What Happens If the Personal Representative of an Estate Fails to Administer the Estate Properly?

What Happens If the Personal Representative of an Estate Fails to Administer the Estate Properly?
The personal representative of an estate has substantial responsibilities for administering the estate. While estate administration usually goes smoothly, especially if a lawyer assists with the process, sometimes a personal representative fails or refuses to perform those duties and administer the estate properly. Michigan law provides solutions in that situation, but court intervention is almost always necessary.

Personal Representative Responsibilities Under Michigan Law

After receiving authorization from the court, a personal representative collects and inventories the deceased person’s assets and property, pays any outstanding debts and expenses, and ultimately distributes the estate to the beneficiaries, either directly or through a trust. In carrying out all these duties, the personal representative is a fiduciary, subject to strict requirements established in Michigan statutes.

In most cases, a personal representative retains an experienced estate administration lawyer to ensure that all legal requirements are met throughout the process. However, sometimes a personal representative does not understand the responsibilities of the position or decides to proceed in a manner inconsistent with what the law requires. If that happens, Michigan laws provide specific remedies for persons whose interests are affected by the personal representative’s conduct.

Remedies For Improper Estate Administration By a Personal Representative

Michigan statutes provide several alternatives for asking a court to address improper actions of a personal representative. The remedies are contained in different sections of the law.

Court Order Restraining the Personal Representative

The first alternative is found in MCL 700.3607. That section authorizes an “interested person” to petition the probate court for an order restraining specific conduct of the personal representative of an estate. A court may also issue this type of order on its own motion.

If the court determines that the personal representative may take action that unreasonably jeopardizes the interest of the petitioner or another interested person, the court has authority to issue a temporary order restraining action by the personal representative or make another order to ensure proper performance of the personal representative ’s responsibility. If the court issues a temporary order, a hearing is held within 14 days of issuance of the temporary order, unless the parties to the action agree otherwise. Following the hearing, the court rules on the relief requested in the petition.

For purposes of this section, a different section defines “interested person” broadly to include a decedent’s spouse, child, heir, beneficiary, creditor, or other person with a property right or claim against an estate, as well as a person having priority for appointment as personal representative or a fiduciary representing an interested person. The law acknowledges that the meaning “interested persons” varies in different circumstances and should be determined by a court based on the specifics of a particular matter.

Termination of a Personal Representative By Court Removal

In addition to requesting a court order directing the personal representative to perform the required duties or refrain from certain conduct, an interested person may petition the probate court for removal of the personal representative under MCL 700.3611. The section authorizes the court to remove a personal representative for specific reasons and establishes the procedure for requesting removal by the court.

The grounds for removing a personal representative are serious and must be demonstrated to the court through evidence. The court may remove a personal representative if the judge concludes that (1) removal is in the best interests of the estate, (2) a material misrepresentation of fact occurred during the process of the personal representative’s appointment, or (3) the personal representative disregarded a court order, became incapable of performing as personal representative, mismanaged the estate, or failed to perform a duty of the position.

An “interested person” for a removal petition is the same as for a petition requesting a court order directing the personal representative to refrain from certain conduct or perform specific duties.

Remedies for Breach of Fiduciary Duty By a Personal Representative

The personal representative of an estate is by definition a fiduciary position. Under MCL 700.1308 and 700.1309, the court has broad range of authority to remedy a breach of fiduciary duty by a personal representative.

Potential court action under these sections includes issuance of an order compelling the personal representative to perform the fiduciary duties or enjoining the personal representative from committing a breach of those duties. The court also may order an accounting or suspend or remove the personal representative. Michigan courts often suspend a personal representative in whole or in part and appoint a special fiduciary under this statutory authority, if there is evidence of mismanagement of an estate or even only an allegation of mismanagement.

What To Do If You Think a Personal Representative Is Administering an Estate Improperly

If you have an interest in an estate and think that the personal representative is not properly performing the responsibilities of the position, you should contact an experienced Michigan probate litigation attorney at the earliest opportunity. As discussed above, state laws give the probate courts authority to act quickly to prevent a personal representative from interfering with the rights of those with an interest in the estate.

The best and most appropriate remedy in a particular case depends entirely on the facts and circumstances of the situation. A probate litigation lawyer will ascertain all the facts to determine what legal remedies are available, then fully discuss possible options for proceeding with the client.

To secure court action, filing a petition is only the first step. Substantiating the impropriety of a personal representative’s actions requires introducing evidence in court that factually establishes the nature of the misconduct. Accomplishing that task requires assistance from a lawyer with knowledge of the applicable laws as well as experience presenting evidence to Michigan probate courts. A request for court action involving the personal representative of an estate is a very significant legal matter. It is not a process that should ever be undertaken without representation by an attorney experienced in probate court actions.

Our BRMM Michigan Probate Litigation Attorneys Are Here to Help

If you need assistance with a situation involving the conduct of the personal representative of an estate, our probate litigation lawyers can assist. We take the time to understand the situation, then explain what options are available for proceeding. Our substantial probate litigation experience and our extensive practice in estate administration position us extremely well to help clients who encounter issues during the administration of an estate.

At BRMM, we’ve been providing legal services to clients for more than 40 years. Our compassion, credentials, and commitment set us apart. Call us at (248) 494-4577 to talk with us about matters relating to estate administration or other areas of concern. We serve clients in Troy, Oakland County, and surrounding areas, as well as out-of-state clients with estate and probate matters arising in Michigan.
Related Posts
  • The Michigan Probate Process Read More
  • What to Know When Challenging a Will Read More
  • Creditor Claims and Paying Debts of an Estate Read More