HB0330 Gaw, Steve

C O M M I T T E E

HB 330 -- PROBATE

SPONSOR: Gaw

COMMITTEE ACTION: Voted "do pass" by the Committee on Judiciary and Ethics by a vote of 9 to 3.

This bill makes several changes in the procedure of estate administration and in the law of intestate succession.

In the area of procedure of estate administration, the bill:

(1) Makes any person submitting an affidavit setting forth a claim against the decedent an interested person. The hearing required within 15 days of such filing is not to determine the validity of the claim, but simply who should be directed to apply for letters. All interested persons must receive notice of this hearing. The bill also puts a timeliness requirement on the person found by the court to be entitled to the issuance of letters; this person must apply and qualify for such letters within a time frame established by the court, or the court may issue letters to a different applicant;

(2) Allows the court, at any time, to order a qualifying estate to be handled pursuant to sections 473.090 and 473.097 (involving estates under $10,000), upon petition by any qualified person. The court does not have to provide notice to interested parties;

(3) Permits but does not require the personal representative to notify creditors by first class mail that the creditor must file a claim by a certain date. The bill prescribes changes in the form of the notice to creditors. Creditors notified by first class mail or personal service must respond within 2 months, instead of 6 months;

(4) Changes the time frame within which one must file to establish an interest in an estate by descent from 6 months after the first publication of letters to 6 months plus 20 days. (Pursuant to 473.590 and 473.840, which allow 20 days to object to a statement of account or a final settlement);

(5) Allows the court to refuse to grant letters at any time. The ceiling for the value of the estate for which a creditor can apply for refusal of letters is increased from $5,000 to $10,000;

(6) Allows a distributee of an estate valued at less than $40,000 to obtain his or her property at any time after 30 days after the death of the decedent. The bill also allows the affiant to liquidate the estate's personal property to pay debts of the estate and to facilitate distribution of the property;

(7) Shortens the time in which a person may bring a proceeding against the bond of the personal representative from two years after the personal representative's discharge to one year after;

(8) Bars debts of the decedent (with enumerated exceptions) not filed with the court within 6 months of the first publication of the notice of letters testamentary, or within 2 months for creditors to whom notice was mailed or served; and

(9) Changes, from one year to six months, the time period that must expire after the filing of the statement of account before the personal representative is automatically discharged from further claims by an interested party. The court is required to make an order discharging the representative after proper distribution is ordered, pursuant to a hearing on an objection to the statement of account;

In the law of intestate succession and estate administration, the bill:

(1) Takes parents out of the intestacy succession when there exists a surviving spouse, one or both parents, but no issue. Currently, the spouse gets the first $20,000, then half the balance, with the rest going to the parent or parents. This section of the bill gives everything to the surviving spouse if there are no issue. The bill also changes "and" to "or" in the distribution to descendants of the parents and siblings, cleaning up an ambiguity as to whether the distribution was to be per stirpes or per capita. The bill also requires a predeceased spouse (in order for the predeceased spouse's kindred to take) to have been married to the decedent when the predeceased spouse died. In the scenario of more than one such predeceased spouse, the kindred of each predeceased spouse take in equal shares;

(2) Includes a pickup truck as a passenger motor vehicle that can be exempt property;

(3) Removes the one year limit on a support allowance to the surviving spouse and dependent children and, instead, allows it to continue through the period of administration, as long as the estate is adequate to discharge allowed claims. The allowance may be paid in a lump sum or in period installments. The death of any person entitled to such a family allowance terminates the right to allowances not yet paid. In setting the amount of the support allowance, the court may consider the applicant's income, assets and expenses. The court may allocate allowance funds appropriately when a dependent child of the decedent is not living with the surviving spouse. The court may also authorize the distribution of property in kind, instead of a cash allowance, to dependent children (instead of only to the surviving spouse);

(4) Increases the limit on the support allowance from $7,500 to $15,000; and

(5) Allows property disposed of through the tangible personal property list to include cash, evidence of indebtedness, documents of title and securities (but still excludes property used in a trade or business).

FISCAL NOTE: No impact on state funds.

PROPONENTS: Supporters say that the bill addresses several areas of estate administration in order to make the handling of an estate easier and more efficient for the heirs, attorneys, and courts. Many provisions have not been updated for a long time, and estate planning and inflation have made several provisions obsolete. One change is a response to a Missouri Supreme Court decision regarding the statute of limitations on creditors' claims against estates. Other changes were made regarding dollar amount thresholds to adjust for inflation. Changes in the amount thresholds in estate administration are needed to ease the administration of small estates, which are more prevalent with the increase in estate planning.

Testifying for the bill were Representative Gaw; and Missouri Bar.

OPPONENTS: There was no opposition voiced to the committee.

Richard Smreker, Research Analyst