Probate Bureaucracy
I hate probate, and I’ve hated it for a very long time. That doesn’t mean probate serves no legitimate purpose, because there are certainly situations where court supervision protects beneficiaries, forces accountability, or resolves disputes that otherwise might never get settled.
What I hate is what happens when the process stops being about protecting anyone and instead becomes an exercise in complying with technical requirements that make no practical difference to the result. When pinpoint accuracy in bureaucracy becomes more important than common sense, the estate spends more time, the lawyers and staff spend more time, and the beneficiaries usually end up paying for all of it.
That frustration came roaring back recently when I was filing an Inventory for an estate through the newer online portal used for North Carolina court filings. One of the assets listed on the Inventory consisted of more than $1 million in bonds, so I listed the value on the Inventory and put “see attached” next to the amount. We then separately uploaded the valuation printout showing the supporting information for that figure, which meant the court had the Inventory, the value, and the documentation supporting the value all in the same electronic filing submission. There was no missing asset, no unexplained number, and no question about what the attached valuation was supposed to document.
Electronically Rejected: A Modern Filing Glitch
The filing was rejected because the valuation printout was uploaded as a separate PDF instead of being physically combined into the same PDF as the Inventory. In other words, the court already had every piece of information it needed, but the documents were apparently sitting in the wrong electronic arrangement. We had to take the exact same Inventory and the exact same valuation printout, combine them into a single PDF, and submit the filing again. Nothing substantive changed; nobody learned anything new, and no beneficiary received any additional protection because two electronic files became one electronic file.
The Real Cost of Combining Two PDFs Into One
This is the kind of thing that makes both attorneys and clients shake their heads because somebody has to spend time fixing it. A staff member has to review the rejection, locate the documents, combine the PDFs, resubmit the filing, and then make sure the replacement filing is accepted. Legal work isn’t free, and even when the amount of time involved in one incident is relatively small, these little procedural detours add up over the course of an estate administration.
The beneficiaries are ultimately paying for people to rearrange electronic paperwork because common sense doesn’t always win when a bureaucracy decides that form matters more than substance.
My frustration with this kind of nonsense goes back much further than electronic court filing systems. During the COVID lockdowns, probate work didn’t stop, but almost everything associated with it became slower and more cumbersome. Courts were operating under new procedures, banks were restricting access, businesses were trying to limit in-person contact, and everyone was being told to avoid unnecessary trips into public places.
Simple Request — Reorder Checks, Mail Them to the Same Address
In one estate, I was actually serving as the court-appointed Administrator, and I needed to reorder checks for the estate checking account at a very large Bank “in” America. This should have been one of the easiest tasks imaginable, so I had my probate assistant call the bank while I joined the beginning of the call on speakerphone. I verified who I was, explained that I was the Administrator, and authorized the bank to speak with my assistant for the limited purpose of reordering checks and having them mailed to the address already on file. The bank representative said they understood, so I went back to work while my assistant stayed on the phone. About 20 minutes later, she came into my office and told me the bank needed me to get back on the phone because they wanted me to authorize her again.
When I got back on the call, the representative asked whether what I really wanted was to add my assistant to the account as an authorized signer. I responded, “ABSOLUTELY NOT,” because I was the court-appointed Administrator and the only person I wanted authorized to control that estate account. I explained again that I was not trying to give my assistant the power to write checks, withdraw money, or do anything else with the estate funds. I simply wanted the bank to speak with her long enough to reorder checks and mail them to the address the bank already had in its own
records.
And The Probate Bureaucracy Continues
The bank responded as though this were entirely new information and said they would restart the process. I went back to work again, assuming the problem had finally been cleared up, but about 15 minutes later my assistant came back into my office because the bank needed me to authorize her yet again. I got on the phone, gave the authorization yet again, and returned to what I had been doing. A few minutes later, my assistant finally came in and told me the bank had reached its ultimate conclusion: they could not reorder the checks over the phone at all.
That meant that during the height of the COVID lockdowns, when everyone was being told to avoid unnecessary public contact, I had to physically go into a bank branch so the bank could reorder checks and mail them to the address it already had on file. The bank was not being asked to transfer money, change ownership, add another signer, or send the checks somewhere new. It simply refused to mail more checks to the existing address unless I first went into a physical building and interacted with other people during a pandemic. That was probate bureaucracy colliding with corporate bureaucracy, and there was no benefit to the estate or the beneficiaries from any part of the exercise.
Reopening an Account Just to Pay for Paperwork
An even older story came from another attorney who had reached the very end of an estate administration and submitted the Final Accounting. Everything balanced down to the penny, and the supporting documentation was exceptionally thorough. For every transaction, the attorney had an invoice, a copy of the cancelled check, and a highlighted entry on the bank statement showing that the amount had actually been deducted from the account. This was long enough ago that banks were still returning the actual cancelled checks rather than giving customers a sheet filled with tiny images of them, so the file contained an enormous amount of documentation proving where every dollar went.
There was one medical bill for less than $100 where the cancelled check could not be found. The file still contained the invoice from the clinic, and the bank statement showed a payment for the exact amount of that invoice with a notation that the payment went to the clinic. The accounting balanced perfectly, there was no dispute that the bill was legitimate, and there was no realistic question that the payment had been made. The court nevertheless refused to close the estate without a copy of that one cancelled check.
The attorney then had to contact the bank and order another copy of the cancelled check, and the bank charged $5 for producing it. The problem was that the estate checking account had already been closed because all of the bills had been paid and the estate was supposed to be finished. The account had to be reopened, money had to be deposited so the $5 charge could be paid, and then the Final Accounting had to be revised because there was now a brand-new $5 estate expense that had not existed when the original accounting was prepared. The requirement for one additional piece of documentation actually created another financial transaction, which then created the need for still more accounting work.
That story captures almost perfectly what drives me crazy about probate. The court already had an invoice showing what was owed, a bank statement showing that the exact amount had been paid to the exact provider, and an accounting that balanced to the penny. Requiring the cancelled check didn’t uncover fraud, correct an error, or protect a beneficiary from a missing asset. It simply created another expense and more work because the paperwork was not complete in exactly the way the system required.
The Cost of Probate
This is why I tell clients that the cost of probate isn’t limited to filing fees and attorney fees that can be listed neatly on a spreadsheet. Probate also carries the cost of delay, repetitive paperwork, unnecessary follow-up, and the countless small procedural requirements that have to be satisfied before the estate can finally be closed. Some of those requirements are important, and some are necessary to protect beneficiaries or creditors, but others are the legal equivalent of being told to move the same stack of paper from one side of the desk to the other because that’s where the rules say it belongs.
A properly drafted and properly funded Revocable Living Trust can often keep a large portion of an estate outside of the probate system entirely. That doesn’t mean there’s no work after someone dies, because trust administration still requires assets to be identified, bills to be paid, taxes to be handled, and beneficiaries to receive what they are entitled to receive. The major difference is that much of that work can be handled privately without repeatedly asking a court for permission, approval, or confirmation that the paperwork has been assembled in precisely the required format.
For many families, that difference can save substantial time, reduce expenses, and eliminate a tremendous amount of frustration.
After decades of seeing this happen, my hatred of probate isn’t theoretical. It comes from watching families spend money fixing technical problems that don’t change the underlying facts, watching attorneys and staff burn time satisfying requirements that accomplish very little, and watching common sense lose to bureaucracy over and over again.
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If I can structure a client’s estate plan so the family can avoid as much of that process as legally and practically possible, that’s exactly what I want to do.
If you want to learn more about how proper estate planning can help your family avoid unnecessary court involvement and reduce the headaches that come with probate, download my estate planning e-book at www.estateplanningebook.com.