Disclaimer: This article is for educational purposes only and does not constitute legal advice. Consult a licensed attorney to discuss your specific situation.
Detailed Answer
When someone dies in Hawaii, the appointed personal representative (executor or administrator) must notify creditors and manage claims under the Hawaii Probate Code (Chapter 560, Hawaii Revised Statutes).
1. Identify Known Creditors
Start by reviewing the decedent’s financial records—bills, statements, loan documents, credit cards and medical statements. Create a list of all potential claimants.
2. Mail Notice to Known Creditors
Within 30 days of appointment, the personal representative must mail each known creditor a notice of administration. This notice must comply with HRS §560:3-901 and include key dates and the address for filing claims. See HRS §560:3-901: Notice to creditors and HRS §560:3-902: Contents of notice.
3. Publish Notice to Unknown Creditors
Within 30 days of appointment, publish the same notice once a week for three consecutive weeks in a newspaper of general circulation in the county where probate is pending. This alerts creditors without specific addresses.
4. Observe the Deadline for Claim Filing
Creditors must present their claims no later than the later of:
– Four months after the first date of publication, or
– Three months after service of the mailed notice.
(HRS §560:3-903: Time for filing claims.) Claims filed after this period are barred.
5. Review, Allow, or Reject Claims
When a claim arrives, the personal representative must review it and decide whether to allow or reject it. Under HRS §560:3-1101, you must provide written notice of allowance or rejection within two months of filing. See Allowance or rejection of claims.
6. Pay Allowed Claims in Order of Priority
After claims are allowed, the personal representative pays them from estate assets. Hawaii law sets priorities in HRS §560:3-803. Typical order is funeral expenses, administration costs, taxes, secured claims, then unsecured claims.
7. Handle Disputes and Court Actions
If a creditor disagrees with rejection, they may petition the probate court to resolve the dispute. Likewise, if assets remain after payments, the personal representative petitions for final distribution.
Helpful Hints
- Keep detailed records of all notices, publications and mailed dates.
- Use certified mail with return receipt to track notices to known creditors.
- Maintain a calendar of deadlines to protect the estate from surprise claims.
- Set aside funds for anticipated claims before distributing assets.
- Consult an experienced probate attorney if creditors or heirs dispute claims.