From our “Ask a Question” Mailbag: Pennsylvania Executor’s Action BEFORE Making a Distribution

Most Recently Updated July 10, 2018

“I am the executor of my mother’s estate in Montgomery County, Pennsylvania. I have sold the real estate, liquidated all the assets and am ready to distribute, but my sister will not give me a release of liability. What can I do?”

Pennsylvania Executor’s Action BEFORE Making a Distribution

Pennsylvania Executor’s Action BEFORE Making a Distribution

You are right to be concerned. Prior to making distributions from the estate, you should insist on getting a release of liability.  Often, obtaining your release is straight forward and out of court. Most jurisdictions refer to these releases as “informal,” meaning out of court.  The most typical method is having your attorney draft, circulate, and have interested parties sign a Family Settlement Agreement.

For example, let’s say Brother is the executor. Executor sold the home, paid the final taxes, and now is ready to make the final distribution. He gives his sister her share of the estate without a release. She then uses these funds to hire an attorney to file a Petition for Accounting.  Executor is forced to file the formal accounting and may have to pay his attorney completely out of his own money.

Typically the probate attorney assembles a Settlement Agreement and attaches to the agreement a complete accounting of your actions plus a Schedule of Distribution where you inform the heirs of how you plan to distribute the estate assets. After all the heirs agree and sign the Settlement Agreement, you can safely make the distribution.

The same example. Except, sister signed a Family Settlement Agreement before receiving her check. She hires a lawyer to file the same petition. In this case, the judge dismisses the petition. She waived her right to file such a petition in the Family Settlement Agreement.

Formal Accounting

When an heir refuses to sign the Settlement Agreement, this forces a Formal Accounting. In this situation, you would file with the Montgomery County Orphans’ Court. These Formal Accountings must follow specific rules. All the heirs receive a date to file objections to your accounting. If no one files objections the court approves your Accounting.  Your protection is obtained.

If an heir objects to your accounting there is a hearing where the judge hears all sides and makes a ruling. Either way, the worry about future liability disappears.  At this point make your final distributions.

Further Estate Litigation Questions?

Helping executors close estates when challenged is only one of many Estate Litigation issues our firm addresses. Consequently, if you want to learn more, please read my more detailed article, Trust and Estate Litigation All You Need to Know.

In Conclusion: Pennsylvania Executor’s Action BEFORE Making a Distribution

I hope that this article was helpful in explaining the steps needed to face an executor challenge. Further, I included links to even more detailed information on my website. Therefore, please contact me and let me know how I did. Certainly, your comments and questions are welcome!

Let our Litigation Lawyers help walk you through what can be a confusing process. To begin with, call to speak to one of our experienced Litigation Attorneys.  By all means, our lawyers are ready to answer your questions. In fact, feel free to contact our office for a free consultation. Ultimately our goal is to put our 25 years of estate litigation experience to work for you.

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