Detailed Answer
Short answer: In Delaware, the probate court typically requires a bond (also called a surety bond or fiduciary bond) from a person appointed to serve as an administrator of an intestate estate. The court sets the bond amount to protect the estate’s creditors and heirs. In some circumstances the court can reduce or waive the bond requirement — for example when all heirs consent, when a will expressly waives bond, when the proposed administrator is a corporate fiduciary already bonded, or when the court finds waiver is appropriate. This article explains what a bond is, why courts require it, how Delaware probate generally handles bond questions, and how you might seek a reduction or waiver.
What is a probate (fiduciary) bond?
A probate bond is an insurance-style guarantee that the personal representative (administrator for an intestate estate) will faithfully carry out duties: collect assets, pay debts and taxes, and distribute what remains to heirs. If the administrator mismanages estate assets, the bond compensates the estate for losses.
Why does Delaware require a bond?
The Delaware Court of Chancery (and the Register in Chancery or other probate forum handling small estates) requires security to protect creditors and beneficiaries when someone takes control of estate property. The bond helps ensure the administrator does not misuse funds and that there is a financial remedy if they do.
How is the bond amount set?
The court sets the bond amount based on the estate’s circumstances. Factors the court considers typically include the value of cash and personal property, anticipated receipts (e.g., life insurance proceeds), potential income during administration, and foreseeable liabilities. The court has discretion to require higher security when the estate is large or complicated and lower security when the estate is small or when other protections exist.
Who ordinarily must post the bond?
A proposed administrator appointed by the court must post the bond before receiving authority to act in most cases. The court issues letters of administration only after required conditions, including security, are satisfied.
When can the bond be waived or reduced in Delaware?
Common situations where the bond can be waived or reduced include:
- Unanimous written consent from all heirs or interested parties. If every person who would inherit signs a written waiver or consent, the court often will waive or reduce the bond.
- Designated waiver in a will. (Note: this applies to appointed executors under a will; in intestacy there is no will to waive bond in advance.)
- Appointment of a corporate fiduciary or bank that already provides institutional security and is regulated. Courts often accept institutional qualifications in lieu of a separate bond.
- Small or simple estates. When the estate’s assets are nominal or the administration is straightforward, the court may reduce the bond amount or dispense with it.
- Demonstrated good cause. The administrator can file a motion showing why the bond should be reduced or excused — for example, if a close family member is the sole beneficiary and all parties agree.
Because Delaware law vests the court with discretion, the judge will evaluate proof, signed consents, the size and nature of the estate, creditor exposure, and any objections before deciding whether to waive or lower the bond.
How do you ask the court to waive or reduce the bond?
- Notify interested parties. Give required notice to heirs, creditors, and parties with an interest in the estate. The court’s local rules explain notice procedures.
- File a formal petition or motion with the register or court asking for waiver or reduction. Attach written consents from beneficiaries if available.
- Provide supporting documentation. Include estate asset estimates, reasons for the request (e.g., sole heir, nominal assets, corporate fiduciary), and any proposed alternatives (e.g., limited bond amount or restricted authority without bond).
- Attend the hearing. The court may hold a hearing before ruling. Be prepared to explain why waiver serves justice and protection of the estate.
If a bond is required, how do I obtain one?
You can obtain a fiduciary bond from a surety company or bonding agent. The bonding company evaluates the proposed administrator’s credit and charges a premium (a percentage of the bond amount). The court accepts the bond once it is issued in the required form and amount.
Practical examples (hypothetical)
Example 1 — Small estate: A decedent leaves a modest checking account and personal items worth little. The decedent’s adult child is the sole heir and everyone signs a written waiver. The court may waive the bond or set a nominal bond.
Example 2 — Large estate with multiple heirs: The estate includes bank accounts, investment accounts, and an interest in a family business. Heirs do not all consent. The court will likely require a substantial bond to protect the estate.
Where to read Delaware law and local procedure
Delaware statutes governing decedents’ estates are found in Title 12 of the Delaware Code. For statutory text and chapter listings see: Delaware Code, Title 12 — Decedents’ Estates. For practical probate forms and local court procedures, check the Delaware Courts website for probate/chancery practice or contact the Register in Chancery in the county where the decedent lived.
Important: The court’s practice and the exact paperwork vary by county and by whether the Chancery Court or a register handles the administration. The court has wide discretion. If you expect disputes, large assets, or creditor claims, consider getting professional advice.
Disclaimer: This article is for general information and educational purposes only. It is not legal advice and does not create an attorney-client relationship. For advice about your specific situation, consult a licensed Delaware attorney or the probate/register’s office where you will file.
Helpful Hints
- Check Title 12 of the Delaware Code for statutory language and refer to the court’s local probate rules: https://delcode.delaware.gov/title12/
- Before petitioning, identify all heirs and potential creditors so you can serve proper notice and gather consents if possible.
- If everyone who would inherit signs a written waiver, bring those signed consents to the court with your petition — written consents carry more weight than oral agreements.
- Consider a professional fiduciary or bank when estate assets are large or complex; many courts accept institutional fiduciaries without additional bonding concerns.
- Get a bond premium quote early. Bond companies require personal and credit information and can give you the expected cost as a percentage of the bond amount.
- If you anticipate disputes among heirs, expect the court to require a bond; plan administration steps accordingly.
- If you cannot afford a bond, ask the court about alternatives such as limited letters of administration, inventory-only authority, or appointment of a special administrator with limited powers.
- Keep clear records and provide periodic accounting to reduce the likelihood of claims against the bond.