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How Florida Probate Rules Prevent Creditors From “Jumping The Line”


When administering a Florida estate, the executor or personal representative must pay any debts or expenses of the estate from the available assets. If there are insufficient assets to pay everyone, the law spells out the order in which different classes of creditors are paid. For example, the highest class is the expenses related to the administration of the estate itself. The next-highest class is funeral expenses. Altogether, there are eight classes.

Creditor Cannot Use Judgment Lien to Directly Foreclose on Decedent’s House

A creditor is not allowed to “jump the line,” as it were and demand payment before creditors belonging to a higher class. Take this recent decision from the Florida Second District Court of Appeal, Jones v. McKinney, where one estate sued another estate for actions that took place when both decedents were alive. The creditor estate then attempted to place a lien on the only asset of the debtor estate.

The decedents were two women, named Loretta and Adelaide. While they were alive, Loretta exploited and stole property from Adelaide. After Loretta died, Adelaide filed a creditor’s claim against her estate. This led to a lawsuit against the estate, which yielded a civil judgment of $2.2 million.

As is common practice when a creditor obtains a civil judgment, Adelaide proceeded to record a judgment lien against Loretta’s property in Charlotte County, Florida. This property was also the only asset of Loretta’s estate. Loretta’s executor tried to sell the home, but Adelaide’s estate–she died at some point during these proceedings–asked the court for permission to execute on the lien itself.

Loretta’s estate objected, noting that civil judgments were class 8 claims under Florida probate–i.e., the lowest priority debts. The proper course of action would therefore be to permit Loretta’s estate to sell the property and apply the proceeds to the debts and expenses of the estate as specified by state law.

The probate court, however, ruled in favor of Adelaide’s estate. On appeal, the Second District reversed that decision. The appellate court agreed with Loretta’s estate that the judgment held by Adelaide’s estate was of no greater priority than any other creditor claim.

Where the probate court apparently confused things was that Florida law does make an exception to the order of priority for liens against a specific property, such as a mortgage. But a civil judgment is not a lien against any specific property. Rather, it is a lien against any real property in the county where it is recorded. Such general liens do not enjoy any greater priority than normal.

Contact a Florida Probate Litigation Lawyer Today

If you are involved in a legal dispute involving a probate estate, it is important to seek out advice from attorneys knowledgeable in this area. To speak with a qualified Pompano Beach probate and trust litigation attorney, contact the offices of Mark R. Manceri, P.A., today to schedule a consultation.



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