When a business owner or partner dies, there are a variety of legal matters that must be addressed in regard to the succession of his or her controlling assets and roles within the company. If the decedent left a will and created a legally binding succession plan, then the transfer of assets and power should go relatively smoothly. But one part of the transition could prove time-consuming and even contentious; probate
Basically, when an estate goes into probate, it is up to the state to authenticate the decedent’s will and then oversee its execution. To do this, the court assigns someone, typically referred to as the executor, to oversee the administration of the will. Often the executor is someone named in the will itself, though it is also possible the court may appoint the descendant’s next of kin to perform the task.
During probate, the executor is responsible for locating and protecting all of the decedent’s assets. The assets must be valuated, that is, assigned a value that is determined by appraisals and account statements.
The executor must also notify all of the decedent’s creditors who have a limited time frame in which to make claims for money they are owed by the estate. The executor can pay or reject the claims based upon their merit. Creditors whose claims are rejected can petition the court to require the bills be paid. The executor must also see that taxes owed on the estate are paid.
Probate is a complex process even when there is a will and a competent executor. But probate can become very difficult and contentious if the defendant did not leave a will. In such cases, it is up to the state to determine how the assets will be apportioned.
If you have business interests in a company that is in probate, you may want to have an experienced business litigation attorney act as your representative. The attorney can work on your behalf in an effort to ensure that you receive the share of the estate and related business interests to which you believe you are entitled.