During probate, is being a Personal Representative a Second Job

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November 13, 2024

Many of our clients are surprised by just how much of the probate process occurs outside the courtroom. A good portion of our clients have never had any experience with probate or any sort of legal proceeding at all, and their only frame of reference for how legal action takes place is from film and television, where there is a prevailing myth that a person can hire an attorney and the attorney can sort of take care of the entire process for them. Attorneys, especially in probate, do not act in place of the Personal Representative but serve to advise and properly document what the Personal Representative does, and advise the Personal Representative on how to properly deal with the estate's assets. The Personal Representative does the vast majority of the actual work: handling the physical assets, signing title transfers or sale documents, holding estate sales, negotiating with creditors, etc.

If this all seems like a lot of work, that's because it most certainly is. This is why Personal Representative's sign a lawful Oath before being appointed and why they are accountable to the court. Being a Personal Representative is not a casual affair, it is a duty and a responsibility. However, it is not a strictly voluntary or charitable position. We tell our clients that acting as a Personal Representative should be treated as taking on a second job, and like any other job, the law provides for Personal Representatives to be appropriately compensated for their work.

In the state of Florida, Personal Representative's compensation is covered by F.S. 733.617 which lays out a schedule of compensation rates that are based on the value of the estate. The percentage rates decrease with the total value of the estate, with the lowest level being the most common: for estates valued at less than $1 million, the Personal Representative is entitled to 3% of the total estate value as compensation. This is in addition to any portion of an estate that a Personal Representative may be entitled to receive as an heir or beneficiary. For example: if an estate is valued at $100,000.00 total with no creditors' claims, and there are only two heirs, one of whom is the Personal Representative, the Personal Representative would first claim their 3%, or $3,000.00 in this case, and the remaining $97,000.00 would then be divided amongst the two heirs into $48,500.00 each. The Personal Representative would receive a total of 51,500.00 and the other heir would receive $48,000.00 since the claimed compensation is considered a Class 1 claim against the estate under F.S. 733.707(1)(a) and must be accounted for first before the rest of the estate value is disbursed to the rightful heirs.

This statute is very important to understanding compensation for Personal Representatives since it defines a Class 1 claim as, in part, "Costs, expenses of administration..." but does not specify what qualifies. As such, "expenses of administration" is a broad umbrella term that can be interpreted, with proper explanation and thorough documentation, and can be virtually any out-of-pocket expense related to probate including the payment of attorney's fees. For instance, if your loved one lived in Florida but you had to drive a long distance to get to their home to pack up their belongings for an estate sale, your travel expenses are considered "costs of administration." Fuel, lodging, and even meals bought during this travel period could, in theory, be considered a cost of administration and could then be claimed against the estate by the Personal Representative to repay their out-of-pocket expenses.

It's important to understand that these expenses also exist separately from the Personal Representative's compensation AND any share of the estate the Personal Representative may be entitled to receive. Following our example above, for an estate with only two heirs, one of whom is a Personal Representative, if the Personal Representative had to spend $500.00 of their own money to travel to the home of the decedent and pay a company to move out all the furniture (just for example), then the Personal Representative would receive $3,000.00 as their compensation (3% of the estate), plus the $500 reimbursement, leaving a total of $96,500. The Personal Representative would receive $51,750 total, and the other heir would receive $48,250.

These legal guarantees are precisely why the Personal Representative is accountable to the court and must precisely document all of their expenses, if any: to prevent malfeasance and misappropriation of funds. It is also the reason why notice and consent of all interested persons is such a critical element to probate proceedings and is often the difference-maker between a simple probate that only takes a few months, and one that can last years, eat away at the estate's funds, and potentially lead to other legal action. Communication is the key to success in probate, and making sure everyone involved is onboard and in agreement with the Personal Representative's actions is the best way to guarantee that cases are completed in a timely manner, but we understand that this is not always the case. Sometimes there will be delays or an interested person who just isn't cooperative with the process, or other disputes. Fortunately, most of the time these disputes can be resolved as long as everyone understands what is going on, and that's where we come in. We'll help to coordinate communication between the Personal Representative, the heirs, the creditors, and the courts and make sure everyone is informed and up-to-date on all relevant information.

If you have questions about Probate issues, don’t wait—make sure your legal rights are protected. Call 863.250.2990 today to schedule your Free Consultation with our Probate attorneys.