When a person dies, her debts and assets become part of her estate and are subject to a legal process called probate. “Probate” means to prove the validity of a will, but the primary objectives of probating an estate are settling the estate’s debts and distributing the remaining assets to beneficiaries according to the terms of the decedent’s will. A will is insufficient to pass title to real property unless it has been proved in a Vermont probate court (14 V.S.A. 101). If a decedent dies intestate (without a valid will), her estate is distributed in accordance with Vermont’s laws of descent and distribution, codified at 14 V.S.A. 301, et seq.
In addition to testate and intestate estates, the probate court oversees ancillary probates, where a decedent resides outside of the state but owns property in Vermont, and small estates, where the estate involves no real property and the value of decedent’s assets is less than $10k. Assets titled solely in the decedent’s name are subject to probate, while assets titled with a survivorship or beneficiary designation transfer outside of probate by operation of law. Action is still typically required to legally change ownership of nonprobate assets. Consult an estate lawyer to discuss what is required for your specific situation.
Following a death, open an intestate or testate estate by filing a petition in the probate court (probate division of the superior court) in the county where the decedent maintained permanent residence at the time of death. A petitioner is typically the estate’s executor – the person named in the decedent’s will to serve as the estate’s fiduciary. A petitioner may also be any interested person, including heirs, devisees, beneficiaries, or person affected by the probate proceeding, as defined at 14 V.S.A. 204(1).
If the decedent left a will, the executor or petitioner files this at the time of petition to be validated. Some testators may file their wills upon execution with the court; the first duty of the executor is to check to see if the will has been filed with the court. The executor must present a certified copy of the death certificate to the court. If the decedent dies intestate (without a will), the court appoints an administrator according to the order of priority established at 14 V.S.A. 903. The executor or administrator of an estate may also be referred to in more general terms as a personal representative (PR).
The court formally appoints the executor or administrator by issuing letters testamentary or letters of administration, respectively, once the appointee has given bond as directed by 14 V.S.A. 906. The letters evidence the personal representative’s authority to represent and conduct business on behalf of the estate. The executor or administrator files an inventory of the estate with the probate division within 30 days of his or her appointment, and then annually as required. The PR must also publish a notice to creditors unless excused under 14 V.S.A. 1201. The payment of claims against the estate may commence four months after initial publication of notice to creditors (14 V.S.A. 1207); this is the statute of limitations on filing claims against the estate (14 V.S.A. 1203).
If the decedent’s assets are insufficient to pay claims, then the PR may need to sell the estate’s property. Pursuant to Vermont Title Standards 13.1, 13.2 and by operation of law, the title of a decedent passes to her devisees or heirs upon death, subject to a lien of the administrator for payment of debts, expenses of administration, and other expenses legally chargeable against the estate. The PR may sell real property and execute an executor’s or administrator’s deed 14 V.S.A. 1652 only after an order by the probate court.
First, the executor or administrator submits application to the probate division of the superior court (at the county level) for a license to sell real estate for payment of debts or other charges of administration (14 V.S.A. 1613). The Register of the probate division for the relevant district executes the license, which is then recorded in the land records (at the local level). The license describes the property the executor or administrator is authorized to sell or convey. The court may also grant a license to sell real estate, even though the personal property of the decedent is not exhausted, if it has obtained consent from the heirs and devisees and has determined that a sale will not prevent any specific devise by will and is in the best interest of the interested parties (14 V.S.A. 1612).
Following a sale of real property, the PR executes a deed to convey title. A deed by executor or administrator typically carries a limited warranty of title, meaning the PR does not warrant to defend against title defects that existed before the decedent’s ownership of the property. A deed by executor or administrator is “as valid to convey the real estate of a deceased person, thereby authorized to be sold, as if the deed had been executed by the deceased in his or her lifetime” 14 V.S.A. 1652.
The deed should specifically reference the order giving license to sell the within described property, along with meeting standards of form and content for recorded deeds in Vermont. To property transfer title to the grantee/purchaser, the PR signs the deed in the presence of an authorized officer before recording in the city or town clerk’s office where the subject realty is situated.
For a distribution after the estate’s debts and expenses of administration are paid, the probate division “shall assign the residue of the estate to the persons entitled” to it through court order (14 V.S.A. 1721). The order or decree names the distributees and the proportions or parts to which each is entitled, to be distributed to them by the executor or administrator. It also establishes how all heirs taking the property will vest title . A decree “is…evidence of the finality of a transfer of property” from decedent to heir or devisee and establishes marketable title. Record a certified copy of the decree in the town/city clerk’s land records (14 V.S.A. 1742).
Consult a lawyer with questions about executor’s and administrator’s deeds, decrees of distribution, and probate procedures in the State of Vermont, as each situation is unique.