How a Personal Representative Can Avoid Paying Out of Pocket for Mistakes

A person who takes on the responsibility of serving as an estate representative may not understand the risks involved. These risks are serious and should not be underestimated when deciding to serve.

 

All representatives take on the risk of personal legal and financial liability for any negligence during the administration process. Legal risks mean that the representative can be sued by estate beneficiaries, creditors and government agencies for mistakes in handling debts and claims, even inadvertent mistakes. When a party who believes their rights to the estate have been violated, the disappointed party may bring a legal action to enforce their rights called a surcharge action. These legal matters arise when a party was not paid what they believe they should have received from the estate. A good example would be the Commonwealth of Pennsylvania suing the representative for failing to make request for and pay a Medicaid lien before distribution.

 

Unfortunately, the risks do not end with the hassle and expense of defending lawsuits. The other more serious risk is personal financial liability. Some are shocked to discover that the law holds a representative personally responsible for mistakes in estate administration. This means that the representative’s own assets can be targeted by any party who was unhappy with the way the estate was closed. Even in situations where a claim is resolved favorably, the mishandled situation can lead to delays in closing the estate.

 

These risks can leave a lingering worry of whether things that happened in the administration process will surface later. Sometimes mistakes can take a while to surface before it becomes clear a mistake occurred. Other mistakes become immediately apparent when a legal demand letter is received, or a court petition is served. In either case, the representative will have a very real concern of whether they will be held responsible for the outcome of the dispute.

 

Our office helps keep estate representatives out of trouble and close the administration process the right way. We help bring peace of mind knowing that the law was followed properly and that unknown pitfalls are avoided.

 

As a probate law firm for estate executors, we help settle estates efficiently and reduce stress. If you know someone faced with a probate process or roadblocks to an estate property sale, please have them contact us for a free evaluation at:

 

Phone: (215) 918-4242 

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If you are not quite ready for a consultation, download our probate handbook HERE. We’ll send you helpful probate guides and resources so you know how to handle the estate.