Probate vs. Non-Probate Assets
Once you are appointed as executor, your powers extend to the probate assets in the decedent’s estate. Probate assets may include personal property or real estate that was not jointly owned with a right of survivorship. However, you typically will not have any power to control non-probate assets, such as life insurance or other assets with designated beneficiaries, assets held in trust, or real estate or bank accounts owned jointly with rights of survivorship, which means that when one of the joint owners dies, the account belongs to the surviving owner. Since these assets are distributed by their own terms rather than under the will, they do not go through the probate process.
The decedent’s creditors may make claims against the estate, wanting payment for debts the decedent incurred during his lifetime. Under Pennsylvania law, your powers as executor include the power to deny claims that don’t appear to be valid. However, a creditor can contest your decision by presenting his claim to the court when you present the estate’s audit. If the creditor fails to present his claim at this time, he is no longer entitled to payment for that claim.
Payment of Debts
If the estate does not have enough cash available to pay the decedent’s debts, you may sell the decedent’s property to raise the money for payments. Under Pennsylvania law, you cannot sell real estate that was specifically given to a beneficiary without getting either that beneficiary’s permission or court permission first, but you can sell personal property under your general authority as executor. Usually, you can even sell personal property that was given to a specific beneficiary. However, the court has the ability to restrict your power to sell real or personal property.
As executor, you have broad power to administer the estate as you determine is appropriate. However, beneficiaries of the estate also have authority to challenge your actions if you do something with which they disagree. The beneficiaries can file a challenge with the county register of wills or appeal with the local orphan’s court. The court may terminate your powers as executor under certain circumstances, such as if it determines you have mismanaged the estate or have failed to perform any of your legally required duties.