Upon an individual’s death, a legal entity called an “estate” is created which includes all of the property owned by the decedent. A personal representative or executor, chosen by the decedent prior to his/her death, is charged to administer and direct the assets in the estate. The assets in the estate are subject to creditors for expenses and liabilities of the estate. When we initially consult with family members, an important question arises regarding whether a Personal Representative could be personally liable for the debts and liabilities of an estate.
Debts and liabilities of an estate could include mortgages, credit card debt, medical expenses, car loans, and personal loans. Can a person be held personally liable for these expenses if they choose to serve as personal representative of an estate? The general answer is “no”. A personal representative administering an estate cannot be held personally liable for these debts. Even if these debts make the estate insolvent, the personal representative cannot be held liable for any shortfall.
There is an exception to this general rule if the personal representative commits any mistakes or negligence in the administration of the estate. In Florida, personal representatives are required to have an attorney represent them in an estate. Obtaining competent and specialized legal representation can eliminate the risk of mistakes or negligence in administration. Additionally, intentionally bad acts, such as stealing or misappropriating the assets of an estate, are another way that a personal representative may subject themselves to personal liability. If such acts exists, creditors can hold the personal representative responsible for any damage caused.