SECTION 3-317.
UNIVERSAL SUCCESSION; UNIVERSAL SUCCESSORS’ LIABILITY TO CREDITORS, OTHER
HEIRS, DEVISEES AND PERSONS ENTITLED TO DECEDENT’S PROPERTY; LIABILITY OF OTHER
PERSONS ENTITLED TO PROPERTY Uniform Probate Code
(a) In the
proportions and subject to the limits expressed in Section 3-321, universal
successors assume all liabilities of the decedent that were not discharged by
reason of death and liability for all taxes, claims against the decedent or the
estate, and charges properly incurred after death for the preservation of the
estate, to the extent those items, if duly presented, would be valid claims
against the decedent’s estate.
(b) In the
proportions and subject to the limits expressed in Section 3-321, universal
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successors are
personally liable to other heirs, devisees, and persons entitled to property of
the decedent for the assets or amounts that would be due those heirs, were the
estate administered, but no allowance having priority over devisees may be
claimed for attorney’s fees or charges for preservation of the estate in excess
of reasonable amounts properly incurred.
(c) Universal
successors are entitled to their interests in the estate as heirs or devisees
subject to priority and abatement pursuant to Section 3-902 and to agreement
pursuant to Section 3-912.
(d) Other
heirs, devisees, and persons to whom assets have been distributed have the same
powers and liabilities as distributees under Sections 3-908, 3-909, and 3-910.
(e) Absent
breach of fiduciary obligations or express undertaking, a fiduciary’s liability
is limited to the assets received by the fiduciary.
Comment
The purpose of
succession without administration is not to alter the relative property
interests of the parties but only to facilitate the family’s expeditious
settlement of the estate. Consistent with this, the liability arising from the
assumption of obligations is stated explicitly here to assist in understanding
the coupling of power and liability. Subsection (b) includes an abatement
reference that recognizes the possible adjustment that may be necessary by
reason of excess claims under UPC Section 3-902.
In succession
without administration, there being no personal representative’s notice to
creditors, the short non-claim period under UPC Section 3-803(a)(1) does not
apply and creditors are subject to the statutes of limitations and the
limitation of three years on decedent’s creditors when no notice is published under
UPC Section 3-803(a)(2). The general statutes of limitation are suspended for
four months following the decedent’s death but resume thereafter under UPC
Section 3-802. The assumption of liability by the universal successors upon the
issuance of the Statement of Universal Succession is deemed to be by operation
of law and does not operate to extend or renew any statute of limitations that
had begun to run against the decedent. The result is that creditors are barred
by the general statutes of limitation or 3 years whichever is the shorter.
The obligation
of the universal successors to other heirs, devisees and distributees is based
on the promise to perform in return for the direct distribution of property and
any limitation or laches begins to run on issuance of the statement of
universal succession unless otherwise extended by action or assurance of the
universal successor.
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It should be
noted that this statute does not deal with the consequences or obligations that
arise under either federal or state tax laws. The universal successors will be
subject to obligations for the return and payment of both income and estate
taxes in many situations depending upon the tax law and the circumstances of
the decedent and the estate. These tax consequences should be determined before
electing to utilize succession without administration.
