Trust and Estate Law
Bette Heller, J.
The Affidavit for Small Estates: How, When, and Why to Use It
This is a follow-up to a June 2013 article about the statutes governing affidavits for small estates. The initial article, written by a Trust and Estate Section subcommittee, discussed problems with the statutes as they existed at that time. Since then, the committee proposed statutory amendments to alleviate those problems. This article reviews those amendments, which became effective August 1, 2014.
CRS §§ 15-12-1201 and -1202, the “affidavit statutes,” are a part of the Colorado Probate Code and provide for the easy and cost-efficient collection of personal property in small estates. These statutes allow parties to avoid the expense of court proceedings and help alleviate ever-increasing loads on already overcrowded court dockets.
This article discusses the history of the affidavit statutes and the procedure for using an official affidavit to collect personal property in small estates.
Evolution of the Affidavit Statutes
procedure for collecting personal property of a decedent
without opening a probate proceeding has been available in
Colorado since 1963. In addition to the statutes, there is an
Affidavit Form for the collection of personal property of a
decedent (Affidavit or JDF 998)
The amount of personal property that can be collected with the Affidavit has traditionally been tied to the exempt property and family allowance amounts available to a surviving spouse and minor children under CRS §§ 15-11-403(1)(b) and -404(1). The rationale for this is to allow a decedent’s family to collect these amounts without the expense of a probate proceeding, because these amounts are not subject to creditor claims. It should be noted that real property cannot be collected or transferred by using an Affidavit.
In spring 2012, a subcommittee of the CBA Trust and Estate Section’s Statutory Revisions Committee (SRC) began meeting to discuss the customary practice and uses of the Affidavit, to compare those uses with the language of the statutes, and to discuss possible amendments of the statutes to codify those uses. The subcommittee found that the statutes were not always consistent with the Affidavit or the Instructions, and that there was confusion about how the Affidavit could be used. The subcommittee decided to begin by writing an article on the subject, which alerted practitioners that there was not uniform agreement in the interpretation and uses of the statutes. The article was published in the June 2013 issue of The Colorado Lawyer,3 and discussed the following topics:
• Who can sign an Affidavit?
• Who can collect the decedent’s personal property?
• What is the potential liability of a person collecting the property?
• Whom is the holder of property authorized to deliver the property to?
• What is the liability of the holder of property?
• What property can be collected with an Affidavit?
• Can the Affidavit be used to collect personal property if the decedent owned real property?
While the subcommittee was working on the article, a CBA member informed the SRC that the newly appointed general counsel for credit unions believed that the affidavit procedure did not apply to credit unions, but only to commercial banks. In response, the SRC quickly added a section to the Trust and Estate Section’s 2013 Omnibus Bill to amend CRS § 15-12-1201(1) to include the words “funds on deposit at any financial institution” in the description of personal property covered by the affidavit procedure, clarifying that credit union accounts were subject to collection by Affidavit.
After the article was published, the SRC authorized the subcommittee to work on changes to the statutes that would alleviate the confusion and contradictions that were pointed out in the article. These changes were made part of the Trust and Estate Section’s 2014 Omnibus Bill and became law effective August 1, 2014.
What Did the Statutes Say in 2013?
Before the 2014 amendments, the affidavit statutes provided:
§ 15-12-1201. Collection of personal property by affidavit.
(1) At any time ten or more days after the date of death of a decedent, any person indebted to the decedent or having possession of any personal property including but not limited to funds on deposit at any financial institution, tangible personal property, or an instrument evidencing a debt, obligation, stock, chose in action, or stock brand belonging to the decedent shall pay or deliver such property to a person claiming to be the successor of the decedent upon being presented an affidavit made by or on behalf of the successor stating that:
(a) The fair market value of property owned by the decedent and subject to disposition by will or intestate succession at the time of his or her death, wherever that property is located, less liens and encumbrances, does not exceed sixty thousand dollars;
(b) At least ten days have elapsed since the death of the decedent;
(c) No application or petition for the appointment of a personal representative is pending or has been granted in any jurisdiction; and
(d) Each claiming successor is entitled to payment or delivery of the property in the respective proportion set forth in such affidavit.
(2) A transfer agent of any security shall change the registered ownership on the books of a corporation from the decedent to the successor or successors upon the presentation of an affidavit as provided in subsection (1) of this section.
(3) The public official having cognizance over the registered title of any personal property of the decedent shall change the registered ownership from the decedent to the successor or successors upon the presentation of an affidavit as provided in subsection (1) of this section.
§ 15-12-1202. Effect of affidavit. The person paying, delivering, transferring, or issuing personal property or the evidence thereof pursuant to affidavit is discharged and released to the same extent as if he dealt with a personal representative of the decedent. He is not required to see to the application of the personal property or evidence thereof or to inquire into the truth of any statement in the affidavit. If any person to whom an affidavit is delivered refuses to pay, deliver, transfer, or issue any personal property or evidence thereof, it may be recovered or its payment, delivery, transfer, or issuance compelled upon proof of their right in a proceeding brought for the purpose by or on behalf of the persons entitled thereto. Any person to whom payment, delivery, transfer, or issuance is made is answerable and accountable therefor to any personal representative of the estate or to any other person having a superior right.
What Changed in 2014?
The basic requirements for using an Affidavit have not changed and remain in CRS § 15-12-1201(1):
• The fair market value of all probate assets owned by the decedent, less liens and encumbrances, cannot exceed a specific amount.
• At least 10 days must have passed since the date of death.
• No application for probate can exist anywhere.
• Only personal property can be collected with the Affidavit.
Amount Subject to Collection by Affidavit
Before 2012, the combination of the exempt amount and family allowances equaled the Affidavit amount. The exempt amount was $26,000, and although...