A “personal representative” is a person or a company that is appointed by the Probate Court to manage the estate of a decedent in a probate proceeding and perform the activities necessary to settle a decedent’s estate. They are a fiduciary with respect to the estate and as such are required to perform their duties with the utmost honesty and care and with the best interests of the estate in mind. If the personal representative was named by the decedent in their will, they are often called the “executor.” The Probate Court oversees the personal representative’s activities.
Personal Representative Appointment
Before the personal representative has the legal authority to act on behalf of the estate, they must petition the Probate Court and the court must appoint them. If the decedent left a will naming their choice, then typically that is the person who petitions the court to initiate the estate administration process and for appointment as personal presentative. In addition to petitioning the court and receiving approval, to qualify the petitioner may be required to post a bond and must sign a statement of acceptance. NM Stat § 45-3-601
Duties and Responsibilities
Once qualified, they must quickly proceed to take care of the steps necessary to settle the decedent’s estate.
- Inventory the assets. As the representative of the estate, the personal representative must take control of the estate assets. It is important that they understand the difference between probate assets and non-probate assets as only probate assets are subject to court supervised estate administration. Generally, probate property is real and personal property owned by the decedent individually or as a tenant in common with someone else, while non-probate property is property owned by the decedent jointly with others with survivorship rights or property that has designated beneficiaries such as 401(k) plans or life insurance policies. As part of the process, the personal representative creates an inventory of estate assets. The inventory must include a description of property as well as its fair market value at the time of death. If an interested party requests a copy, they must provide it. They may also file the original of the inventory with the appropriate court. NM Stat § 45-3-706.
- Notify creditors. The first step in paying creditors is to notify them that the decedent’s estate has been opened and the time frame for filing claims. Upon appointment the personal representative may publish a notice to creditors once a week for 3 successive weeks in a newspaper in the county in which the probate proceeding is pending. In addition, they may give written notice by mail or other delivery to known creditors. Creditors must file claims within four months after the published notice, or within 60 days after the mailing or other delivery of the notice, whichever is later. Claims that are not timely filed are forever barred. NM Stat § 45-3-801
- Pay estate debts. One of the tasks of administration is to ensure that debts owed by the decedent are paid. Upon receiving a claim against the estate, they must determine whether it is valid and allow or disallow it. They must let creditors know within 60 days of when the claim is filed whether it is allowed or disallowed. Otherwise the claim will be deemed allowed. If the estate does not have sufficient assets to pay all the claims, some will go unpaid. However, the personal representative does not have the power to determine what gets paid and what does not when assets are insufficient. New Mexico law determines the priority for payment. For example, the law requires that before any other debts are paid, the expenses related to administration must be paid.
- Asset distribution and closing of estate. Asset distribution is the personal representative’s final major responsibility. They must make sure that the estate is ready for distribution. Debt and expenses must have been paid and all claims addressed. They will also have to get approval from the court. Once the court approves the proposed distribution, assets can be distributed according to the terms of the will or, in the absence of a will, according to New Mexico’s rules of intestate succession.
Personal Representative Compensation
In New Mexico, a personal representative receives reasonable compensation for their work in settling a decedent’s estate. If a will provides for the amount of compensation, they have the options of renouncing the provision before qualifying. They would then be entitled to reasonable compensation. NM Stat § 45-3-719.