Is my father's estate liable if he owes money from her mother and brother?

Question

My father recently passed away leaving his property in a Trust. The vultures have come out. Surprisingly, it’s his siblings (our Aunts & Uncles). My father informed us that his brother owed the estate at $50K. The uncle never addressed any money due to him while my father was ill. He had plenty of opportunity since my dad has prostate cancer. The uncle expected to be a recipient in the will and upon learning otherwise, he searched through his old records and found copies of 2 promissory notes. They are dated 1995 with terms stating (in exact wording): ‘On Demand after date I promise to pay to the order of ‘the person’s name is listed’.  Payable at (left blank). Value received with interest at 0% per annum. One note is to my uncle. The other note is to my dad’s mother who passed away in 1997. It gets better. The proof the uncle provided are only copies and have a deposition stamp dated 1996. These are notes produced by father during his divorce with my mother in 1996, showing that he owed money to his mother and brother. Is my father’s estate liable?

Christine Socrates · Answer

This appears to be a complex question and I recommend that you bring all the information you have and promissory notes to an attorney to properly evaluate your case.  Also, more background information is needed regarding the facts you have set forth below.

Victor Waid · Answer

Suggest you obtain the services of a trust/probate litigation lawyer to sort through this problem and determine the  liability of the trust for any past due debts owing by the deceased father; suspect the statutes of limitation to collect those notes have expired.

Edwin K. Niles · Answer

Hard to answer as your question is very unclear as to who owes money to whom.  But if the money is owed by Dad to others, then the trustee should send out notice to creditors and follow the established procedure for paying claims.  The attorney handling the trust administration should know how to do this.

Brian Haggerty · Answer

Possibly. Discuss this with the lawyer who is assisting you with the trust administration. You don't have a lawyer helping with the trust administration? Well, now you do, because if you don't lawyer up it's going to cost $50,000, so do yourself a favor. The promissory notes may be valid, although there may be ways they could be defeated, especially since uncle and aunt don't have originals.

Christine James · Answer

If your father never made a payment on the notes, they are likely barred by the statute of limitations.  GET AN ATTORNEY.  It will save a lot of time, money and headache.

Julie Mains · Answer

No, based on the facts as you stated them, the statute of limitations for personal debts has passed.  It is 4 years in California so he should have attempted to collect from your father over a decade ago.

Randall Romei · Answer

Valid notes are debts of the estate.  The original notes would be necessary for proof since the presumption is that the original is cancelled and destroyed when paid.  Can we assume your father acknowledged the debt in the divorce proceeding?  Your grandmother's estate is the proper party to make a claim on the note to the grandmother and the estate would have to be reopened.  It may be too late to make that claim depending on when the estate was settled.  The uncle would not necessarily be the only recipient of funds under the claim, the legatees under the grandmothers will or intestate estate would share in any funds recovered.  Assets in the probate estate would be subject to any successful claim.  Depending on the terms and nature of the trust the assets in the trust may not be liable for the claims against the probate estate.  In such a case the assets deposited into the Trust before death may be protected.

Jayne Sebby · Answer

This is a complex problem that can't be addressed responsibly in this forum.  The estate is going to need a good estate attorney with experience in this sort of dilemna.

Mark T. Peters · Answer

You need to get the attorney involved.  I could make an argument that the statute of limitations has run on those notes and so are not payable.  However, that depends on the state's law applicable to the notes.  I tend to doubt the debts are either valid or owing (I think your dad may have been trying to scam your mom), but you won't know until a judge decides.

Cheryl David · Answer

I suggest you get an attorney. The probate clerk will make the decision, if you contest the notes and follow the process.

Richard Keyes · Answer

If Missouri, if no payments have been made on the promissory notes in ten years, your uncle has a statute of limitations problem.  See an attorney for legal advice.

Dara J. Goldsmith · Answer

Maybe.  Sounds like there will be litigation.  Speak with the attorney handling the trust administration.  If there is not one, hire one.  Best of luck to you.

James Frederick · Answer

It is hard to say based on just the information given. Given the amount involved, I would strongly recommend having the documents reviewed by an attorney. The key issue is whether the debts were intended to be forgiven at death or to carry over to the estate. If your uncle actually loaned your father money, then he should be repaid, in my opinion.

James Oberholtzer · Answer

Probably yes; however, you need to do some investigation before making a conclusion.  What were the loans for?  Where are the original promissory notes?  Any records of the loans being made?  Any records of any payments?  Are the notes too old to be enforced?  Statutes of limitation?

Frances Headley · Answer

The statute of limitations has run on the notes.  You should consult a probate attorney to assist you with any so called debts.

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Is my father's estate liable if he owes money from her mother and brother?

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