[WSBAPT] Creditor's Claim not filed with Court

Tue May 15 09:15:26 PDT 2018

It is simple once you get through the maze that is Title 11 and the cases about it. Which took me about 35 years. The PR owes a duty to valid creditors and must protect their rights, but not invalid (read, not in compliance with 11.40) creditors. The more recent cases that say, no compliance, no claim, help define "valid creditors:"

Under RCW 11.48.030, an executor is chargeable in this accounts for the whole estate of a deceased. The executor is an officer of the court and in a fiduciary relationship to those beneficially interested in the estate. He is obligated to exercise the utmost good faith and utilize the skill, judgment and diligence that an ordinarily cautious and prudent person would employ in the *528 management of his own affairs. Hesthagen v. Harby, 78 Wash.2d 934, 942, 481 P.2d 438 (1971); In re Estate of Peterson, 12 Wash.2d 686, 733, 123 P.2d 733 (1942). He must perform his duties not only for the benefit of the legatees but must also protect the estate from invalid and doubtful claims, In re Estate of Shea's Estate, 69 Wash.2d 899, 421 P.2d 356 (1966), while protecting the rights of valid creditors. Kerns v. Pickett, 49 Wash.2d 770, 306 P.2d 1112 (1957). It is his duty to settle an estate as quickly as possible but without sacrifice to the estate, National Bank of Commerce v. Peterson, 179 Wash. 638, 644, 38 P.2d 361 (1934), and he is liable for any breach of his responsibility which causes loss to another. Hesthagen v. Harby, Supra. His trust must be fulfilled with conscientious fidelity whether his charge is large or small.

Wilson's Estate v. Livingston, 8 Wash. App. 519, 527–28, 507 P.2d 902, 909 (1973)

Rob

Robert D. Wilson-Hoss 
Hoss & Wilson-Hoss, LLP 
236 West Birch Street 
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www.hossandwilson-hoss.com
rob at hctc.com

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From: wsbapt-bounces at lists.wsbarppt.com [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Thomas M. Culbertson
Sent: Tuesday, May 15, 2018 8:26 AM
To: WSBA Probate & Trust Listserv
Subject: Re: [WSBAPT] Creditor's Claim not filed with Court

Phil raises a point that every so often gives me some concern. I’m not aware of any WA authority on the subject of what duties, if any, does a PR owe a creditor. I would like the law to be that there is no duty, except perhaps to a creditor who has properly filed a claim AND the claim has been accepted (or is <$1000 and not timely rejected).  I’m sure we’ve all experienced variations on the following theme – after receiving actual notice, credit card collection agency (undoubtedly one we’re all familiar with) calls saying they are willing to accept 75 cents on the dollar, I ask whether they have filed a creditor’s claim, “no, we don’t plan to do that”, and I say I can’t respond until I talk to my client. Of course I never do respond, they never file a claim, we ignore their follow up communications, and the estate saves a bunch of money. Does anyone think my client or I owe any duty at all to tell them how to get their act together? The collection agency must have  a pretty persuasive marketing department, selling a service that routinely squanders its clients’ claims.

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THOMAS M. CULBERTSON  I  Lukins & Annis, PS

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From: wsbapt-bounces at lists.wsbarppt.com [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Philip N. Jones
Sent: Friday, May 11, 2018 11:51 AM
To: WSBA Probate & Trust Listserv
Subject: Re: [WSBAPT] Creditor's Claim not filed with Court

I agree with Nestor.  But if the claim is properly filed, I believe that the PR has a fiduciary duty to the creditor(s).  But I have not found any authority to that effect, or at least not much authority.  Anyone have any authority?

Phil Jones

Portland, OR

From: wsbapt-bounces at lists.wsbarppt.com [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of nestor at pplsweb.com
Sent: Friday, May 11, 2018 11:38 AM
To: 'WSBA Probate & Trust Listserv' <wsbapt at lists.wsbarppt.com>
Subject: Re: [WSBAPT] Creditor's Claim not filed with Court

In my opinion the PR has a duty to the other beneficiaries to reject any claim not properly filed. 

Nestor 

Nestor Gorfinkel, Attorney at Law

Licensed in Washington & Florida

Florida Civil-Law (International) Notary

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From: wsbapt-bounces at lists.wsbarppt.com <wsbapt-bounces at lists.wsbarppt.com> On Behalf Of Brent Williams-Ruth
Sent: Friday, May 11, 2018 11:21 AM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
Subject: [WSBAPT] Creditor's Claim not filed with Court

Greetings - 

I have a PR, that gave actual notice to a creditor, mailed on April 9, 2018 and stamped received on April 12, 2018.  As of this date, the creditor has only sent an email and a US Mail notice of payment recovery but has not, as of today, filed the claim with the Court. 

The estate is small and there are other creditor's claims that were properly filed with the Court that have reduced the residual to an even smaller amount.  The PR (who is also one of three beneficiaries) would like to reject the claim for failing to properly file the claim within 30 days of receiving notice.  Reading through RCW 11.40.70 it clearly states that notice needs to come to the personal representative AND be filed with the Court. 

My question really relates to 11.40.070(4) - the waiver of defects, where it says that if written notice was provided the PR may elect to treat the claim as properly filed. 

Do Courts expect PR's to waive the defect of not filing the claim? This is a large insurer with a subro department that is seeking money for a claim that they paid out for their insured (and before you ask, my decedent was driving around without insurance for the last couple years of his life) and now want to recover from the Estate. 

Thank you for your responses. 

Brent

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Brent Williams-Ruth 
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