Illinois Probate Act 755 ILCS 5/12-4: When Security Excused or Specified
Estate administration is the legal process that your estate must go through before your assets can be distributed to your beneficiaries. In Chicago the Probate Court oversees the settlement of estates. Estate administration proceedings begin when someone approaches the Probate Court and files a petition seeking the appointment of a representative. There are specific requirements that must be met before the court will approve a petition appointing a representative and before the court will allow the petitioner to move forward with estate administration activities. One such requirement is filing a bond. Depending on the size and complexity of your estate, the administration process will likely take at 6-12 months, and in some cases, significantly longer. There are sometimes problems along the way such as will challenges and disputes with creditors and heirs that can impact the administration process. If you have questions about the requirements of serving as the representative of an estate, including the requirements of Illinois Probate Act, section 12-4- When security excused or specified, contact a Chicago estate administration lawyer at the Law Offices of Stephen Bilkis & Associates who understands who may act as representative as well as the process for appointing an executor.Process for Being Named Representative
The first step in being appointed representative is that the person seeking appointment must petition the court requesting letters. “Letters,” also called letters testamentary or letters of administration are an order from the Illinois Probate Court stating that the person named therein has the legal right to serve as administrator for the decedent’s estate.
The court will not issue letters to a petitioner if he or she is not qualified. A person would not meet the qualification requirements if he is under 18-years-old, a convicted felon, not a U.S. resident, or is mentally incapacitated. Furthermore, as an experienced Chicago estate administration attorney will explain, the court will not issue letters to a petitioner if there is another person who has a greater right to receive letters and who also has submitted a petition.
In addition, before the appointed representative can start the activities related to managing an estate, he or she must take a file an oath or affirmation that he or she will do the job in a manner that is consistent with the law. In addition the court typically will require that anyone seeking to serve as a representative post a bond. Bond is a type of insurance that protects the estate from misdeeds or mistakes of the representative. A representative is responsible for collecting the assets in the decedent’s estate, paying debts, receiving money and assets into the estate, and distributing remaining assets to the appropriate people. These responsibilities are significant. Any error or mismanagement of the estate assets can result in a significant financial loss to the estate and to the beneficiaries and heirs. To protect the estate, beneficiaries, heirs, and creditors, Illinois Probate law requires most representatives to obtain a bond that can be used to compensate those rightfully entitled to funds if the representative mishandles the estate assets. If the representative is not able to get a bond, then the court may decline to issue letters.When Security Excused or Specified
Under Illinois Probate Act, section 12-4- When security excused or specified, the representative will not be required to post a bond if the will specifies that none is required. However, if the court has reason to believe that the representative has committed fraud or is incompetent, or if there is evidence that the estate does not have sufficient assets to pay all claims against it, then the court can still require the representative to post bond.
The law also excuses bond when the estate’s representative is a corporate representative. Under the Illinois Corporate Fiduciary Act, certain entities are authorized to act as the representative of an estate. While the designation of a corporate representative is common when the estate is large or complex, testators can also designate a corporate representative to administer smaller estates.Amount of Bond and Cost of Bond
The amount of the bond is typically tied to the size of the estate and the type of surety. A surety is the person or company that issues the bond. If the surety is an individual, the bond will be at least two times the value of the personal estate. If the surety is a company, the bond will be at least 1.5 times the value of the personal estate. The court can raise the amount of bond for a number of reasons during the administration process.
The cost of the bond to the representative depends on a number of factors such as the representative’s creditworthiness, the size of the estate, the type of assets in the estate, the relationship between the representative and the estate, and where there are disputes amount beneficiaries or heirs.
If you have questions related to the type and amount of bond, discuss them with an experienced estate administration attorney in Chicago.Related Statutory Provisions
- Individual representative; oath and bond: Illinois Probate Act, 755 ILCS 5/12-2
- Deposit in lieu or reduction of bond: Illinois Probate Act, 755 ILCS 5/12-7
- Additional bond for proceeds of sale or mortgage: Illinois Probate Act, 755 ILCS 5/12-9
- Further bond or security: Illinois Probate Act, 755 ILCS 5/12-10
(a) Except as provided in paragraph (c) of Section 6-13 with respect to a nonresident executor, no security is required of a person who is excused by the will from giving bond or security and no greater security than is specified by the will is required, unless in either case the court, from its own knowledge or the suggestion of any interested person, has cause to suspect the representative of fraud or incompetence or believes that the estate of the decedent will not be sufficient to discharge all the claims against the estate, or in the case of a testamentary guardian of the estate, that the rights of the ward will be prejudiced by failure to give security.
(b) If a person designates a guardian of his person or estate or both to be appointed in the event he is adjudged a person with a disability as provided in Section 11a-6 and excuses the guardian from giving bond or security, or if the guardian is the Office of State Guardian, the guardian's bond in the amount from time to time required under this Article shall be in full force and effect without writing, unless the court requires the filing of a written bond.
(c) The Office of State Guardian shall not be required to have sureties or surety companies as security on its bonds. The oath and bond of the representative without surety shall be sufficient.
One of the reasons that Illinois requires representatives to have a bond, is that mistakes in the estate administration process do happen. The result can be a financial loss to the estate and liability on the representative. If you are an executor or estate administrator and have questions or concerns related to the bond or surety requirements, including the requirements of Illinois Probate Act, section 12-4- When security excused or specified, an experienced estate administration attorney serving Chicago can help. The attorneys at the Law Offices of Stephen Bilkis & Associates have over two decades of experience representing clients in estate matters, including matters related to the appointment of a representative and the administration process. Contact an attorney in our office attorneys at 855-454-5529 to schedule a free, no obligation consultation regarding your case. We serve individuals throughout Chicago.