FastCounsel

Detailed Answer

When an executor (personal representative) receives a creditor’s settlement demand, Maryland law requires careful review and documentation before payment or objection. Under Maryland Code, Estates & Trusts § 7-103 (https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=statr&section=7-103), creditors must present written claims within three months after first publication of the Notice to Creditors. The executor then has 60 days to allow or dispute the claim. To assess the demand and respond properly, gather the following:

1. Proof of Appointment

• Letters Testamentary or Letters of Administration: Certified documents issued by the Register of Wills showing your authority.

2. Decedent’s Records

• Certified Death Certificate: Needed to validate the estate and provide to institutions.
• Estate Inventory: Filed under Md. Code, Estates & Trusts § 7-201; lists assets and liabilities.

3. Notice to Creditors

• Copy of the published notice and proof of publication date. This triggers the three-month claim period under § 7-103.

4. Creditor’s Demand Package

• Demand Letter or Statement: Original correspondence (letter, email) with the amount claimed and itemization.
• Invoices, Billing Statements, or Account Ledgers: Detailed billing records showing how the balance arose.
• Contracts, Promissory Notes, or Leases: Underlying agreements that create the debt.
• Proof of Service: Certified mail receipts or courier records showing when and how the claim was delivered.

5. Security Documentation (if applicable)

• Deeds of Trust or Mortgages: Documents securing a claim against real property.
• UCC Financing Statements: If the creditor asserts a security interest in personal property.

6. Payments and Offsets

• Cancelled Checks or Electronic Payment Records: Evidence of any prior payments to the creditor.
• Correspondence on Adjustments: Agreements to reduce or compromise the debt.

7. Estate Accounting Records

• Receipts and Disbursements Ledger: Tracks all estate transactions to date.
• Bank Statements: Show available funds in estate accounts for payment.

Once you assemble these documents, compare the claim to estate assets and liabilities. If the claim appears valid, draft a settlement proposal or arrange payment. If you dispute the debt’s amount or validity, file a formal exception in the Orphans’ Court within 60 days of presentment. Always note deadlines to avoid automatic allowance or disallowance under Md. Code, Estates & Trusts § 7-103.

Helpful Hints

• Keep digital and hard-copy folders for each creditor claim.
• Note all dates: publication of notice, claim receipt, and deadlines to allow or dispute.
• Request certified copies of statutes from the Register of Wills if unsure.
• Consult probate court procedures in your county for filing exceptions.
• Maintain a communication log for calls and emails with creditors.

Disclaimer: This article is for educational purposes only and does not constitute legal advice. Consult a qualified Maryland attorney for guidance tailored to your situation.