YOUR GUAM LAWYER

Guam law provides for probate as the court supervised legal process that includes determining the validity of your Last Will and Testament and/or the application of the intestacy laws, gathering of your assets, paying your debts, taxes, and the expenses of will administration, and then distributing the remaining assets to those persons entitled to them. To make sure that your property is distributed according to your intention your survivors will usually submit your Last Will and Testament to probate court. The main advantage of probate is that the court is supervising the entire proceedings, and the probate laws are being followed. This is especially beneficial if there are claims of creditors, challenges to the Will, or disputes that arise from the Will or to any assets of the estate, or disputes as amongst heirs.  However, the probate process can be time consuming and costly. The probate process is also criticized for the loss of privacy surrounding the will maker’s financial affairs.

Probate with a Will

Without a doubt, things can proceed in an orderly and legal fashion if you have a Will at the time of your death. The person you name as the executor/executrix of your Will becomes the central figure in the probate proceedings. Your executor/executrix will carry out the many duties specified by law, and the Will you leave will provide the guidelines for the probate process. The legal term for probate proceedings with a Will is testate proceedings.

Initial Proceedings

Upon your death, your survivors will determine whether it is necessary and appropriate to probate your estate. [It may also be that your creditors determine a probate is necessary in order to facilitate and address collection]  If so, then usually the person you have nominated to be your executor will submit your Will to the Superior Court of Guam, along with a petition to the court that will include information about you, your death and your Will. The petition will request that the court accept the Will as valid and to appoint the executor designated in the Will. The court will also review the executor's residency and bond requirements. Heirs, beneficiaries, and creditors must be notified of the admission of the Will and the opening of the estate, after which they have a limited amount of time to challenge the Will and/or submit claims to the estate. The estate may then obtain a federal identification number for tax purposes because it is considered a separate taxpayer. The executor may also open a bank account in the name of the estate in which to deposit income and receipts of the estate, and out of which to pay expenses, and make distributions to the beneficiaries. The initial proceedings will also be when the court takes into consideration any challenges to the admission of the Will.

Executor Duties

The executor plays the key role in the probate proceedings from the very beginning. After residency and bond issues are reviewed, and the court officially appoints him or her as the executor, it is up to him or her to collect and inventory the assets of the estate, pay all debts and expenses of the estate, and then distribute property to the beneficiaries and establish any trusts, if directed by the Will.

It will be the executor's responsibility to notify heirs, beneficiaries and creditors, obtain a federal identification number for tax purposes, and open a checking account in the name of the estate.  The executor must review all records to determine all of the assets of your estate, and physically take custody of all assets which are subject to probate. After taking custody, the executor must determine the fair market value of the estate property, pay any debts still outstanding, resolve any claims by creditors, and pay the costs of all expenses incurred in administering the estate. The executor may have to sell some of the estate's assets to pay debts and expenses.  The executor is also responsible for preparing and filing death tax returns. This can include the Guam tax or federal estate tax returns. He or she will also be responsible for filing your final individual income tax return, the estate income tax returns, and any necessary gift tax returns. Finally, it is the responsibility of the executor to distribute the remaining estate assets to the beneficiaries, and to establish and fund any trusts specified in the Will.

Intestate Succession

Guam law also provides a statutory plan in the event you die without a Will.  There was a time when a person would die and their property would escheat to the king.  Hence, there is a prevailing attitude that you must have a Will or your property will go to the government upon death.  The intestacy law ensures that your family will take your assets upon your death in much the same way as they would pass through a Will.  A Will is necessary of you want to eliminate or “cut out” a person from your estate.  It would also be necessary if you wanted a portion of your estate to go to a non-profit organization such as your church or synagogue.  In the event you die without a Will, Guam law directs that your estate will be subject to probate in the Superior Court.  The judge will appoint a personal representative to serve as the administrator (male) or administratrix (female) to direct the affairs of your estate in accordance with the law.   

Closing the Estate

When all of the distributions to the beneficiaries have been made or are nearing completion, a final report must be filed with the probate court which summarizes all of the receipts and disbursements of the estate and summarizes all other acts taken by the executor. A copy is provided to the beneficiaries who have the opportunity to object to any items in the report. If the beneficiaries have no objections, the court will typically approve the closing of the estate, the beneficiaries will sign receipts indicating that they have received their distributions, the executor will file these receipts, and the court will discharge the executor from duty.

Cost of Probate

There can be substantial cost involved in probating an estate, so it makes sense to avoid or curtail full probate where possible and appropriate. If it is not necessary to deal with possible claims against the estate or challenges to the Will, if it's not necessary to have formal authority to retitle the decedent's assets, and if it's not necessary for the court to supervise the activities of the executor, court supervision and its related costs can be dramatically reduced, or eliminated altogether. Probate also involves executor and attorney fees, which, however, are usually subject to Guam law limitations. Although such limits may vary from state to state, personal representative (executor/executrix admistrator/administratrix) fees often consdtitute a percentage of the of the assets that are subject to probate. Of course, many executors who are friends or family members of the deceased agree to serve without a fee. An attorney’s fees will vary depending on the amount of work spent on the probate process, but they are usually based on the same guidelines as the personal representative fees.

Time Spent in Probate

Probate proceedings are lengthy. Many estates can take a year or two to complete, and if it's necessary to file estate tax returns, the proceedings can last well into a third year. The size of the estate and Guam laws affect the length of the probate process.  The time it takes for distributions to reach beneficiaries also varies. The usual time frame for the first distribution is from four to eight months from the time of death, although most states have provisions for spouses and minor children to possibly receive distributions almost immediately.

Privacy Issues

When a Will is admitted to probate, it becomes public record. Not only does the Will itself become public, but all documents involved in the proceedings become public record and can be viewed by anyone desiring access. Some people have legitimate reasons for viewing this loss of privacy as a negative aspect of probate proceedings.

Short Form Probate

The duration and cost of the regular probate process can be minimized for some small estates that do not exceed a certain value. Every state but Montana and North Carolina has some sort of Small Estate Administration, but they differ on what exactly qualifies as a small estate.  Guam has law that applies to Estates Under $20,000.  When you die and do not leave any real property or your real property passes by operation of law, then your heirs may possibly apply this particular law to take possession of Estate assets within this amount without probate in the court.   

Confirmation of Community Property

Guam is a community property jurisdiction whereby the surviving spouse may generally succeed to all community property without the administration of probate.  For example, you die with an estate consisting of a house that you purchased with community funds after you married.  This qualifies a community property regardless of the name or names on the title.  If the character of the property meets the constricts of the community property laws, then property will pass to the surviving spouse with a simple document filed at the Department of Land Management.   

We strongly urge you to make an appointment and meet with an experienced attorney to discuss your concerns and issues pertinent to probate.  Guam law is unique and your probate may entail assets that span more than one jurisdiction.  We look for ways to legally avoid probate and work diligently to reasonably reduce the expense attendant thereto.  Take time to be "in the know" as there is no charge for an initial consultation.