San Antonio Express-News
April 20, 2004

Probate Clears Realty Title
-and-
Handling Debts in Probate

copyright 2004, Paul Premack

A Will expresses a testator’s instructions about new ownership of assets by identifying the heirs and what they are to receive. It is also a confidential document, and a testator can change his or her Will as often as desired.

Only when the testator dies are the Will’s instructions carried out, and they must then be made public so that they can be honored. When your mother-in-law left her Will with her attorney, she was not making her wishes known to the public. On the contrary, her communications with her attorney are strictly confidential.

To make the Will public, it must go through the probate process. First, probate establishes the validity of the Will. Is it her "last" Will or did she make one later expressing new intentions? Probate allows the public to treat your husband as legal owner of the land in Pharr, and as legal owner he can proceed to sell the land as he wishes.

Dear Mr. Premack: My friend died and named me executrix of his Will. He had over $15,000 in credit card debt and additional debt from hospital bills. He had no children or spouse. However, he had a partner who co-owned their house. He has few other assets or personal affects that could be liquidated to cover his debts. What is my responsibility with regard to the credit card debt and/or hospital bills? Who comes first in the long line of creditors? SSS via Email

You do not have individual liability for his debts. His estate owes the debts, and as Executrix you oversee the process. There is a very specific, if complex, process that can be invoked when his Will is admitted to probate.

As Executrix, you are allowed to give each creditor formal notices to bring their claims; if they do not act in a short time, their claims are barred. If they do act, their claims are classified into legal categories. Credit cards are "class 8 claims," which are at the bottom of the list after medical bills, funeral expenses, secured debt, child support obligations, etc. If a claim is valid, you will accept it and then inform the creditor that there are no available assets.

If his partner still lives in the home, and was a co-owner all along, the house is the partner’s homestead and thus exempt from creditor's claims. Hence, creditors don't really have anything to go after. You have the option of informally telling them that his estate was insolvent, and most of the credit card companies will write off the debts.

Depending on the circumstances, some of the hospital bills may be covered by either Medicare or Medicaid (if he was on either of those programs). He may have had health insurance through his workplace or privately. The hospital should be making claims through any valid insurance coverage before seeking payment from his estate. If they do file an estate claim, the first $15,000 of medical bills are a "class 1 claim" that will not be paid due to insolvency.