A lawyer could be of use to personal representatives for loved ones’ estates. Not only might some courts require that some people work with an attorney, but an attorney could also educate personal representatives about the facets of their fiduciary duties. Among these obligations that many people are less familiar with are the differences between unsupervised and supervised estates in Lombard. Let a lawyer help you today.
The difference between an unsupervised estate and a supervised estate is the involvement of the probate court. An unsupervised estate, which is the vast majority of the estates opened in the Lombard area, is a proceeding whereby the representative could perform acts in the best interests of the estate without court approval. The classic example is selling real property. A representative could sign a deed, a listing agreement, and a real estate contract in an unsupervised estate or an independent estate without obtaining court approval.
It is probably easier to explain the difference by describing what a supervised estate representative has to do. Before they spend anything from an estate, they need to obtain court approval. Generally, what happens is an inventory is filed in a supervised estate. It needs to be filed with the court. It does not need to be in an unsupervised estate, but that inventory establishes the starting point for the supervised representative’s accounts. They need to file accounts with the court every year, and those accounts need to be approved.
Before any distribution is made, those distributions need to be approved by the court. This includes establishing a budget, for example, for the payment of regular expenses such as maintaining real property. If there is a business that needs to be wound down or run, the representative likely needs to obtain court approval before any funds could be spent to pursue those goals. And, every distribution needs to be approved by the court. This includes the payment of fees to a CPA, an attorney, and the representative.
In an unsupervised estate, a notice of these actions is generally given to all the beneficiaries. For example in the event of selling real property, even in an independent estate, they do not need court approval. It is better to just give notice of the sale to all the beneficiaries so if there is a problem or the beneficiaries have an issue with any aspect of the sale, they could try and raise that in court ahead of time as opposed to at the end of the estate administration.
In an unsupervised estate, they are only in court once to open and once to close. Everything else is handled outside of court. The beneficiaries still need to approve everything. They still need to approve the final account, but the estate is saved the expense of needing to go to court for every disbursement or every action that the representative takes.
An estate lawyer could help a personal representative in the administration of an estate by advising the representatives so that they do not breach their fiduciary duty. One of the main risks to serving as administrator is the concept that the administrator owes a fiduciary duty to the beneficiaries and any other interested persons in the estate. This means that the actions they take need to be in the best interests of the estate, need to maximize the property that is available to the beneficiaries, and need not allow the estate to waste in any fashion.
A lawyer could help a personal representative as they make decisions with respect to different types of property and whether or not they expend funds for certain types of reasons, such as evaluating claims, evaluating debts, or evaluating whether or not certain property needs to be maintained versus sold. An estate lawyer needs to represent a personal representative because the estate is a vehicle in which the interests of numerous parties are being represented.
For example, in Illinois, oftentimes judges would not allow a personal representative to open an estate without a lawyer. That is because in Illinois a person is allowed to represent themselves, but they are not allowed to represent the interests of others. Some think of the estate as a kind of abstract entity that involves the interests of all sorts of different people. A lawyer needs to represent the estate since lawyers are the individuals in Illinois allowed to represent the interests of other people.
The difference between unsupervised and supervised estates in Lombard is significant. However, many people like yourself often find themselves overwhelmed by the intricacies and legal duties involved in administering an estate. For assistance fulfilling your fiduciary obligations, reach out to a dedicated attorney who could be of help.