Articles Tagged with probate

On February 9, 2017, Representative Bill Mitchell of Decatur, introduced HB3089 to the Illinois House of Representatives.  The proposed legislation would amend the Probate Act of 1975, by adding an additional subsection to 755 ILCS 5/18-3, which provides the notice requirements for probate estates.  This bill has not yet cleared the House of Representatives, as it was referred to the Rules Committee on March 31, 2017, which is where it currently stands.

Section 18-3 of the Probate Act of 1975 states the current requirements for notice of probate estates.  Most probate attorneys are already familiar with these requirements: Publication of creditor notice for three consecutive weeks in the county where the estate is being administered, and mailing direct notice to any known or reasonably ascertainable creditors.  HB 3089 would add an additional subsection which would require direct notice be sent to the Illinois Department of Healthcare and Family Services (DHS) if the decedent was 55 years of age or older or resided in a nursing facility or other medical institution.  HB 3089 further provides that the notice be sent to the Bureau of Collections at the Chicago office of the Department, and must include a copy of the underlying petition as well as the decedent’s social security number and date of birth.

There are a few interesting pieces of this proposed legislation which are worth examining.  The first is the number of probate estates this would impact.  Presumably, a large number of decedents are over age 55 at the time of death.  Furthermore, the notice would also be required for any decedent (regardless of age) who “resided in a nursing facility or other medical institution.”  The concern with this language is that it is broad and undefined.  Does it apply for a decedent who ever resided in a nursing home, or just resided there at the time of death?  What is considered a “medical institution?”  Does it apply for assisted living facilities, rehab, or extended hospital stays?  If this legislation passes, the best practice for attorneys may simply be to send the notice to DHS for every probate estate opened.

Probate is the process by which a court will supervise the administration of an estate when someone passes away.  Many clients prefer to avoid probate because the process can be time-consuming and costly.  This article will examine the various ways probate can be avoided.

Joint Tenants with Rights of Survivorship.  When there are more than one owner to a piece of property, there are different ways the property can be titled.  One example is joint tenancy.  When a decedent dies while holding property in joint tenancy with another person, the property will pass to the surviving owner by operation of law.  This applies for both real estate and personal assets such as a bank account.

Beneficiary Designation/Payable on Death.  Many assets such as retirement accounts will allow for a beneficiary designation or payable on death designation to be placed on the account.  In this case, when the owner of the account dies, it passes automatically to the beneficiary who is listed on the account.  However, the key for this technique is that there must be a valid and living beneficiary at the time of death.  If there is no beneficiary listed, the asset will pass with the decedent’s estate, which will most likely trigger a probate proceeding.

When a guardian is appointed for a person with a disability (the “ward”), the guardian is required to follow certain guidelines.  There are two types of guardianships in Illinois, and they each have different rules to follow.

The first is “guardianship of the person.”  The guardian of the person is responsible for securing the support, care, comfort, education, and professional services for the ward.  Pursuant to the Illinois Probate Act, the guardian of the person is also expected to assist the ward in the development of maximum self-reliance and independence.  Despite the fact that guardians seemingly have a substantial amount of authority, they are not given carte blanche permission to make every decision associated with the ward.  A guardian is still expected to listen to the wishes of the ward and make an effort to carry out those wishes.  Furthermore, a guardian cannot change the residential placement of the ward without explicit authorization from the court.  This prevents a guardian from being able to place a ward in a nursing home without a thorough investigation by the court to determine if that home is in the ward’s best interests.

The second type of guardianship is called the “guardianship of the estate.”  The estate guardian is responsible for handling the finances and assets of the ward.  He/she is expected to manage the estate frugally and apply the income and principal of the estate so far as necessary for the comfort and suitable support and education of the ward (755 ILCS 5/11a-18).  The guardian may make payments directly to the ward, or to a third party to pay for things like rent, food, clothing, entertainment, etc.  Once again, this is a significant amount of power, but it is not without its limits.  A guardian of the estate can only spend the ward’s assets on things that directly benefit the ward or the ward’s minor or adult dependent children.  If the guardian is not following these guidelines, it may be grounds for the guardian to be removed.

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