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

© AvidLaw, LLC

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.

Exciting Arizona Probate Software

News is spreading among Arizona probate attorneys about AvidLaw's AZ Probate Partner software. Before 2008, almost all new subscribers heard about AZ Probate Partner through direct marketing efforts. We called them, sent them letters or sent them emails and they subscribed after seeing the demo. This year, however, we are receiving more incoming inquiries from lawyers who have learned about AZ Probate Partner from our growing subscriber base.

The Connor Law Firm PLC in Phoenix is an example of a recent subscriber to AZ Probate Partner. Ben Connor contacted AvidLaw after hearing about the software from a colleague. Ben is now happily using AZ Probate Partner in his practice. Mr. Connor says AZ Probate Partner is "really a great program!" His experience is not unique. Ron Adams of Hoopes and Adams, PLC, in Chandler, has been using AZ Probate Partner for years is also very pleased. He says, "We use it regularly and it has worked very well for us."

For more information about AZ Probate Partner, go to azprobate.avidlaw.com.

AZ Probate Partner Enters It's Third Year

AZ Probate Partner began its third year by with a new release which, among other things, added new documents for Gila, Mohave, Pima and Pinal counties. AZ Probate Partner now covers over 60 Arizona informal probate documents, including not only the documents to be filed in court, but also questionnaires and checklists that simplify the Arizona informal probate process.











AZ Probate Partner has been used for years by dozens of practitioners across Arizona to quickly and accurately assemble informal probate documents for hundreds of filings. It is designed for filings in all Arizona counties and automatically assembles the documents needed for each county.

As time goes on, this blog will highlight the practices of some of the attorneys who use AZ Probate Partner. They include attorneys at Fennemore Craig P.C., Gibson, Ferrin & Riggs, PLC, and Hoopes & Adams, PLC.

AZ Probate Partner is a product of AvidLaw, LLC, an Arizona company dedicated to streamlining the drafting of complex legal documents.