Question: I loaned money to a friend of mine. Before he paid it back, he died. I know I can file a claim with his estate, but I do not know how to be sure I get notice or how to protect myself. Can you explain?
Answer: It is often said that you cannot take money to your grave. However, your assets and liabilities soldier on after death. Collection of a debt owned by a dead person can be complicated.
The simplest action is to file what is known as a caveat with the court where the will may be admitted to probate. A caveat is a filing with the court requesting the court provide notice of probate proceedings to the person filing the caveat. The caveator must be an interested party, and a creditor of a decedent certainly qualifies.
Recent amendment to Florida statutes allows caveats to be filed before probate is opened. That means you would receive notice of petition for probate when it is filed and allow you to participate or make a claim from the beginning. The caveat expires after two years.
The caveat must contain the decedent's social security number, last known residential address and date of birth, if they are known, a statement of the interest of the caveator in the estate and the name, mailing address and residential address of the caveator. If the caveator is not a Florida resident, the caveator must designate a resident agent in Florida for service of notice.
Caveats can also protect persons other than creditors, such as children of a decedent who are concerned that a sibling has coerced mom or dad to draft a new will and then seek to probate that will after mom or dad dies. By statute, if a caveat has been filed by an interested person other than a creditor, the court may not admit a will of the decedent to probate or appoint a personal representative until the caveator is given notice and opportunity to oppose admission of the will to probate and appointment of the personal representative.
To make a claim against a decedent's estate, a creditor must formally file a claim for payment in probate. The caveat is a powerful protection as it insures the caveator will be given notice of probate and opportunity to file a timely claim. By statute, the estate must serve actual notice of probate on all known creditors and publish notice in the newspaper as well. Deadline for filing a claim is the later of three months after the date of first publication in the newspaper or thirty days after date of service on the creditor.
When a caveat is filed, the estate and court clerk must give actual notice. Florida courts have ruled that when a caveator is not given notice by the clerk or served by the estate, the creditor's claim is not bared by the 3 month/30 day deadline.
Although filing a caveat does provide some protection, it does not insure payment. You must pick the right court. If probate is opened in a court other than where the caveat is filed, the statutory protection for a caveator will not apply. More importantly, a creditor cannot merely file a caveat and then wait to be noticed. Under Section 733.710 of Florida Statutes, claims against a decedent are barred two years after death unless a claim has been filed in probate.
In some cases, probate has been delayed to allow the two year claims bar to pass. After that time, probate can be opened and creditor claims automatically barred by the statute.
The two year limitations period can pose a real problem. However, a creditor can insure that probate is open early enough to allow for claims by filing the creditor's own petition for administration. By Florida law, any interested party may petition to open probate and a creditor qualifies as an interested party.
Opening probate does not guarantee payment. The estate may not have assets. Or, it may have assets, but the creditor may find other claims given higher priority by statute.
Expenses of administration and claims against the estate must be paid in order established by Section 733.707 of Florida Statutes. The statute generally provides for payment of costs of administration, followed by funeral expenses, debts and taxes, medical expenses during the decedent's last sixty days, arrearages in child support and debts acquired after death by continuation of the decedents business before other claims.
These proceedings can be complex and technical. Because of the differing time limitations and procedural requirements for pursuit of claims against an estate, you would be well advised to retain an experienced attorney. An attorney will be able to review the circumstances and substance of your claim and advise as to options for possible collection. Since failure to timely file a claim can bar recovery, you should meet with an attorney promptly.