New York Probate and Estate Administration Lawyer Blog
While the case of In re Estate of Domingo Torres, Sr. turns on the narrow issue of whether to grant the New York City Department of Social Services (DSS) more time to file objections to the account filed by the personal representative, here we will look at why the DSS wants the Surrogate’s Court to hear its objections.
At the time that Torres passed away, he owed the DSS $87.903.76. As part of the estate administration process, New York law requires that the personal representative pay debts owed by the decedent out of estate assets before assets are distributed to the decedent’s beneficiaries or heirs. However, debts can only be paid to the extent there are funds in the estate to do.
As required, the DSS filed a claim against the decedent’s estate for $87.903.76. Even though it appeared as if the claim was valid and timely filed, it was denied simply because the estate did not have the money to pay it. However, the personal representative filed a lawsuit against the party responsible for Torres’ death and recovered $300,000. From that money, the DSS expected to be able to recover the money it was owed.
When someone dies as a result of the negligence or willful act of another person or entity, under New York law, their personal representative has the right to file a lawsuit to recover damages from the person or entity who caused the death. The lawsuit must be filed in New York Supreme Court. If successful, a determination must be made as to how to allocate the damages awarded: wrongful death or personal injury. The manner in which the award is classified determines who will ultimately end up with the money. While the Supreme Court determines liability in a wrongful death lawsuit, typically the Surrogate’s Court determines the allocation of an award in a proceeding called a compromise hearing. As a practical manner, the compromise proceeding occurs as part of an accounting where the personal representative reports how assets of the estate will be distributed.
A wrongful death award is for the economic losses suffered by the decedent’s distributees. This means that that money goes directly to the decedent’s distributees and never becomes part of the decedent’s probate estate. Economic losses refer to the financial contributions that the decedent would have made to their spouse and children, if any. On the other hand, money that is awarded for personal injury is for the conscious pain and suffering of the decedent. This means that the money compensates the decedent’s loss. Therefore, it is part of the decedent’s probate estate. Money that is a part of the decedent’s estate can be reached by creditors.
In In re Estate of Domingo Torres, Sr., 100% of the $300,000 settlement was allocated to the wrongful death cause of action. As a result, none of the money would be added to the decedent’s probate estate and none of it would be available to pay creditors. Not surprisingly, DSS objected to the allocation. However, they did not timely object. As a result, they asked the court for more time to file their objection.
If the court had granted DSS more time to object to the allocation, for the court to change the allocation, the DSS would still have to present evidence that the decedent suffered conscious pain and suffering. Typically, medical records would be required. If the decedent died instantly and was not aware they were about to face a catastrophic injury, conscious pain and suffering may not have occurred.