Category: Estate and probate

Resolution: Get Organized



Popular New Year’s resolutions for Americans don’t seem to change a whole lot through the years. You’ll often see things like “lose weight” and “save more money” on resolution lists. Another common trend for resolutions is getting organized.

Now is the time to go beyond just cutting back the clutter, and start planning for your future and protecting your family. Here are a few organizational goals you can set for yourself to accomplish this in the New Year:

  1. Find out if a trust is right for you – and if so, what type
  2. Write or review/update your will
  3. Complete an Advance Health Care Directive
  4. Change or update your beneficiaries
  5. Draft a Power of Attorney
  6. Digitize your important documents

This list may seem daunting and you may just need to understand what estate planning documents you already have or might need for the future. Get professional help, like the experienced estate planning team at Herrig & Vogt, LLP, to finally tackle those big to-dos.  

Make an appointment for a free consultation to discuss your inquiries or needs for estate planning.

Avoiding Probate With A Heggstad Petition

When a person dies (known as a “decedent”), their estate (that is, all of their assets and property) comprises both “probate assets” and “non-probate assets.” “Probate assets” are assets that must be distributed to your intended heirs through the court process known as probate. Probate can be a lengthy and expensive process. In essence, the court ensures that a decedent’s assets are properly distributed to his or her intended beneficiaries.

“Probate assets” include bank accounts, real property, and personal property, such as jewelry, furniture, or vehicles. Conversely, “non-probate assets” mean just what they say: assets that do not need to go through the probate process. Such assets include real property held as “joint tenants,” pay-on-death bank accounts, life insurance, and retirement accounts. Importantly, and as it relates here, “non-probate assets” also include assets (even those that are initially “probate assets”) that are held in a trust.

A trust is when one person (known as the “trustee”) holds title to property for the benefit of another person (known as the “beneficiary”). The “settlor” (also known as the “trustor”) creates the trust and must place his or her property into the trust. This process is known as “funding the trust” and it is a critical and often overlooked procedure when establishing a trust.

By far the most common (and problematic) example is failing to transfer title in the trustor’s real property (i.e. his or her home) into the trust. As noted above, real property, such as your house, is generally a “probate asset” and therefore must be distributed through probate. One of the significant advantages of having a trust is the ability to transfer your real property into your trust, which thereby avoids probate. To do so, the trustor must change the title on the property to be held in the name of the trustee, as trustee for the trust. However, if the trustor fails to properly “fund his or her trust” by not transferring title, the real property will remain a “probate asset” and will need to go through the probate process.

Here is where the “Heggstad petition” comes into play. With a Heggstad petition – named after a 1993 California Court of Appeals case – real property may be made part of a trust’s assets without a separate deed transferring property into the trust. In essence, a Heggstad petition acts as a post-mortem transfer of real property into the trust.

However, Courts do not automatically grant Heggstad petitions. This area of law is nuanced and has over 20 years of case law exploring a variety of different circumstances. The Court will look at various indicators, including the trustor’s intent when establishing the trust.

Herrig &Vogt, LLP is experienced in successfully preparing and arguing Heggstad petitions. Contact us today for a free consultation to ensure your property is successfully part of your trust.

Disputes With A Trustee (Of A Trust)

Unfortunately, there may be times when a trustee of a trust breaches their fiduciary duties to the trust’s beneficiaries. For instance, a trustee may fail to disclose the content and value of the trust assets to the beneficiaries. Even more egregiously, he or she may misappropriate funds or fail to distribute assets to the intended beneficiaries.

Fortunately, the California Probate Code provides that a violation of any duty by the trustee is a breach of trust. The attorneys at Herrig & Vogt are well versed in identifying improper actions (or lack thereof) by a trustee and will advocate on your behalf to protect and restore your interests as a beneficiary.

If a trustee threatens to commit or commits a breach of trust, a beneficiary or co-trustee may commence a proceeding for a variety of purposes. For example, the beneficiary or co-trustee may file an action against the trustee to (1) compel the trustee to perform his or her duties; (2) enjoin the trustee from committing a breach of trust; (3) compel the trustee to redress a breach of trust by payment of money or otherwise; (4) appoint a receiver or temporary trustee to take possession of the trust property and administer the trust; (5) remove the trustee; (6) set aside acts of the trustee; (7) reduce or deny compensation of the trustee; (8) impose an equitable lien or a constructive trust on trust property; or (9) trace trust property that has been wrongfully disposed of and recover the property or its proceeds. Further, a trustee who has occupied property of the estate, while wrongfully excluding the true owner, must at least account for its rental value, even if the trustee made no net profit.

With respect to a trustee’s breach of his or her fiduciary duties, the purpose of the California Probate Code is aimed at making sure the beneficiaries recover any lost assets, or are adequately compensated. Thus, if trust property is wrongfully disposed of by the trustee, the beneficiary may elect to sue for the proceeds, or may recover the reasonable value of the property conveyed, regardless of the amount actually received for it.

In addition, a beneficiary may petition the court to compel the trustee to provide an accounting of the trust if he or she has either: (1) failed to provide an account within 60 days after the beneficiary’s written request, or (2) no report or account has been made within the six months preceding the request. The petition may also be used to compel the trustee to provide a copy of the terms of the trust. In a similar vein, the beneficiary may also contest the trustee’s accounting if he or she believes it was deficient.

If you are the beneficiary of a trust and are experiencing difficulties with a trustee, you are entitled to certain statutorily provided rights. Contact the attorneys at Herrig & Vogt, LLP today for a free consultation to ensure your rights are protected.

Does Probate Take A Long Time In California?

The process of probate in California involves taking a closer look at the decedent’s will and estate. In so many ways, this is actually beneficial, as it can help avoid oversights, both big and small. But to many people, they understandably only think about how the distribution of the assets is going to be delayed. After all, they could be depending on inheritance to pay off debts, or something just as critical.

The question then arises: “How long does probate take in California?” The answer is probably far vaguer than you want to hear.

The Duration of the Average Probate

There is no absolute definition of how long the probate process will take to fully complete. For the most part, creditors will have four months to make claims towards pieces of the estate, so you can probably expect to wait at least that much. There are also going to be pretty big delays between filing the petition and actually having the case heard. In California, the courts are infamously backlogged so that wait could be another few months.

If it can be put into an average definition, an uncomplicated estate and well-drafted will might take upwards of eight months to finalize. If the estate is quite large, it might be a full year before property is distributed. If the will is drafted incorrectly, or if someone has a valid claim to challenge how a piece of the estate is being handed out, an unknown amount of months could be added to the lifespan of the probate.

Although it is clearly a unique and peculiar case, there is a home in San Juan Capistrano that has apparently been locked in probate since 1925. While the odds of this happening to your loved one’s estate are about as slim as winning the lottery three times in a row, it does stand to show that probate is, for the most part, an undefined process.

If you need to manage a will going through probate – or if you want to learn how to increase your chances of avoiding probate – call 888.901.8229 to speak to a Roseville probate lawyer from Herrig & Vogt, LLP. Our firm was founded in 1994, and we offer free consultations, so don’t hesitate to contact us today!

Alternatives To Probate

In California, when an individual dies (known as a “decedent”), his or her assets must be distributed to the decedent’s heirs. In many cases, the decedent’s assets must go through the legal process known as probate, whereby a Court validates the decedent’s will, or lack thereof, and helps administer and distribute the decedent’s estate to the rightful heirs. This process generally takes at least six months to complete.

There are, however, certain circumstances and procedures whereby probate proceedings can be sidestepped entirely. For instance, if the decedent has a surviving spouse or domestic partner, he or she may file a Spousal Property Petition to transfer all eligible real and personal property.

If the decedent’s estate does not exceed $150,000, a beneficiary may use a Small Estate Affidavit to transfer the decedent’s personal property, such as bank accounts, stocks, furniture, and jewelry.

While California real property cannot be transferred by a Small Estate Affidavit, title can be transferred by an Affidavit Regarding Real Property of Small Value if the real property does not exceed $50,000. The affidavit, however, may not be filed until six months after the decedent’s death.

When the decedent’s real and personal property do not exceed $150,000, title may be transferred through a Petition to Determine Succession to Real Property. Unlike an Affidavit Regarding Real Property of Small Value, this procedure only requires that 40 days (as opposed to six months) have passed since the decedent’s death.

Even if the above procedures cannot be used, certain “non-probate” assets may be immediately distributed to the intended beneficiary without the inherent delay of probate proceedings.

These non-probate assets include property held in an inter vivos (or living) trust; multiple party accounts, such as joint bank accounts and P.O.D. (pay on death) accounts; T.O.D. (transfer on death) accounts; real property held in joint tenancy; life insurance; and retirement accounts, such as an IRA, pension fund, and 401(k).

Contact Herrig & Vogt, LLP today for a free consultation on navigating what can often be a confusing probate process.

Probate Attorney Fees And Compensation

In most cases, the personal representative of an estate will retain a probate attorney to help administer the estate. In California, the personal representative and his or her attorney are entitled to ordinary compensation for their services, the amount of which is determined entirely by statute. Pursuant to California Probate Code sections 10800 and 10810, compensation is based on the value of the estate as follows:

  1. Four percent on the first $100,000.
  2. Three percent on the next $100,000.
  3. Two percent on the next $800,000.
  4. One percent on the next $9,000,000.
  5. One-half of one percent on the next $15,000,000.
  6. For all amounts above $25,000,000, a reasonable amount will be determined by the Court.

Therefore, if an estate is worth $400,000, the personal representative and his or her attorney are each entitled to $11,000 ($4,000 for the first $100,000; $3,000 for the second $100,000; $2,000 for the third $100,000; and $2,000 for the fourth $100,000). The personal representative may choose to waive his or her right to compensation, which often happens when he or she is a family member or the sole beneficiary of the estate.

In certain circumstances, the Court may allow additional compensation for “extraordinary” services in an amount the Court determines is just and reasonable. Examples of “extraordinary” services that may be awarded by the Court include litigation undertaken to benefit the estate or to protect its interests; federal estate tax matters; sales of property; defense of a contested will; and extraordinary efforts to locate estate assets.

Finally, the personal representative is allowed all necessary expenses in the administration of the estate, which include the costs of the probate proceedings. These costs include court filings and publication of the petition to probate the estate. Typically, probate costs are advanced by the estate’s attorney and are refunded from the estate upon distribution of the estate’s assets.

Contact Herrig & Vogt, LLP today for a free consultation on navigating what can often be a murky probate process.