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Contested Accounting in New York

contested accounting in New York

If you are an executor or administrator of an estate, the last thing you want to deal with is a contested accounting in New York. But the beneficiaries are making edging towards one, so it is up to you to de-escalate the situation quickly.

A contested accounting in New York has many downsides, not only for the executor but for the beneficiaries as well:

  • It requires a lot of work from the executor. The executor has to spend time on the contested accounting in New York, the time he could have spent on his professional and personal pursuits. The executor will not be paid extra for the work of providing an accounting.
  • Expensive. The fees for attorneys, accountants, and appraisers being involved can add up to tens of thousands of dollars.
  • Gives Beneficiaries Another Reason to Complain. To add insult to injury, the beneficiaries will complain that the executor is spending too much on lawyers and accountants, for the contested accounting in New York, even though it is the beneficiaries themselves who created the accounting situation in the first place.
  • Exposes the Executor to Potential Liability. Once the executor files the contested accounting in New York, the beneficiaries’ attorney will try to find inconsistencies in order to extract a settlement from the executor.
  • Can Force Unjust Settlement. The prospect of a drawn-out contested accounting in New York can squeeze the executor into giving up a share of their rightfully owned estate just to avoid the torture.
  • Leaves Less Money in the Estate to be Shared. Money can be better spent by you and beneficiaries then paying lawyers and accountants.

Try to Settle for an Informal Accounting. Since a contested accounting is about to start anyway, you will have no choice but to file some sort of an accounting. An informal accounting is a good way for the executor and the beneficiaries to try to find common ground and resolve a case without the expenses and the time commitment of a formal accounting.

An informal accounting has many benefits over a contested accounting:

  • It requires less work. Because you don’t have to use court-mandated forms, there is less work to do. For example, you would not have to list every single item of expense and income, you can just give a summary of income and expenses.
  • Cheaper. Less attorney and accountant fees.
  • Easier to work things out. The atmosphere of a contested accounting is less contentious so it’s easier to work things out.
  • More money left over for a settlement. As opposed to giving estate money to lawyers and accountants, keep the money for yourselves and the beneficiaries

Make Sure to Include All Expenses. Just like filing a tax return for a business, you will pay dearly if you neglect to list all of the expenses. Make sure the beneficiaries will not charge you for money that is not due to them but was spent on the expenses of the estate. Look over the estate accounts and even the decedent’s personal bank accounts and possibly your personal bank accounts (ask your estate attorney). Even small expenses can add up to large sums fairly quickly. No expense should be left unaccounted for.

Be Involved in the Accounting Process. It’s easy to just let the attorney and the accountant handle the contested accounting in New York. After all, they’re getting paid to do it. You can’t do everything yourself, and you have to delegate. However, this does not mean that you should not be involved in the process. After all is said and done, it’s you who is in the crosshairs, not the attorney or the accountant. So make sure you check their work.

Do Not Procrastinate. Start compiling the contested accounting as soon as the Citation for Compulsory Accounting is served, if not before. This is because it takes months to put together an accounting, but the court is only going to give you from thirty to sixty days. Courts know that executors have the option to start putting the accounting together before the court issues the Contested accounting Order; this is why courts give so little time to file an accounting. Don’t procrastinate – call your New York estate lawyer and tell them to start working on the accounting right away.

The sooner you start, the more time you have to fix any issues that may come up, so that you’re one hundred percent protected from any allegations that may come up from the beneficiaries. Even if the beneficiaries will ultimately agree to work things out based on an informal accounting, you will still need to file some kind of accounting, so get to work.

Hire a Good Estate Attorney. If you are looking for an estate attorney who is experienced in submitting and defending complex judicial estate accountings in New York, call the Law Offices of Albert Goodwin at (212) 233-1233 or (718) 509-9774. We can compile and submit your estate accounting, defend against objections and make sure that your rights are protected.

Informal Accounting in New York

informal accounting in New York

Informal accounting is easier, cheaper and faster than a formal accounting. A Compulsory Formal Accounting is a Drag. If you are an executor or administrator of an estate, the last thing you want to do is to have to provide a formal accounting, unless the beneficiaries are making you do it.

Try to Settle for an Informal Accounting. If the beneficiaries are asking questions, you will have no choice but to file some sort of an accounting. An informal accounting is a good way for the executor and the beneficiaries to try to find common ground and resolve a case without the expenses and the time commitment of a formal accounting.

An informal accounting has many benefits over a formal accounting:

  • It requires less work. Because you don’t have to use court-mandated forms, there is less work to do. For example, you would not have to list every single item of expense and income, you can just give a summary of income and expenses.
  • Cheaper. Less attorney and accountant fees.
  • Easier to work things out. The atmosphere of an uncontested informal accounting is less contentious so it’s easier to work things out.
  • More money left over for a settlement. As opposed to giving estate money to lawyers and accountants, keep the money for yourselves and the beneficiaries

Make Sure to Include All Expenses. Just like filing a tax return for a business, you will pay dearly if you neglect to list all of the expenses in your informal accounting. Make sure the beneficiaries will not charge you for money that is not due to them but was spent on the expenses of the estate. Look over the estate accounts and even the decedent’s personal bank accounts and possibly your personal bank accounts (ask your estate attorney). Even small expenses can add up to large sums fairly quickly. No expense should be left unaccounted for.

Be Involved in the Informal Accounting Process

It’s easy to just let the attorney and the accountant handle the accounting. After all, they’re getting paid to do it. You can’t do everything yourself, and you have to delegate. However, this does not mean that you should not be involved in the process. After all is said and done, it’s you who is in the crosshairs, not the attorney or the accountant. So make sure you check their work.

Do Not Procrastinate. Start compiling the accounting as soon as the Citation for Compulsory Accounting is served, if not before. This is because it takes months to put together an accounting, but the court is only going to give you from thirty to sixty days. Courts know that executors have the option to start putting the accounting together before the court issues the Accounting Order; this is why courts give so little time to file an accounting. Don’t procrastinate – call your New York estate lawyer and tell them to start working on the accounting right away.

The sooner you start, the more time you have to fix any issues that may come up, so that you’re one hundred percent protected from any allegations that may come up from the beneficiaries. Even if the beneficiaries will ultimately agree to work things out based on an informal accounting, you will still need to file some kind of accounting, so get to work.

A formal accounting has many downsides, not only for the executor but for the beneficiaries as well:

  • It requires a lot of work from the executor. The executor has to spend time on the accounting, time he could have spent on his professional and personal pursuits. The executor will not be paid extra for the work of providing an accounting.
  • Expensive. The fees for attorneys, accountants, and appraisers being involved can add up to tens of thousands of dollars.
  • Gives Beneficiaries Another Reason to Complain. To add insult to injury, the beneficiaries will complain that the executor is spending too much on lawyers and accountants, even though it is the beneficiaries themselves who created the accounting situation in the first place.
  • Exposes the Executor to Potential Liability. Once the executor files the accounting, the beneficiaries’ attorney will try to find inconsistencies in order to extract a settlement from the executor.
  • Can Force Unjust Settlement. The prospect of a drawn-out compulsory accounting proceeding can squeeze the executor into giving up a share of their rightfully owned estate just to avoid the torture.
  • Leaves Less Money in the Estate to be Shared. Money can be better spent by you and beneficiaries then paying lawyers and accountants.

Hire a Good Estate Attorney. If you are looking for an estate attorney who is experienced in preparing an informal accounting, call the Law Offices of Albert Goodwin at (212) 233-1233. We can compile and submit your informal accounting and make sure that your rights are protected.

Judicial Accounting in New York

judicial accounting in New York

If you are an executor or administrator of an estate, the last thing you want to do is to have to provide a judicial accounting in New York. But the beneficiaries are making you do it, so here you are.

A judicial accounting in New York has many downsides, not only for the executor but for the beneficiaries as well:

  • It requires a lot of work from the executor. The executor has to spend time on the judicial accounting in New York, the time he could have spent on his professional and personal pursuits. The executor will not be paid extra for the work of providing an accounting.
  • Expensive. The fees for attorneys, accountants, and appraisers being involved can add up to tens of thousands of dollars.
  • Gives Beneficiaries Another Reason to Complain. To add insult to injury, the beneficiaries will complain that the executor is spending too much on lawyers and accountants, for the judicial accounting in New York, even though it is the beneficiaries themselves who created the accounting situation in the first place.
  • Exposes the Executor to Potential Liability. Once the executor files the judicial accounting in New York, the beneficiaries’ attorney will try to find inconsistencies in order to extract a settlement from the executor.
  • Can Force Unjust Settlement. The prospect of a drawn-out judicial accounting in New York can squeeze the executor into giving up a share of their rightfully owned estate just to avoid the torture.
  • Leaves Less Money in the Estate to be Shared. Money can be better spent by you and beneficiaries then paying lawyers and accountants.

Try to Settle for an Informal Accounting. Since a proceeding for a judicial accounting has been filed against you, you will have no choice but to file some sort of an accounting. An informal accounting is a good way for the executor and the beneficiaries to try to find common ground and resolve a case without the expenses and the time commitment of a formal accounting.

An informal accounting has many benefits over a judicial accounting:

  • It requires less work. Because you don’t have to use court-mandated forms, there is less work to do. For example, you would not have to list every single item of expense and income, you can just give a summary of income and expenses.
  • Cheaper. Less attorney and accountant fees.
  • Easier to work things out. The atmosphere of a contested accounting is less contentious so it’s easier to work things out.
  • More money left over for a settlement. As opposed to giving estate money to lawyers and accountants, keep the money for yourselves and the beneficiaries

Make Sure to Include All Expenses. Just like filing a tax return for a business, you will pay dearly if you neglect to list all of the expenses. Make sure the beneficiaries will not charge you for money that is not due to them but was spent on the expenses of the estate. Look over the estate accounts and even the decedent’s personal bank accounts and possibly your personal bank accounts (ask your estate attorney). Even small expenses can add up to large sums fairly quickly. No expense should be left unaccounted for.

Be Involved in the Accounting Process. It’s easy to just let the attorney and the accountant handle the judicial accounting in New York. After all, they’re getting paid to do it. You can’t do everything yourself, and you have to delegate. However, this does not mean that you should not be involved in the process. After all is said and done, it’s you who is in the crosshairs, not the attorney or the accountant. So make sure you check their work.

Do Not Procrastinate. Start compiling the judicial accounting as soon as the Citation for Compulsory Accounting is served, if not before. This is because it takes months to put together an accounting, but the court is only going to give you from thirty to sixty days. Courts know that executors have the option to start putting the accounting together before the court issues the Judicial Accounting Order; this is why courts give so little time to file an accounting. Don’t procrastinate – call your New York estate lawyer and tell them to start working on the accounting right away.

The sooner you start, the more time you have to fix any issues that may come up, so that you’re one hundred percent protected from any allegations that may come up from the beneficiaries. Even if the beneficiaries will ultimately agree to work things out based on an informal accounting, you will still need to file some kind of accounting, so get to work.

Hire a Good Estate Attorney. If you are looking for an estate attorney who is experienced in submitting and defending complex judicial estate accountings in New York, call the Law Offices of Albert Goodwin at (212) 233-1233. We can compile and submit your estate accounting, defend against objections and make sure that your rights are protected.

Protecting the Executor from Unfounded Allegations

Managing an Estate is Harder Than It Looks

There are various situation where non-attorneys become executors of an estate. Many (if not most) people placed in this situation do not have adequate knowledge on the subject.[1] In fact, such a person might not think twice if their relative or friend called them to ask “if it’s OK” to be an executor “if anything happened to them.” A layperson likely envisions the role of an executor as one who makes sure the decedent’s asset distribution matches the last will and testament. That line of thinking is not incorrect. The problem, however, is that this is the end goal, and there are much time-consuming battles to fight, until the executor actually gets to distribute the decedent’s assets.

Most non-attorney executors have an outside career or familial obligations and might not allocate the requisite time to understand the legal requirements. Unfortunately, the probate rules are demanding and exact. And when unexpected claimants stake a claim over the decedent’s assets is when an executor runs into avoidable problems and needs to protect herself. In some cases, it may be too late. The best solution is for the busy executor to hire an attorney immediately. The attorney would advise and prepare each step of the way. The attorney’s fees are usually paid through the estate; with no direct cost to the executor.[2] On the other hand, improper estate handling could place the executor personally responsible.

An executor must manage the estate with a reasonable duty of care from day one.[3] For example, before the court grants a letter testamentary (appoints) the executor; an executor could only utilize estate’s funds to pay for funeral expenses and only what is “necessary to preserve” the estate.[4] After receiving the letters testamentary, the executor has three main duties: gathering assets (filing an inventory with the court);[5] administering assets (taking care of the estate)[6]; and distributing assets.[7] Each of these steps present many potential pitfalls for an executor. For an approximate timeline, see New York Probate Timeline – A Sample Case Study.

New York law provides broadly that an executor is personally liable when the executor fails to “exercise reasonable care, diligence and prudence.”[8] As mentioned, one such situation is when the executor utilizes estate assets prior to the court’s permission. Another one is when executor distributes assets too soon and not in the proper order of priority. For example: paying out government owed taxes is priority.[9] In fact, it is unwise to distribute the assets prior to seven months, else the executor may be liable to pay out a legitimate debtor claim.[10] On the other hand, a delay of distribution beyond a reasonable time could lead to an executor owing as much as 9% interest.[11]

Additional problems could arise if the executor is not balancing the assets equitably among the beneficiaries. If an executor must sell off assets to pay creditors, he must do so in a fair manner. An executor must treat the estate beneficiaries equitably; else the executor be responsible from any resulting losses and dismissed.[12] Additionally, an executor must treat such estate selling as a prudent investor.[13] Moreover, there are many other nuances to know which an warrants the executor’s dismissal. For example. it is often tempting for a busy executor to handle a limited estate through their own account. Yet, this can lead to the executor’s dismissal.[14] Another is doing a disservice to either the surviving spouse or to beneficiaries under twenty-one years. By New York Estate rules, up to $25,000 in cash and value is excluded from the estate proceeding and is disbursed immediately.[15] Ignoring this rule not only hinders the decedents, but also places the executor prime for dismissal  and payment of interest on the money for the delay.

There are many such intricate rules the N.Y. appointed executor must follow. Often, an executor’s appointment can quickly turn from prideful responsibility into a regretful burden. Managing an estate can be burdensome to the busy executor—regardless of the potential for compensation. Yet, the executor could place themselves in financial and legal problems if not acting as the law intends. Which is why, it is best for the executor to hire an attorney. Not only would that protect the executor from personal liability and from dismissal challenges; but would also ensure estate’s proper administration per the decedent’s last wishes.

New York executor protection laws are complicated, and experience in the Surrogate’s Court practice is paramount when dealing with those issues. Call the Law Offices of Albert Goodwin at (212) 233-1233, New York estate, guardianship, wills, trust, medicaid and probate lawyer, and make an appointment to discuss spousal claims and rights to the estate.

[1] In New York, barring a few exceptions, any competent U.S. citizen over the age of eighteen could be an executor. SeeN.Y. Surr. Ct. Proc. Act Law § 707 (McKinney 2018).

[2] There could be indirect costs if an executor doubles as a beneficiary. The more expenses paid out, the less assets left to distribute. Such executor could consider foregoing their statutory executor fees. Seeid§ 2307.

[3] N.Y. Est. Powers & Trusts Law § 11-2.3 (McKinney 2018).

[4] Id.§ 11-2.3.

[5] 22 N.Y. Comp. Codes R. & Regs. § 207.20 (McKinney 2018).

[6] See Surrogate’s Court: Fiduciary Responsibilities

[7] N.Y. Est. Powers & Trusts Law § 11-1.5.

[8] Id. § 11-4.7.

[9] 31 U.S.C. § 3713 (2018).

[10] N.Y. Surr. Ct. Proc. Act Law § 1802.

[11] E.g., In re Marsh, 966 N.Y.S.2d 456, 459 (2013) (unreasonable delay in distribution resulted in a personal liability of 9% interest).

[12] See In re Estate of Witherill, 828 N.Y.S.2d 722, 725 (2007).

[13] N.Y. Est. Powers & Trusts Law § 11-2.3.

[14] See N.Y. Surr. Ct. Proc. Act Law § 719.

[15] N.Y. Est. Powers & Trusts Law § 5-3.1.

Providing a Compulsory Accounting of the Estate

compulsory accounting in New York

A compulsory formal accounting can be frustrating and time-consuming. If you are an executor or administrator of an estate, the last thing you want to do is to have to provide a formal accounting. But the beneficiaries are making you do it, so here you are.

A formal accounting has many downsides, not only for the executor but for the beneficiaries as well:

  • It requires a lot of work from the executor. The executor has to spend time on the accounting, time he could have spent on his professional and personal pursuits. The executor will not be paid extra for the work of providing an accounting.
  • Expensive. The fees for attorneys, accountants, and appraisers being involved can add up to tens of thousands of dollars.
  • Gives Beneficiaries Another Reason to Complain. To add insult to injury, the beneficiaries will complain that the executor is spending too much on lawyers and accountants, even though it is the beneficiaries themselves who created the accounting situation in the first place.
  • Exposes the Executor to Potential Liability. Once the executor files the accounting, the beneficiaries’ attorney will try to find inconsistencies in order to extract a settlement from the executor.
  • Can Force Unjust Settlement. The prospect of a drawn-out compulsory accounting proceeding can squeeze the executor into giving up a share of their rightfully owned estate just to avoid the torture.
  • Leaves Less Money in the Estate to be Shared. Money can be better spent by you and beneficiaries then paying lawyers and accountants.

Try to Settle for an Informal Accounting. Since a proceeding for a compulsory accounting has been filed against you, you will have no choice but to file some sort of an accounting. An informal accounting is a good way for the executor and the beneficiaries to try to find common ground and resolve a case without the expenses and the time commitment of a formal accounting.

An informal accounting has many benefits over a formal accounting:

  • It requires less work. Because you don’t have to use court-mandated forms, there is less work to do. For example, you would not have to list every single item of expense and income, you can just give a summary of income and expenses.
  • Cheaper. Less attorney and accountant fees.
  • Easier to work things out. The atmosphere of a contested accounting is less contentious so it’s easier to work things out.
  • More money left over for a settlement. As opposed to giving estate money to lawyers and accountants, keep the money for yourselves and the beneficiaries

Make Sure to Include All Expenses. Just like filing a tax return for a business, you will pay dearly if you neglect to list all of the expenses. Make sure the beneficiaries will not charge you for money that is not due to them but was spent on the expenses of the estate. Look over the estate accounts and even the decedent’s personal bank accounts and possibly your personal bank accounts (ask your estate attorney). Even small expenses can add up to large sums fairly quickly. No expense should be left unaccounted for.

Be Involved in the Accounting Process. It’s easy to just let the attorney and the accountant handle the accounting. After all, they’re getting paid to do it. You can’t do everything yourself, and you have to delegate. However, this does not mean that you should not be involved in the process. After all is said and done, it’s you who is in the crosshairs, not the attorney or the accountant. So make sure you check their work.

Do Not Procrastinate. Start compiling the accounting as soon as the Citation for Compulsory Accounting is served, if not before. This is because it takes months to put together an accounting, but the court is only going to give you from thirty to sixty days. Courts know that executors have the option to start putting the accounting together before the court issues the Accounting Order; this is why courts give so little time to file an accounting. Don’t procrastinate – call your New York estate lawyer and tell them to start working on the accounting right away.

The sooner you start, the more time you have to fix any issues that may come up, so that you’re one hundred percent protected from any allegations that may come up from the beneficiaries. Even if the beneficiaries will ultimately agree to work things out based on an informal accounting, you will still need to file some kind of accounting, so get to work.

Hire a Good Estate Attorney. If you are looking for an estate attorney who is experienced in submitting and defending complex estate accountings, call the Law Offices of Albert Goodwin at (212) 233-1233. We can compile and submit your estate accounting, defend against objections and make sure that your rights are protected.

Defending the Executor’s Share in a Business

Executors often find themselves in a situation where beneficiaries make a claim to the executor’s own part of the business that they were in with the decedent. The beneficiaries will not care about the hard work that the executor has put into the business. They do not care about having the business prosper, its employees paid and its function be a contribution to society. All they want is a hard dollar.

Executors find that the beneficiaries are looking for the executor to buy out the executor’s share of the business at the risk dissolution of the business and having its assets sold off. Beneficiaries may also try to secure dividends from the business in the form of a monthly or annual payout for the interesest of the decedent – they wish to receive income from the business indefinitely, decades after the decedent is no longer around.

If the beneficiaries have a way of showing that they have 20% of the shares of a company, they will have some leverage because of the chance that they can force the company into dissolution.

What the beneficiaries pretend to not understand is the fact that liquidity is hard to come by in a company. Most companies are struggling, and are finding just enough income to pay its staff and hopefully something to the owners. For most companies, getting a large payout or periodic shareholder dividends is just not realistic.

If you are a shareholder, you will need to hire a New York estate attorney who understands where you are coming from and has experience in convincing beneficiaries that the value of the business interest of the decedent usually does not translate into a large payout for the decedent’s heirs, that businesses have limited cashflow and that they will have to settle for something reasonable.

Depending on the circumstances, we either try to arrange financing to buy the beneficiaries out for a reasonable amount, or agree on some sort of reasonable periodic payout to the beneficiaries from the business, limited to a number of years.

If you are an executor who was in business with the decedent and are looking for an attorney who will protect your interest in the business, speak with attorney Albert Goodwin at (212) 233-1233.

Defending Estates Against Inflated Spousal Elective Share Elections

Spouses are entitled to up to a third of the estate’s value, including property that was transferred out of the estate up to a year before the decedent’s death. Executors frequently find that the elective share claims can be inflated.

Spouses can claim that property of the estate is worth more than the executor states on their accounting. They will demand all records pertaining to the asset value and will hire accountants and expert witnesses to try to argue that the asset is worth more than it really is.

They can claim that personal assets of the executor are a part of the estate. This especially pertains to the executor’s business interests. If an executor has been in business with the decedent and owns a share of the business, the electing spouse will try to claim that the executor’s interest is also part of the augmented estate.

They can claim that there are more assets in the estate than there really are. Even though there is usually no basis for those claims, they will attempt to look at the executor’s personal assets, and claim that those assets belong to the augmented estate.

They will try to have the executor disqualified and will try to have an independent Receiver or the Public Administrator of the county be appointed as a neutral “Executor” instead. As we wrote here, this is unlikely to work.

They will claim that the executor caused losses to the estate by their conduct, but will refuse to recognize actual losses to the estate.

Spouses can also claim that the expenses of the estate, which are deducted from the value of the estate before spousal share is calculated, are inflated. They claim that attorneys’ fees are too high, even though it is probably their inflated claims that brought about the attorneys’ fees in the first place. They will claim that accounting fees are too high – again, there would not have needed to be accounting fees unless an estate was forced to account. They claim that expenses are unnecessary and pick on any other part of the accounting that is not to their liking in the hope of intimidating the estate executive and forcing them to increase the spousal elective share.

It is possible that a spouse gave up their right to the elective share in a prenuptial agreement or a postnuptial agreement. It is important to see if those documents exist and go over them. It is also possible that the spouse gave up a right to the elective share some other way.

The value of any property that the spouse received from the decedent outside of the estate gets subtracted from the amount they are entitled to as part of the elective share. It is important to investigate what the spouse received outside of the estate. This is sometimes known to the family, can be seen from the decedent’s paperwork, or can even be found out by asking questions under oath during the discovery process of the legal proceeding.

If you are an executor who is facing those challenges from the spouse of the decedent, speak with Albert Goodwin, an attorney who defends executors. Call (212) 233-1233.

Defending Executors from Disqualification and Removal

Although New York law gives judges broad discretion to disqualify Executors, the law also gives great respect to the decedent’s decision to appoint an executor. The courts will not disqualify a person from an appointment unless there is a real concern for the estate.

Many attempts to disqualify an executor happen because the other beneficiaries don’t like the executor. They say they are “not comfortable” with the executor. But the truth is, it is not their choice who the executor is. The testator gets to nominate the executor, and it’s a decision that the beneficiaries would have to live with.

Most executor disqualification attempts allege some sort of dishonesty. Such attempts are usually tied in with other attacks on the estate, as part of a broader strategy. For example, potential heirs might allege that the executor is hiding the estate’s assets and is for that reason not qualified to act as an executor. Or, they may say that the nominated Executor tricked the decedent into making a will. Allegations alone are not enough to remove or disqualify an executor, and those allegations are notoriously difficult to prove.

New York law states that an executor appointment can be denied “by reason of substance abuse, dishonesty, improvidence, want of understanding, or who is otherwise unfit for the execution of the office.” It also gives some other reasons to disqualify an Executor, see NY SCPA 707.

A vast majority of challenges to executor qualifications are not upheld by New York courts. However, we’ve seen cases where executors were disqualified, especially with wills where there is an alternate executor specified.

Sometimes a bond is enough to calm any concerns with the executor. A bond essentially is insurance on any potential misconduct by the nominated Executor. However, some executors don’t qualify for a bond, and a small percentage of estates are so large as to preclude any sort of bond that makes financial sense. Those are the cases where executor qualifications can become an issue.

The most important thing an executor can do to not get disqualified is to comply with all New York laws, follow all of the court’s orders and not miss any deadlines specified in the law or set by the court.

If you are nominated as an Executor and beneficiaries are attempting to disqualify or remove you, call attorney Albert Goodwin at (212) 233-1233.

Defending Beneficiary Designations

People have the right to appoint whomever they choose to be the beneficiary of their financial accounts. In an attempt to invalidate a beneficiary designation form, a challenger will claim lack of mental capacity, fraud, duress, undue influence or forgery. A challenger might also attempt to “bring the asset back” by using a theory of effective trust.

Mental Capacity Challenges – Opponents of beneficiary designation will first look at medical records to try to find evidence of mental incapacity. Not because medical records are so great at indicating capacity to make beneficiary designations, but because that is the most objective evidence the court can get. They will also testify to the decedent’s alleged incapacity at the time of signing the documents.  They will say that the person was incapable of making a beneficiary designation. You will probably say that the person was capable of making legal documents. Hopefully, the way the story is presented and the small details will make a difference and the court will dismiss a claim against the property transfer or the case will result in a settlement which is reasonable.

Fraud Allegations – Opponents of the property transfer will allege fraud, claiming that either the decedent did not know what they were signing or that they were deceived about what the document does. They may claim that the decedent was slipped a beneficiary designation under a guise of a different document or in a pile of other documents which the unsuspecting decedent then signed. For example, a pile of documents containing a power of attorney and health proxy. Those challenges are difficult to prove and are usually successfully defended.

Duress Allegations– duress is rarely used on beneficiary designation challenges, or in any contract challenges, but sometimes objectants claim that the person receiving property abused the decedent and basically forced them to transfer the property. Duress allegations are hard to prove and relatively easy to defend.

Effective Trust Attempts– Many opponents of the property transfer claim that the person who the property was transferred to promised the parent to hold the property for the other heirs as well (“I’m giving the property to you and you will hold it for the whole family, including your brothers and sisters”). The claim that the promise created an effective trust, with the person owning the property not being the rightful owner but in fact just a trustee for all of the decedent’s heirs. Since opponents of the transfer were probably not there during the transfer, it is difficult to imagine why they claim to know what the arrangement was. If they are trying to testify that the decedent told them the property is really theirs with the person who it was transferred to just holding it for them, that testimony would not be admissible because it is hearsay and because of the “Dead Man’s Statute.” But it doesn’t mean that people don’t try.

Defending a beneficiary designation is in many ways similar to defending a Will challenge. You can learn more about it by reading that article.

If you are a designee of property and the beneficiary designation is being challenged, talk to attorney Albert Goodwin at (212) 233-1233.

Defending a Pre-Death Gift of Property

If you received a gift from someone, it remains a gift even after that person died. Understandably, there might be people who disagree with the gift-giver’s decision. They will try to throw everything they got into trying to cancel the gift. Fortunately for you, they are facing an uphill battle.

No undue influence challenges. In New York, challenging a gift is harder than challenging a will because undue influence is a ground for a will challenge but not really a ground per se in a lawsuit to set aside a gift. To set aside a gift, the challenger would essentially proceed the same way as trying to break someone’s contract, and that is something that is notoriously hard.

Dead Man’s Statute – What makes it even harder is the fact that the person who made the contract (the gift) is no longer there, and any evidence of conversation with that person is likely to be inadmissible in New York due to the rule of evidence commonly known as the “dead man’s statute.” One cannot quote the words of the decedent when trying to challenge something that he purportedly wanted to do.

The only viable options they have is challenging a gift are fraud, duress, lack of capacity to make a contract or forgery.

Lack of capacity is usually the more powerful option, if there are medical records to prove it. Lack of capacity to make a gift is even a little easier to prove than lack of capacity to make a will, because in a will the proponent is allowed to argue “lucid moments” at the time of making of the will, whereas in gift challenges, if it is determined that the giver lacked mental capacity to enter into a contract, they are presumed to always be in the state of not having such mental capacity.

Fraud is even harder to prove than lack of capacity. There are usually no witnesses to the transaction, so any allegations are usually anecdotal or an assumption that cannot be proven. Same thing with duress – it’s easy to claim duress when the people claiming it weren’t there, but it’s also impossible to prove for that same reason – even if duress does happen, no-one is there to witness it.

Forgery – If a deed, check or a contract was involved, people who challenge it claim forgery. What is important to understand is that a person’s handwriting changes throughout their lifetime, so the signature on the contested document will be compared with the decedent’s handwriting during that life period. We commonly use checks that the decedent signed around the same time, if available. Both sides to a forgery claim usually retain handwriting experts as expert witnesses for their side of the case.

If you received property from someone, they died, and now that gift is being challenged, get qualified legal defense from attorney Albert Goodwin. Call today at (212) 233-1233.