The Problems with Probate
When most people start the estate planning process, they immediately think about drafting a Last Will and Testament. While an estate plan based upon a Will can be perfectly appropriate in many cases, everyone should understand the practical implications of such a plan. A Will does not go into effect automatically after someone passes a way. In order to carry out the wishes in a Last Will and Testament it must pass through the court-supervised probate process. Probate is not necessarily a bad thing. However, you need to know the potential risks involved in the process so that you can make an informed decision about what role it will play in your estate plan. The problems with probate include:
- A lack of privacy;
- High court costs and fees;
- Time delays;
- A possible need for ancillary (or additional) probate actions; and,
- The potential for contested probate
Lack of Privacy
Like most court cases, probate is a matter of public record. That means anyone can obtain copies of any paperwork filed in a probate case, including a Last Will and Testament itself. Some probate courts in Georgia even make this paperwork available to view online. This lack of privacy may not concern most people; however, some people put sensitive information in their Wills that they would not want the world to see. For example, if someone chooses to disinherit a child in their Will (which is any intensely personal decision) anyone could learn about it. Sometimes a detailed list of all the property belonging to an estate, called an "inventory", must also be filed with the probate court, which lets everyone know exactly what a deceased person owned. This lack of privacy is compounded by the fact that Georgia law requires that several notices get published in the local newspaper in a probate case, alerting everyone in the area that a case is pending.
Probate Can be Expensive
Just like other court cases, there are costs and fees associated with probate. Although the initial filing fees for probate cases are lower than other civil actions in Georgia, the total court costs required to complete a probate case are typically higher. In addition to fees for filing for probate, you have to pay fees for the court to consider certain relief while a case is pending (such as motions to sell property). Along with court costs, you have to pay publication fees to your local newspaper at multiple points throughout the probate process. On top of these costs, probate courts in Georgia charge a $2 fee for each and every page filed in a case, which adds up quickly.
Court costs and fees are usually just a small portion of the expense incurred in a probate case. Most people, for good reason, do not feel comfortable handling the case themselves and will hire an attorney. Attorney fees for probate cases can vary widely. Some attorneys charge a flat fee, others charge on an hourly basis, and still others charge a contingency fee (where the amount of the fee is based upon the value of the estate itself). These court costs and attorney fees are considered "expenses of administration" that get reimbursed out of an estate before most other debts, which reduces the amount of the estate that can be ultimately be distributed to beneficiaries.
Probate Can be Time-Consuming
Filing a petition to probate a Last Will and Testament is just the first step in a much longer process, and the timeline can vary greatly depending upon a number of factors.Related FAQ
How Long Does
Probate Take? The delay associated with probate may not pose a problem in many cases; however, some estates can lose value due to this delay. For example, if a deceased individual owned a home, the inability to make payments or sell the home until someone is appointed as Executor can result in foreclosure. The time delay associated with probate can also threaten the well-being of family members who are financially dependent upon a deceased individual, because the deceased individual's assets will essentially be frozen until the estate is administered. There are faster "temporary" petitions that can be filed to probate a Will in emergency situations such as this, but that also increases the total costs for the process.
Probate can become more difficult when a deceased individual owned real property (such as land or homes) in states other than Georgia. When Georgia residents pass away, we have to file a petition to probate their Will in the county where they resided. However, the Executor appointed by a Georgia probate court may not have the authority to transfer real property located in other states. Many states, such as New York and Florida, require entirely separate probate actions to be filed in that state to address property located there, which is referred to as "ancillary probate." Ancillary probate can increase the costs and time associated with administering an estate. Not only will you incur additional court costs for these out-of-state proceedings, but you will likely need to hire a local attorney in that state to guide you through the process.
Caveats and Contested Probate
A Last Will and Testament gives you the ability to control who receives your property after you pass away, and no one (even family members) is entitled to receive property under your Will if you do not want them to.Related FAQ
Who Can File
a Caveat? Although you have the right to leave property to whoever you choose in your Will, certain people can object to the probate of your Will and prevent the disposition of property as you intended. An objection, or "caveat" to the probate of a Will represents a challenge to a Will's validity. There are numerous grounds for asserting a caveat, such as allegations that a testator's signature on a Will was forged, or that a testator lacked the mental capacity to create a Will, or that a testator was coerced into making a Will.
The probate process provides inviduals with a readlily-accessible forum to object to Wills they disagree with. In some cases, the probate process actually invites controversy. For example, even though someone might disinherit a child in their Will, that child must still be served with the petition to probate and given an opportunity to object. Once a caveat is filed, the parties must litigate the merits of the challenge. Even frivolous caveats that end up being dismissed by the court can seriously increase the time and costs associated with probate.
A caveat is not the only way probate can become contested. Other disputes about the administration of an estate can arise after a Will has been entered to probate. For example, if beneficiaries believe an Executor is not administering an estate properly, they can demand the Executor produce an accounting or even ask the probate court to remove the Executor. Just as with caveats, each of these disputes can become mired in litigation and threaten the solvency of the estate.
Unfortunately, contested litigation regarding the probate of a Will or administration of an estate rarely ends in probate court. Only a handful of counties in Georgia have probate court judges who are required to be lawyers, which are called Article 6 courts. In every other county in Georgia, a probate court judge's orders can be reviewed by a superior court de novo. This means that if someone is dissatisfied with a decision rendered by a non-Article 6 probate court, they can simply appeal to a superior court and the case will be tried all over again.
How to Avoid Probate
People should not be unduly afraid of the probate process. Plenty of Wills pass through probate without difficulty, and many estates get administered without unnecessary delay. However, anyone who has concerns about the probate process, or who simply wants to cut the court out of their estate plan, should consider non-probate options for transferring their property. Some of the more common non-probate options include beneficiary designations and jointly owned assets, which are discussed more here. For a more robust and flexible approach, anyone who wants to avoid the probate process entirely (as well as plan for their incapacity) should consider basing their estate plan upon a Revocable Living Trust