23 Feb Who is responsible if dad dies without a will?
Q. My father died suddenly of a heart attack. He left no will as far as my brothers and I can tell. He had a condo with a second mortgage, a car and a lot of credit card debt. We think we found his safe deposit box key. A friend said if we file the paperwork just to open the safe deposit box, we will be liable in New Jersey for settling his entire estate. We fear that there may be no money left in the condo once the debts are paid. What do we do?
— Responsible or not?
A. We’re sorry to hear about your dad.
When someone dies without a will and leaves nothing to guide their heirs, well, it can be complicated.
The process of being appointed as executor if there is a will, or administrator if there is no will, is not that difficult or expensive in New Jersey, said Catherine Romania, an estate planning attorney with Witman Stadtmauer in Florham Park.
Bonds are generally waived for executors, but administrators do have to post a bond, she said. The bond is based upon the value of the estate, which in this case does not appear to be significant.
Being appointed as an executor or administrator does not make you personally responsible for any of the decedent’s unpaid debts or obligations, Romania said.
“Because there is real estate involved and you are an heir of the estate, once foreclosure of a mortgage is begun, you will likely be named in the proceedings whether or not you are an administrator or executor, although you do not necessarily have to respond to any pleadings you receive,” Romania said.
She said you cannot be forced to take on the burdens of administration of an estate merely because you are an heir. But, she said, once you agree to serve and you are appointed as an executor or an administrator, you cannot just quit. You would need permission from the court to resign and a successor fiduciary would need to be appointed.
If there is no family member willing to serve as a fiduciary to administer your father’s estate and because there are assets in your father’s estate to be administered and debts to be paid, then the court would probably appoint an attorney to serve in such capacity, although by statute even creditors can apply for the job, Romania said. The administrator will be paid from the sale of the assets, meaning it is less likely there will be anything left to pass to the heirs.
Romania said assuming your father was not married at the time of his death and you and your brothers are his only children and he left no will, then you would each be entitled to a one-third share of his estate based on the laws of intestacy.
You would also each be entitled to be appointed and to act jointly as administrators of his estate, but any one or two of you could renounce in favor of the other(s), Romania said. For example, you could renounce so that your two brothers could serve without you, although you would remain a one-third heir.
If you think you found your father’s safe deposit box key and think you know which bank holds the box, you should contact the bank to determine the bank’s policy with respect to opening a decedent’s safe deposit box solely for the purpose of obtaining the decedent’s original will and/or life insurance policies and other important documents, if any.
This is generally best done in person with an original death certificate and proof of your identification and relationship to the decedent, Romania said.
“Unfortunately, although proposed bills have been presented in the New Jersey legislature to require bank officials to open safe deposit boxes in the sole name of a decedent for family members to search for wills and other necessary documents, these bills have not become law in New Jersey,” Romania said. “If the bank does not have a policy which permits the bank officer to open the box, then you will need to go to the surrogate and get appointed as an administrator of the estate and return to the bank with Letters of Administration which will then allow you access to the box.”
Alternatively, you will need to go to court and obtain a court order requiring the opening of the box, which is a more expensive option, she said.
Good luck to you and your family.
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This post was first published in February 2017.NJMoneyHelp.com presents certain general financial planning principles and advice, but should never be viewed as a substitute for obtaining advice from a personal professional advisor who understands your unique individual circumstances.