Every legal process carries with it an expectation of a certain amount of procedural requirements. Probate is certainly no exception to this. There are many steps required in probate cases, including opening the case, providing notice to creditors, finding the names and addresses of beneficiaries, and making sure that allowable debts are paid in the correct order. Most of these steps must be completed by the personal representative. One of the duties of the personal representative is to create and file an estate inventory.
An estate inventory, in its simplest form, is a document that details all the assets and debts of the estate. In order to make sure that the estate is properly administered, it is essential to have an accurate estate inventory. The inventory must be filed with the probate court and sent to very particular people. The inventory must be sent to all interested parties, including heirs, descendants, surviving spouses, specifically named devisees, and all creditors of the estate. Note that just because you receive a copy of the accounting does not mean that you have been left any property under the decedent’s last will and testament or that you are entitled to inherit under Minnesota law. Rather, the document simply signifies that the person is defined as an “interested party” of the estate under Minnesota law, i.e. someone who could have a potential property interest in the estate.
Public policy dictates that creditors receive a copy of the inventory for good reason. The creditors should carefully review the estate inventory and look for two main issues: the amount of debt versus the amount of assets, as well as whether there are many creditors with a higher priority of payment under Minnesota law. If a creditor sees that there are not many assets in the estate or even that the estate is clearly insolvent (meaning the estate owes more than it is worth), it is very possible that the creditor will never get paid if the debt is one of low priority, such as unsecured credit card debt. That said, filing a claim early can still benefit the creditor, as creditors of the same priority level will be paid in the order that their claims were received.
We have experience helping our clients understand probate and the distribution of assets. Call us today at (651) 371-9117 and let us help you