FINDING AND RECOVERING ASSETS – CITATION PROCEEDINGS – PART 1
One of the duties of the estate representative is to make a thorough search for all property of the decedent. All of the property that belongs to the estate is then reflected on the inventory or inventory report. Most financial information can be located by a thorough search of the decedent’s financial records and by a review of the decedent’s will, income tax returns, and bank accounts, especially checking accounts. Tangible personal property – furniture, clothing, and other possessions – must also be listed.
What happens when property is “missing”? Records regarding money or other intangible assets should be obtained as soon as possible, because most financial institutions do not keep records for more than seven years. A letter from the attorney for the estate may be sufficient to get copies of missing or additional records. The financial institution may however, want letters of office or even a direction signed by the representative. If necessary, the records can be subpoenaed. The search for tangible personal property can be more difficult. It is important to first put together as detailed a list as possible of the items that are missing. Information for the list can be obtained from relatives, neighbors, friends, or even photographs.
After this initial investigation, the representative and the attorney must decide whether or not it is economically feasible to pursue recovery of the missing assets. Especially with regard to tangible personal property, unless the representative and attorney know specifically who has the property and where it is located, it is usually not economic to seek its recovery, because such property is usually of such limited value. Jewelry, works of art, collectibles, and other more valuable items may, however, be worth pursuing.
There are many ways outside of Probate to bring property into an estate. A separate proceeding can be brought in some other division of the Court. Examples include actions dealing with title and possession of real estate, for imposition of a constructive trust, for partition, for accounting, for injunction, for collection of money, for dissolution of partnerships and corporations, etc. A listing of the full range of actions and remedies available is beyond the scope of this article. The representative steps into the shoes of the decedent, and he or she may then pursue any and all actions that the decedent could. The representative and attorney must decide on a case-by-case basis whether they wish to proceed in Probate or somewhere else by a different action.
The statutory mechanism set out in the Probate Act is to institute Citation proceedings. The Citation statute is as follows:
§16-1. Citation on behalf of estate.
(a) Upon filing a petition therefor by the representative or by any person interested in the estate or, in the case of an estate of a ward by any other person, the court shall order a citation to issue for the appearance before it of any person whom the petitioner believes (1) to have concealed, converted or embezzled or to have in his possession or control any personal property, books of account, papers or evidences of debt or title to lands which belonged to a person whose estate is being administered in that court or which belongs to his estate or to his representative or (2) to have information or knowledge withheld by the respondent from the representative and needed by the representative for the recovery of any property by suit or otherwise. The petition shall contain a request for the relief sought.
(b) The citation must be served not less than 10 days before the return day designated in the citation and must be served and returned in the same manner provided for summons in civil cases. If there is a personal representative who is not the respondent, notice of the proceeding shall be given by mail or in person to the personal representative not less than 5 days before the return day designated in the citation.
(c) If the representative is the respondent, the court may appoint a special administrator to represent the estate. The court may permit the special administrator to prosecute or defend an appeal.
(d) The court may examine the respondent on oath whether or not the petitioner has proved the matters alleged in the petition, may hear the evidence offered by any party, may determine all questions of title, claims of adverse title and the right of property and may enter such orders and judgment as the case requires. If the respondent refuses to answer proper questions put to him or refuses to obey the court’s order to deliver any personal property or, if converted, its proceeds or value, or books of account, papers or evidences of debt or title to lands, the court may commit him to jail until he complies with the order of the court or is discharged by due course of law and the court may enforce its order against the respondent’s real and personal property in the manner in which judgments for the payment of money are enforced. The court may tax the costs of the proceeding against the respondent and enter judgment therefor against him.
Sub-Section (a) provides that the Citation may be issued by the representative or by any other person interested in the estate. It is usually the representative who issues the Citation, but situations do arise where the representative refuses to act or is the target of the Citation and may not be the petitioner. Where the representative is the respondent, Sub-Section (c) authorizes appointment of a special administrator to represent the estate. A recent case clarified that the same attorney cannot represent the representative both as representative and as a Citation respondent, since that would constitute a conflict of interest. As a practical matter, most judges in Cook County will let the petitioning party represent himself and the estate in pursuing the representative rather than requiring the petitioner or the estate to incur the additional cost of appointing a special administrator. Please note that Citation proceedings are to be used in all estates – decedent, disabled, and minor.
Note that some of the relief that otherwise might be sought by Citation proceedings against a representative can be achieved by appropriate objections to an inventory or an accounting, i.e., by claiming that assets are missing. However, where assets have never been brought into the estate in the first place or where ownership of assets by the estate is not clear, the Court will usually require a Citation and will not allow those claims to be made in the form of such objections.
Sub-Section (a) also specifies what may be sought to be recovered in the Citation proceedings, i.e., tangible personal property, documents, information, or knowledge. Historically, the Citation could not seek relief with regard to real estate nor could it go beyond a liberal interpretation of the matters contained in the statute. Illinois cases divided on whether or not Citation proceedings could be used to recover money due an estate or whether separate proceedings must be brought in other divisions of the court. For example, Estate of Pinkard, 94 Ill.App.3d 34, 417 N.E.2d 1360, 49 Ill.Dec. 346 (1980) held that Citation proceeding cannot be used to recover a “debt.” In Lombardi, Ex’r v. Lepkowicz, 28 Ill.App.3d 79, 328 N.E.2d 328 (1975), a defendant being sued in a municipal division suit sought transfer of the procedure to the Probate Court in order to avoid barring his testimony under the Dead-Man’s Act, and the motion was denied. To the contrary, Estate of Willich, 338 Ill.App. 289, 87 N.E.2d 327 (1949), interpreted the phrase “personal property” more broadly and did allow the Citation to seek recovery of money. In more recent times, the scope of the Citation seems to have broadened and the differences in where proceedings must or may be brought have narrowed.
©2004 by Cary A. Lind, all rights reserved.