Preliminary Thoughts in Collection Actions

Every time someone comes into my office for a collection action I have to give them the same preliminary talk; I call it the “Do you really want to pursue this action talk”.  What do I mean by that?  Well there are certain considerations that need attention before you blindly pursue someone who owes you money.

1. Does that person have the money?

Hiring an attorney is not a cheap endeavor.  We do our best to give our clients the best rates for the best service, but even then, a collection action can be costly.  What you need to ask yourself before you endure that cost is, “Does the individual or company I am pursuing have the money they owe me?”  If they don’t have any money, you may be able to get a judgment on them, even one that includes attorney’s fees, but if they don’t have the money to pay the judgment, that judgment isn’t worth the paper it is printed on and really you are just adding to the amount that you have lost.

 

2. Do they have the will and the means to spend more than you?

As I said above, hiring an attorney can be quite expensive, and the amount of that expense varies based on the amount of time that the attorney has to spend to get a judgment.  Sometimes you have an individual or company that owes you money and you know they are not going to respond to any kind of legal proceeding.  IN that case you may find that the attorney’s fees will be relatively low and the process will be relatively easy.  However, if you know that this person has the money, but they are going to fight you tooth and nail, you might want to consider not pursuing the case.  Sometimes people who are wrong will produce so much work for your attorney that you run out of money to pay for the representation.  In these cases you may want to consider not pursuing the claim even though you have an amazing case since you may never see the end of the case. 

 

3. Are you willing to deal with this for multiple years?

Collection cases, especially involving a wealthy and malicious individual or company, can last well beyond three years.  While the case is going on you will be constantly reminded of the proceeding and will often have to take time from your work to work on this case, whether it be meetings with your attorney, depositions, or appearing in court.  These legal cases take a lot of time and can be mentally and emotionally draining.  Add to the length of the case the fact that every year you are pursuing the case you are spending money on it and not getting any of it back any time soon.

 

What should you do?

You need to hire an attorney who your trust.  You don’t want an attorney who isn’t going to bring these issues up to you and then will send you a bill when it’s all over and you still don’t have your collection paid.  You need an attorney who understands when it is time to accept your losses and move on or it would be best to fight and get the judgment even though you may not get paid right away.  

 

At the Law Offices of Kinley & Styskal we pride ourselves in treating our clients like family.  Our clients are not just dollar signs walking through the door, they are people with families and lives of their own.  We like to help our client see how their case stands up in the law and in practical application.  We offer free consultations and are not going to sell you anything you don’t need.  You can contact us at (657)859-9095 or your can visit our website at: http://www.kinleyandstyskal.com

 

We hope to hear from you and show you how you should be treated by the legal community.

 

No legal representation exists by virtue of these blogs. It is recommended that you contact an attorney directly for a more complete advise.  These blogs are only informational in content, they are not to be considered actual legal advise.  Before taking any legal action consult an attorney.

 

Posted in Uncategorized | Tagged , , , , | Leave a comment

Durable Power of Attorneys v. Regular Power of Attorneys

Many people have asked me why they should be getting a durable power of attorney as opposed to a regular power of attorney and what the difference is.

Why a Durable Power of Attorney?

Powers of Attorneys are set up so another individual is able to make financial or health care decisions for you.  What most people don’t know is that there is a significant difference between a Durable Power of Attorney and a Regular Power of Attorney.  A Regular Power of Attorney is a useful device to allow people to act on your behalf, but what they don’t know is that once you lose capacity, or the ability to think coherently, that power of Attorney expires.  You have to be a clear minded individual for a Regular Power of Attorney to be in effect.

Why do I care if it expires when I lose capacity?

In the case of a health care Power of Attorney if you go into surgery and due to the procedure you wake up in a diminished capacity, or are no longer able to think clearly, that Power of Attorney will no longer be in effect, and the person you chose to act for you will no longer be able to act.

 

How Can I Be Sure That My Power of Attorney is Durable?

Hire an attorney.  If you hire an Attorney you will be sure that they put the appropriate language into the document.  The Law Offices of Kinley & Styskal are very happy to help you with all of your estate planning needs including Powers of Attorney and you can reach them at (657) 859-9095, or visit their website at http://www.kinleyandstyskal.com/ .

 

No legal representation exists by virtue of these blogs. It is recommended that you contact an attorney directly for a more complete advise.  These blogs are only informational in content, they are not to be considered actual legal advise.  Before taking any legal action consult an attorney.

Posted in Uncategorized | Tagged , , , | Leave a comment

Why would I want a Trust over a Will?

Many times I have been asked why would I want to pay for a trust when a will is cheaper?

Probate is the answer

The short answer is Probate.  A will is a great device to ensure that your desires for the distribution of your possessions when you pass are carried out, but it does not help you avoid Probate.  Probate is the proceeding that the court conducts to determine who gets what of your property when you have passed.  Probate is often a necessary proceeding if a party did not have the foresight to plan their estate, but if you are taking the time to make a will you should take the time to make a trust (if you have an estate that is more than $150,000).

Why $150,000?

The Probate Code states that if a person’s possessions at the end of their life are worth less than $150,000 that person’s estate does not need to go through probate.

Why is a Trust Better than a Will?

Which brings us back to the original question, why is a Trust better than a will?  Well, if you have significant real estate holdings your estate is going to be worth more than $150,000 and if you make a Will that Will will have to go through probate, which is a long and expensive process.  However, any property that you place in a Trust does not have to go through probate, because once you put property into a Trust (depending on how the trust is set up) that property is no longer considered your property, it is considered property of the Trust, and so when you pass only YOUR property needs to go through probate.  So, a Trust can be used as a tool to help reduce the value of YOUR property and therefore make it so that your estate does not need to go through Probate.  Therefore, if  you spend a little more money on a Trust instead of just a Will you will save significantly more money than you spent by avoiding Probate.

If anyone is interested in having a Trust put together for them please contact an attorney.  The Law Offices of Kinley & Styskal are very happy to help you with any Will or Trust matter.  You can contact us at (657) 859-9095, or visit http://www.kinleyandstyskal.com

No legal representation exists by virtue of these blogs. It is recommended that you contact an attorney directly for a more complete advise.  These blogs are only informational in content, they are not to be considered actual legal advise.  Before taking any legal action consult an attorney.

Posted in Uncategorized | Leave a comment

Does a House Willed to Me Have to Pass Through Probate?

Lately I have been asked a number of times about whether a house left to an individual in a will needs to go through probate?

Do I need to go through probate?

To determine whether or not a piece of real property, real estate, has to go through probate your attorney will look at how the property is held in title and how the property is being transferred.

Title of real property

Title of real property means, how the property is owned.  Is it sole and separate property, joint tenancy, tenants in common, life estate, or in a trust?  There are many different types of title, and depending on what kind of title the real property is held in the requirements for the transfer of that title upon the death of an owner of that property change. There are many rules regarding the passage of title and small changes in the situation can change how the property will pass.  If the property is considered to be community property, meaning it is owned by a married couple, the spouse of the deceased individual will own 50% of that property and the other 50% could pass automatically to the spouse depending on the type of title and the deceased individual’s will.  If the property is held by title that has a multiple owners and a right of surviorship, 100% of that property is going to be passed automatically to the surviving owners.  Sometimes there is a will that gifts the real property to an individual but because of the way the title was held that gift fails, or by law could not be fulfilled.  That situation would be like me giving you a car that did not belong to me.

How Do You Know if the Title of Real Property will Affect Your Rights?

Hire an attorney.  There are many different ways that title can affect an individual’s rights to that property and there are even more rules and laws that can modify the title of the property beyond the rules of that distinct title.  Attorneys are taught to understand these nuances.  The Law Offices of Kinley & Styskal are very familiar with these rules and would be happy to walk you through your rights.  We would even be happy to look at your will or trust and make sure that the gifts you intend to give to your family are actually going to pass the way you would like them to.  www.kinleyandstyskal.com

Transfer of real property upon death

The manner of how the real property is being transferred upon the death of the primary owner can affect whether or not you have to go through probate.  The best way to keep your real property from having to pass through probate is to make sure that you place it in a Trust.  When placing your real property into a trust be sure that you actually change the title of the property and have the trust hold title to the real property on the deed.  In other words, if you are putting your real property into a trust, don’t just say it is in the trust, actually record a deed naming the trust as the owner of the property.  If you just use a pour-over will to place the real property into a trust that property will have to pass through probate to execute the wishes of the pour-over will.

Transferring real property by will, does not allow it to avoid Probate, in fact that is exactly the type of transfer that would need to go through Probate.  Therefore, if someone passes away and they leave their real property to you in their will, you will have to go through Probate.

For more questions about this situation please feel free to contact the Law Offices of Kinley & Styskal, we offer free consultations.  We are a Loyal Family Firm Who Will Treat You Like Family.  www.kinleyandstyskal.com, Phone: 657-859-9095

No legal representation exists by virtue of these blogs. It is recommended that you contact an attorney directly for a more complete advise.  These blogs are only informational in content, they are not to be considered actual legal advise.  Before taking any legal action consult an attorney.

Posted in Uncategorized | Tagged , , , , , | Leave a comment

Bonds: Needed Protection or Unnecessary Burden?

In many situations when dealing with the Probate Court parties are required to obtain what is called a bond.  In these proceedings there are ways to avoid the bond requirement, but is that something you want to do, or is it better to have the bond?

What is a bond?

Barron’s Law Dictionary defines a bond as, a “written instrument with sureties, guaranteeing faithful performance of acts or duties contemplated”.  Basically a bond is like insurance to be sure that the person managing another’s property is going to do so properly and faithfully.  If the person managing the property of another does not do what they were required to do the bond is used to replenish the property that was improperly managed.

Do you need a bond?

The court will require a bond where there has not been any indication by the original owner of property or the heirs of the property that they do not want a bond.  In most cases there is no choice of whether or not to get a bond, the court will simply require it.  A bond is necessary when the competency or trustworthiness of an individual who is managing another’s property is questionable.  If you feel that the managing individual may improperly use, distribute, or invest property it would be a good idea to ensure that there is a bond in place, because then if the managing party does mess up you have the bond to help restore the property that was mismanaged.  If you are confident in the competency and trustworthiness of the managing party, it would be in the best interests of the estate, monetarily, to not have the bond.  Keep in mind that what I am saying is like saying if you believe that the person who is going to drive your car is a good driver and is trustworthy you don’t need insurance so you can save that money.  The chances of a person you believe is competent and trustworthy messing up the management of the property is very low, but it could still happen and if it does you would be without any remedy for that mistake without a bond.  But if you are willing to take that chance you can save money for the estate.

Why wouldn’t I want a bond?

Bonds can be expensive.  The price of a bond depends on the value of the property that the bond is protecting and the credit of the person managing the property.  You may ask, “Why do I care about the price of the bond?” Well the price of the bond matters to you (assuming you have an interest in the property being managed) because the price of the bond is taken from the actual property being managed.  Basically to protect the property a bond takes money from the property, and depending on the situation that can be a large sum of money.

How do I avoid having to get a bond?

In order to avoid the bond requirement you either need to have an owner of property who had the foresight and trust in their heirs to specify in their estate documents that they waive the bond requirement or you need to have all of the parties who have a potential interest in the property sign a waiver of the bond requirement and file it with the court.  The best way is for the original owner of property to include a waiver of the bond requirement in their will, trust or other estate documents.  When getting the parties who have a potential interest in the property to waive the bond requirement you need to have all of the parties who have a potential interest in the property sign a waiver of the bond requirement.  Even if you have 9 out of 10 individuals with a potential interest in the property sign a waiver and 1 who doesn’t, you must get a bond.

Anyone who is concerned about a bond and want to be sure that their property does not need a bond may contact the Law Offices of Kinley & Styskal, http://www.kinleyandstyskal.com.  We are very familiar with the processes for waving bonds in different probate proceedings.

 

No legal representation exists by virtue of these blogs. It is recommended that you contact an attorney directly for a more complete advise.  These blogs are only informational in content, they are not to be considered actual legal advise.  Before taking any legal action consult an attorney.

Posted in Uncategorized | Leave a comment

These Blogs do not Constitute Legal Advice

No legal representation exists by virtue of these blogs. It is recommended that you contact an attorney directly for a more complete advise.  These blogs are only informational in content, they are not to be considered actual legal advise.  Before taking any legal action consult an attorney.

Posted in Uncategorized | Leave a comment

Probate – The Longer, More Expensive Way to Leave Your Estate to Your Family

Often I tell clients that Probate is good for the attorney but not the Estate.  What I mean by that is that if you have to go through a Probate you are going to be faced with a long process and a large bill from your attorney. 

What is a Probate?

A Probate is a proceeding in court where the court determines who or whom will be inheriting the possessions of a deceased individual.  Basically the court is employed to determine who gets what.

How does a Probate Work?

When an individual passes away another party is required to contact the court and inform them of the individual’s death.  The individual who informs the court is called the Petitioner.  The Petitioner is placed in charge of making sure that all the bills of the deceased individual, or decedent, are paid and that at the end of the Probate Proceeding the proper individuals receive their portion of the deceased individual’s possessions.  The court must first make sure that everyone is alright with the Petitioner being in charge of the estate and the distributions, so they hold a hearing where others are given a chance to dispute the appointment of the Petitioner.  If no one objects to the appointment of the Petitioner the court will appoint the Petitioner as either the Executor, if there is a will, or the Administrator, if there is no will.  Once an Executor/Administrator is appointed they are required to notify creditors of the Probate Proceeding so that the creditors may inform the court of any money they are owed before it is distributed.  If the creditors do not notify the court of the money they are owed in a certain amount of time they will no longer be able to get their money.  Finally, when enough time is given to allow the creditors to notify the court of their debts the court approves the distribution of the property  of the decedent’s estate.

How Long Does a Probate Take?

A Probate Proceeding will take at least six (6) months to be completed from start to finish.  Once all of the paperwork is prepared for a Probate the Petitioner is required to post a notice of the Probate Proceeding for three (3) months in a newspaper where the decedent resided.  This notice is to inform any creditors of the proceeding so that they may inform the court of their desire to be repaid.  Once notice has been published for three (3) months the Petitioner must acquire a court date to have the account of expenses paid and the final distribution plan approved by the court.  You may be thinking to yourself, “Well that’s only three maybe four months tops, so why did he say at least six?”.  Right now, at least in California, the courts are underfunded and therefore very busy, the court’s schedule is very full, so when the Petitioner does request a court date it is most likely going to be scheduled three (3) months from the date the Petitioner requests it.  The biggest problem with this time frame is that it leaves the family of the deceased being constantly reminded of their passing.  For six (6) months there are updates, requests for information, paperwork that needs to be signed, and notices received reminding the family of their loss, which can be very hard for people.

How Much Does a Probate Cost?

A typical Probate costs $395 to file, plus the fees for the Probate Referee (an individual appointed by the court to assess the value of the estate), plus the attorney’s fees.

 Attorney’s fees can range from $10,000 to $20,000 or even more.  There are statutory fees, meaning there is a law that states what the attorney may charge for his/her services.  This law was put in place to ensure that attorneys were not overcharging their clients, but it has actually caused it to be the set price for an attorney to do that work.  It does not matter how much or how little work the attorney does, they are entitled to the amount set forth in the law.  The amount the attorney is paid is determined by how much the deceased person had, if their estate is worth more the attorney gets paid more.  Also with this statute the Petitioner/Executor/Administrator is paid statutory fees.  The fees of the attorney and the fees of the Petitioner are all taken out of the deceased individual’s possessions.  So before anything is given to the family of the deceased individual the attorney and the Petitioner are paid, which means that there is less for the family to get. 

Further, with a Probate proceeding there are fees for a Bond.  A bond is basically an insurance plan that is taken out by the Petitioner to insure that the Petitioner does not mess up when managing the property of the deceased individual.  This sounds great, why wouldn’t you want to have insurance to make sure that the property is not mismanaged?  Well, the reason you may not want a bond is because they can be costly depending on the Petitioner’s credit and how much property the deceased individual had, and that cost is deducted from the deceased individual’s property before the attorney takes his/her fees, before the Petitioner takes his/her fees, before the family gets what is theirs.  Most of the time the bond is not even needed.

Do you have to do a Probate?

If you properly set up your estate before you pass away you can make it so that your property does not have to go through this process before your family gets what you want them to get.  With the proper planning your estate can be instantly distributed upon your death.  The Law firm of Kinley & Styskal, http://www.kinleyandstyskal.com, works very hard for our clients before hand to make sure that Probate is avoided.

How can you avoid Probate?

There are techniques using the manner in which you are holding your property that can cause that property to not have to go through probate.  You can also transfer your property into a trust that would cause your estate to be small enough so that it does not have to go through probate.

How small does your estate have to be to not have to go through Probate?

Section 13100 of the California Probate Code states that if your estate is worth less than $150,000 you do not have to go through probate.  You do need to prepare paperwork for the court and the entities who are holding certain property, but that process is much easier than going through an actual probate.  It is recommended that you have an attorney prepare this paperwork since there are very specific things that the law requires in that paperwork.

I Have a Will, Does That Mean I Don’t Have to Go Through Probate?

No.  If you have a will it must go through Probate, unless all of your possessions add up to less than $150,000.  All wills must be Probated unless there is not enough value in the estate of the deceased person.

I Have a Trust, Does that Mean I Don’t Have to Go Through Probate?

It depends on how the trust is set up.  If you have actually transferred title of your property into the name of the trust that property will not have to go through Probate.  The problem is that often times people set up a trust and never actually transfer their property into the trust.  Often people think, “Oh, I have a trust and a pour-over-will (a will that states that all of the deceased person’s possessions are to be placed into the trust) so I don’t have to go through Probate.”  This is wrong!  Any will, even a pour-over-will must go through Probate.  If you have not specifically named your possessions in the trust or transferred title of your possessions into the name of the trust they are not in the trust.  The pour-over-will is the device that permits the court, through the Probate Process, to put those items into the trust, but not before incurring the costs and delays of a Probate Proceeding.

How Do I Know if My Estate is Set up Properly?

Hire an attorney.  If you contact the Law Offices of Kinley & Styskal we will be happy to sit down with you and look over your Estate Planning documents for no charge.  We do not charge you until you actually have us doing work.  We will gladly discuss your situation with you and let you know if we see any issues that might arise with your estate.  We are very familiar with all of the techniques that can be implemented to avoid probate and would be happy to help you utilize them.

 

Come to Kinely & Styskal, we pride ourselves in treating our clients like family!  We are a Loyal Family firm and We’ll Treat You Like Family! http://www.KinleyandStyskal.com

Posted in Uncategorized | Tagged , , , , , , , , | 2 Comments