The Inventory and Appraisement

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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.