When someone dies here in California, their estate must go through probate before any assets can be passed on to their heirs and beneficiaries.
Part of that process involves the estate paying off any outstanding claims from creditors who submit bills to the estate. However, it may be possible to avoid paying all the claims made by creditors.
What personal representatives need to know
According to California Probate Code §9353, creditor claims may be rejected entirely or in part. The creditor has 90 days from the date of denial to file an action to further the claim and proceed to arbitration or another type of resolution.
Some claims may otherwise expire for statutory reasons. Creditors have 90 days to take legal action on rejected claims. They also may wait until the claims come due (if they are not due already) to submit claims.
One caveat to be aware of is that if the personal representative position is vacant for any reason (death of the personal representative or a change in the representation), the period of vacancy does not count toward the 90-day limit.
When they need a little help
Personal representatives are usually friends or family of the decedent. As such, most are lay people without a broad understanding of the California probate laws. They may struggle with properly notifying creditors that their claims were rejected.
They also might not know that creditors can contest any rejected claims or be unaware that they can request documentation of the alleged claims from the creditors.
The probate court has an active role in resolving disputes over claims submitted by creditors, but for those with limited legal knowledge, it can appear overwhelming. There is no reason to continue to struggle with managing the estate on your own. Learn more about the rights and responsibilities of estate representatives to get the best results.