[WSBAPT] Creditor's Options

[Eric Nelsen]

So the decedent's tort liability has been reduced to a contract that provides for installment payments, is that right? I assume it is simply a contract to make payments and it's not secured by a deed of trust or anything like that. I will also assume that the debt is a community debt of decedent and spouse. In that case, the creditor would have to get a probate started so they can file a creditor claim. They can be appointed as PR per RCW 11.28.120(6)<https://app.leg.wa.gov/RCW/default.aspx?cite=11.28.120>, or petition to have a 3rd party appointed. They'd have to give notice to the surviving spouse per RCW 11.28.131<https://app.leg.wa.gov/RCW/default.aspx?cite=11.28.131>. Once the probate is commenced, they'd file the creditor claim and get it allowed or rejected, and file suit if it's rejected.

The creditor cannot pursue the claim directly against the surviving spouse without also filing a claim in the estate. Ruth v. Dight.

The estate of the first spouse to die (Spouse 1) has jurisdiction over all community property and community debts. The death of a spouse terminates the marital relationship and the "marital community." Bank of Montreal v. Buchanan, 32 Wn. 480, 73 P. 482 (1903); see also Washington State Bar Assn. Community Property Deskbook (4th ed. 2014) (hereinafter "CP Deskbook"), Sec. 4.11. At death of Spouse 1, the community "ceases to exist." Sutton v. Hirvonen, 113 Wn.2d 1, 6, 775 P.2d 448 (1989). Spouse 1's estate accordingly has jurisdiction over all community property and community liability, not just the decedent's half, so as to dispose of all community matters. Ruth v. Dight, 75 Wn.2d 660, 670, 453 P.2d 631 (1969) (claim against the community cannot be pursued against surviving spouse if not also properly brought against the deceased spouse's estate); Gilliam v. City of Centralia, 14 Wn.2d 523, 531, 128 P.2d 661 (1942) (deceased spouse's personal representative, not the surviving spouse, has authority to pursue a community claim); Magee v. Big Bend Land Co., 51 Wash. 406, 408, 99 P. 16 (1909) (administration of first spouse's estate had jurisdiction and authority to sell the entire community real property). See also CP Deskbook, Sec. 4.13.

Sincerely,

Eric

Eric C. Nelsen
Sayre Law Offices, PLLC
1417 31st Ave South
Seattle WA 98144-3909
206-625-0092
eric at sayrelawoffices.com<mailto:eric at sayrelawoffices.com>

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From: wsbapt-bounces at lists.wsbarppt.com <wsbapt-bounces at lists.wsbarppt.com> On Behalf Of samuel at meylerlegal.com
Sent: Tuesday, August 30, 2022 6:07 PM
To: 'WSBA Probate & Trust Listserv' <wsbapt at lists.wsbarppt.com>
Subject: [WSBAPT] Creditor's Options

Listmates,

Here is the scenario: Decedent causes a car accident in 2016, admits fault and enters into an agreement with the other/injured party's insurer to make payments over time.  Decedent passes away on 8/17/2020.  Decedent was married and wife continues to live in the family home which has equity in it.  Probate was never opened.  What options does the insurer have to pursue collection of the outstanding balance?  What procedures would the insurer have to follow?  Thanks for your input.


Samuel M. Meyler
Meyler Legal, PLLC
1700 Westlake Ave. N., Ste. 200
Seattle, Washington 98109
Tel:  206.876.7770
Fax:  206.876.7771
Email:  samuel at meylerlegal.com<mailto:samuel at meylerlegal.com>

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