Texas Simple Probate Techniques Criticized

In Breach of trust — Texas estate laws make stealing from the dead an easy crime, American-Statesman (Austin, TX), Dec. 10, 2006, reporter Tony Plohetski strongly criticizes the probate system in Texas because of the possibility of abuse despite that fact that in most cases the system operates smoothly, efficiently, and economically.

Here are a few excerpts from this article:

An Austin American-Statesman review has found that state laws make it alarmingly easy for the executor of a will — usually a family member, friend or lawyer — to steal or squander what people often spent a lifetime building, frequently with little chance of getting caught. State probate laws don’t ensure that a deceased person’s assets actually get to heirs — or require executors to tell the heirs they’re named in a will.  [Note that the reporter is confusing the term “heirs” with the term “beneficiaries.”] * * *

Texas probate judges and lawyers say it’s impossible to know how often people entrusted with dispersing a dead person’s belongings steal them instead. Neither the state nor any other organization monitors estate thefts.

But records at the State Bar of Texas give a hint of how prevalent the problem is. Even though lawyers are tapped to be executors far less frequently than family and friends, the bar receives more than 100 complaints each year against lawyers handling estate cases.

The complaints included anything from attorneys missing court deadlines or other inaction to estate mismanagement and theft. * * *

Created soon after Texas became a state in the mid-1800s, it was designed to pass wealth from generation to generation with little government involvement.

That lack of oversight has created significant weaknesses in an area of the law that eventually affects almost every Texan:

• State statutes don’t require executors — the people trusted with settling estates — to tell loved ones that they are named in a will, although in 1989 lawmakers required charities to be notified. Unless heirs know they were supposed to receive something, they might not know to ask for it.
     
• Executors are not required to tell probate courts how they distribute assets and whether they were distributed according to the will, and probate judges almost never follow up to make sure executors carried out the will’s instructions.
     
• Unless heirs who suspect wrongdoing hire an attorney and file a lawsuit, they generally must wait 15 months after an executor takes charge before demanding an accounting of how the executor divided the assets. Critics of the process say money and property often have vanished by then. * * *

Many probate experts, lawyers and judges like Texas’ system for its simplicity and say it is one of the easiest in the United States to navigate. They said they would be reluctant to trade that convenience for more oversight of executors’ work.

Special thanks to Prof. Wayne Scott (St. Mary’s University School of Law) for bringing this report to my attention.