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Posted by Rich Carreiro on August 5, 2008, 7:45 pm
A relative of my wife's who is a Pennsylvania resident died
last year.
The executrix of the estate is the decedent's sister. To
be very clear, no lawyer or law firm was named as the executor
of the estate.
The executrix has reported to my wife that the lawyer the executrix
has engaged (the same lawyer who drew up the decedent's will) claims
that he, the laywer, is entitled under PA statute to some minimum
percentage of the estate.
That sounds totally and completely bogus to me.
I could see it if the lawyer *was the executor* of the estate.
However, that is *not* the case here.
In other words, I think the estate is basically being ripped
off by the guy.
I was therefore wondering if any of you with knowledge of PA
probate law could give me some pointers (to PA statutes,
PA probate FAQs, etc.) to documentation showing (hopefully) that
this lawyer is mistaken or lying, so that I can get this information
to the executrix before she pays out any more money to the lawyer.
Thank you!
--
Rich Carreiro rlc-news@rlcarr.com
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Posted by Elizabeth Richardson on August 5, 2008, 8:07 pm
>
> The executrix has reported to my wife that the lawyer the executrix
> has engaged (the same lawyer who drew up the decedent's will) claims
> that he, the laywer, is entitled under PA statute to some minimum
> percentage of the estate.
>
> That sounds totally and completely bogus to me.
Rich, I don't know PA laws, but I can tell you that such is the law in
California, so your scenario sounds, if not reasonable, then legally
accurate. The executor/trix is also allowed to charge a percentage of
assets.
Elizabeth Richardson
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Posted by Tad Borek on August 6, 2008, 1:46 pm
Elizabeth Richardson wrote:
> Rich, I don't know PA laws, but I can tell you that such is the law in
> California, so your scenario sounds, if not reasonable, then legally
> accurate. The executor/trix is also allowed to charge a percentage of
> assets.
Elizabeth is correct, CA does have statutory fees for both the attorney
and personal representative, stated as percentages of the gross estate.
But those are maximum fees, and while attorneys may use them as their
standard fee, the PR is free to negotiate a lower one with an attorney.
(Higher fees can't be negotiated or charged, unless they are for
extraordinary services that aren't normally required in estate
administration).
It's been awhile since I looked at a PA estate but my recollection is
that PA doesn't have a percentage-based statutory fee. I just looked on
the PA bar web site and their consumer pamphlet on estate planning
states, "Talk to your lawyer to find out whether services will be based
on an hourly fee, a flat rate, or on a percentage of the estate assets
and what would work best for you."
http://www.pabar.org/public/membership/conleg.asp
-Tad
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Posted by dapperdobbs on August 6, 2008, 3:35 pm
Very much esteemed Elizabeth,
Please escuse me if my post seemed to slight yours - I'm not familiar
with CA laws, and obviously I erred saying "I have never heard of ..."
since you had just written that CA has fees based on estate value. And
you are correct. Apologies for my very sloppy posting mind - it
slipped :-)
Best,
Dapper
wrote:
>
> Rich, I don't know PA laws, but I can tell you that such is the law in
> California, so your scenario sounds, if not reasonable, then legally
> accurate. The executor/trix is also allowed to charge a percentage of
> assets.
>
> Elizabeth Richardson
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Posted by kastnna on August 6, 2008, 4:59 pm
Yeah for estate planning!
But seriously, numerous states have laws similar to CA's that allow an
attorney to collect a fee based on the assets in the estate. It is
common to have a step-rate system (e.g. 6% of 1st $10,000; 4% of
everything else up to $1,000,000; 1% of everything over). In Rich's
case it appears PA does not have such law, but "reasonable" is often
not agreed upon. Here, in AL, a court must approve an attorney's fees,
but as much as 4% is not uncommon for more complex estates.
[Soapbox]:
I commonly hear "I don't need estate planning because my estate won't
be more than $X, so I won't owe taxes anyway". I've seen $1M estates
with $25k in fees that could have been almost totally avoided with $4k
in estate planning. Other than tax avoidance (the "biggie"), keep in
mind that estate planning also removes assets from your estate. The
lower the probate estate the lower the fees. Just one more thing to
consider when deciding if estate planning is necessary.
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