Join us as we sit down with Attorney, Kimberly Brown, to talk through what you can expect from the probate process in Oregon. In this interview, Kimberly covers the following:
• What probate is, and what type of property will go through probate
• Important probate terminology to understand
• How to file for probate
• The impact that a will, or the lack of one, has on the probate process
• The role of personal representatives in the process
• An outline of the steps involved in a probate
• Filing tax returns and paying taxes
• …and MUCH more!
If you would like to speak with one of our family law attorneys, please call our office at (503) 227-0200, or visit our website at https://www.pacificcascadelegal.com.
Disclaimer: Nothing in this communication is intended to provide legal advice nor does it constitute a client-attorney relationship, therefore you should not interpret the contents as such.
Welcome to Modern Family Matters, a podcast devoted to exploring family law topics that matter most to you. Covering a wide range of legal, personal, and family law matters, with expert analysis from skilled attorneys and professional guests, we hope that our podcast provides answers, clarity, and guidance towards a better tomorrow for you and your family. Here's your host, Steve Altishin.
Steve Altishin 0:28
Hi, everyone. I'm Steve Altishin, Director of Client Partnerships here at Pacific Cascade Legal. And today we have our Pacific Cascade Legal attorney, Kimberly Brown, with us to talk about probates, what they are, and how the process works. So Kimberly, how you doing today?
Kimberly Brown 0:50
I am well, how about yourself?
Steve Altishin 0:51
I'm doing well today, sad about the queen.
Kimberly Brown 0:55
I am too. I am too.
Steve Altishin 0:58
So Kimberly, we've done several Facebook Lives. and a lot of folks love seeing you. But there may be some folks out there who haven't, so for them, can you just tell us a little bit about yourself?
Kimberly Brown 1:11
Sure. I'm Kimberly Brown. I'm a 24 year practitioner. And I know you can't tell by looking at me, but I started practicing when I was 12. I have been doing primarily family law as a solo practitioner for about 22 of those years. And for me, family law and as a solo practitioner included things like probate, guardianships, conservatorships, along with the divorce, custody, adoption work that most people traditionally think about in family law.
Steve Altishin 1:45
Well, good, this is perfect for you then. And you know, what we're gonna do is just talk about, you know, this word probate. And so I'm thinking let's start with, well, the start. What exactly is probate?
Kimberly Brown 2:02
You know, I think because the media or TV programs always show like this terrible family arguments about fights that are going on about million dollar estates, everybody has this idea that probate is a difficult and an onerous process, and it is not, generally. What probate is, and all that it is, is the process by which the title of a piece of property, whether it's a house, a car, a bank account, an investment account, can be passed from the person who has died to either somebody who is inheriting it, or to a third party purchaser. So if the estate wants to sell the house from the person who died to somebody who nobody knows, just wants to buy the house, the title can pass clean. And by clean it means there's no lien on the property, there's no creditors who can come and try to take the property away from you down the road. That is the whole purpose of probate is to transfer title from the person who has died to whoever is going to get the property, an heir, a beneficiary, or a third party purchaser: clean.
Steve Altishin 3:25
It's really to protect them, isn't it?
Kimberly Brown 3:27
It is, yeah. And you know, when I when clients come into my office, they often will say, I don't want to do probate, I just want to do a living trust or or other probate means a weak or other estate transfer means we talked about some of them. But one of the things we also talk about is that what probate does is there's a mechanism by which creditors have a certain time for months in Oregon, by which they make a claim against the estate. And if they don't meet that timeline, they don't get to make a claim after the estate is closed. And so that title can still transfer clean, because you've given notice, you've you know, you've looked for them. And so it's a great way of making sure that everybody that is supposed to be paid gets paid and anybody that you didn't know about or who's slow about getting their claim and can't come back later to either the air the beneficiary or the third party purchaser and say, well, I should have been paid from the person who has died, they owed me a medical bill that I you know, or they owed me a credit card debt. And so I'm gonna put a lien on your house. They didn't even know the person who died. Exactly.
Steve Altishin 4:41
Just as a personal
experience. We did a probate on my step man or my mother in law and seven years later, eight years later, we get you know, some bill. Send it back. Well, tough luck.
Kimberly Brown 5:00
Have. Exactly, exactly. And I think people don't realize how if they knew how much protection or or how much benefit they receive about being kept safe. Being free from late claims, that probate offers them, I think that they would feel better about it.
Steve Altishin 5:23
Oh, yeah. Oh, I agree. I agree. Now, you said you know, it's kind of it's where property gets transferred. But but does everything have to be probated? Are there properties that don't have to be probated or you know, some other mechanism?
Kimberly Brown 5:41
Okay. So when I say that, that the property is the process by which property has to be transferred, or property is transferred from the person who has died to the to somebody who's who's entitled to have a clean title, I'm talking about that there was not some pre planning, or some The deed is not titled in a certain way that allows it to automatically go to somebody else. So if you are married and you buy a house, your spouse generally is on title with you. And if they are entitled with you, you they are generally the title merges to them immediately on the first death. So husband dies, wife is automatically no need for probate life is automatically the sole owner of the house, if she's on title with the husband before she dies. There are investment accounts and in bank accounts, you can do a Pay on Death or transfer on death designation, where they're where you don't name somebody, a co owner of the assets. So they're not the co owner of your bank account, they're not the co owner of your investment account. But you say at my death, I'm asking you to transfer or pay to this beneficiary the money that's left in these accounts, that does not have to go through probate because you've pre plan to that. In the House Situation. Oregon has a I think it's called a date of death deed, I'm having trouble locating the word for it. But you can you can file if you file it before you die, you can file a deed that will allow the property are transferred to the person you designate. Without having to go through probate. And I'm trying to think so. So we have co ownership we have through transfer on deed or and then I think that's it, those are those are the kinds of ways that they transfer faster top of my head, I'm not going to have something pop up in a minute, but
Steve Altishin 7:43
Well, my head pops up every three minutes. And I go oh, okay. So, so let's, before we get like, a little too deep in this or not too deep, but deep into this. Let's talk a little bit about some terminology that is involved in probate because I know that the there's terminology that was used in the 1600s. And the same thing sort of as now, but sometimes it's got a different name. And so I'm just going to give you a couple things that people hear. And what they are in the first one is is you know, a fiduciary.
Kimberly Brown 8:23
Yeah, that is the person that's the person who is appointed to to be the one who has the responsibility and the obligation to manage another person's affair and Oh, an owes a duty of good faith of could of care and confidence. And so there's certain responsibilities they have, and they have to do it in the best interest of the person or the estate in the case of a probate once they've been appointed.
Steve Altishin 9:03
That leads to the naming. There's executor there's executive, there's personal representative, are they different? No.
Kimberly Brown 9:13
I say if you watch TV, you know the term executor in Oregon, we call them personal representatives, but they're generally interchangeable. And so we just if a client comes in and they say executor, I'm the executor of their state, I just say well, okay, but in Oregon we call on personal representatives, but then after explaining to them once they want to call it executor it doesn't matter on the paperwork it says personal representative and as long as they remember that when they're signing their name is the fiduciary personal representative, you know, Tom, Tom or, or or Jane Doe, personal representative, then they're fine on doing that.
Steve Altishin 9:53
And you also hear devisee or devisees, and airs
Kimberly Brown 9:59
All right. So a devisee is somebody who is going to get property from the person who has died because they wrote a will, and said, I want this property to go to to Steve, my friend, Steve. So now you're a devisee, because it's in the will. an heiress, usually somebody who is related to the person who has died and would inherit the estate, even if there was no will, under the state laws. So children, your spouse, if you don't, if you're not married, you don't have children. There's ways that the state generally has about who inherits if you don't have children or spouse,
Steve Altishin 10:45
and that leads to the last one I wanted to get to was intestate, what is intestate
Kimberly Brown 10:51
estate just means that the person didn't leave a will. And that there, that in order to distribute the assets of the estate, we're going to have to look at the state laws to see how our state Oregon governs how the state is going to be divided. And in general, you can you can just say that if a person is married, and it's a first marriage, and the kids are often the first marriage, the spouse is going to inherit everything. If it's in general, I'm just I want to make sure this is in general, if that's if there are children from a different marriage, if this is a second marriage and the end, there, the person who died has children from another marriage generally, it's it's about 50% to the spouse and 50% to the children from a different marriage. So that's, that's sort of the state law in Oregon.
Steve Altishin 11:46
But on intestate I'm assuming all right, that you still have to have a probate, I mean, the property still has to pass somehow legal right?
Kimberly Brown 11:54
Unless they've done some pre planning and transfer on death or have dead death deed that I must use a probate to transfer the deed from the person who has died the title from the person who has died to the person who should have the title and have a clean title. So yes, they do have to do a probate.
Steve Altishin 12:14
So how do you start? What? How does the administration of the estate probate get going?
Kimberly Brown 12:21
Both with intestate estates and people who have done wills, the first thing that you have to realize is that we need to have a death certificate. So until the death certificate is received by the person who's going to be asking the court to have them nominated as the personal representative in an intestate estate, or who has been nominated in the will to be the personal representative, we have to get the the death certificate, it's just a requirement to be filed along with the petition asking the court to appoint a personal representative. So you file a petition to appoint a personal representative and the death certificate. And if it's a will, if there's a will in it, then what we have to do is also attach the will to the petition for probate and file the original will with the court. We always need some information about the person who has died and the person who's going to be the is requesting to be appointed the personal representative. And we usually need information about either the heirs or devisees such as you know, what's your address? Where are you know, in the petition if we don't know their address, but we're gonna have to look for it. We can might be able to say in the petitions, I mean, like we think they live in Texas, but we'll say last known to reside in San Antonio, Texas or something like that, and then we'll do an investigation to locate them.
Steve Altishin 13:49
That can lead to where do you file it? If if, if I'm in Texas, and my uncle lied and made me the personal representative, can I just hang out in you know, Austin or do I gotta go to Oregon or what?
Kimberly Brown 14:05
Well, you can hang out in Texas. But your state cannot hang out in the state that you have to file cannot hang out in Texas. If there's property in the state of Oregon. You need to file the probate in the The venue is generally where the where the property is, is located. So if the person died in Multnomah County, you can go to Multnomah County even if there is property in Clackamas County, but generally we'll file it in Clackamas County, because it's just easier to say we're all going to be in Clackamas County because that's where the person used to live. That's where the houses the bank accounts are the car, those kinds of things and, and so, generally, we have to file a probate to transfer the title in the state where the probate is located and, and there are times when we when we will have to file what's called an ancillary probate where it's not a full probate, but we will file a probate in Oregon. And then if they had a vacation house in San Antonio, Texas, where you're residing, then we'll file an ancillary probate in San Antonio, Texas to transfer the title of the vacation home as well. But it has to be filed in Texas. To me, they're two separate cases.
Steve Altishin 15:21
So let's talk about, again, me, I'm the personal representative. What do I do? What? What do I do?
Kimberly Brown 15:32
So if you are, if you are the personal representative of an intestate estate, the one of the first things that has to happen is you have to be bonded. And bonded is essentially an insurance policy. That guarantees that if you were to do something nefarious, if you know, if you were to just one day, decide that you needed that money, because something was really rough or whatever, that there was an an insurance to guarantee that that the estate would be protected, you have to be bonded, a lot of times people in wills waive a bond requirement. And so that's in Wales, we don't often have to do a bond requirement. And then we have to also request a federal ID number. And once we have either the bond in place, or the bond wave and the federal ID number, the first thing you do generally is open an estate bank accounts using the federal ID number, you go to the you go to any bank normally, and you say I need to open a state bank account, and you open the estate of Bob or or Tammy Jones. And it's that sort of says the state of and then it will have Steve's personal representative, and then you deposit, you'll have letters testamentary is what they're called the court issued letters testamentary. That's what makes you the personal representative, you'll get a copy a certified copy, it's a big red stamp on it. And that's how the banks know that you're officially appointed. And you'll show that to the bank. So you have I forgot to tell you that that you filed a petition, and then the bond and then you get these letters testamentary. And you take those to the bank, and then you can go to any investment account or any place and say I'm the personal representative, here's the letters and you transfer that money into the estate account.
Steve Altishin 17:23
Once I've got that done, I got a bank account. I got some from the court that says you know, you could actually do something with this stay? Do I get it together? Do I've figured out before I just start giving it away? What do I do,
Kimberly Brown 17:39
but generally the you do not start giving it away until the court says you can give it away part of the way that an estate is protected, is that we have to follow certain steps in order to make sure that the estate is is paid to the creditors that need to be paid and and that we're cleaning up all the titles making sure that nothing's goes on. So you are supposed to as the personal representative, go to the IRAs to the investment accounts to the banks and transfer money into the estate account, we look to see whether the house if there's a house, does the state want to sell it? Or is it going to be transferred to somebody, we try to make those arrangements, whatever that's going to be. And then we also have to file what's called a Notice of and we have to publicize that notice for four weeks in a newspaper that's basically says to the to the world, but really to the county where the probate is filed in, Hey, there's this probate filed and if you've got a claim against the state, you have four months to file a claim. And those notices are there's an address put in the in the notice. Usually it's the attorneys address, but sometimes it's the personal representatives address and the those debts as they come in, you can pay those debts if there's enough funds to do that. And then you also have a responsibility. One of those duties of care and duties of diligence is you have to kind of go through the mail of the person who has died. You know, is there a visa from Wells Fargo bank statement or a credit card statement? Well, if there's a $12,000 balance on that, I think you as a personal representative should have a clue that it's probably still got $12,000 on it. It's a statement. It's just the one he received right around the time that person died. So you have to contact and reach out to Wells Fargo, even if they don't contact in the four months you're supposed to reach out and you know, utility bills and check and see if there's any debts on any of those sort of things. So you have an obligation to check for creditors.
Steve Altishin 19:49
Do I do I just go and pay them and do they have to actually respond back to me and say, Well, yeah, here's the bill.
Kimberly Brown 19:58
You have to let them know that there's an estate and they are supposed to send you a bill, and you have an obligation to let them know they're supposed to send you a bill. There are people who did that if they don't, if they don't push it really hard and tell them, then it just goes away. But I think that's a violation of your fiduciary role, to just hope that they don't come in within the four month period of time. I think there's just an affirmative obligation, you're required to really make sure that if there's bills there, they are paid. But but there is also an obligation of the creditor to get you the right amount of the of the bill.
Steve Altishin 20:39
And what what about things that the the person who died may own that are like still going on, you know, what it like, I don't know, business, maybe they're renting property, I mean, don't have to become a landlord for this period of time.
Kimberly Brown 20:57
And if if there is a building that the person who died owns, and there are tenants in the building, and there are agreements between the decedent, the person who died, and the people who are renting the building, those contracts are still valid contracts. So you as the personal representative will have some landlord tenant kind of obligations, and you will, you know, if the building is going to be sold, you know, we have to follow the rules that have of informing the tenants, if there are rules that we have to follow to say the building is going to be sold, the contracts are still valid if the building is sold. And then if there's an ongoing business, there is an obligation that you, you know, if there's a manager there, that you contact the manager and make sure that the business is still ongoing, but then then the decision needs to be made, hopefully, the the, the person who died has a will. And they've laid out how they want the will to, in their will, how they want the business to be divided. Or if they don't have a will, that they have an heir that that is interested in the business or already works for the business. And we can get the business valued, so that we know how much it's worth, as we go about to dividing the estate, you know that one person may want the business that sells handmade leather shoes from Italy, and that business is worth a million dollars and there's a million dollars in a bank account. Well, one person can get the business and the other person can get the bank account, if they want it that way. I mean, you know, and it hasn't been specified in the will.
Steve Altishin 22:34
How do I how do I know? I've kind of
gathered like said I'll property I'm kind of managing it. I'm trying to make sure that it's you know, but I don't think we're getting them contacted the creditors so we can pay people off? Also, how do I know who to pay? I mean, excuse me, how do I know who to give the money to how do we know how to distribute and who to
distribute it to.
Kimberly Brown 22:59
So you pay your bills, you go see a CPA to make sure that the taxes if there's any taxes owed by income taxes for the person who has died, you know, they will generally if they if they have some income that they earned in, let's say, 222 in 2020. If they die in September, they still have an income tax obligation if they earned income in 2022. So you have to make sure that income tax is done, you have to make sure that that is there an estate tax do or an estate tax form that still you have to take care of that. And then if there's a will, then you follow the terms of the will if the will says Kimberly gets it all. And I you know, and I don't want anybody else to get it. Then after you pay all of the debts after you've made sure all the taxes are paid, you write a check after you file after a form is filed with the court asking the court to allow you to distribute it, because you've paid all the bills and you've gotten all the taxes done. And then you write a check to Kimberley for the full amount. If it's an intestate estate, you know, when you have it's, it's a lot easier when it's all cash. But usually what you do is you sell the if there's real property, we sell the real property that money gets put into the account, we can't close the state, we can't distribute the money until the house is sold. If there's a business and that's the main asset of the estate, we can't distribute any money until the business is sold. So we have to we have to liquidate whatever the assets are if nobody's going to inherit or once those assets are they were designated to go to somebody and then that gets put into the bank account and then if there's no if there's no will then we have to look to the intestate succession laws. And then after you file a petition to distribute the assets of the estate, you would write a check. Let's say there's three children you would write each child A third check for a third of it. I want to say something, I keep talking about forms that have to be done. And you know, we have to do an inventory form that we didn't talk about. There's all this stuff that has been, most people in probates have have an attorney, that does the process. And people get a little overwhelmed just the idea of an attorney. But what I will say is that while the attorneys in this area of practice will often ask for the costs to be advanced between 1000 1500, let's say, for the publication for the filing fee. If there's any bond kind of obligation, attorney fees are paid out of the estate at the end of the estate, as you as Steve would not be required to pay the attorney upfront, or throughout the process, as the law requires that the court has to approve the fees of the attorney. So the attorney actually helps you all the way along the way. They send you a letter that says, Hey, Steve, you've got the letters, here's the tax ID number, go open a bank account. Hey, Steve, here's the notice of that. Here's the the form you have to fill out that says, I looked for all of the creditors of the estate, and I and I've looked exactly like I was supposed to, and I couldn't find anybody or I found who I was supposed to. These are the things I did to check. You know, here's the inventory of all of the stuff that's in the estate, I found the IRA, I found the bank accounts, I found the house, I found the boat, I found the cars, and this is what they're worth. And then here's the end at the end, here's what's left after I've paid all the bills, and here's what's the attorneys fees are. And here's what the personal representative fees are because you can get statute, there's a statutory rate for personal attorney fees. And I'm asking the court to distribute that most of that is all done by attorney. So you don't have to do that. Because that's a lot of information, you have to learn really quickly. And so you have to read all of the forms we do for you citing them, but
Steve Altishin 27:08
But all this gets us back down to like you said, gathering stuff, making sure you got it all making sure you paid the people who are supposed to pay and then making sure you give the rest of it to the people you're supposed to give it to. Right. Whatever it's if there is a if there's a an argument, we talk a lot about what the personal representative does. But let's say I don't know, the spouse comes in and says hey, I don't want that I want this or or a kid comes in and says, Hey, that will was you know, was shouldn't have been done. And yeah, I was deceived into doing it. I mean, are those things handled in the probate too?
Kimberly Brown 27:48
Yeah. If there is a disagreement about how things are supposed to be distributed, or what somebody wants, the person who is has the disagreement has to file an objection with the in the probate process, and that's their responsibility to do. So if there's a spouse who doesn't think that the children should inherit any of the money, they might file up an objection, and they have to show that there's some reason why the intestate succession laws shouldn't apply in this particular instance. If there's if there's a will that exists, what would they normally those contests generally are, there was some kind of undue influence at the time, I mean, you'll often see that there was a will done 20 years ago, and then three days before they died, they amended a will or they did a new will. And all of a sudden certain people got left out. And so that's that's when you see like a objections coming forward. There's somebody somebody, and sometimes it's not, I mean, sometimes it is that everybody else has not checked in for 20 years, and you've got the nephew who's taken that person to the doctor, and the medical appointments and been the one visiting every couple of days or whatever. But But yeah, you have to file a an objection with the with the with the estate, and then the personal representative has the authority to to have the probate court deal with the objection or have that moved into civil court. And then there's it gets really kind of complicated at that point.
Steve Altishin 29:35
At the end then I as the personal representative, handout, all the money. And I think you said that I gotta get I gotta get approval by the court first. And if the court if the court gives me that approval, and I do what the Court tells me to do, it feels like I'm also got some protection. If someone comes back later and say, No, I wanted that amount. Right
Kimberly Brown 29:59
now What what we have when you distribute the estate, you have all of the people who are getting something from the estate, sign a receipt. And part of their signing the receipt is that I agree that I've gotten everything that I'm entitled to get. And I am not going to come back and say later, I should have gotten something different. And and I understand that if there's a missing kind of thing that was done accidentally, that they're, you know that I'm not going to make personal representative pay for that out of their own pocket. Sort of, it's written by lawyers for lawyers. So it's a little bit more complicated language than that, but that's what it says, If you translate it into regular people language, and so so so we have this receipt that you that you sign is as an heir, or devisee. And so that helps protect the personal representative. And also lets the court know that the person who was in the will got what they were supposed to get.
Steve Altishin 31:08
And, and that kind of is it's a process ending, everyone knows it's over. And it's done and had their, their, their time to say what they need me to say, we're up, we're really right at what we should be going by there's one last thing, what if my state is like, super small? Do I have to go through this entire process? Or is there sort of a simplified version out there?
Kimberly Brown 31:33
If I remember the numbers correctly, you can file a smallest state in Oregon, which is a much quicker process if your house is $200,000 or less, and, and your cash value is 75,000, I think is the number. So 275,000 total, you can file an affidavit of claim being successor that basically just says, Hey, this is all we have. This is who's supposed to inherit it. This is how we, you know, propose it happen. And you file that and you can you don't have to do the filing of the notice you don't have to do a lot of stuff. The way that you have to do it in a full probate. Well, that's good.
Steve Altishin 32:19
This was wonderful. This was this was really, really helpful. And, you know, we're, as always, we we talk and talk and talk and we get a little over time, but that's okay. Because, you know, just explaining how probate works. I mean, this is complex legalese at its finest. And you were able to make it understandable for even someone like me, so that's so thank you. Thanks for asking me. Oh, work. I'll keep asking you. And everyone else. Thank you for joining us in anyone has questions anymore after this, please post it here. We can get you connected and Kimberly. And until next time, stay safe. Stay happy. Be well.
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