In most states, an executor is allowed to go back in time and authorize estate actions that occurred between the time of a person's death and the time the executor is appointed. A case from Florida illustrates that they do not always have to use that authority.
When a person passes away, there is a gap in time before a court officially appoints a personal representative, also known as an executor. However, there are often estate actions that take place during that time.
In many states, the personal representative can retroactively authorize those actions after his or her appointment, if doing so would be beneficial to the estate.
Wealth Management recently discussed a Florida case holding that a personal representative is not required to exercise that authority.
The article is titled "Estate Not Liable for Car Accident After Decedent's Death."
In this case, the decedent's adult daughter had lived with him. Although she had a car of her own, she often used her father's car with his permission. She was driving her deceased father's car when she got into an accident and struck another vehicle.
Subsequently, the decedent's stepson was appointed to be the personal representative of the estate.
Under Florida law, if the daughter was driving the vehicle with the permission of the owner, then the owner could be held liable for any damages, which in this case would be the estate.
Occupants of the other vehicle in the accident sued the estate. However, the personal representative of the estate declined to retroactively authorize the daughter's use of the vehicle. Therefore, the estate would not be liable for any damages.
The case turned on whether the personal representative was required to exercise that retroactive authority. The court ultimately ruled that he was not.
Consequently, the personal representative is not required to do something that would be harmful to the estate, even if authorized to do so.
For more information about estate administration and planning in Orlando, FL (and throughout the rest of Central Florida), visit our estate planning website and be sure to subscribe to our complimentary estate planning e-newsletter while you are there.
Reference: Wealth Management (June 23, 2017) "Estate Not Liable for Car Accident After Decedent's Death."