Florida Known Creditors Denied Notice Have Two Years To File Claims

In Jones v. Golden, the Florida Supreme Court settled a disputed issue amongst the Florida District Courts of Appeal — Is the claim of a creditor who is not served with a copy of the notice to creditors but whose claim is known or reasonably ascertainable barred under section 733.702(1) if not filed within three months after the first publication of the notice to creditors absent an extension, or is the claim timely if filed within two years of the decedent’s death under section 733.710?

 

Florida Known Creditors Who Did Not Receive Notice Have Two Years To File Claims

The now settled law of Florida is that the claim of a known or reasonably ascertainable creditor who was never served with a copy of the notice to creditors is timely if filed within two years of the decedent’s death.  Here’s how the Florida Supreme Court got there.

The Florida Supreme Court had for review Golden v. Jones, where the Florida Fourth District Court of Appeal held “that if a known or reasonably ascertainable creditor is never served with a copy of the notice to creditors, the statute of limitations set forth in section 733.702(1), Florida Statutes, never begins to run and the creditor’s claim is timely if it is filed within two years of the decedent’s death.”

The Florida Fourth District Court of Appeal’s decision directly conflicted with the Florida First and Second District Courts of Appeal in Morgenthau v. Estate of Andzel and Lubee v. Adams.  These cases held that even a reasonably ascertainable creditor who was not served with a copy of the notice to creditors is required to file a claim within three months after the first publication of the notice, unless the creditor files a motion for an extension of time under section 733.702(3) within the two-year period of repose set forth in section 733.710.

The Florida Supreme Court examined three Florida probate statutes: sections 733.2121, 733.702, and 733.710.

Section 733.2121, Florida Statutes

Section 733.2121 addresses the personal representative’s duty to publish a notice to creditors of the pending administration of an estate and to serve a copy of the notice to creditors on known or reasonably ascertainable creditors.  It provides:

(1) Unless creditors’ claims are otherwise barred by s. 733.710, the personal representative shall promptly publish a notice to creditors. The notice shall contain the name of the decedent, the file number of the estate, the designation and address of the court in which the proceedings are pending, the name and address of the personal representative, the name and address of the personal representative’s attorney, and the date of first publication. The notice shall state that creditors must file claims against the estate with the court during the time periods set forth in s. 733.702, or be forever barred.

(2) Publication shall be once a week for 2 consecutive weeks, in a newspaper published in the county where the estate is administered or, if there is no newspaper published in the county, in a newspaper of general circulation in that county.

(3)(a) The personal representative shall promptly make a diligent search to determine the names and addresses of creditors of the decedent who are reasonably ascertainable, even if the claims are unmatured, contingent, or unliquidated, and shall promptly serve a copy of the notice on those creditors. Impracticable and extended searches are not required. Service is not required on any creditor who has filed a claim as provided in this part, whose claim has been paid in full, or whose claim is listed in a personal representative’s timely filed proof of claim.

. . . .
(4) Claims are barred as provided in ss. 733.702 and 733.710. § 733.2121, Fla. Stat. (2006); see also Fla. Prob. R. 5.241(a) (“[T]he personal representative shall promptly publish a notice to creditors and serve a copy of the notice on all creditors of the decedent who are reasonably ascertainable.”).

Section 733.702, Florida Statutes

Section 733.702 is a statute of limitations and provides, in relevant part:

(1) [N]o claim or demand against the decedent’s estate . . . is binding on the estate . . . unless filed in the probate proceeding on or before the later of the date that is 3 months after the time of the first publication of the notice to creditors or, as to any creditor required to be served with a copy of the notice to creditors, 30 days after the date of service on the creditor . . . .

. . . .

(3) Any claim not timely filed as provided in this section is barred even though no objection to the claim is filed unless the court extends the time in which the claim may be filed. An extension may be granted only upon grounds of fraud, estoppel, or insufficient notice of the claims period.

. . . .

(6) Nothing in this section shall extend the limitations period set forth in s. 733.710.

Section 733.710, Florida Statutes

Section 733.710 is a jurisdictional statute of nonclaim and provides, in relevant part:

(1) Notwithstanding any other provision of the code, 2 years after the death of a person, neither the decedent’s estate, the personal representative, if any, nor the beneficiaries shall be liable for any claim or cause of action against the decedent, whether or not letters of administration have been issued, except as provided in this section.

(2) This section shall not apply to a creditor who has filed a claim pursuant to s. 733.702 within 2 years after the person’s death, and whose claim has not been paid or otherwise disposed of pursuant to s. 733.705.

 

Florida Unknown vs. Known Creditors

The Florida Supreme Court explained that section 733.702, Florida Statutes, creates two distinct and different limitations periods for creditor claims — one for unknown creditors and the second for Florida known creditors or reasonably ascertainable creditors.

Unknown creditors have three months from the first publication of the notice to creditors. But known or reasonably ascertainable creditors do not need to rely on publication.  Section 733.2121(3), Florida Statutes, requires that a personal representative must serve known or reasonably ascertainable creditors with notice.  “The limitations period applicable to known or reasonably ascertainable creditors does not begin to run until service is perfected.”  Once served, then the known or reasonably ascertainable creditors have 30 days after the date of service on the creditor, or 3 months after the time of first publication of the notice to creditors, whichever is later, to file a claim.

If a known or reasonably ascertainable creditor is not served with a copy of the notice, section 733.702(1) does not govern the timeliness of that creditor’s claims. The Florida Supreme Court stated:

Instead, the claims of such a creditor are only barred if not filed within the two-year period of repose set forth in section 733.710. Thus, the claim of a known or reasonably ascertainable creditor who was never served with a copy of the notice to creditors is timely if filed within two years of the decedent’s death. Further, because the limitations periods in section 733.702 are inapplicable under such circumstances, it is not necessary for the creditor to seek an extension of time under section 733.702(3) since that section applies only to claims that are untimely under section 733.702.

The Florida Supreme Court decided the issue of the timeliness of such creditor claims as one of statutory interpretation and as one of due process.  Citing to the United States Supreme Court case of Tulsa v. Pope, the Florida Supreme Court agreed that the  “due process clause requires that a known or reasonably ascertainable creditor be given notice by mail or other means as certain to ensure actual notice.”

Therefore, the claim of a known or reasonably ascertainable creditor who was never served with a copy of the notice to creditors is timely if filed within two years of the decedent’s death.  This decision finally brings clarity to the unsettled law regarding the timeliness of creditor claims in Florida estates.

Pinellas County (Clearwater)

Matthew Weidner

Orange County (Orlando)

Philip W. Gunthert

Broward County (Ft. Lauderdale)

Natasha M. Dalton

Hillsborough County (Tampa)

R. Todd Burbine

Sarasota County

Dawn Bates-Buchanan

Lee County (Ft. Myers)

Scott Kuhn

Duval County (Jacksonville)

Long H. Duong

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