Klenk Law

My sister is claiming loans from my deceased father were gifts. As Personal Representative, what can I do?

Posted on Thu Oct 8, 2015, on Probate and Estate Administration

From our “Ask a Question” mailbag: My sister and her husband are always broke. They asked my father for a loan to help them pay off a bunch of debts and he gave it to them. They were supposed to repay him monthly, but only sent him one or two payments over the years. Now that he has died, I am the Personal Representative of his estate and I asked for them to repay the loan. Suddenly, they claim these loans were “gifts”. What can I do?

One of your jobs as Personal Representative is to gather together all the Estate’s assets. Any loans your father may have made are an asset of his Estate, so you have the power (and obligation) to collect the debt. In order to fulfill this duty, you have the right to use Estate funds to hire an attorney to help you.

This attorney can use his or her expertise in probate to examine the paperwork, cancelled checks, and those one or two payments your sister made. The attorney will then advise you of the strength of your position that the transfers were loans. If the evidence exists, your attorney will then prepare a formal accounting that reduces your sister’s share by amount of the loan, or that gives her the loan as part of her inheritance. If your sister refuses to agree to this characterization, you are now ready to present your case to the judge.

If you have any other questions about probate, feel free to contact our office for a free consultation with one of our Probate Attorneys.


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