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Can executor refuse to pay debt?

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shellyray

Junior Member
What is the name of your state (only U.S. law)? Kentucky Okay let me see, this is kind of long but I will try and shorten it for you. My mother in law passed away, but before she did she cosigned for a car for my nephew and she also thought she was cosigning for a mobile home. However, the bank put her name on the loan first. The nephew has been paying for both for at least the last 2 years. He has talked to the bank and they have told him they are putting a claim in on both the car and the mobile home with the estate. So now that he knows the estate is going to have to pay for them he is not even trying to get either one refinanced. So now he is really happy that everything he has will be paid for.

So my question is can the executor of the estate refuse to pay these bills because they are not her bills. It can be proven that he has been paying these bills for the last 3 years on mobile home and 2 1/2 years on the car. However, if the estate has to pay for these items do they become the property of the estate. Her name is first on the mobile home and his is second. Her name is not on the car at all.

I have read in the Kentucky Revised Statutes that bills can be refused but it does not explain any circumstances, and I can't find anywhere to find what some of the circumstances would be.

Any insight into this would be greatly appreciated. Thanking all who respond in advance.
 
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justalayman

Senior Member
So my question is can the executor of the estate refuse to pay these bills because they are not her bills.
I'm not sure of the situation. Was there one or two loans? Was she the only borrower listed on either loan or was there a co-borrower?

. If she was the only party listed as borrower, then the claim against the estate is valid.

However, if the estate has to pay for these items do they become the property of the estate
depends

Her name is first on the mobile home and his is second.
it depends exactly how they are on the title. If this was a joint ownership with rights of survivorship, title would transfer to the joint owner without any action from the probate needed. Depending on how the contract is written, they may or may not have the right to repo in an attempt to satisfy the loan. If the ownership was not jointly with rights of survivorship, the estate would own whatever the title granted her. Most often it is a 1/2 share unless otherwise specified but very often it is jointly with rights of survivorship.

to the car, if she is not on the title at all, it is owned by whomever is on the title BUT if there is a lien on the title, it won't be released until the loan is paid. Here again, depending on how the loan contract was written, the bank may or may not have the right of repo.

I have read in the Kentucky Revised Statutes that bills can be refused
bills can be refused but if the creditor does not want to accept that action, they can initiate a suit against the estate in an attempt to collect their money.
 

latigo

Senior Member
The only way this nephew is going to have those assets dropped in his lap free and clear is if whoever is administering this estate is unqualified to do so and is doing so without the benefit of a Kentucky attorney steeped in Kentucky probate law!

And your telling us that you are attempting to research those arcane laws - plus probing around on the Internet for answers - suggests that you are the appointed executor and you are acting without counsel. Either that or you are trying to second-guess the attorney for the estate indicating lack of confidence in the attorney.

The appointment of an “executor” would mean that the deceased had a will. So, are these assets mentioned in the will? Are the financial commitments to the bank mentioned in the will? Has an inventory and appraisement been filed and if so have these assets been included?
___________________

Having done my harping, if I were representing the executor under these unique circumstances, what I would recommend is that bank’s creditors claims be flat rejected. Thus forcing the bank to bring an action against the estate to litigate its claims. Then the executor could interplead the nephew and get all these issues and parties packaged together for adjudication.

(And hopefully as soon as Aardy can extract his snout from the termite mound, we will all be much enlightened.)
 

latigo

Senior Member
Here is an example of what I meant by “arcane”.

Kentucky Revised Statutes Section 396.115 Payment of contingent, unliquidated or future claims.

“(1) If a claim which will mature at a future time, or a contingent or unliquidated claim, matures or becomes certain before the distribution of the estate, and if the claim has been allowed, it shall be paid in the same manner as matured and absolute claims of the same class.
(2) In other cases the personal representative or, on petition of the personal representative or the claimant in a special proceeding for the purpose, the court may provide for payment as follows:
(a) If the claimant consents, he may be paid the present or agreed value of the claim, taking any uncertainty into account;
(b) Arrangement for future payment, or possible payment, on the happening of the contingency or on liquidation may be made by creating a trust, giving a mortgage, obtaining a bond or security from a distributee, or otherwise.”

_________________

With the bank, upon rejection of its claims, proceeding under this Section:

KRS 396.135 Execution against estate property prohibited.
“No execution may issue upon nor may any levy be made against any property of the estate under any judgment against a decedent or a personal representative, but this section shall not be construed to prevent the enforcement of mortgages, pledges or liens upon real or personal property in an appropriate proceeding.”
 

anteater

Senior Member
(And hopefully as soon as Aardy can extract his snout from the termite mound, we will all be much enlightened.)
Burp...

My words of enlightenment? Someone needs to take the nephew behind the barn and beat the snot out of him. And if the principals don't want to do it, then hire someone. It should be a legitimate expense of administering the estate.

Of course, that is not legal advice.

Telling tales from another legal advice forum... Apparently the attorney hired by the executor is saying to pay the loans and "they" are looking for another attorney.

I have to agree, Lats. The nephew has to be roped into this somehow. This won't be pretty.
 

shellyray

Junior Member
I'm not sure of the situation. Was there one or two loans? Was she the only borrower listed on either loan or was there a co-borrower?
There are two loans. One for the mobile home her name is first on the loan with him as a cosigner (it was supposed to be the other way around). I don't think she noticed this because she never borrowed money her husband always did that she just went and signed her name. So that is exactly what she did here. One for the car, his name is first with her as a cosigner.
. If she was the only party listed as borrower, then the claim against the estate is valid.
They are both listed on both loans, she is first on the mobile home and he is first on the car.
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depends

it depends exactly how they are on the title. If this was a joint ownership with rights of survivorship, title would transfer to the joint owner without any action from the probate needed. Depending on how the contract is written, they may or may not have the right to repo in an attempt to satisfy the loan. If the ownership was not jointly with rights of survivorship, the estate would own whatever the title granted her. Most often it is a 1/2 share unless otherwise specified but very often it is jointly with rights of survivorship.

[FONT="Comic Sans MS"]On the mobile home her name is first it reads (Jane Doe or John Doe). The car has his name only her name appears no where on the title to the car just the mobile home.


to the car, if she is not on the title at all, it is owned by whomever is on the title BUT if there is a lien on the title, it won't be released until the loan is paid. Here again, depending on how the loan contract was written, the bank may or may not have the right of repo.

bills can be refused but if the creditor does not want to accept that action, they can initiate a suit against the estate in an attempt to collect their money.
That is one thing I do not understand is as a cosigner how they can put a claim against the estate for the car?

thank you
 

shellyray

Junior Member
The only way this nephew is going to have those assets dropped in his lap free and clear is if whoever is administering this estate is unqualified to do so and is doing so without the benefit of a Kentucky attorney steeped in Kentucky probate law!

And your telling us that you are attempting to research those arcane laws - plus probing around on the Internet for answers - suggests that you are the appointed executor and you are acting without counsel. Either that or you are trying to second-guess the attorney for the estate indicating lack of confidence in the attorney

I have counsel however, he just seems to say pay it, and I do not think that is right so, rather than argue with him at the present moment I thought I would do some investigating so I could ask him some questions the next time I talked to him, instead of just taking his word for it.

The appointment of an “executor” would mean that the deceased had a will. So, are these assets mentioned in the will? Are the financial commitments to the bank mentioned in the will? Has an inventory and appraisement been filed and if so have these assets been included?
No they are not mentioned in the will. No the financial commitments to the bank are not mentioned in the will. (I don't think she thought this would happen.) I think she thought that he would just continue to pay for it and that would be that. Or she would have done something. No an inventory and appraisement have not be filed.

___________________

Having done my harping, if I were representing the executor under these unique circumstances, what I would recommend is that bank’s creditors claims be flat rejected. Thus forcing the bank to bring an action against the estate to litigate its claims. Then the executor could interplead the nephew and get all these issues and parties packaged together for adjudication.

(And hopefully as soon as Aardy can extract his snout from the termite mound, we will all be much enlightened.)
Thank you!
 

shellyray

Junior Member
Burp...

My words of enlightenment? Someone needs to take the nephew behind the barn and beat the snot out of him. And if the principals don't want to do it, then hire someone. It should be a legitimate expense of administering the estate.

Of course, that is not legal advice.

Telling tales from another legal advice forum... Apparently the attorney hired by the executor is saying to pay the loans and "they" are looking for another attorney.

I have to agree, Lats. The nephew has to be roped into this somehow. This won't be pretty.
I agree whole heartedly he is just setting back biding his time until all of his stuff is paid for (he also has another $21,000 loan that we are just waiting to see if they file a claim for ) it has no collateral just her signature. He darn near took everything she had when she was alive. Now he is going to get what is left now that she is gone. There just has to be something that can be done!
 

justalayman

Senior Member
That is one thing I do not understand is as a cosigner how they can put a claim against the estate for the car?

thank you
depending on the contract, it may be possible to give up the home to satisfy the lien. Something to look into.

If she was a cosigner (guarantor) and not a co-borrower, I do not see what claim they would have against the estate either. I would check to see which she actually is. It will make a difference.

(he also has another $21,000 loan that we are just waiting to see if they file a claim for ) it has no collateral just her signature.
if the estate funds do not cover all of the debts, this one would be more likely to be paid than the others, as long as the others are secured loans. If there is a right of repo, the lenders for the car and MH could repo to reclaim some of the funds.
 

shellyray

Junior Member
depending on the contract, it may be possible to give up the home to satisfy the lien. Something to look into.

If she was a cosigner (guarantor) and not a co-borrower, I do not see what claim they would have against the estate either. I would check to see which she actually is. It will make a difference.

if the estate funds do not cover all of the debts, this one would be more likely to be paid than the others, as long as the others are secured loans. If there is a right of repo, the lenders for the car and MH could repo to reclaim some of the funds.
That is definitely something to look into.

So if she is a cosigner she should not be obligated, but as a co-borrower she would/could be held responsible.

She still has a house and land that could be sold. Not to mention farm equipment, car, truck etc. There would be enough to pay all of his debts. The only debt she had herself was a car and it was only $1,800.00 that is it.

As far as the $21,000 a friend of mine is a loan officer at the finance company where this loan is and she reassured me that unless he fails to pay they will not put a claim in. So hopefully he will continue to pay.

THANK YOU!
 

shellyray

Junior Member
Here is an example of what I meant by “arcane”.

Kentucky Revised Statutes Section 396.115 Payment of contingent, unliquidated or future claims.

“(1) If a claim which will mature at a future time, or a contingent or unliquidated claim, matures or becomes certain before the distribution of the estate, and if the claim has been allowed, it shall be paid in the same manner as matured and absolute claims of the same class.
(2) In other cases the personal representative or, on petition of the personal representative or the claimant in a special proceeding for the purpose, the court may provide for payment as follows:
(a) If the claimant consents, he may be paid the present or agreed value of the claim, taking any uncertainty into account;
(b) Arrangement for future payment, or possible payment, on the happening of the contingency or on liquidation may be made by creating a trust, giving a mortgage, obtaining a bond or security from a distributee, or otherwise.”

_________________

With the bank, upon rejection of its claims, proceeding under this Section:

KRS 396.135 Execution against estate property prohibited.
“No execution may issue upon nor may any levy be made against any property of the estate under any judgment against a decedent or a personal representative, but this section shall not be construed to prevent the enforcement of mortgages, pledges or liens upon real or personal property in an appropriate proceeding.”
This is exactly why I am here. Why can't they just say it so people can understand it?
 

tranquility

Senior Member
I'm old.

Without putting on glasses, I can read the default font.

I think I have value to those who write, but, I don't want to put on glasses because a person wants to use a different font. I mean really, I spent time in college in determining the proper font to use on the paper.

Here, I'd say the best one is one an old person can read. YMMV.
 

anteater

Senior Member
So if she is a cosigner she should not be obligated...
I would not take that to the bank (as it were).

I tried to do a bit of research and opinion seems to be all over the place. And did not find anything particularly about Kentucky.

I think that you need to get hold of the loan documents and read them very closely.

I still think that an "intervention" with the nephew is needed. I take that he is a grandson. What do his parents think about this?
 

anteater

Senior Member
I'm old.

Without putting on glasses, I can read the default font.

I think I have value to those who write, but, I don't want to put on glasses because a person wants to use a different font. I mean really, I spent time in college in determining the proper font to use on the paper.

Here, I'd say the best one is one an old person can read. YMMV.
Oh c'mon, gramps. Take a little nap and your eyesight will be sharper. :D
 

shellyray

Junior Member
I'm old.

Without putting on glasses, I can read the default font.

I think I have value to those who write, but, I don't want to put on glasses because a person wants to use a different font. I mean really, I spent time in college in determining the proper font to use on the paper.

Here, I'd say the best one is one an old person can read. YMMV.
I am sorry it bothers you so bad. I am also sorry you spent so much time in college on what font to use. I do value your opinion and advise. However, it helps me keep what I say and what everyone else says separate, and from running together. Easier for me to read. I do agree the first font I was using was very bad and very hard to read. I do apologize for that. But do you agree that the new one is easier to read and see?

Okay how is this I will just use the default font just make it bold so I can see it better. Does that work for you?:)
 
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