Updating to 2012.4.2

First you will need to determine which version you are running.
1. Open AvidLaw Probate
2. Find the version number

The version number can be found at the top left hand corner of the left pane.

Once you have determined the version you are running you will need to do one of the following.
A. If you are running AvidLaw Probate Version 2012.4.0 or later

Click the Tools tab
Select Update Template Sets…
Click Ok

Click Continue
This will begin the install process. If asked to overwrite existing files select Overwrite All

B. If you are not running AvidLaw Probate Version 2012.4.0 or later

Read these special instructions.

If you need assistance or are having trouble with the steps above please call us (480) 361-1324 or email us support@avidlaw.com

Update on Mandatory Training for Unlicensed Personal Representatives

A Few Refinements. As we explained back in September, Rule 27.1 of the Arizona Rules of Probate Procedure, which became effective on September 1, 2012, requires individuals who are not licensed fiduciaries to “complete a training program approved by the Supreme Court before letters to serve as guardian, conservator, or personal representative are issued.” This requirement applies unless otherwise ordered by the court. It also doesn’t immediately apply in the case of temporary appointment of guardians and conservators in emergency situations under A.R.S. § 14-5310(A), A.R.S. § 14-5401.01(A) or A.R.S. § 14-5207(C). In these situations, the training program must be completed “within thirty days of appointment or before the permanent appointment of the fiduciary, whichever is earlier.” In that earlier article, we also reviewed the nature of the mandatory training and where the training programs can be found. In the interim since that article, a few things have changed in this regard. The following information is more current:

The Nature of the Training. The Internet web site for the Arizona Judicial Branch, http://www.azcourts.gov/probate/Training.aspx, includes the required training program. Training for unlicensed personal representatives is provided in two courses. The proposed personal representative must complete both courses before letters will be issued. Each course is available either as an online video, which can be viewed in fewer than fifteen minutes, or as a PDF file, which can be reviewed in approximately the same amount of time. Also, for persons without computer access, each course is available in alternate formats through the Superior Court in each county.

The first course is a general overview, entitled Introduction to Serving as a Non-Licensed Fiduciary. This course is required not only for personal representatives, but also for guardians and conservators. The second course, which is unique to personal representatives, is entitled Welcome to Personal Representatives Training Module.

AvidLaw Document Changes. The AvidLaw templates for the Statement of Informal [Probate and] Appointment of Personal Representative have been updated to contain the appropriate language to implement this new requirement. We have also updated the applicable AvidLaw checklists to remind you that this training must be completed and that notice of completion must be filed with the Court prior to the issuance of Letters.

In addition, now that Certificates of Completion are available and can be incorporated into our software, we have added the two Certificates of Completion applicable to personal representatives to the AvidLaw documents. In addition, we have added a new document entitled Notice of Completion of Required Training, as the pleading to be filed to provide notice that the training has been completed and to with the Certificates of Completion attached.

These document changes are only available in our most recent update, numbered 2012.4.2. If you are using an earlier version of our software, you must update your software to take advantage of these changes, as well as other revisions, bug corrections, etc., that will make your drafting experience more efficient and your pleadings more effective.

AvidLaw Tips: Document Options

At the time you initially install AvidLaw Probate, you go through the Enter Attorney Information interview, setting up information about your practice, entering default document options, and entering your AvidLaw license code. As time goes on, you may not think much more about those settings. This article reviews the document options that can be changed at Enter Attorney Information. It may be helpful for those who have been using AvidLaw probate for a while to review these options to determine whether you are using the document options that are best for your practice.

Locating the Document Options. The second dialog in Enter Attorney Information, the one that follows Attorney Information, is called Document Options. This dialog contains a set of questions about the default manner in which documents are assembled in AvidLaw Probate. After these options have been selected, they apply automatically to all documents drafted in AvidLaw Probate. A document option can be changed for a given pleading, for a given case, or for all documents to be drafted in the future. If you want to change an option, just make the change in Enter Attorney Information, then draft the applicable documents. The option will apply as changed to all documents drafted until you return to Enter Attorney Information to change the option again.

Display law firm information vertically in left margin. The first document option is whether you want your law firm information to be displayed vertically in the left margin of pleadings. This is, of course, just an aesthetic decision. Such a display is not required, but is preferred by many of our customers.

Identifying the Court in the Caption. AvidLaw Probate pleadings identify the court in one of two ways. The longer designation is IN THE SUPERIOR COURT OF ARIZONA IN AND FOR [COUNTY] COUNTY. The shorter designation is ARIZONA SUPERIOR COURT [COUNTY] COUNTY. Either designation is appropriate. The selection of one other the other is a matter of personal preference.

Format of Law Firm Countersignature Line. Some AvidLaw pleadings that are signed by applicants, personal representatives, or other parties are designed to be countersigned by the attorney. AvidLaw provides three different formats for these countersignature blocks. The first option lists the name of the firm followed by a signature line. The second adds the name of the attorney below the signature line. The third also adds the law firm address below the name of the attorney.

Signatory of Certain Notice Documents. Some firms prefer to have the Notice of Informal Probate, Notice of Informal Appointment, Notices to Creditors and Proofs of Mailing signed by the client (either the applicant or the personal representative). Others prefer to have these documents signed by the attorney. This option allows a firm to select the option it prefers. It appears the most firms prefer to have these documents signed by the attorney, perhaps because such a signature doesn’t require any appointment with the client.

Assembly of Comprehensive Sets of Documents. AvidLaw Probate contains several “Assemble All” items that allow users to answer the relevant questions, then assemble all documents applicable to a given stage of the probate process. This document option allows you to determine whether the set of documents assembled at these items is created as one single Word document file, encompassing all of the documents, or whether each document in the set is assembled as a separate Word document file. In our experience, most firms choose to have each document in the set assembled as a separate Word file, but several have opted to include all of the documents in a single Word document file.

Notary Blocks: Blank for Date Commission Expires. In Arizona, no blank is needed for the date on which the notary’s commission expires. If such a blank is provided, however, the notary must provide the date on that blank. Some law firms prefer to include such a blank in all notary blocks. Among other things, this avoids problems when documents are notarized in other jurisdictions where such a blank is required. Other firms omit the blank on documents assembled for notarization in Arizona, adding it manually to drafts of documents to be signed in other jurisdictions.

Notary Blocks and A.R.S. § 41-313(C) Compliance. A.R.S. § 41-313(C) states that if a notary “attaches a notarial certificate to a document using a separate sheet of paper,” the attachment must contain a description of the document that includes at a minimum: 1. “the title or type of document,” 2. the document date, 3. the number of pages of the document, and 4. any additional signers other than those named in the notarial certificate. This document option allows you to include a description to the notary block that is intended to meet this requirement. Each firm can determine whether to include the description in documents assembled through AvidLaw Probate.

The New Mandatory Fee Guidelines

Fee Guidelines. The new provisions of Rule 33 of the Arizona Rules of Probate Procedure, which are effective on September 1, 2012, require the Superior Court to follow the new statewide fee guidelines set forth in the Arizona Code of Judicial Administration. In most cases, these guidelines will come into play when the court is considering a petition for approval of fees. Attorneys representing personal representatives don’t generally need to file such petitions (see Rule 33(G)), but these guidelines also apply whenever the court is determining “reasonable compensation” under the probate code (Rule 33(F)). Since such a determination can occur in informal probate cases, personal representatives and their counsel should be aware of and comply with these guidelines. These new mandatory guidelines can now be seen at: http://www.azcourts.gov/Portals/0/admcode/pdfcurrentcode/3-303_New_2012.pdf

A Few Important Points. While each probate practitioner should review and understand every aspect of these guidelines, the following are some major points of particular interest.

• The fee guidelines don’t apply if compensation is set forth in the will.
• Reasonable compensation is best determined on a case-by-case basis in light of consistent compensation guidelines
• The judicial officer has discretion to assign more or less weight to each of the compensation factors as deemed just and reasonable
• While travel and waiting time can be billed at regular rates, they may be deemed unnecessary if written or electronic correspondence or telephonic hearings would have served the need without unnecessary cost
•  if services could have been performed by someone with a lower billable rate, that rate should apply to these services
• clerical and secretarial services are not billable on an hourly basis, but are to be factored into the hourly rates of the professionals who use those services
•  reimbursable costs incurred in the best interests of the estate are to be reimbursed at actual cost, with no markup
•  only one attorney may bill for attendance at hearings, depositions, etc. (absent good cause)
•  flat fee compensation (for all or part of an engagement) is permissible if (a) the flat fee enhances the predictability of the amount of compensation, (b) the flat fee helps to align the interest of the professional with that of the estate (e.g., the professional is thereby more motivated to seek the interests of the estate), (c) the flat fee is disclosed in advance, in writing, in detail, with reference to the hourly fees that would otherwise be charged, and (d) the professional documents the actual efforts covered by the flat fee

Many other specific points are included with the guidelines. Be sure to become well acquainted with them and to modify your billing practices as needed to ensure conformity with the guidelines and to continue to receive reasonable compensation for your services.

Mandatory Training for Non-licensed Fiduciaries

The Training Requirement. Rule 27.1 of the Arizona Rules of Probate Procedure, which is effective on September 1, 2012, requires individuals who are not licensed fiduciaries to “complete a training program approved by the Supreme Court before letters to serve as guardian, conservator, or personal representative are issued.” This requirement applies unless otherwise ordered by the court. It also doesn’t immediately apply in the case of temporary appointment of guardians and conservators in emergency situations under A.R.S. § 14-5310(A), A.R.S. § 14-5401.01(A) or A.R.S. § 14-5207(C). In these situations, the training program must be completed “within thirty days of appointment or before the permanent appointment of the fiduciary, whichever is earlier.”

The Nature of the Training. The Internet web site for the Arizona Judicial Branch, http://www.azcourts.gov/probate/Training.aspx, has now been updated to include the required training program. Training for unlicensed personal representatives includes two online videos. The first is a general overview, entitled Introduction to Serving as a Fiduciary, that is applicable to guardians, conservators, and personal representatives. This helpful video can be viewed in fewer than fifteen minutes. The second online video that must be watched by unlicensed personal representatives is entitled Welcome to Personal Representatives Training Module. This second online video can also be viewed in fewer than fifteen minutes. At the end of each online video is a page that can be printed, signed and dated, and submitted to the Court as proof of training.

Where to Find the Training Programs. The Internet web site for the Arizona Judicial Branch also explains that these programs “will be delivered online and available in alternate formats through county superior courts.” We didn’t check all county web sites, but we did locate the training videos on the Maricopa site at http://www.azcourts.gov/probate/Training.aspx.

Document Changes. The AvidLaw templates for the Statement of Informal [Probate and] Appointment of Personal Representative have been updated to contain the appropriate language to implement this new requirement. We have also updated the applicable AvidLaw checklists to remind you that this training must be completed and reported to the Court prior to the issuance of Letters and to include the applicable Certificates of Authenticity with the documents to be filed.

How to Update AvidLaw Probate

First you will need to determine which version you are running.
1. Open AvidLaw Probate
2. Find the version number

The version number can be found at the top left hand corner of the left pane.

Once you have determined the version you are running you will need to do one of the following.
A. If you are running AvidLaw Probate Version 2012.2.0 or later

Click the Tools tab
Select Update Template Sets…
Click Ok

Click Continue
This will begin the install process. If asked to overwrite existing files select Overwrite All

B. If you are not running AvidLaw Probate Version 2012.2.0 or later

Go to www.avidlaw.com/download/ and click the button to download AvidLaw Probate 2012

If you need assistance or are having trouble with the steps above please call us (480) 361-1324 or email us support@avidlaw.com

What’s new in this update?

Personal Representative Priority and Renouncing the Right to Serve

An objection to the appointment of a personal representative can’t be resolved in an informal proceeding—it “can be made only in formal proceedings” (A.R.S. § 14-3203(B)). This means that everyone involved in an informal probate proceeding must be in accord about the proposed personal representative. If anyone objects to an appointment or if the court determines that there is an unresolved issue of priority, a formal proceeding is needed to resolve this issue. Consequently, it is important for practitioners to understand the order of priority among those who may serve as personal representatives. It is also important that the pleadings clearly state that those whose appointment is sought have priority and that anyone who might otherwise have priority has appropriately renounced the right to serve and has consented to the appointment of  those whose appointment is sought.

Qualified to Serve. The order of priority for personal representative is set forth in  A.R.S. § 14-3203. Even a person who has priority to serve cannot serve if that person is “disqualified” (see A.R.S. § 14-3203(A)) or in other words, is “not qualified to serve” (see A.R.S. § 14-3203(F)). Neither minors (persons under the age of 18 years) nor foreign corporations can qualify to serve as personal representatives in Arizona (see A.R.S. § 14-3203(F)(1) and (3)). In addition, others can be deemed “not qualified to serve” if, in formal proceedings, the court finds them “unsuitable” (see A.R.S. § 14-3203(F)(2)).

Priority under the Will. If a valid will is being probated, the highest priority goes to a person named as personal representative in the will (or to a person named pursuant to a power that was conferred in the will) (see A.R.S. § 14-3203(A)(1)). If the will names multiple parties to serve together, they may do so by jointly applying for appointment (see A.R.S. § 14-3203(C)). A person named in a will (or in a power conferred in the will) may serve or renounce the right to serve, but cannot nominate another to act in his or her place (see A.R.S. § 14-3203(C)).

Priority of the Surviving Spouse. If a valid will is being probated and no personal representative is named in the will (or in a power conferred in the will), or if all who are named in the will are renouncing, and the surviving spouse is a devisee under the will, then the surviving spouse has priority to serve as personal representative (see A.R.S. § 14-3203(A)(2)). If, however, the surviving spouse is not a devisee under such a will, the other devisees have priority to serve (see A.R.S. § 14-3203(A)(3)).

If, on the other hand, no valid will is being probated, or if all qualified devisees under the will renounce the right to serve, the surviving spouse has priority to serve (see A.R.S. § 14-3203(A)(4)).

Priority of other Devisees and Heirs. As mentioned above, if a valid will is being probated and no personal representative is named in the will (or named in a power conferred in the will), or if all who are named in the will are renouncing, and there is no surviving spouse or if the surviving spouse either is not a devisee under the will or the surviving spouse renounces the right to serve, then the other devisees have equal priority to serve (see A.R.S. § 14-3203(A)(2)).

If, on the other hand, no valid will is being probated, and there is no surviving spouse or if the surviving spouse renounces the right to serve, then the other heirs of the estate have equal priority to serve  (see A.R.S. § 14-3203(A)(5)).

Nominating Another to Serve. A surviving spouse, a devisee, or an heir with priority to serve may serve, may renounce the right to serve, or may nominate another to serve as personal representative in his or her place  (see A.R.S. § 14-3203(C)).

Multiple Qualified Devisees or Heirs with Priority. If multiple qualified devisees or heirs have priority, any of them for whom appointment is not sought must renounce the right to serve and consent to the appointment of those for whom appointment is sought (see A.R.S. § 14-3203(C)).

Foreign Domiciliary Personal Representative. In the case of the probate of the Arizona estate of a decedent who was domiciled in another state, the personal representative appointed by the court in the domiciliary state has priority unless the will appoints another person to be the personal representative of the Arizona estate (see A.R.S. § 14-3203(G)). Note, however, that foreign corporations can’t qualify to serve as personal representatives in Arizona (see A.R.S. § 14-3203(F)(3)). If the foreign domiciliary personal representative is a foreign corporation, or otherwise chooses not to serve, it can nominate another party to serve in Arizona (see A.R.S. § 14-3203(G)) and the nominated party will have the same priority as the domiciliary personal representative.

Others with Priority. After devisees and heirs, the department of veterans’ services is next in line for priority if the decedent was a veteran, the spouse of a veteran, or the child of a veteran (see A.R.S. § 14-3203(A)(6)). Forty days after the decedent’s death, any creditor is next in line for priority (see A.R.S. § 14-3203(A)(7)). Final priority lies in the public fiduciary (see A.R.S. § 14-3203(A)(6)).

Minors and Protected Persons. While minors are unqualified to serve as personal representative, a conservator for a minor, or for a protected person, or if there is no conservator, a guardian, can represent the interests of the minor or protected person by objecting to a nomination, nominating, or otherwise participating in the process of appointment (see A.R.S. § 14-3203(D)). A minor who is at least 14 years old who would have priority except for his or her minority may nominate a personal representative to serve (see A.R.S. § 14-3203(C)).

Personal Representative Compensation and Renunciation of Fee

If you were to ask someone who has served as a personal representative of an estate, you would probably learn that it was a significant, sometimes stressful, effort. It is not surprising, then to learn that personal representatives are entitled to “reasonable compensation” for their services (see A. R. S. § 14-3719). In fact, even if the will spells out the amount of compensation to be received by the personal representative, if that amount is not “reasonable,” then the personal representative can, by renouncing that provision of the will, and thereby become entitled to “reasonable compensation” (see A. R. S. § 14-3719). Of course, if the personal representative is otherwise contractually obligated to perform the services for a specified amount of compensation, a renunciation of a provision in the will does not void the contract (see A. R. S. § 14-3719).

In some cases, however, despite the fact that the law allows the personal representative to receive reasonable compensation for services, the personal representative may be better off by renouncing the right to such compensation. For instance, if the personal representative is the sole devisee or heir to the estate, it makes little sense to compensate the personal representative from the funds that will eventually go to him or her by inheritance. Among other things, income received for services as a personal representative are taxable income, whereas money received as an inheritance isn’t taxable income.

If a personal representative prefers not to be compensated, or prefers to receive less than the amount that would be considered to be reasonable compensation, he or she may renounce the right to receive all or any portion of such compensation (see A. R. S. § 14-3719). In addition, a written renunciation of fee may be filed with the court. AvidLaw Probate includes such a renunciation.

On the other hand, if the personal representative opts to receive reasonable compensation for services, the personal representative must keep detailed records that can substantiate the reasonableness of the fees. These records should account for such factors as the types of services provided, the time and skills required to accomplish the services, the novelty or difficulty of issues encountered, the impact of service as personal representative on other opportunities for compensation, fees customarily charged in the area for similar services, the size of the estate and its income, potential liabilities associated with the service, results obtained for the estate, time constraints imposed by various circumstances, the personal representative’s experience, reputation, diligence and ability, and the reasonableness of the efforts expended.

The Bond Requirement

In order to protect the interests of heirs, devisees and creditors against the possibility that the personal representative might mishandle the estate, A. R. S. § 14-3603 requires the Personal Representative to file a bond. However, because such risk is often minimal, the statutes also provide several exceptions to this bond requirement. In fact, the exceptions are such that the filing of a bond in an informal probate is relatively uncommon. In cases where a bond is required, the amount of the bond can be provided in the will (see A. R. S. § 14-3604(A)) or, if not, it will generally not be less than the amount of the Personal Representative’s estimate of the value of the estate (less encumbrances), together with the annual income expected to be earned by the estate (see  A. R. S. § 14-3604(A)). Several other factors, mentioned below, can also affect the bond amount.

Exceptions to the Bond Requirement

There are three exceptions to the bond requirement that often apply to an individual personal representative in an informal probate. In a testate probate, the bond requirement can be expressly waived in the will (see A. R. S. § 14-3603(A)(1)). Even if the will doesn’t expressly waive the bond requirement, this requirement can be waived by writings signed by all of the devisees (see A. R. S. § 14-3603(A)(2)). Similarly, in an intestate probate, the bond requirement can be waived by writings signed by all of the heirs (see A. R. S. § 14-3603(A)(2)).

Certain entities are exempt from the bond requirement when they serve as personal representative. These include most banks, savings and loans, title insurance companies, and certified trust companies (see A. R. S. § 14-3603(A)(3)).

The final exception to the bond requirement applies in the limited situation in which the estate is small enough to qualify for summary administrative procedures under A. R. S. § 14-3973 and the surviving spouse is either applying to serve as personal representative or is nominating someone to serve as personal representative.

Although there is generally no bond requirement under these exceptions, A. R. S. § 14-3603(A) provides that the court may still require a bond if an interested party petitions for a bond requirement, providing reasonable evidence that the interested party’s interest in the estate “in danger of being lost because of the administration of the estate.” Such a petition can even be filed by a party who earlier waived bond.

Reductions in the Bond Amount.

In cases where bond is required, the registrar may permit the amount of the bond to be reduced by the value of assets deposited in a restricted account with a domestic financial institution (see A. R. S. § 14-3604(A)). On petition by the personal representative or another interested party, the registrar may further reduce the bond amount, eliminate it altogether, or even increase it (see A. R. S. § 14-3604(A)).

Arizona Tardy Probate

Tardy Probate and Other Exceptions to the Two Year Requirement
A. R. S. § 14-3108 provides that in most cases a probate proceeding, whether formal or informal, “shall not be commenced more than two years after the decedent's death.” There are, however, four exceptions to this general rule.
The first three of these exceptions are fairly narrow. We will first mention these unusual exceptions, then we will discuss the fourth exception, tardy probate, which is very common.
The first exception to the two year requirement deals with the rare case in which a prior proceeding has been dismissed because of doubt about the fact of the decedent's death. In such a case, a proceeding can be filed “anytime thereafter” if it can be shown that the decedent did, in fact, die before the prior (dismissed) proceeding and it can be shown that the person bringing the case (applicant or petitioner) didn't “unduly” delay the subsequent proceeding. In this case, the date the case is filed is to be treated as the date of death for purposes of other provisions that relate to the date of death.
The second exception deals with the unusual case of a person who had been missing, absent or disappeared and for whom a conservator had been appointed. A probate proceeding for such a person can be filed within two years after the conservator is able to establish the death of that (protected) person. In this case as well, the date the case is filed is to be treated as the date of death for purposes of other provisions that relate to the date of death.
The third exception covers another uncommon situation. If a will has been informally probated, a proceeding to contest the probate of the will can be brought within the later of two years after the decedent's death and twelve months after the informal probate.
Tardy Probate
The fourth exception is the tardy probate exception. This exception allows a probate proceeding to be brought after the two years have passed if none was brought during the two years. There are two limitations to a probate proceeding brought under the tardy probate exception. First, the Personal Representative may only possess estate assets to the degree necessary “to confirm title thereto in the rightful successors to the estate.” Second, the only claims that can be presented against the estate are expenses of administration. Because there is no need to deal with creditor's claims, there is no need to publish notice to creditors or to wait for creditors to file claims against the estate. Consequently, the property can be transferred as soon as letters are issued and the probate can be closed as soon as the property has been transferred.
This “tardy probate” exception has proven very useful—particularly in cases in which the need for a probate is only made evident to the successors in interest years after the death when they are preparing to sell or transfer assets still held in the decedent's name. A common situation is when the estate property passes the surviving spouse, but no probate takes place to transfer estate assets to the spouse. Later, when the surviving spouse decides to sell the home, it is realized that this property is still held in the name of the decedent. Clear title to the home can often be obtained at this late date through the “tardy probate” process.
AvidLaw Probate easily identifies a tardy probate, asks the relevant questions, and prepares the applicable documents, saving you time and increasing profitability even if tardy probates are not common to your practice.

New Auto Update Feature

With our latest quarterly update, AvidLaw Probate now has an auto-update feature that greatly simplifies the process of keeping the template set up-to-date. After you install this latest quarterly update, future updates will happen almost automatically. When we upload an update to the Internet, your software will automatically sense that the update is available. Then, whenever you initiate the assembly of a template (whether an AvidLaw Probate template or not), you will be notified that there are updates available and be given instructions on how to find and install them.

One of the greatest benefits of this new feature is that it lets us update the software a little more often. We will continue to do one major update each quarter and we will continue to let you know, through this newsletter and email, when a quarterly update is available. In addition, if we make a small but very helpful change between quarterly updates, we now have a means to provide the change to every user before anyone assembles another AvidLaw Probate template.

As we mentioned, this feature is only available to you after you install the latest quarterly update in the traditional manner. If you haven’t already done so, please follow the instructions in the quarterly update email as soon as possible, so that the Auto Update feature will be available to you for all future updates.

Here is a link to a short video that demonstrates how the new auto update feature works. Please, let us know if you have any questions, concerns or comments. Thank you!

The Finish Button

Some of you have reported inconsistent results relating to the Assemble ALL Documents feature within AvidLaw Probate. In some cases, the documents are not all being assembled when, at the End of Interview screen, you click on “Send the assembled document to Microsoft Word and close this window.” For this reason, we have changed our instructions for assembling all documents from the End of Interview screen. In the future, please click on the Finish button located in the lower right hand corner of the End of Interview screen in the Assemble window. This button will consistently assemble the document or documents associated with the interview. Also, be aware that this button is available throughout the interview and, if selected, will begin the assembly of the document or documents associated with that interview.

Also, because we no longer recommend that you use the “Send the assembled document to Microsoft Word and close this window” button, we suggest that you change your HotDocs Options to remove this button from the End of Interview screen. To do this, open AvidLaw Probate and select the Tools tab and then Options. Click on the plus sign next to the Interviews and Dialogs folder to see the subfolders.  Select the End of Interview subfolder and, within it, unselect “Send the assembled text document to the word processor.” While you’re here, we suggest that you also unselect “Close this window without saving the assembled document.” This option simply performs the same function as the red X in the upper right hand corner of the Assemble window.

If you need help with these steps or have any questions please let us know.

New Referral Program

Now your friends and colleagues who are new to AvidLaw Probate can use it on one matter for free. If they mention your name when they sign up, we’ll also credit you with a free AvidLaw Probate matter of your own (or, if you have an annual license, we’ll add two months onto your next annual subscription). It’s a win-win opportunity!

We’ve learned that your good word is easily our most effective way to get the word out about AvidLaw Probate. We have set up a way to make it easier than ever for your friends to take AvidLaw Probate for a spin—with a significant benefit both for them and for you. Just have your friend call me, Garth Pedersen, at 480-361-1324, asking for our special offer and mentioning your name. We’ll set them up with AvidLaw Probate and credit you for sending them our way.

Thank you for your help. We look forward to sharing with your colleagues all the benefits of AvidLaw Probate.

Ancillary Probate in Arizona

This article discusses some of the basic laws and procedures that apply to the probate of the Arizona property of a decedent who died while domiciled in another state (a foreign domiciliary). Arizona statutes provide several potential alternatives to the estates of decedents who were domiciled in another state at the time of death and owned property in Arizona.

The first option needn't involve any probate of the estate in Arizona or elsewhere. If the entire estate of the decedent (the entire estate, not just the Arizona property) is small enough to allow for the use of small estate affidavits.

Secondly, if the principal administration of the estate is being handled in the state of domicile, then the Arizona property can be administered either through a local ancillary probate administration (formal or informal) (see ARS 14-4207) or without local administration through a proof of authority filing (see ARS 14-4201 through 4205).

Finally, if no principal administration of the estate is taking place in state of domicile, a principal administration of the estate could take place locally in Arizona (see ARS 14-4207).

Small Estate Affidavits


These affidavits (see ARS 14-3971 through 3974) can be used to transfer the decedent's Arizona property whether the decedent was domiciled in Arizona or elsewhere at the time of death. The details of the use of these assets is the topic of a separate article, but, in general, if there is no probate proceeding with respect to the decedent's property in any estate and if the net value of all real property in the estate is $75,000 or less, it is possible that any Arizona real property can be transferred through the use of an Affidavit for Transfer of  Title to Real Property. Similarly, if there is no probate proceeding with respect to the decedent's property in any estate and if the net value of all the decedent's personal property (tangible and intangible) is $50,000 or less, it is possible that any Arizona personal property can be transferred through the use of an Affidavit for Collection of Personal Property.

A Proof of Authority Filing


If principal administration of the estate is taking place in the state of domicile, and no local administration has begun in Arizona, the decedent's personal representative (or executor) in that state (the domiciliary personal representative) can become authorized to transfer the decedent's Arizona property through proof of authority. A proof of authority is not a local administration of the Arizona estate. Rather, it is a filing in Arizona probate court that authorizes the transfer of Arizona property under the authority given in the domiciliary administration. In many cases, filing a proof of authority is a much simpler and less expensive process than a full blown ancillary proceeding.

A proof of authority filing is made by filing with the probate court in a county where the property is located an affidavit that recites the applicable facts, to which is attached a certified copy of the Letters in the domiciliary administration. If there is a bond requirement in the original jurisdiction, a certified copy of the bond must be attached. On the other hand, if there is no bond requirement in the original jurisdiction, a certified copy of the appointment document (or other document) indicating that there is no bond requirement should also be attached to prove the absence of a bond requirement.

The filing fee for a Proof of Authority is the same as it is for a probate. There is also a fee to obtain a Certified copy of the Proof of Authority, one of which needs to be recorded in each Arizona county where the decedent owned property. The domiciliary foreign personal representative is then authorized to “exercise as to assets in this state all powers of a local personal representative” (ARS 14-4205). The domiciliary foreign personal representative may transfer the property by sale or Deed of Distribution, and may deal as needed with any mortgage holder.

An Ancillary Probate in Arizona


An ancillary probate proceeding is a local proceeding that mirrors the principal administration of the state in another jurisdiction, but covers only Arizona property. If a Proof of Authority filing is a possibility, it should be used rather than an ancillary probate proceeding. In the event such a filing isn't applicable, then an ancillary administration in Arizona can be used to transfer the applicable property. This proceeding is, in most respects, very similar to a principal administration, except that it is limited in certain respects (such as the notification of creditors) because it deals only with the Arizona estate. Venue is in an Arizona county where some of the decedent's property is located. The captions of the various pleadings need to indicate the ancillary nature of the proceeding, which will also be represented in the text of the pleadings, as applicable.


An Arizona Principal Administration


If there is no principal administration of the estate in the domiciliary jurisdiction, the principal administration of the estate can take place in Arizona. Venue is in an Arizona county where some of the decedent's property is located.

AvidLaw Probate is designed to help practitioners prepare documents for each type of proceeding described above. For more information about AvidLaw Probate, please call 480-361-1324 or visit our website www.avidlaw.com.

Notice to Creditors

ARS 14-3801 requires that two kinds of notice be given to the creditors of a decedent's estate. In the first place, the personal representative must publish notice to creditors once a week for three consecutive weeks. Secondly, the personal representative must notify all “known creditors” either by mail or by other delivery. These notices inform creditors of the need to file a claim with the estate before the deadline for filing such claims passes. Most distributions from the estate can only take place after this deadline has passed.
Notice by publication
Notice by publication must be given at the time of appointment. The notice must be published in a “a newspaper of general circulation in the county.” A good list of such newspapers can be found at  http://www.azcc.gov/divisions/corporations/filings/forms/newspubs.pdf. This list was compiled with respect to a different statute with the same standard. Various factors including cost, convenience, cooperation, etc. set publishers apart from each other. Select a publisher that meets the needs of your client.
Notice by mail
All known creditors must receive notice by mail or other delivery. The term “known creditors” isn't defined, but counsel for personal representatives should consider a broad definition and err on the side of sending such notice. If, during the course of estate administration, the court were to determine that a given creditor that didn't receive notice by mail or delivery is a “known creditor,” the deadline for this creditor to file a claim against the estate would be extended. The reality of this risk increases the incentive to send notice by mail to any potential creditor for whom an address is reasonably available.
Deadline for filing a claim
In general, creditors may file a claim against the estate for 120 days (basically four months) after the first publication date. In most cases, this deadline applies to “known creditors” as well as creditors for whom notice is given by publication. However, if notice by mail or delivery is given more than 60 days after the first date of publication, the known creditor may continue to file a claim against the estate until 60 days have passed after the mailing or delivery of the notice.
The filing of a claim
ARS 14-3804 provides that, to file a claim, a creditor merely needs to mail or deliver to the personal representative a written statement of the claim, which is a written document that indicates the basis of the claim, the name and address of the claimant and the amount claimed. The claim is deemed presented on receipt of the written statement of claim by the personal representative. It is not necessary that this information be provided in particular form. For instance, an invoice or other correspondence that is received by the personal representative (or counsel for the personal representative) and that contains this information will, in most cases, constitute the filing of a claim against the estate.
The statutes relating to claims against the estate contain many provisions that are not considered in this short article. Consider reviewing these statutes, primarily ARS 14-3801 through 14-3816.

Tips & Tricks: New License Code Features

Recently we have added a couple of new features to AvidLaw Probate that you may or may not have noticed.  Whenever you need to review your license agreement or change your firm’s license code, you do so at the license agreement screen, which is found in the Enter Attorney Information item. The license agreement screen, titled AvidLaw AIP License Agreement, is the final screen in this item.

The first feature that we have added applies to the text box where you enter your license code.  In the past, you rarely needed to revisit this screen after your license code was entered.  With the new pricing options, a firm that moves from a matter-based license to an annual license (or vice versa) receives a new license code. Because of this, we now make the license code field available at all times.  This allows you, upon renewal of your annual license, changes to your law firm information, or if you switch to matter-based licensing, to simply enter the new code and update your license. (Note: if you are switching to matter-based you will also need to accept the license agreement for matter-based users.)

A second feature we have added is a countdown feature that shows you how many days remain before your annual license expires.  This feature allows you to quickly check how much time you have left on your annual license and is also found on the license agreement screen.

As always we are committed to providing your firm with the best products and support possible.  We are always looking for new ways to help streamline your practice.  Please feel free to contact us with any suggestions on how to improve AvidLaw Probate.  Thank you!

Recent Changes to Arizona Informal Probate Law and Procedure

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Learn more at avidlaw.com

or call us at 480-361-1324

In 2011, there were a number of changes in both statutes and rules of procedure relating to probate in Arizona. While the lion’s share of these changes affect Guardianship and Conservatorship proceedings,  some of them apply in Informal Probate cases and a few have resulted in changes in the AvidLaw Probate forms. This article summarizes some of the changes that impact Arizona informal probate practice.

New laws and rules about fees and budgets. If you have paid attention to the news about changes in the laws and rules, you have no doubt heard about new requirements with respect to attorneys fees and to budgets required to be filed in some cases. The fee changes (see ARS 14-5109 and 14-5110) affect guardianships and conservatorships, but do not currently affect informal probate practice. The changes requiring the submission of a budget (see ARPP Rule 30.3) affect only conservatorships. It appears, however, that the Statewide Fee Guidelines, expected to come out in September, will apply to attorneys for Personal Representatives. When that happens, we will deal with them in the software.

The following changes that have taken place over the last year or so affect informal probate practice.

ARS 41-313 has been amended to require additional information to be included with a notarial certificate “if a notary attaches a notarial certificate to a document using a separate sheet of paper.” Some practitioners have raised concerns about the vague nature of this language. The AvidLaw Probate forms now give users an option to always include the additional information with notarial certificates or to omit this information. It may be helpful to review this provision in determining when this additional information is appropriate for documents you draft.

ARS 14-1104 now specifically requires fiduciaries to consider costs when making decisions about how to act, and to make reasonable decisions to limit those costs. This statute has been revised to require personal representatives to apply cost/benefit analysis in decisions relating to administration of the estate. Any will provision that directs otherwise will apply. It is possible that this provision will lead some testators to include in the will sufficient direction to allow the personal representative to accomplish the testator’s wishes where a pure cost/benefit analysis might not be appropriate. This change should be considered in the representation of personal representatives, but it has not caused any changes in the AvidLaw Probate forms.

ARS 14-1105 allows parties or attorneys to be charged with some or all of the costs that are incurred because of their “unreasonable conduct.” Similarly, the new Rule 10(G) in the Arizona Rules of Probate Procedure provides for remedies in the case of “vexatious conduct,” including a prohibition against filing pleadings and other papers without first obtaining a court order. Also, ARS 14-1109 allows the court to rule on a repetitive filing before responsive filings and without a hearing. These provisions should be explained to clients who might otherwise want to engage in “unreasonable” or “vexatious” conduct or in repetitive filings. These provisions have not, however, caused any changes in the AvidLaw Probate forms.

ARS 14-1108 encourages alternative dispute resolution in probate cases. It not only encourages arbitration, but also other options. As with the other statutory and rule changes discussed so far, this change did not affect any AvidLaw Probate forms.

ARS 14-5652(B) requires any attorney who is acting as the personal representative (or as a trustee) to disclose in writing to everyone with an interest in the matter the names of anyone with an interest in the matter for whom the attorney either is performing or has previously performed legal services. This disclosure is required within a reasonable time after the attorney learns that the client or former client has an interest in the estate. This means that an attorney serving as personal representative must make such a disclosure upon learning that a client or former client is a creditor, heir, devisee, or some other person with an interest in the estate.

Rule 8 of the Arizona Rules of Probate Procedure now sets forth specific consequences that can apply in the case of a failure to serve required notice on an interested party in a probate action. The court has the option to dismiss the case without prejudice, to require service within a specified time. The provision allows the court to extend the time for service for good cause shown.

Rule 10(D)(1) of the Arizona Rules of Probate Procedure requires the attorney for a Personal Representative to “encourage the fiduciary to take those actions the fiduciary is authorized to perform and can perform competently on the fiduciary’s own to fulfill the fiduciary’s duties.” While this provision hasn’t changed any AvidLaw Probate forms, it may be good practice for practitioners to edit engagement letters to include such encouragement, at least generally, and perhaps to discuss some specific actions that clients might take.

Rule 15.2 of the Arizona Rules of Probate Procedure establishes proceedings for lack of prosecution. In general, the court must issue a notice of impending dismissal two years after the case is filed unless a closing statement, a petition to settle the estate, an order terminating the appointment of a special administrator, or an order extending the administration of the estate. Cases will be dismissed 90 days after the notice has been issued unless one of the items discussed above has been filed or there has been a request for hearing or conference, a petition to terminate the appointment, or a status report describing unresolved matters. A similar process takes place six months after filing if there has been no action or hearing in the case. Dismissals under this rule are without prejudice. No AvidLaw Probate forms have been changed due to this rule.

Rule 22(A) of the Arizona Rules of Probate Procedure requires each order appointing a personal representative (including a statement of informal probate) to include a warning that the appointment isn’t effective until letters are issued. The applicable AvidLaw Probate forms have been modified to include this warning.

Rule 22(C) of the Arizona Rules of Probate Procedure has specific provisions relating to restricted accounts. This rule requires certain wording in the letters of any fiduciary for whom funds will be restricted. The AvidLaw Probate forms don’t deal with restricted accounts in informal probate cases, because there is rarely a bond requirement, so property is seldom restricted. However, if you have such a case, you should be aware that the language of the letters needs to comply with this rule.

Rule 22(D) of the Arizona Rules of Probate Procedure has provisions similar to those of Rule 22(C) with respect to restrictions on the authority to transfer or manage real property.

Rule 27.1 of the Arizona Rules of Probate Procedure requires all unlicensed individuals (and some entities) to receive training prior to serving as Personal Representatives. This rule, which is effective on or after September 1, 2012, will require changes to the AvidLaw Probate forms. AvidLaw will make these changes by the time the rule becomes effective.

AvidLaw is pleased to be able to provide general explanations of law changes to those who use our forms. We look forward to any comments you may have about these changes and how they affect your practice.

The Inventory and Appraisement

© AvidLaw, LLC

Learn more at avidlaw.com

or call us at 480-361-1324

A Personal Representative has three main duties—to possess the estate, to preserve it, and to distribute it to the appropriate parties. To fulfill the first of these duties—the duty to possess the estate—the Personal Representative must first find out what property was owned and what debts were owed by the decedent at the time of death.

Identify and Possess the Estate. As the Personal Representative becomes aware of property owned by the decedent, he or she must take control of the property (see ARS 14-3709). In the case of titled property, this means that title to the property should be changed to: “Estate of DECEDENT NAME, PERSONAL REPRESENTATIVE NAME as Personal Representative.” In the case of other property, the Personal Representative must take possession of the property and preserve it for the beneficiaries of the estate.

Identifying Debts Owed by the Decedent. The process of establishing what property is in the estate must take into account the debts owed by the estate, which, of course, diminish the amount of property that can go to the heirs or devisees. The Personal Representative has an affirmative duty to notify any “known creditor” of the Decedent (see ARS 14-3801(B)) by mail or delivery. The Personal Representative must also publish notice to all other creditors once a week for three successive weeks (see ARS 14-3801(A)). Claims that are not presented by the deadline are forfeited (see ARS 14-3803). The Personal Representative must respond to each presented claim either by allowing it or disallowing it in whole or in part (see ARS 14-3806).

The Estate Inventory. Because the Personal Representative is responsible to see that all identified property is preserved for the beneficiaries, he or she is required to inventory all such property (see ARS 14-3706). The inventory is also an “appraisement.” In other words, the inventory must state the value of the property in the estate. The settlement of the estate will require the Personal Representative to give an account of what happened to all property included in the inventory. The Inventory must be prepared within ninety days of appointment.

List Estate Property in the Inventory. The inventory must list the property “with reasonable detail.” This doesn’t require a listing for each item of property in the estate, but the categories listed should be clear. Items of significant value should be listed separately. The greater the value of an item, the less reasonable it is to list it only as part of a group of items. For married decedents, community property must be listed separately from separate property (see ARS 14-3706(A)). Real property should also be listed separately from personal property. The fair market value must be given for each item (or category) of property listed in the inventory. If the fair market value it is an appraised value, the name of the appraiser should also be given. If an item of property is subject to debt, the amount and type of debt must also be listed.

The Public and Private Options. The statute provides two options for filing and mailing the inventory. The more common is the private option, which doesn’t require the details of the inventory to be filed with the Court. Under this option, a copy of the inventory must be sent to each beneficiary of the estate (heir or devisee) and to each other interested party that requests one. Only a proof of such mailing needs to be filed with the court. Under the public option, the inventory must be filed with the court and a copy sent to each interested party requesting one.

Supplemental and Amended Inventories. If, after the inventory is prepared, the Personal Representative becomes aware of “any property not included in the original inventory” or that the valuation or description of any property was “erroneous or misleading,” then a supplemental or amended inventory must be prepared and filed or mailed in the same manner as the original inventory. A supplemental inventory lists changes from the original inventory. An amended inventory lists all property again, noting the changes from the original inventory. The statute calls for a supplementary inventory, but, because an amended inventory includes everything required in the supplementary inventory, it also fulfills the statutory requirement.

AvidLaw is pleased to be able to provide general explanations of Arizona probate law and practice to those who use our forms. We look forward to any comments you may have about these summaries, including ideas for enhancing them.

Tips and Tricks: Distributing estate assets

AvidLaw Probate is designed to save you time across the entire probate process. One time-saving tool we’ve built into AvidLaw Probate helps you quickly list assets as you prepare the appropriate distribution documents. To take full advantage of this tool, you need to plan in advance.
As you list the inventory, you should keep in mind how the various items will be distributed. This awareness will allow you to identify items of property in the inventory in the same way that they will need to be identified upon distribution. Real property should be identified by its legal description. Any specific items that are listed in the will or in a separate writing should be identified in the inventory the same way they are identified in such documents. Groups of property that will be distributed together can sometimes be listed in the same groups in the inventory. For instance, if a stamp collection will be distributed to an individual, you will save time by identifying the collection as an item in the inventory, rather than as part of “items stored in the attic.”
When you use AvidLaw Probate to prepare the Inventory and Appraisement, you will group the various items as community or separate property and as real or personal property. In addition, you will identify each item with a description and a value. If you have appropriately identified each item in the inventory with a view towards its eventual distribution, you will often be able to use the same description and, perhaps, the same value, at the time of distribution. In the distribution documents, you again need to identify each item with a description and value. Each item also needs to be identified as separate or community property and as real or personal property.
AvidLaw Probate allows you to quickly use the information for an inventory item as a starting point for an item being distributed. In many cases, copying this information is all you will need to do to identify the item being distributed. In other cases, some editing of the description or other information will be required, but the process will usually be relatively fast and painless if your inventory descriptions anticipate the eventual division and distribution of the property.
On the other hand, if you have not planned ahead, then you will probably take longer preparing the distribution documents. For example, if all furniture is grouped together in the inventory, but the dining room set goes to John and the living room furniture goes to Sally, then each of these sets will need to be described separately when it is distributed.
As you draft any distribution document, you can follow these 3 easy steps to copy the inventory information for use in the distribution document:
1. To identify the item being distributed, click Yes when asked if you want to copy the asset description from the inventory.
2. Select the correct asset from the drop down menu.
3. If needed, edit the inventory description or other information to match the actual distribution.