How Do Creditors Get Paid by a Probated Estate?
A person or entity that has a financial claim against a decedent must file a creditor claim with the superior court of the county in which the probate was filed and serve that creditor claim on the personal representative of the estate of the decedent. RCW 11.40.010, 11.40.070. The creditor claim must be filed and served (RCW 11.40.070(3)) within four months after the first publication of notice to creditors in a legal newspaper in the county of decedent’s residence, or within thirty days after the personal representative mails actual notice to the creditor. RCW 11.40.051.
When the probate is opened by the personal representative, she files notice to creditors and then causes that notice to be published in a legal newspaper in the decedent’s county of residence once per week for three consecutive weeks (The notice to creditors should be published in the county of decedent's residence, and nowhere else, even if the probate is filed in an alternate county. RCW 11.40.020(2).) The personal representative should also give actual notice to known creditors by serving upon the creditor or mailing to the creditor’s last known address a copy of the notice to creditors. The personal representative is also required to mail a copy of the notice to creditors to the Department of Social and Health Services. A personal representative must file proof with the court of giving notice to creditors and publishing that notice. RCW 11.40.020. The creditor claim form is contained at RCW 11.40.030, and its contents and manner of delivery are further specified at RCW 11.40.070.
The personal representative must conduct a thorough search of the decedent’s papers and financial statements in searching for creditors. When the personal representative has completed this search, she is presumed to have done her duty regarding creditors, and she may file with the court an affidavit concerning reasonably ascertainable creditors. This affidavit and the reasonably diligent search that underlies it may affect the status of undiscovered creditors which are subsequently discovered. RCW 11.40.040, 11.40.051.
The personal representative has a duty to allow or reject all claims properly presented. RCW 11.40.080, 11.40.090, 11.40.100. No claim barred by the statute of limitations may be allowed. RCW 11.40.090(4). The personal representative has a right to compromise claims in the best interests of the estate. Claimant of a rejected claim has thirty days in which to bring suit on the rejected claim. RCW 11.40.100.
If the personal representative has a creditor claim of his own, that claim must be presented to the court for approval, regardless whether nonintervention powers have been granted to the personal representative. RCW 11.40.140.