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legally speaking

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By Linda Toga, Esq.

Linda Toga, Esq.

THE FACTS: 

My mother recently passed away. She had a will which named me as executor and provided that I was to get the bulk of her estate. The balance was to be divided between by two siblings. I found a copy of her will in a file with her other important papers but the original was not in the file. I believe my brother may have the original will since he was a signatory on her safe deposit box which he emptied before my mother died. My brother and I do not get along and he refuses to take my calls.

THE QUESTION:

Is there a way I can compel my brother to turn over the will so that I can petition the court for letters testamentary and handle the probate of my mother’s estate in accordance with her wishes?

THE ANSWER: 

It is unfortunate when there is no cooperation between family members when a loved one dies but it is not uncommon. If you have asked your brother about the will and he refuses to turn it over, file it with the court or provide any information about its whereabouts; all is not lost. You can ask the Surrogate’s Court in the county where you mother lived for an order compelling your brother to provide information about the will and to turn it over if he does, in fact, have custody of the document. 

You should have an experienced attorney prepare and file with the court a petition to compel production of a will. The court will need the name and address of the brother you believe has the will, as well as the names and addresses of all other interested parties. The court also requires an original death certificate and a proposed order. 

Once the Surrogate signs the order, a certified copy of the order directing your brother to participate in an inquiry about the whereabouts of the will and to turn over to the court the original will must be served upon your brother. Your attorney then has the authority to question your brother about the will. If he refuses to cooperate with your attorney, your brother has a date certain set by the court to either turn over the will or explain why he cannot do so. The court can then decide how best to proceed. 

Although your brother’s inheritance may be smaller if your mother’s will is probated than if an administrator is appointed, hopefully your brother will do the right thing when faced with a legally enforceable court order. 

Linda M. Toga, Esq. provides legal services in the areas of estate administration, estate planning, real estate and small business services from her East Setauket office.  Call 631-444-5605 or vising her website at www.LMTOGALAW.com to schedule a consultation. 

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By Linda M. Toga, Esq.

Linda Toga, Esq.

THE FACTS: 

We just bought our first house from an estate. When we looked at the house with our realtor, most, but not all, of the furnishings had already been removed. The contract of sale provided that the house was being sold “As Is” and was to be “broom swept” at the time of the closing. When we did the walk thru, we were shocked to see that the furniture and household furnishings that were in the house when we first saw it were still there and that the house was quite dirty.

THE QUESTION:

Were we wrong to believe that “As Is” in the context of a real estate transaction refers to the physical condition of the house itself and not to the extent to which it may be furnished? Should the seller have thoroughly cleaned the house before the closing?

THE ANSWER: 

Unless the contract of sale stated that the items left in the house were included in the sale, you were not wrong to expect that the furniture and household items in the house would have been removed before the closing. In the context of a real estate transaction, “As Is” refers to the condition of the structure, the plumbing, the electrical system, the heat/AC systems and the included appliances. It also covers kitchen cabinets, bathroom vanities and built-in bookcases, as well as other items that are attached to the structure itself. 

Despite this fact, the question of whether “As Is” also refers to the presence in the house of personal property such as furniture and furnishings sometimes arises when the seller is an estate or when the property being sold has either been rented or vacant for a long period of time. Under those circumstances it is not unusual for the seller to have no interest in keeping the contents of the house and no desire to pay for their removal. 

To avoid any confusion and conflict, both the seller and the purchaser should discuss with their respective attorney what items of personal property, if any, are included in the sale and confirm that the other party has the same understanding of the term “As Is”. 

As for a house being “broom swept,” courts have concluded that a house is “broom swept” if it is free of furniture, household furnishings, garbage, refuse, trash and other debris. A seller should not, for example, leave a broken freezer in the basement, a dirty litter box in the hallway, decayed food in the refrigerator or cans of paint and other hazardous materials in the garage. By doing so, the seller is not satisfying his obligations under the contract to leave the house “broom swept.”

However, if the house is dusty, if there are crumbs on the counter and some hair on the bathroom floor, a court will still likely find that the house was “broom swept.” If you want assurances that the house will be in move-in condition, you should ask that a provision be added to the contract of sale stating that the seller must have the house professionally cleaned prior to the closing. 

Linda M. Toga, Esq. provides legal services in the areas of estate administration, estate planning, real estate and small business services from her East Setauket office.  Call 631-444-5605 or vising her website at www.LMTOGALAW.com to schedule a consultation

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By Linda Toga, Esq.

Linda Toga, Esq.

THE FACTS: 

My mother died recently. Her will provides that I am the executor of her estate and directs that her estate is to be divided equally between me and my two siblings. In addition to her bank account and her home, my mother had an inherited IRA and a Roth IRA. My sister is the beneficiary on the inherited IRA and my brother is the beneficiary of the Roth IRA.

THE QUESTION:

Based upon my mother’s will, am I entitled to 1/3 of the assets in the IRAs?

THE ANSWER: 

The quick answer is NO. Regardless of whether it is a traditional IRA or a Roth, how the funds in an IRA are distributed upon the death of the account holder is governed by the beneficiary designation form associated with the account. A will only governs the distribution of probate assets which are assets that are owned individually by the decedent and are not subject to a beneficiary designation. The only time assets in an IRA would be subject to the terms of a will is if none of the people named on the beneficiary designation form associated with the IRA were alive at the time of the account holder’s death.

Unfortunately for you, unless your siblings chose to share some of the funds they receive from the IRAs with you, you are only entitled to 1/3 of your mother’s probate assets after all of her last expenses and the expenses of administering her estate are paid. 

Interestingly, even if the balance in each of the IRAs is the same, it is unlikely that your siblings will enjoy equal shares of your mother’s estate. While they are both entitled to a share of the probate estate that is equal to your share, your sister will have to pay income tax on the distributions she receives from the traditional IRA while your brother will receive all of the assets in the Roth IRA income tax free. 

If your mother wanted you all to share equally in her estate, she should have named all of you as equal beneficiaries on both of the IRAs. In the alternative, her attorney could have added language to her will that provided that the value of any non-probate assets passing to her children was to be taken into consideration when calculating the share of her probate assets passing to each of her children. If your mother’s will directed you to consider non-probate assets when distributing her probate estate, you would get a larger share of the probate assets to compensate for the fact that you were not named as a beneficiary on either of the IRAs. 

Although you are not entitled to funds in the IRAs, the fact that you are named as the executor of your mother’s estate entitles you to statutory commissions. Commissions are based on the value of the probate estate and can be significant. Oftentimes when a family member is the executor, he/she elects to not take commissions since doing so decreases the size of the estate that is distributed to the beneficiaries. 

However, if you feel strongly that your mother’s wish was that you received as much from her estate as your siblings, and your siblings do not feel inclined to share with you some of the non-probate assets they receive from the IRAs, you may want to consider taking commissions to help balance things out. 

The fact that your mother’s wishes may not be realized highlights the value of working with an experienced estate planning attorney and the importance of considering all of your assets when engaging in estate planning. If you do not take into consideration jointly held property and accounts, transfer on death designations, retirement plans and life insurance policies when engaging in estate planning, there is a good chance that your estate plan will not accurately reflect your wishes. 

Linda M. Toga, Esq. provides legal services in the areas of estate administration, estate planning, real estate and small business services from her East Setauket office.  Call 631-444-5605 or vising her website at www.LMTOGALAW.com to schedule a consultation. 

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By Linda M. Toga, Esq.

Linda Toga, Esq.

THE FACTS: 

My uncle John named my cousin Mike as executor in his will. Mike lives out of state and decided it would be too burdensome for him to serve as executor. Since I was named as successor executor, I had my attorney file a petition asking that the court issue to me letters testamentary. Mike signed a form renouncing his appointment and consenting to my appointment. Now that I am about to close the estate and receive commissions for serving as executor, Mike is insisting that he is entitled to the commissions since he was my uncle’s first choice for executor.

THE QUESTION:

Is Mike correct?  

THE ANSWER: 

Mike is absolutely wrong. Commissions are designed to compensate an executor for the time and effort he spends marshalling the decedent’s assets, paying the decedent’s debts and distributing the probate assets in accordance with the terms of the decedent’s will. Commissions paid to an executor of an estate are statutory. That means that there is a law (Surrogate’s Court Procedure Act, Section 2307) that sets forth the manner in which the commissions are calculated. That calculation takes into account the value of the estate assets and how those assets are addressed in the will. 

For example, if the decedent owned a house and in his will made a specific bequest of the house to his daughter, the value of the house is not included in the commission calculation. If, however, the decedent did not make a specific bequest of the house and simply stated in his will that his entire estate was to be distributed to his children in equal shares, the value of the house would be included in the commission calculations.

The commissions paid to an executor represent a percentage of the value of the estate so, the larger the estate, the greater the commissions. Commissions are awarded on a sliding scale. Generally an executor earns 5% of the first $100,000 of the value of the estate, 4% on the next $200,000 of the value of the estate and so on. 

The percentage on the value of the estate decreases as the value of the estate increases. Calculating commissions is a bit involved since the executor has to take into consideration the value of assets he receives as well as the value of assets paid out by the estate. Those figures may not be the same if, for example, the decedent’s investments lose significant value during the administration of the estate. Commissions paid to an executor are considered income and are subject to income tax. 

Although Surrogate’s Court Procedure Act, Section 2307 gives the executor the right to take commissions, it is not a requirement and it is not uncommon for close family members of the decedent who are also beneficiaries under the will to forego commissions. Doing so results in all of the beneficiaries who are entitled to a specific share of the estate to get a little more. 

That being said, in situations where there are beneficiaries that are likely to be uncooperative, I often recommend that the executor advise the beneficiaries that his decision about taking commissions is dependent on their conduct. Knowing they may get a bit more from the estate if they help rather than hinder the executor is usually enough to get cooperation.

Because of the complexities involved in probating an estate and calculating executor commissions, it is prudent for the person named as executor in a will to retain an experienced attorney to assist with the process. 

Linda M. Toga, Esq provides legal services in the areas of estate planning and administration, real estate, small business services and litigation. She is available for email and phone consultations. Call 631-444-5605 or email Ms. Toga at [email protected] 

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By Linda Toga, Esq.

Linda Toga, Esq.

THE FACTS:

My aunt Mary died recently. She was widowed and had no children. My father, her only sibling, died a few years ago. In her will Mary named me as the executrix of her estate and the sole beneficiary. The attorney who drafted the will expected to be retained to handle Mary’s estate but I have worked with a different attorney and want to work with him in connection with the probate of Mary’s estate. The drafting attorney has the original will and has refused to give it to me.

THE QUESTIONS:

Must I retain the drafting attorney to handle the probate of my aunt’s will? If not, must he turn the will over to me or my attorney?

THE ANSWER:

The short answer to your first question is an emphatic “NO”! Although many attorneys assume and likely hope that the families of their estate planning clients will retain them to handle the estates of those clients when they die, there is absolutely no legal basis for the drafting attorney to insist that he/she be retained by the named executor to assist with the probate of the estate. If your aunt wanted the drafting attorney to handle her estate, she certainly could have named him as executor. Since she named you, you are free to retain any attorney you want to assist you with the probate process.

As for whether the drafting attorney must provide you or your attorney with the original will, it would clearly be better if the drafting attorney simply agreed to turn the will over to you or your attorney. However, if that does happen, all is not lost since New York law provides a mechanism for compelling a person who is holding an original will of a decedent to file that will with the surrogate’s court.

If polite requests for the will are ignored, your attorney can commence a proceeding in the surrogate’s court to compel the drafting attorney to produce the will. If the court determines that the drafting attorney did not have good cause to withhold the will, the court may not only order the attorney to file the original will with the court but, can also order the drafting attorney to reimburse you for the attorney’s fees you paid in connection with the proceeding.

Obviously, unless there is a good reason why the drafting attorney will not provide you or your attorney with the will, it is in his/her best interest to simply turn it over without the need for court intervention.

Linda M. Toga, Esq provides legal services in the areas of estate planning and administration, real estate, small business services and litigation. She is available for email and phone consultations. Call 631-444-5605 or email Ms. Toga at [email protected]

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By Linda Toga, Esq.

Linda Toga, Esq.

THE FACTS:

I have a friend who says I’m crazy to have a will rather than a revocable trust because probating a will is so time consuming and expensive.

THE QUESTION:

Is she right?

THE ANSWER:

In certain situations, probating a will may be more expensive and time consuming than having your assets pass pursuant to a trust. However, unless there is a will contest or your executor elects to take commissions, getting a will admitted to probate is generally a relatively quick and inexpensive process.

While I do not recommend a will to a client who is estranged from family members or who anticipates a will contest, I do recommend a will for clients whose heirs are easy to locate and on good terms, and whose executor is a family member or friend who is unlikely to take commissions. That is because under those circumstances, the probate process is straight forward and the legal fees associated with the process are generally quite modest.

The probate process is started when the person named as the executor under the will files a short petition with the surrogate’s court seeking letters testamentary. The petition provides information about the decedent, his heirs and his assets. Individuals in line to inherit and people named in the will must get notice of filing and/or sign a consent form.

The consent forms are filed with the court along with the petition, the original will and death certificate and a fee that ranges from $45 to $1,250. Even during the pandemic we are now experiencing, the surrogate’s court has been processing probate petitions and issuing letters testamentary within a few weeks.

Once letters are issues, the executor has the authority to sell property, close accounts and otherwise marshal the decedent’s assets to ultimately distribute those assets in accordance with the terms of the will. Provided the executor choses to forego commissions, the process of obtaining letters testamentary often costs less than $3,000, including the filing fee.

Although it may cost less to distribute your assets pursuant to a trust, creating a trust often costs more than will and there are frequently expenses involved in funding the trust that are not incurred when you have a will prepared.

In addition, having a trust does not guarantee that your entire estate will pass to your beneficiaries without court intervention. It is not uncommon for people who opt to have a trust created to forget to put some of their assets into the trust.  If they do not retitle an account or a vehicle, for example, the trust will not govern how those asset are distributed. In that case, someone will have to petition the court for the authority to dispose of those assets.

Getting back to your question, you are not crazy for having a will rather than a trust. Although your friend’s circumstances may dictate that a trust is the better option for her, as I mentioned above, I generally recommend that my clients have me prepare wills as part of their estate plans. That being said, if after hearing the pros and cons of having a trust a client choses to have me prepare a trust, I am happy to do so. The important thing is that the client makes an informed decision.

Linda M. Toga, Esq provides legal services in the areas of estate planning and administration, real estate, small business services and litigation. She is available for email and phone consultations. Call 631-444-5605 or email Ms. Toga at [email protected]

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By Linda Toga, Esq.

Linda Toga, Esq.

THE FACTS: My brother John died unexpectedly. John never married and has no children. He had a Will in which he named me as executrix and left everything to me and my sister, Julie. The only assets John had was a bank account with a balance of $22,500.

THE QUESTION: What do I need to do to close that account so the money can be divided between me and Julie?

THE ANSWER: In most cases when someone dies with assets and a will, the person named in the will as executrix must file a petition with the surrogate court in the county where the decedent lived seeking letters testamentary. Once letters testamentary are obtained and the executrix has obtained a taxpayer identification number from the IRS, the executrix can go to the bank to close the account.

It is noteworthy the bank will not write checks to beneficiaries of the estate but, will only write a check for the balance in the account payable to the estate. That check must be deposited in an estate account from which the distributions to the beneficiaries can be made. 

In your case, since the value of John’s assets is less than $30,000, you need not obtain letters testamentary. Instead you can file an affidavit with the surrogate‘s court as part of a small estate administration. The filing fee is $1 and the form is less involved than the one used to file for letters testamentary. You will have to provide the name and address of the bank, the account number and the account balance and information on who is entitled to the funds.

Once the affidavit is accepted, the court will send you a certificate that gives you the authority to close your brother’s bank account. You will receive a separate certificate that gives you the authority to open an estate account into which you need to deposit the check issued by the bank.

To insure that the affidavit is prepared and filed correctly, I recommend that you retain an attorney with surrogate’s court experience to represent you. That way you can be sure the process will go as smoothly possible.

Linda M. Toga, Esq provides legal services in the areas of estate planning and administration, real estate, small business services and litigation. She is available for email and phone consultations. Call 631-444-5605 or email Ms. Toga at [email protected]

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By Linda Toga, Esq.

Linda Toga, Esq.

THE FACTS: My husband, Fred, died recently. We are both on the deed to our house.

THE QUESTION: Do I need to change the deed?

THE ANSWER: Whether you need to change the deed depends on how you and Fred took title to the property when you first purchased it. You and Fred were co-owners of your property but, the ownership interest of co-owners of real property can be expressed on a deed in different ways.

Two or more co-owners can each own a specific percent of the property For example, two owners can each have a 50% interest in the piece of property. Each owner can dispose of his/her 50% interest as he/she pleases. Owners with this sort of arrangement are referred to as tenants in common.

Two or more people can also own property jointly with the right of survivorship. Such co-owners are referred to as joint tenants and the deed to the property will include the words “joint tenants with the right of survivorship” or “jt. tenants WROS.” Each joint tenant has an interest in the entire property and generally cannot dispose of their interest in the property without the consent of the other joint tenants.

Finally, when a married couple takes title to real property, they can do so jointly as tenants in the entirety. This designation is similar to jt. tenants WROS but, is only an option for married couples.

If you and Fred took title to your home as 50/50 tenants in common, a new deed should be prepared by which the executor or administrator of Fred’s estate transfers his 50% interest in the property to the person he named as the beneficiary in his will or the person entitled to his share under the intestacy statute. The new deed must be signed by the executor/administrator and filed/recorded in the office of the county clerk in the county in which the property is located.

If you and Fred held the property as joint tenants WROS or as tenants in the entirety, there is no need to change the deed. You became the sole owner of the property upon Fred’s death by operation of law. In other words, Fred’s ownership interest in the property was extinguished when he died and you automatically became the owner.

If you sell the property, you will need to provide proof that Fred died. Without such proof, the deed bearing only your signature will not be accepted for recording. If your house is not sold until after you die, the person selling your house will have to provide both Fred’s death certificate and letters testamentary or letters of administration from the surrogate’s court to establish that he/she has the authority to sell the property.

If you are still uncertain as to whether a new deed is needed, you should contact an attorney with experience in real estate who can review your deed and advise you as to how to proceed.   

Linda M. Toga, Esq provides legal services in the areas of real estate, estate planning and administration, small business services and litigation. She is available for email and phone consultations. Call 631-444-5605 or email Ms. Toga at [email protected] She will respond to messages and emails as quickly as possible.

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By Linda Toga, Esq.

Linda Toga, Esq.

THE FACTS: I am starting to work on my estate plan and am having trouble deciding who I should name as guardian of my three children in the event I die when they are still minors.

THE QUESTION: Can you provide some guidance on what factors I should consider when making a decision about an appropriate appointment?

THE ANSWER: I can certainly provide guidance about choosing a guardian but I want to first commend you on planning ahead. So many people put off estate planning and the end results are often less than optimal.

After many years helping clients develop their estate plans, I have come to the conclusion that the decision as to who will serve as guardians of their children is the most difficult decisions my clients face. This is particularly true when the client does not have family in the area. That being said, there are certainly situations where friends may be more suitable guardians than family members.

When choosing a guardian, you want to name someone who is willing and able to raise your children in an environment similar to the one they are familiar with and one in which they can thrive. Whoever you chose as guardian should have values that are similar to yours and be willing to love and nurture your children.

Not only should you look at the relationship between the person you are considering as guardian and your children but also the relationship between that person’s children and your own. Are the children similar in age? Do the children get along? Do they have common interests? If the proposed guardian does not have children, is that because she doesn’t want children? These are the sorts of questions you should be asking yourself.

Since you will likely want your children to continue to have a relationship with your family regardless of who is appointed as guardian, the relationship between the guardian and family members may be a factor.

Where the proposed guardian lives and her living arrangements also come into play. Does the guardian live locally so that your children can stay in the same school district or will they have to relocate out of state? Does the guardian have room to take in three children or will the guardian need to build an addition or move in order to welcome your children into her home? If the guardian’s living arrangement is not suitable, does she have the funds to remedy the situation?

While money should not be the overriding factor in deciding on a guardian, if the person you want to name does not have the means to take in and care for your children, you can address this issue in your will. By setting aside assets in a testamentary trust which can be distributed to the guardian to cover certain costs, you can decrease the chance that the guardian will suffer economic hardship as a result of caring for your children. Funds that remain in the trust when your youngest child is no longer a minor can be distributed to your children.

While the discussion above is far from exhaustive, it sets forth many of the things you should think about when deciding on who to name as guardian of your children. However, do not assume that the decision is yours alone. Ask the person you would like to name as guardian if she is willing and able to accept the responsibility of raising your children. Upon your death, you don’t want the person you named as guardian to be surprised.

Linda M. Toga, Esq provides legal services in the areas of estate planning and administration, real estate, small business services and litigation. She is available for email and phone consultations. Call 631-444-5605 or email Ms. Toga at [email protected]

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By Linda Toga, Esq.

Linda Toga, Esq.

THE FACTS: Ever since I purchased my property, my neighbor had allowed me to drive over his property to get to my garage since the driveway that is on my property is very narrow and difficult to navigate. I am concerned that when my neighbor dies or sells his property, I will no longer be able to use the driveway that passes over his property. He told me he is willing to sell me the strip of his property that I am currently using.

THE QUESTION: Is this the best way to proceed?

THE ANSWER: Unless your neighbor owns a very large parcel of land that is subject to subdivision, I would be surprised if he would be allowed to simply sell you a piece of his property. Even if his property could be legally subdivided, it is unlikely that he could sell you a parcel that is smaller than the standard building lots in your area.

Rather than seeking a subdivision, I suggest that your neighbor grant you an easement over his property that runs with the land. In other words, he could grant you the right to use a specific part of his property for a specific purpose and indicate that the obligations and benefits created by the easement shall be enjoyed by subsequent owners of both your property and his own.

If your neighbor is amenable to creating an easement, the first thing that would have to be done is to have a surveyor map out the area that you will be allowed to use and prepare the legal description of that area. He should then retain an attorney to prepare an easement agreement that sets forth the details of your continued use of the area and the rights and obligations of whoever may own each of the subject properties now and in the future.

The agreement must contain sufficient information to identify the properties involved and the area comprising the easement. The agreement must then be recorded against both your property and your neighbor’s property so that future owners of both properties are on notice of the existence of the easement and their rights and obligations.

Once properly recorded, you will have the right to use the designated area of your neighbor’s property as a driveway for as long as you own your property and future owners will enjoy the same benefits you now enjoy.

Linda M. Toga, Esq provides legal services in the areas of real estate, estate planning and administration, small business services and litigation. She is available for email and phone consultations. Call 631-444-5605 or email Ms. Toga at [email protected] She will respond to messages and emails as quickly as possible.