to avoid probate – often because of unwarranted fears about the probate process. However, this is typically an unnecessary and short sighted strategy. In New Jersey, the probate process is quite simple. In addition, probate is usually necessary even if all assets are retitled because frequently there are final pension checks or Social Security checks as well as personal effects and automobiles which are owned solely in a decedent’s name. Finally, for individuals who have substantial assets, the retitling or designation of all assets to avoid probate can actually waste tax planning opportunities.
In general, the probate process is initiated with the establishment of a personal representative for a decedent’s estate. A representative is typically appointed in one of six (6) ways:
1. Administrator of a small estate.
2. Executor of an estate under a Will.
3. Administrator of an intestate estate.
4. Administrator C.T.A. of an estate pursuant to a Will.
5. Administrator appointed by the Superior Court
6.Administrator for personal injury litigation.
1. Administrator of a Small Estate. There are a variety of estates which are very small in nature. Recognizing that it is unnecessary to require bonding or unnecessary probate fees, New Jersey statutes allow for the appointment of a small estate administrator in certain circumstances. In the event there is a surviving spouse, a surviving spouse may apply, pursuant to an affidavit provided by the Surrogate’s Court, to act as administrator if the size of the estate is less than or equal to $20,000. N.J.S.A. 3B:10-3. In the event there is no surviving spouse, an heir of an estate may qualify as personal representative if the size of the estate is less than or equal to $10,000. N.J.S.A. 3B:10-4. In these circumstances, a decedent’s heirs may administer an estate without the requirement of a bond and with a reduced filing fee. The estate is typically not subject to a requirement of an accounting either.
2. Executor of an Estate under a Will. The traditional manner in which a personal representative is appointed is through a decedent’s Will. In this case, this representative is referred to as an executor. In the event an individual dies with a valid Will, the Will may be admitted to probate, pursuant to N.J.S.A. 3B:3-2, if the named executor produces the original Will, certified copy of a death certificate, prerequisite filing fee and one of the Will witnesses to sign an affidavit verifying the authenticity of the Will. Pursuant to N.J.S.A. 3B:3-4, the requirement of a witness is waived if the Will is self-proving.
Officially, a death certificate can be obtained by the township in which a decedent was a resident at the time of his or her death. However, death certificates are traditionally ordered and provided by the funeral director who handles the burial or cremation of the decedent. Prior to filing for probate, it is imperative that the proposed personal representative review the death certificate for accuracy. Inadvertently, there are times when an individual’s address is mistakenly given as a vacation home or nursing facility rather than the actual residence. Moreover, there are sometimes typographical errors and mistakes made on these forms. Once the death certificate has been released, it can be corrected by a form of affidavit. N.J.S.A. 26:6-14.
The original Will must be delivered to the Surrogate. It must be unaltered. A photocopy of the Will can be admitted only upon approval of the Superior Court. Rule 4:82. If the original Will cannot be found, there is a legal presumption that it was revoked by the testator. This presumption can be revoked by clear and convincing evidence that the document was not revoked, and, in fact represented the decedent’s wishes. In re Lawrence’s Will 138 N.J.Eq. 134, 47 A.2d 322 (1946).
Probate of a Will cannot occur until 10 days after the death of the testator, but the application to probate a Will may be filed at any time after death. N.J.S.A. 3B:3-22. Probate of a Will may be accomplished in one of two ways: (1) Common Form Probate and (2) Solemn Form Probate. Common Form Probate is an ex-parte procedure in which the executor appears in the Surrogate’s Court without notice to anyone. Solemn Form Probate occurs when a Verified Complaint and Order to Show Cause to admit a Will to probate is filed. Solemn Form Probate is typically used when a caveat has been filed by an individual who wishes to contest the Will. As such, the only means to discharge the caveat and have a Will admitted into probate is to file an application for its admission.
Under either scenario, before an executor can be appointed, he or she must execute a variety of forms. Rule 4:80-11. First, the proposed executor must execute a Power of Attorney which empowers the county surrogate to accept service of process in any cause of action in which the estate or the executor is a party. In essence, the Power of Attorney states that the surrogate is authorized to accept service of process in the event an individual or entity sues the estate and personal service upon the executor cannot be affected. In this rare event, upon receiving service, the surrogate then mails a copy of the process to the fiduciary at the address given in the Power of Attorney. The proposed executor must also file a qualification affidavit indicating that he or she is ready, willing and able to administer the estate according to law.
Upon the submission of the foregoing, the surrogate will issue Letters Testamentary which is the formal document acknowledging that the Will has been admitted to probate and that the executor has been appointed as the personal representative of the estate. In order to accomplish the objectives of estate administration, the executor must obtain a number of short certificates which are miniature forms of the Letters Testamentary. These forms are proof to a third party, such as a financial institution, that the executor is lawfully empowered to handle the assets in the decedent’s estate.
3. Administrator of an Intestate Estate. In the event an individual dies without aWill, the estate is subject to intestate succession. Distribution is governed by the intestacy statutes of the State ofNew Jersey. N.J.S.A. 3B:5-1 et.seq. The appointment of an administrator is similar to the appointment of the executor. Rule 4:80-1. Obviously, because there is no Will, the only document which needs to be filed is a death certificate. Qualification and Power of Attorney forms, similar to those executed by the executor, are also filed. Unlike most Wills, an administrator must obtain a surety bond before receiving Letters of Administration and Short Certificates.
There is a statutory list of priority for those individuals to serve as administrator. N.J.S.A. 3B:10-2. Obviously, a spouse has priority followed by adult children. Afterwards, the priority stretches out to relatives, such as parents, siblings and other more distant relations. In order to qualify for Letters of Administration, an individual must not only request an appointment but seek the renunciation, in writing, if any individual has equal or statutory priority to serve.
Interestingly enough, N.J.S.A. 3B:5-1 provides that an administrator may be appointed after five days rather than the ten day period required for a Will.
In the event renunciations cannot be acquired, Letters of Administration may be granted if the applicant produces proof that sufficient notice of application has been given to any and all prospective heirs. The notice, in order to be sufficient, must be no less than 10 days for residents of the State of New Jerseyand no less than 60 days for persons residing outside of New Jersey. Rule 4:80-3. However, a surrogate may reduce the aforementioned time periods. In the event an objection is filed in response to these notices, an administrator may only be appointed by an application to the Superior Court through the form of Verified Complaint and Order to Show Cause.
4. Administrator C.T.A. Administration with theWill annexed is obtained when an individual has a valid Will but where no named executor is available to act. N.J.S.A. 3B:10-15. Theoretically, this can occur in the rare instance where a Will has dispositive provisions for the decedent’s estate but fails to appoint an executor. A more typical case would be when an executor, as well as any alternate executor, has died, become mentally incapacitated, renounced, or otherwise failed to serve under theWill. In this situation, an individual applying for Letters of Administration would be required to file a bond. However, distribution of the estate would be made pursuant to theWill rather than pursuant to the intestacy statute.
5. Administration Established by the Superior Court. For a host of reasons, the Superior Court may appoint an administrator of an estate. Rule 4:84-3. In the event of a Will contest, an appointment of an administrator may be made subsequent to the filing of the Complaint and prior to the ultimate determination of the validity of the Will. An appointment can also be made when heirs of law cannot agree upon an administrator for an intestate estate. The Superior Court may also make an appointment in the event there is a need to remove a personal representative due to allegations of fiduciary abuse or neglect. In all of these circumstances, the Superior Court may appoint not only an heir or the named executor, but also an independent administrator.
6. Administrator for Personal Injury Litigation. In the event a suit for wrongful death is brought on behalf of a mistake, an administrator for such purposes must be named. This individual is referred to as the administrator ad prosequendum. Pursuant to N.J.S.A. 3B:10-11, this administrator can be appointed in one of three ways: (1) by the surrogate’s court in the county in which an intestate decedent resided; (2) if a decedent resided outside a state, the surrogate’s court of the county wherein the accident occurred and death resulted; and (3) by the Superior Court. In any event, the individual who received Letters of General Administration can also receive these Letters of Administration as well. This form of administration only applies to intestate estates. An executor under a Will has the obligation right to pursue the wrongful death action on behalf of the estate.