In Minnesota a personal representative is a fiduciary responsible for completing the tasks necessary to settle the estate of a decedent during the estate administration process. MN Stat § 524.1-201. An executor and administrator are specific types of personal representatives. A common misconception about the job of a personal representative is that it is an unpaid position. This not the case. Even though in most instances a spouse, adult child, sibling, or other close family member takes on the responsibility out of love and duty, under Minnesota law they still have the legal right to receive compensation for the work they perform. MN Stat § 524.3-719. If you are considering serving as a personal representative, contact an experienced Minnesota executor commission lawyer for guidance.
Personal Representative Duties and Responsibilities in Minnesota
The purpose of the estate administration process is to wrap of the affairs of a deceased person. This includes making sure the debt that the decedent left behind has been paid or otherwise cared for. It also means making sure their property is cared for and eventually distributed to the decedent’s heirs and beneficiaries.
The job of the personal representative is to manage the steps required to wrap up the deceased person’s affairs. While the main steps include managing the estate’s property, paying estate debit, and distributing estate property, each step can be time consuming and complicated. Before the personal representative can move forward, they must be appointed by the court. MN Stat § 524.3-103. For more information about the duties of the personal representative, contact an experienced Minnesota executor commission lawyer for guidance.
Personal Representative Compensation
In order to receive payment, the personal representative must petition the probate court and essentially submit a bill. In Minnesota, probate matters are handled by the District Court. The court will review the bill. If the court concludes that the amount of reasonable, it will approve payment. When deciding whether a fee is reasonable, the court will consider several factors, including the terms of the will, agreements between the personal representative and the decedent, and the requirements of the Minnesota probate statute. See In re Estate of Schmitz, No. A05-1175 (Minn. Ct. App. May. 30, 2006)
Will. As an experienced executor commission attorney in Minnesota will explain, generally, the terms of a decedent’s will guides the estate administration process, including the personal representative’s fee. Some decedents are vague and direct the personal representative to receive “reasonable compensation for services rendered.” In other instances decedents direct that the personal representative’s fee is a percentage of the value of the estate’s probate assets. In still other instances, the decedent may make no mention of compensation for the personal representative. In such a case, the court will consider a contractual agreement between the decedent and personal representative or the requirements of the Minnesota probate statute.
Contract. A decedent can negotiate a fee with the testator and capture the agreement in a written contract.
Statute. In the absence of language in a will or a contract, the personal representative’s fee will be approved if it meetings the Minnesota statute’s reasonableness standard. MN Stat § 524.3-719. In determining reasonableness, the court must consider the following three factors:
- Time and labor required. The court will look at the type of work that the personal representative was required to handle. If the work required a greater amount of skill or effort than generally required, the court will take that into consideration. For example, if the personal representative is required to manage the decedent’s small business, deal with difficult family members, or initiate or respond to litigation, then they would likely approve a higher fee because of the complexity of the work involved. To show the amount of time spend on the estate, it is critical that the personal representative keep details records to present to the court.
- Complexity and novelty of problems involved. While much of the work of a personal representative is typically the same work required to settle most estates, unique complications can develop. For example, probate litigation presents an added complexity to the estate administration process. Dealing with difficult relatives who refuse to cooperate can also result in the process being much more complex than it other would be.
- Extent of the responsibilities assumed and the results obtained. The court will look closely at the tasks that the personal representative undertook and the results received. For example, if as a result of the personal representative’s actions the value of the estate significantly increased over the course of the administration process, the court will look favorably upon the personal representative’s actions and take that into consideration when evaluating the reasonableness of a fee request.
If you have any questions about your compensation as an executor or the compensation requested by an executor, contact an experienced executor commission attorney in Minnesota.