A personal representative bond (probate and fiduciary surety bond class) guarantees the diligent and honest conduct of the personal representative. State probate codes almost universally allow this appointed estate administrator to bill the estate for his or her services. Compensation for the representative’s time and expenses is appropriate and equitable. Personal representative bond & fair compensation questions arise when calculating reasonable compensation for those costs even where they are statutorily defined. Fortunately, an esteemed colleague has offered some instructive advice.
Attorney Matt McDavitt in his piece for the NLRG (ed. July, 2023) states, “A common issue to be resolved in any administration of a decedent estate is the determination of the rightful value of the compensation due to the serving personal representative. While the will of the decedent may validly dictate the amount of compensation due to the serving personal representative (though, subject to judicial scrutiny), more commonly, the value of such fiduciary compensation follows statutory strictures. Lacking an appropriate testamentary personal representative compensation provision, states employ an array of calculation methods to determine the proper value of such remuneration, . . .”
McDavitt cites formulas pursuant to both DC and California Code and Rules of Court are instructive, however there are jurisdictions that are not as helpful. The author references Tennessee Chancery Rule 19 which appears to deviate from the simple application of a schedule of percentages based on estate asset values. “hus, while some states allow percentage-based commissions based on the value of the estate assets in fact administered by the personal representative, and other jurisdictions look at the hours reasonably and necessarily expended by the personal representative in administering the estate, as well as the fair hourly rate in the region for equivalent work, taking into the account the relative complexity of the estate in question, whether litigation was involved, and similar factors, still other states allow either approach to be employed in the fee calculus.” McDavitt’s inclusion is prescient. Courts continue to exercise broad authorities to determine “fair and just”.
Underwriting of personal representative bonds requires review by a surety specialist with knowledge about fiduciary law in the jurisdiction where the bond will be filed and experience with personal representative bond obligations generally. Surety bond leader, Surety One, Inc., specializes in probate bonds. We offer these surety bonds nationally, in Puerto Rico, Canada and U.S. Virgin Islands. Application submissions are reviewed and quoted on the same day as they are received. We are the MOST RESPONSIVE surety bond underwriter in the business.
