Texas ancillary probate is used to probate assets in Texas for a decedent who resided in a state other than Texas, when the other state conducted probate proceedings.
What Assets Are Subject to Texas Ancillary Probate?
Real property in Texas and tangible personal property in Texas are subject to Texas ancillary probate. Intangible personal property is probated in the domiciliary estate. Intangible personal property – bank accounts, brokerage accounts, stock in closely held companies – these are considered to be sited in the state where the decedent lived, regardless as to where the bank or company is located. (If someone held stock certificates in 50 different companies incorporated in 25 different states, ancillary probate would be required in all 25 states, were intangible personal property to be treated as sited in each such state.)
Given the widespread holdings of mineral interests in Texas, many estates across the country need ancillary probate to transfer ownership of oil and gas holdings owned by the decedent. Livestock is also subject to probate in Texas if that is where the livestock is.
Why is Ancillary Probate Necessary?
The state where real estate is located has exclusive jurisdiction over that land. A probate court in another state has no jurisdiction, and hence no power, to direct the transfer of land in another state. As explained by the case of Haga v. Thomas, 409 S.W.3d 731 (Tex. App. 2013) (internal citations omitted):
Texas courts have ultimate power over lands situated within [this] state. It is the settled law of this State, as well as the law generally, that the title to real property is exclusively subject to the government within whose territory it is situated. The Texas Supreme Court has held that, although the law of the testator’s domicile governs with respect to his personal property, with respect to the testator’s real property, the place where the property is situated is to govern, not only as to the capacity of the testator and the extent of his power to dispose of the property, but as to the forms and solemnities to give the will its due attestation and effect.
Moreover, the Legislature of one state has no power to confer jurisdiction over property situated in another state. It is clear that only the Texas courts have jurisdiction to adjudicate titles to Texas lands, and that in such suits the laws of Texas must apply. Thus, the existence of real property in Texas gives Texas courts jurisdiction over an administration concerning that property.
The law is clear that when a decedent dies in one state and owns real property in another state, both states have jurisdiction over an administration concerning the assets within the particular state’s territorial borders. Probate Code section 95 simplifies the process of admitting to probate in Texas a will that has already been admitted to probate in another state, regardless of whether that other state was the decedent’s domicile. Section 95 says nothing about whether a Texas court has jurisdiction to administer the estate with respect to the decedent’s real property located in Texas when an administration is already pending in another state; instead, it merely provides a procedural mechanism to begin an ancillary probate proceeding in Texas without going through the formal process of admitting the will to probate in Texas.
Here, it is undisputed that Zachary owned personal property in North Carolina, where he resided at the time of his death, and real property located in Texas. Haga contends that section 95 allows the Texas probate court to “dispose of both real and personal property in this State,” but this section does not confer jurisdiction on the ancillary court to “act like courts of original probate jurisdiction” and take actions such as construing the terms of a foreign will. According to Haga, if there is a need for such an action it “must be conducted in the original probate proceeding.”
Haga properly sought to have Zachary’s will admitted to probate in North Carolina, but the North Carolina court lacks jurisdiction to issue rulings affecting Zachary’s real property located in Texas; only a Texas court has jurisdiction to administer real property located in Texas. Thus, the “original” probate court in this case—the North Carolina court—had no jurisdiction to, for example, construe Zachary’s will as it related to his real property located in Texas. Only the Texas probate court—the ancillary court—can do that. Moreover, when the Texas probate court construed Zachary’s will concerning the disposition of his real property in this state, it was required by Texas law to apply the law of the state in which the real property was located, which, in this case, was Texas.
To the extent Haga argues that the probate court erroneously failed to grant his plea to the jurisdiction on the ground that the North Carolina probate proceeding was instituted first and should be considered the “primary” proceeding, Haga has cited no authority that the existence of a prior proceeding in another state admitting a will to probate deprives the Texas probate courts of jurisdiction to resolve any issues relevant to real property of the decedent located in Texas.
We conclude that, because Zachary undisputedly owned real property in Texas, the probate court had jurisdiction to admit Zachary’s will to probate in this state giving full faith and credit to the judgment of the North Carolina probate court. See Tex. Prob. Code Ann. § 95(a). After the will was filed and recorded with a Texas clerk, the will had the same force and effect as if it had been probated by order of the Texas court. Id. § 95(d)(1). The Texas probate court then had jurisdiction to commence an administration of Zachary’s real property located in Texas, which includes jurisdiction to rule on Jerry and Lyda Ann’s application to determine heirship.
So not only does a Texas court performing an ancillary probate have jurisdiction to transfer property in Texas, the Court has the ability to construe the will and determine who the heirs are of the real property in Texas. Indeed, the possibility exists that their could be one set of heirs in the domiciliary estate, and a different set of heirs in the ancillary estate.
How to Avoid Ancillary Probate in Texas
Placing the assets in Texas into a company or trust will avoid ancillary probate in Texas. For example, oil and gas interests could be placed into a limited liability company. It is probably best practice for anyone to hold their mineral interests in a company for liability purposes, but for out of state owners, holding their mineral interests in a company will avoid a Texas ancillary probate.
How Does Texas Ancillary Probate Work?
If the will of the decedent has been admitted to probate in another state, typically the domiciliary state, that will, known as a foreign will, can be admitted to probate in Texas and administered pursuant to the Texas Estates Code with respect to the Texas property.
If formal administration is not needed in Texas, the foreign will may be given effect in Texas by filing an authenticated copy of the foreign will, along with the order admitting the foreign will to probate, in the deed records of the counties in Texas where the decedent owned real property.
If there is a need to administer the Texas estate, the personal representative (also known as the executor) named in the foreign will may apply for ancillary probate of the foreign will and Ancillary Letters Testamentary.
If the will of a nonresident has not been admitted to probate in another state, an original probate proceeding may be necessary in Texas. This type of original probate proceeding of a nonresident is sometimes called “non domiciliary probate.”
The Texas Estates Code can be found here.
The portion of the Texas Estates Code addressing ancillary probate is found at Subtitle K, Chapter 501. It can be located on page 462 of the version of the Code linked above.
The portion of the Texas Estates Code addressing non domiciliary probate is found at Subtitle K, Chapter 502. It can be located on page 466 of the version of the Code linked above.