Zappos Founder Tony Hseih Died Without a Will (Part 4 – Other Administration Issues)

Tony Hseih was an early investor and CEO of Zappos. It appears he left behind no Will or other estate plan at his recent death.

In this blog series, we have been looking at some of the issues in this estate, such as: 1) basic issues of intestacy / dying with no Will; 2) potential issues cause by numerous “other writings” left behind; and 3) a specific and very interesting creditor claim filed in the estate. You can click on the links above to look in more depth at any of those issues.

This blog post focuses on other administration issues that can some up with intestacy.

Administrator

“Administrator” is the term for who is in charge of an estate with no Will. The main point here is that if you leave no Last Will and Testament behind, you will not have a say in who the person in charge will be.

“Personal Representative” is the term for who is in charge of an estate with a Will. This is generally who the deceased person appointed in their Will, subject to facts (is the person nominated still alive) and certain restrictions (is the person nominated a drunk).

There are other terms such as “Executor” which are more general and generally apply to both Administrators and Personal Representatives.

When you leave no Will, you obviously fail to appoint a person to take charge of your estate. A Court will choose this person, guided by priority rules.

These priority rules generally lead to the appointment of a close relative, which is often a good choice. However, under certain facts, such as alienation from a spouse, children, or other close relatives – it can be the opposite of what a person would want.

Administration

Lack of a Will not only affects who will serve as Administrator but how they will do their job, also called the “Administration” of the estate. It can affect:

-Sales: a Will (or lack) can affect issues such as whether the executor has the authority to sell, whether they have to sell certain items, and what the the process of a sale has to be;

-Debt and Creditors: a Will (or lack) can affect issues such as whether the executor distributes debt with an asset or pays the debt before distributing the asset free and clear;

-Bond: a Will (or lack) can affect whether the executor will have to get a bond, which is something of an insurance policy in case they do not follow the law and cause others harm. This can be a small issue; but it can also be a major availability or expense issue.

-Actions: a Will (or lack) can affect whether an executor may (or must, or may not) set up certain trusts, make certain tax elections, and the like.

There are others issues. I may blog more in depth at some point on those. And I would love to hear through comments or direct contact experiences others have had.

But the main point of today’s blog is that leaving no will can affect the Administrator (who will be in charge) and the Administration (how the Administrator will do their job) of an estate.