Paul Rabalais' Louisiana Succession Law Blog

Is Louisiana Succession Really Necessary When Deceased Left a Clear Last Will?

 

We work with some great families getting estates settled after the death of a loved one. Occasionally we are asked, "Is a Succession really necessary if someone dies with a Will and they are clear about who the heirs are?" Sometimes they ask, "Can't we just take my Dad's Will and a death certificate to the bank and ask the bank to give us Dad's money?"

Well it does not work like that. A Succession is necessary even though the deceased left a Will when there are assets titled in the name of the deceased. The Will is filed at the courthouse along with a number of customized Succession documents including the detailed list of assets and debts, petitions, and a Judgment.

If the judge's office determines that all of the procedural rules have been followed, the judge will sign a Judgment of Possession which orders banks and others to transfer assets from the name of the deceased to the heirs named in the Will and in the Judgment of Possession.

We work with phenomenal families from all 64 Louisiana parishes in order to get estates settled. The fact that we embrace technology in our office allows us to get this done in lickety split, keeping suriviving heirs from suffering through delays and other stresses.

Succeessions Happen Twice for Married Couples

One of the major issues you should consider when planning for you and your spouse's passing is the court supervised succession procedure because this will be needed at both spouse's deaths if not properly planned for. One of the main goals we encounter with married couples involves avoiding the succession all together by setting up a Revocable Living Trust. The Revocable Living Trust is used to allow for immediate transfer of control over your property to your spouse and ultimately your heirs without any court supervision.

Why would you want to avoid a succession? A court supervised succession procedure costs at least $5,000 and can drag on anywhere from months to years. In this time, your heirs will encounter roadblocks when it comes to controlling and accessing the property left in your estate. Of major importance, successions procedures are public record and the value and contents of your estate can be viewed by any person with an internet connection.

A lot of people seem to forget that with married couples two sucessions must take place; one at the death of each spouse. This jsut doubles, the cost, the time, the headache, and the amount of information that is open to the public. That is why Revocable Living Trusts, which avoid successions, are a great tool for married couples. 

If you are interested in avoiding this succession procedure and would like to discuss your options give me a call in the New Orleans/Metairie Area at (504) 247-1980 or send an email to chris@rabalaislaw.com. On the Northshore, contact Brent Durham at (985) 246-3020 or brent@rabalaislaw.com. In Baton Rouge, contact Paul Rabalais at 225-329-2450 or paul@rabalaislaw.com.

Chris Kane, Attorney

Director, New Orleans Office

      

Fixing an Incorrect Judgment of Possession

I recently met with a client who was in a bind because the Judgment of Possession or "JOP" issued after her husband's death inaccurately reflected the terms of his will. Apparently the attorney responsible for overseeing her husband's succession forgot to mention include her 1/2 interest in the family home and the entirety of the home was left to her daughter subject to a lifetime usufruct for the wife.

This was incorrect because in Louisiana the home was considered community property. Upon the death of her husband, the wife legally owns 1/2 of all the community property in the husband's estate free and clear of the claims of the children. The inaccuracy of this JOP led to flaws in the retitling of the home. Only the daughter is listed on the new title, this makes the wife unable to sell her interest in the home and creates a real hindrance for Estate tax gifting and her other estate planning needs.

However all is not lost. We can file with the court to amend this JOP to make sure the wife's interest in the home is provided for. After the amendment is granted by the court, then we will have the home retitled to reflect the new and accurate Judgment of Possesion. At this point the wife will be able to exercise all of her rights as co-owner of the property.

If you have experienced problems with the succession for one of your loved ones and would like to discuss your options give me a call in the New Orleans/Metairie Area at (504) 247-1980 or send an email to chris@rabalaislaw.com. On the Northshore, contact Brent Durham at (985) 246-3020 or brent@rabalaislaw.com. In Baton Rouge, contact Paul Rabalais at 225-329-2450 or paul@rabalaislaw.com.

Chris Kane, Attorney

Director, New Orleans Office

       

Independent Estate Admininistration in Louisiana

Last week we encountered a client who was trying to get the succession for their father's estate completed. The father's will was created over 15 years ago in 1995 and was governed by the laws of Louisiana. Overall, the will was pretty standard with the exception of one detail. The will named one of the testator's children as an "independent executor". The odd thing is, this will was created before Louisiana ever recognized what is known as independent administration of a will. Louisiana only began allowing for independent administration in 2001. As you can imagine, myself and my associates were all surprised to see this term in any will created before 2001. Whether it be the extraordinary foresight of the will creator or just a stroke of luck, this "independent executor" term had a great effect on the ease with which the succesion could proceed.

Typically, all wills name an executor. The executor is the person who manages the estate's administration during the succession or probate of the will of the deceased. Administration can include selling estate assets, disbursing estate property, and other various management functions with regard to the estate. When an administrator or executor is not designated and approved as "independent", they must get a court order to take any action with respect to the testator's estate property. The process of getting court approval for all these management activities is cumbersome and could also be costly as court filing fees can quickly pile up.

When an executor is approved as an independent executor, they can take all of the aforementioned management activities without any court involvement. So clearly, independent administration is the way to go in Louisiana because of the ease it facilitates with any succesion. At the Rabalais Law Firm, we make sure to always include this "independent executor" language in every will we create and we will always seek to have an independent administrator or executor approved whenever we deal with a succesion.  If you have a will created prior to 2001 which most likely does not include the "independent executor" term it would be a good idea to update your will to reflect the changes in the law and any changes in your present circumstances. If you are encountering a succesion proceeding, then you will certainly want to have an independent executor or administrator approved to move the process along more quickly.

If you would like to speak with me or one of our other attorneys regarding a will or sucession feel free to call or email me in the New Orleans/Metairie Area at (504) 247-1980 or chris@rabalaislaw.com. On the Northshore, contact Brent Durham at (985) 246-3020 or brent@rabalaislaw.com. In Baton Rouge, contact Paul Rabalais at 225-329-2450 or paul@rabalaislaw.com. We will also be holding free seminars in Metairie on November 16 and Mandeville on November 17 to educate people looking to protect their estate and assets from estate tax and probate costs. Go to our website, www.EstatePlanningInLouisiana.com for more details and to register for this great event.

Chris Kane, Attorney

Director, New Orleans Office

        

What Law Applies When Property is in 2 or More States?

Yesterday a lady who was originally from Louisiana called our office from her home in another state and she had a number of questions about which state's law applied to her late father's possessions since he  owned property both in Louisiana and in Mississippi.  While there are exceptions throughout successions law in Louisiana, the law that applies is generally determined by whether the property is movable or immovable.  These are two classifications of property in Louisiana.  In short, immovable property is land and your home (with a number of others) while movable property is everthing that is not immovable.

If property is movable then the law of the state the decedent was domiciled (i.e. where they lived and intended on living) at the time of death is applicable.  So any vehicles, antiques, tools, or other tangible possessions that were owned by the lady's father would be governed by the Mississippi law since that was the state her father lived at the time of his death.

She then told me that her father also owned a home and some land in Mississippi and he still owned some land in Louisiana as well.  Since land and a home are immovables the rules were different.  For the land her father owned in Louisiana, Louisiana law applied.  However, the home and the land that was in Mississippi was governed by the laws of the state that would be applied by the courts of the state where the property was located (which in this case would be Mississippi). 

The question she called with is an increasingly common scenario.  Often times Louisiana residents own their homes in Louisiana and maybe a condo on a beach in Alabama or Florida.  Or like the lady in the example maybe you or your loved one once lived in Louisiana and have since moved to Mississippi to be near family.  No matter the scenario, our attorneys and staff at the Rabalais Law Firm can provide and quick and simple answer without all the legalese to make sure your possessions go where you want them to at the time of your death and are not controlled by the laws of Louisiana or some other state.  If you have a situation like this or any others related to Successions, Estate Planning, or Medicaid Planning then give our office a call at 1-866-491-3884 or e-mail me at brent@rabalaislaw.com.

Brent E. Durham, Attorney

Director, Northshore Office

 
 

 

 

8 Things to Know About Louisiana Successions

People often call our office after a friend or family member has passed away wanting to know more about successions in Louisiana. Below is a general explanation of our unique, and sometimes complicated, law of successions.

1) When is a succession “opened”?

• The succession opens at the moment of death, and successors have immediate ownership of the property they inherit. This is regardless of whether the succession is actually filed with the Court, although a court order will usually be required for banks and other institutions to transfer funds, as well as for transfer of land ownership.
• While the succession is technically opened automatically, we DO NOT recommend that you forego filing the succession with the proper Court. Letting a succession go for several generations is a common problem in Louisiana that results in an extremely difficult task for the family member or friend who eventually has to deal with everything years down the road when paperwork has been lost and memories have faded.

2) What happens to a person’s community property if they die without a Last Will?

• If a person leaves behind a spouse and children, ½ of the community property will belong to the spouse in full ownership. The surviving spouse will have the usufruct of the other ½ of the community, and the children will have naked ownership. The spouse’s usufruct lasts until the spouse dies or remarries, whichever occurs first. Upon the spouse’s death or remarriage, full ownership of the ½ of the community that was subject to the usufruct automatically vests in the children.
• If a person dies leaving a spouse, but no children, all of the decedent’s property will pass in full ownership to the spouse.

3) What happens to a person’s separate property if they die without a Last Will?

• If they leave behind descendants, they inherit all of the property to the exclusion of everyone else, including a spouse.
  • In all areas of successions law, “descendants” include children that have been given up for adoption. They are still entitled to inherit from their birth parents.
• If they leave no descendants, but leave behind parents and/or siblings or children of predeceased siblings, the parents inherit the lifetime usufruct of the property and the siblings (or children of predeceased siblings) inherit the naked ownership of the property. (This is true unless the property is something the parent donated to the child. In this case, the property reverts to the parent in full ownership.)
  • If there are parents, but no siblings, the parents inherit in full ownership.
  • If there are siblings, but no parents, the siblings inherit in full ownership.
• If they leave no descendants, parents, siblings, or children of predeceased siblings, the property goes to the surviving spouse in full ownership.
• If they leave no descendants, parents, siblings, children of predeceased siblings, or spouse, the property goes to any surviving ascendants, such as grandparents or great-grandparents.
• If they leave no descendants, parents, siblings, children of predeceased siblings, spouse, or other ascendants, the property goes to any other collateral relations, such as great-nieces and nephews, great-aunts and uncles, etc.)
• If the decedent leaves absolutely no relations, the property will go to the state.

4) What happens to a person’s property when they die with a Last Will?

• After the Will is probated and the Judgment of Possession is signed, the property goes to whoever is named in the Will.
• What can’t a person give away in their Will?
  • A married person cannot give away more than ½ of their community property, because ½ of community is owned by the surviving spouse when the other spouse dies.
  • A married person can leave his or her ½ of the community property to anyone they wish, even to the exclusion of their spouse, but they must take into account forced heirship laws.
    • The part that the testator can will away is called the “disposable portion.” The part that the testator cannot will away is called the “legitime.” The legitime will be equal to either ¼ (if there is only one forced heir) or ½ (if there is more than one forced heir) of the testator’s ½ interest in community property.
    • Where forced heirship prevents alienation of part of the testator’s ½ of the community, the testator may leave the usufruct of their ½ to their spouse with the naked ownership of the legitime to the forced heir(s).
      • At the testator’s discretion, this usufruct can last until the surviving spouse’s death, remarriage, cohabitation with another person in the manner of married persons, etc.
      • The forced heirs’ naked ownership may be left in trust with the surviving spouse named as the trustee. This will allow the spouse to deal with the property without having to get permission from the forced heirs (such as selling the home or cars).  

5) What if a person doesn’t want the property they are to inherit?

• The successor may renounce the inheritance, but such renunciation must be express & in writing.
• The property will then go to whoever would have inherited if the renouncer had predeceased the decedent.
  • In the case of a succession where the decedent left a Will, the testator is allowed to say what he wants to happen to the property if it’s renounced or disclaimed by an heir.
  • The person who is disclaiming the property CANNOT say where they want the property to go. It is up to the testator, or, if they made no provision in a Will, to the law.

6) Who handles the succession when a person dies?

• In the case of a death without a Last Will, someone, usually a relative, will petition the court to be appointed as an administrator. This person may act independently if all of the universal and general successors sign agreements. This allows the administrator to act without court approval for everything. If the successors do not agree to independence, the administrator will have to petition the court to do almost everything. The most common thing for which a non-independent administrator needs to ask permission is to sell immovable property.
• In the case of a death where the decedent left a Last Will, the decedent will almost always have appointed someone to serve as executor. This person will usually petition the court to be confirmed as executor. On occasion, the person named does not wish to or is unable to serve as executor. In this case, a person named as an alternate executor in the Will may petition the court, or, if there is no named alternate, any other interested person may petition the court to be named as “dative executor.”
  • The executor may act independently if either the testator stated that was their wish in the Will or if all of the universal and general successors sign agreements.
• The executor or administrator is entitled to payment for their services in the amount of 2.5% of the net estate, unless the decedent provided otherwise in their Will. This fee can be waived, and often is in the case of family members. If the fee is accepted, it must be reported as income on the executor’s/administrator’s tax return.

7) What are some duties of the administrator/executor?

• After being appointed by a court, the succession representative is issued Letters of Administration or Letters Testamentary. These Letters are proof of the succession representative’s authority to deal with matters on behalf of the estate. One of the main things that must be done is opening an estate account.
  • This account may be opened at any bank with a branch in Louisiana. To open an estate account, the representative will need to present the bank with:
    • A copy of the death certificate,
    • A Tax Identification Number, and
    • A certified copy of the Letters
    • Once the estate account is opened, the representative will take a copy of the Letters to the banks and financial institutions at which the decedent had accounts. They will ask that the accounts be closed, and that checks for the balance be issued to the “Estate of John Doe.” These checks will then be deposited into the estate account.
    • The representative will use the estate account assets to pay estate debts, which usually include:          
      • Legal fees,
      • Executor’s/Administrator’s fees,
      • Administration expenses,
      • Funeral and burial expenses,
      • Unpaid medical expenses,
      • 50% of community debts due at death,
        • This includes utility bills, credit card debt, car loans, mortgages, etc.
        • 100% of separate debts due at death
      • The representative will need to maintain a list of these debts, along with the proper documentation.
      • The representative will also need to make a list of the decedent’s assets and the value of those assets on the day the decedent died.
        • The most common assets that need to be listed include:
          • Immovable property (real estate),
          • Bank accounts,
          • Accounts with other financial institutions, such as brokerage accounts,
          • Stocks,
          • Bonds,
          • Cars, boats, trailers, and other titled vehicles,
          • Promissory notes owed to decedent,
          • Business interests (LLCs, corporations, etc.)
          • Assets that do not need to be listed because they are distributed outside of the succession include:
            • Beneficiary designated assets, such as IRAs, 401Ks, and insurance policies.
              • This is only if a beneficiary is actually designated. If there is no designation, or if the beneficiary has died or disclaimed the assets, the assets will be included in the succession, because they will be payable to the estate.
              • Savings bonds in the names of Decedent OR another person.
                • Ownership of these jointly owned savings bonds is transferred automatically to the survivor.
                • If only the decedent is named or if both named persons are dead, the bonds must be listed in the succession.

8) Once all of the paperwork is completed, and the Judge has signed the Judgment of Possession, our office will record the Judgment in the parish or parishes in which any real estate is located. The succession representative will handle distributions to the heirs, transfers of vehicles, stocks, bonds, etc.

If you are interested in retaining our law firm to provide you with our estate administration legal services, contact us for a no-cost initial discussion at 225-329-2450, or email us at laura@rabalaislaw.com.

~ Catherine Martinez

 

Working With the Courts on Successions Can Be Frustrating

We strive at our office to be prompt, accurate and efficient when we are providing our Louisiana Succession legal services. I have to admit that our client services attorney, Catherine Martinez, does a whale of a job creating and processing all of our succession pleadings and other probate paperwork.

Today I received word that the judge's office rejected two of our Louisiana Succession Petitions for Possession. Just so you'll know, a petition or other court pleading can be rejected if it is not procedurally correct or for another valid reason.

In both matters, the Petition for Possession and corresponding Judgment of Possession was rejected because, as the clerk for the duty judge put it, we did not file the required, "Affidavits of Death, Domicile and Heirship."

So they rejected our documents and sent them back to us to start over. What the law clerk failed to realize was that we had filed the required Affidavits of Death, Domicile and Heirship when we filed the Petition to Probate the Will. Anybody who knows anything about Louisiana Successions would have known to look to see if these Affidavits were previously filed.

The solution has to be to either better train the clerk of court employees who are in charge of handling and processing succession pleadings, or to create a probate court which would exclusively handle succession matters. Since there would be cost and politics involved in establishing a probate court, I don't see that happening anytime soon.

While a Louisiana Succession can often times be a streamlined processing of paperwork at the proper courthouse, any number of things can and often do occur to slow down or stop the process in its tracks. The only way to completely avoid a Louisiana Succession is to make certain there are no assets titled in your name at your death which would require a Louisiana Succession - often done by creating and funding a revocable living trust.

Paul

One Child Inherits the Spouse After Both Parents Die - How To Do It

I've been working on a succession the last several weeks of a surviving spouse. Mom died a few weeks ago. Dad died back in 2002. Dad left the usufruct of his estate to Mom, and named their three children as naked owners.

Now that Mom has died, the three children would like one of the children to inherit the house as part of his inheritance from Mom and Dad. Can they do this?

One of the issues that will need to be addressed is that the three children inherited Dad's one-half of the house back in 2002, subject to Mom's usufruct. Now that Mom has died, the three children co-own one-half of the house (or I guess you could say that each child owns 1/6 of the house).

In order for the one child to fully own the house after Mom dies, not only do we have to structure the Judgment of Possession in Mom's succession to reflect that the one child is inheriting Mom's half of the house, but the other two children will have to transfer (sale or donation) their 1/6 interest in the house to the other child so that one child can own the house in full ownership.

The point is that after the surviving spouse dies, we often need to refer back to the succession of the first spouse to die when dividing family assets among the heirs.

If you are an executor of an estate and would like to discuss how we can efficiently provide our legal services to guide you through the settlement of a Louisiana succession of a deceased loved one, give us a call at 225-329-2450, or send me an email at paul@rabalaislaw.com

Paul Rabalais

Family Must Undertake Multiple Successions So Grandson can Buy Grandma's House

Have been working with a family the last three days to figure out how to clear up the title on their grandmother's house. Here's the situation:

Grandma wrote a Last Will in the 1970's leaving her house to Son#1. Grandma later died. No succession has ever been completed on Grandma so the property was never transferred out of her name. After Grandma died, Son#1 executed an Act of Donation donating the property to Son#2. The Act of Donation was properly recorded in the parish Conveyance Records. Son#2 recently died. Grandson wants to buy the home from the estate of Son#2.

What do we do? I'm working with a title attorney who will close the sale from the estate of Son#2 to Grandson. Looks like we'll be completing the succession of Grandma and transferring the house from Grandma to Son#1. Then we'll open the succession of Son#2 and have Granddaughter named as the Independent Administrator of this succession so she can sell the property from the estate to Grandson.

It can be a whole lot easier if an estate gets settled shortly after death when all of the information regarding assets and family members is readily available.

Paul Rabalais

P.S. Feel free to register from my webinar Thursday, May 13, 2010, at 12:30pm. You can register and find out more at www.RabalaisWebinars.com

Grandchildren Inherit When Child Predeceases Parent in Louisiana

I received an email last night from a woman who wanted to know if she had any succession or inheritance rights from her grandmother. Her grandmother died in 1998 without a last will and testament, but domiciled in Louisiana. Prior to her grandmother's death, her mother died.

The woman noted that her grandmother's two other children "split the estate." The woman wanted to know if she had any rights to inherit under Louisiana Succession Law.

Louisiana Succession Law has something called "Representation." When a Louisiana resident dies without a last will and testament, their estate goes to their children. If a child dies before the parent, then that child's share is to be divided among that child's children.

In the previous example, I don't understand how the two surviving children split the estate. Perhaps Grandmother only owned bank accounts and one of the two suriviving children had signature authority over Grandmother's accounts so they were able to access the funds without a court order. Or perhaps one of the children petitioned the court and was appointed as the Administrator of the Succession and was then permitted to open an estate account and move Grandmother's funds into an estate account which they could access. The first "perhaps" is the most likely scenario.

If there was real estate involved, then Succession pleadings would have to have been prepared which should have indicated that the deceased child's children were representing their mother in the grandmother's succession. A judge should have signed a Judgment of Possession which would have transferred the real estate to the heirs in the proper proportions. All of the heirs would have been made a party in the succession - including the grandchildren who were representing their mother - before this real estate could have been transferred.