Clients ask me this question all the time. Although I always recommend hiring a qualified attorney to draft a Will or a Trust for them to avoid this situation, this blog gives the framework for how to handle an estate when someone dies without a will (i.e., intestate).
Under Arizona law, the person in charge of administering the probate estate is called the personal representative. Arizona law provides for the following priority for appointment as a personal representative:
Thus, the personal representative of the estate would be the person with the highest priority in the Arizona statute. Sometimes, this is consistent with what the family wants, and sometimes it isn’t. In general, the personal representative is a fiduciary, and, as such, has fiduciary responsibilities to the beneficiaries of the probate estate with respect to administration of the estate.
Next, if there is no Will, then there is no waiver of bond in the Will. If all of the heirs will sign a waiver of bond and file it in the probate court, then the bond can be waived by the court. If not, the personal representative will need to obtain a bond (i.e., an insurance policy to protect the estate against improper actions by the personal representative) before the court will appoint that person as a personal representative.
According to Arizona law, the estate is distributed to persons who are determined to be heirs of the estate. The heirs are determined according to Sections 14-2102 and 14-2103 of the Arizona Revised Statutes. According to Arizona’s intestate succession laws, if the decedent left a spouse and no issue (i.e., children, grandchildren, etc.), then the spouse takes all of the estate. If the decedent left a spouse and issue, all of whom are also the issue of the surviving spouse, then the spouse takes all of the estate. Moreover, if the decedent left a spouse and issue, one or more of whom is not the issue of the surviving spouse (i.e., children from the decedent’s prior marriage), then the spouse takes the spouse’s half of the community property and one-half of the decedent’s separate property, with the decedent’s issue from the prior marriage taking one-half of the decedent’s community property and one-half of the decedent’s separate property. These two Arizona statutes go on from there to handle all other family circumstances that may come up. Although the intestate succession statutes work well in most families, they certainly do not work well in every circumstance.
Yes, if the heirs are all in agreement, they can sign a Family Distribution Agreement to change the distribution that occurs from the estate. However, this is a BIG IF. Most of the time, it is extremely difficult to get all of the heirs to be in agreement about such a change.
With all of that said, I strongly recommend that all of my clients hire a qualified attorney to help them draft a Will or a Trust so that they can spell out exactly what their wishes are and can avoid the many pitfalls that arise when relying on Arizona’s intestate statutes.
Our firm has helped hundreds of families just like yours handle a wide variety of estate planning, business planning, probate, trust, and elder law issues. When families or business owners are not getting along, we can also handle any disputes and litigation related to their businesses, wills, trusts, guardianships, or conservatorships. Please give me a call, so that I can help you work through these difficult issues with confidence.