Disclaimer: This article is for educational purposes only and does not constitute legal advice.
Detailed Answer
Under Mississippi law, an executor must confirm the estate’s available funds before settling any creditor claim. This process ensures proper payment priority and shields the executor from personal liability.
1. Inventory and Appraisal of Estate Assets
Within 90 days of appointment, the executor must collect, inventory, and appraise all estate property. See Miss. Code Ann. § 91-7-201 for duties related to inventory and appraisal. (Miss. Code Ann. § 91-7-201.)
2. Notice and Filing Deadlines for Creditor Claims
After appointment, the executor must publish notice to creditors. Creditors then have 12 months from the date of publication to file claims. Late claims are barred except for secured or preferred claims. (Miss. Code Ann. § 91-7-353.)
3. Assess Liquid vs. Non-Liquid Assets
Review all cash, bank accounts, investments, and tangible property. Confirm the estate has enough liquid assets to cover claims. If funds fall short, the executor may need to sell assets or negotiate partial settlements under court supervision.
4. Pay Creditors in Statutory Order
Mississippi law establishes a payment hierarchy: administrative expenses (including executor fees), funeral costs, taxes, secured claims, and then unsecured claims. Paying in the correct order prevents disputes and personal exposure. (Miss. Code Ann. § 91-7-317.)
5. Final Accounting and Executor Discharge
Once claims are settled, the executor prepares a final accounting showing all receipts and disbursements. The court reviews this accounting before granting discharge. Proper accounting underpins the executor’s safe release from future liability.
Helpful Hints
- Keep precise records of all estate transactions and communications with creditors.
- Use certified mail for sending notices and receiving claim responses.
- Maintain a separate estate bank account to avoid commingling personal and estate funds.
- Consider a court-approved sale if assets are illiquid but creditors require payment.
- Consult a probate attorney if claims are complex or disputes arise over available assets.