When a person dies, part of placing their affairs in order is to administer their estate; this is simply the legal term for collecting, cataloging and managing their possessions, including liquid assets, real estate, personal belongings, and stocks. During administration, the person in charge of managing these items pays any outstanding debts or taxes and then distributes the remaining property to the heirs of the estate. In many cases, the person in charge of administering the estate is known as the executor. Depending on how the estate has been managed, it may go into probate or trust administration.
What is probate?
During the probate process, the court looks at the will of the deceased (if present) and verifies that it’s valid. Once that is done, the rest of the process tends to go pretty smoothly—assuming all involved parties agree on the contents of the will and the fairness of the situation.
What is the difference between trust administration and probate?
In the event that the deceased has placed their estate into a trust, the court does not act as the entity in charge of distributing and verifying the legitimacy of the will. Instead, that duty falls to a trustee, whose job is to carry out the instructions of the trust, including dividing assets among beneficiaries.
When does trust litigation come into play?
Trust litigation occurs when one or more interested parties feel there is either an issue with the trust. In some cases, the creditors of the deceased may file a suit to collect on debts before the assets can be distributed among the beneficiaries. In other cases, one party may file a suit against the trustee for alleged misconduct or failure to act impartially; in some cases, the trustee has failed to carry out their duties and needs to be replaced.