I get asked often how much time an estate fiduciary has to pay the bills of a decedent. The answer is generally straightforward but has a few twists.
If a creditor isn’t presented within nine months of the decedent’s death, the law states that “the personal representative shall not be liable to the creditor with respect to any assets which the personal representative may have delivered or paid in satisfaction of any lawful claims, devises or distributive shares, before the presentation of the claim.” N.J.S.A. Section3B:22-4. Now that doesn’t mean the creditor is screwed. A creditor can still file the claim against the estate “at any time before the remaining assets of the estate shall have been distributed or paid over pursuant to law,” and the personal representative can accept or reject it. N.J.S.A. Section 3B:22-10. If the claim is rejected, the creditor has one month form the date of rejection to file an action in court and seek a judgment of same. N.J.S.A. Section 3B:22-13. However the court may not compel the estate to pay “unless the court shall, for good cause shown, so direct or until his account has been settled by the court and the court has authorized or directed him to make the payment.” N.J.S.A. Section 3B:22-14. If the assets have already been distributed, the law also allows the creditor to add as defendants beneficiaries of the estate up to the amount they received as per the dollar value stated on what is known as the Release and Refunding Bond.
The law allows creditors to file an action and get their claims paid even though nine months has passed and assets are distributed. But the creditors cannot hold the personal representative liable like they can if the claim is within nine months, and the court needs to make a finding that the estate should be responsible for the claim.
To discuss your NJ estate and probate administration matter, please contact Fredrick P. Niemann, Esq. toll-free at (855) 376-5291 or email him at firstname.lastname@example.org. Please ask us about our video conferencing consultations if you are unable to come to our office.