The Other Probate: A Guide to Ancillary Administration in West Virginia
May 23, 2019
By: Katie L. Monroe
The Initial Probate
Most people are familiar with the concept of probating an estate upon the death of the decedent. The administration of the decedent’s estate is initiated in the county and state where the decedent lived at the time of his or her death, known as the decedent’s domicile. Depending on the state in which the decedent lived, the estate administration procedure may be different if the decedent died with or without a will. During the initial estate administration, assets such as: real estate (located in the domicile state), tangible personal property, bank accounts, stocks, bonds, and other investment accounts are gathered and administered. This probate is often referred to as the domiciliary estate administration. However, with the mobility of today’s society, many decedents also own real estate located in other states at the time of their death.
So what happens if a nonresident decedent dies owning an interest in real property located in West Virginia?
The Other Probate
For these estates, the domiciliary personal representative must arrange for the ancillary administration of the estate in West Virginia. By definition, ancillary administration means the “administration of assets in a foreign state.” i Ancillary administration is necessary when the nonresident decedent owned real estate located in West Virginia, including fractional interests in oil, gas, or other minerals. Under West Virginia common law, title to real estate passes to the heirs at law or the beneficiaries under a will immediately upon the decedent’s death, subject only to the claims of creditors.ii The ancillary estate administration process provides notice to creditors and creates a record of the proper successors to the title of the real property.
Until recently, there was only one available procedure for ancillary administration under the West Virginia Code. To begin, the domiciliary personal representative must obtain exemplified or authenticated copies of the full estate records, including the will, from the county and state where the estate was initially probated. The personal representative must then travel to West Virginia and present a death certificate along with the exemplified or authenticated copies of the estate records to the clerk of the county commission in any county in which the nonresident decedent owned real estate. There is no mechanism under this procedure allowing the ancillary administration and qualification of the ancillary personal representative without the physical appearance of the personal representative in West Virginia to qualify. If bond is not waived under the will, the ancillary personal representative may be required to obtain a bond equal to the amount of the assets located in West Virginia. Once the ancillary personal representative has been appointed in West Virginia, he or she will file an Appraisement of the Estate (“appraisement”) which reports and values the West Virginia real property. Once the period for the filing of creditor claims has expired, the personal representative can file the Waiver of Final Settlement or Final Settlement and close the estate. This process usually takes between 6 to 9 months to complete and can be expensive.
If the decedent owns real estate in more than one West Virginia county, the ancillary personal representative will only qualify in one county. After qualification, the ancillary personal representative simply records a certified copy of the will (or affidavit of heirs if the decedent died without a will) along with the appraisement of the estate and final settlement in each county in which the decedent owned real property. This is a critical, but often forgotten, step in the administration process, especially when the decedent owns fractional mineral interests in multiple West Virginia counties.
If the personal representative is unable or does not wish to travel to West Virginia to personally qualify, they can decline to serve as the ancillary personal representative and consent to the appointment of a successor. This requires the execution of a declination or waiver by the named personal representative under the will. Once the declination has been tendered, a successor ancillary personal representative may be appointed. The successor ancillary personal representative may be the alternate executor named under the will, another relative, or a local attorney.
Over the years, the real property assets of nonresident decedents located in West Virginia have failed to be administered. Often this was due to the cost of the ancillary administration procedure outweighed the value of the real property interest. As time and generations have passed, the lack of estate records for out of state decedents has created many issues in locating lost, missing, and unknown heirs. Ultimately, this may result in the loss of the ownership interest in the real property.
HB 2759: The Alternative Non-administration
But there is hope! During the 2019 regular legislative session, the West Virginia Legislature passed House Bill 2759 which provides for an alternative, streamlined ancillary administration for West Virginia real estate owned by nonresidents by affidavit and without full administration.
What does this mean? Beginning May 30, 2019 (90 days from the date of passage), an out of state personal representative will no longer be required to travel to West Virginia to personally appear and qualify as the ancillary personal representative for a nonresident decedent or post a fiduciary bond. This can be a significant savings to the estate.
Under the new non-administration procedure, the domiciliary personal representative or other interested party will be able to record authenticated or exemplified copies of the estate administration documents in any county in which the nonresident decedent owned real property without personally qualifying as the ancillary personal representative.iii
Additionally, the personal representative will execute and tender an Affidavit for Ancillary Administration of West Virginia Real Estate Without Appointment. In short, the Affidavit sets forth a description of the real estate owned by the nonresident decedent and the names and addresses of the beneficiaries or heirs of the estate who are entitled to the property, either under the decedent’s will or by intestate succession.
It is important to remember that when a decedent dies intestate, West Virginia intestacy law applies to the distribution of any real estate located in this state. This could result in a different distribution of the West Virginia real estate as compared to the assets located in the decedent’s home state.
Once the affidavit has been submitted, a notice of the ancillary administration is published once a week for two consecutive weeks and the notice is served on the surviving spouse, beneficiaries under the will or heirs, and any known creditors of the estate.iv Any objection against the estate must be filed within 60 days after the date of the first publication or 30 days after service of the notice, whichever is later.v If an objection is not timely filed, the objection is forever barred.vi If there are no objections to the non-administration of the estate in West Virginia, the ancillary administration is completed and closed.
Since this is a non-administration of the estate in West Virginia, the formalities of a full estate administration, such as the filing of the appraisement and non-probate inventory, are not required. However, if during the non-administration an objection is raised and sustained, the county commission could require the full and complete ancillary administration of the estate for the nonresident decedent.vii If no objections are filed, it is anticipated that this alternate process will take approximately 3 to 4 months to complete.
The attorneys at Jackson Kelly PLLC are ready to assist you with the administration and transfer of real property interests in West Virginia for a nonresident decedent. Please call us to discuss your individual situation.
Author: Katie L. Monroe, Counsel, Land Minerals and Properties Practice Group
© May 2019 Jackson Kelly PLLC