Detailed Answer
Disclaimer: This article is for informational purposes only and does not constitute legal advice. Consult a licensed attorney to address your unique circumstances.
1. Court-Authorized Sale Under Probate Code
When an estate goes through probate in California, the personal representative (executor or administrator) may sell estate personal property to pay debts, funeral expenses, and administrative costs and to balance inheritances among heirs. Under California Probate Code §10300 et seq., the executor can petition the court for an order authorizing sale of personal property:
- Petition for Sale (Prob. Code §10300): File a petition in the probate proceeding requesting court approval. Link: Prob. Code §10300.
- Notice of Proposed Sale (Prob. Code §10161): Notify heirs and creditors, allowing objections.
- Court Hearing & Order (Prob. Code §10308): If no objection—or objections are overruled—the court issues an order authorizing the sale under specified terms.
2. Private Sale vs. Public Auction
Once you have court authority, you can choose between:
- Private Sale: List items with an estate agent or broker. You negotiate price, subject to approval and confirmation by the court (Prob. Code §10332). Link: Prob. Code §10332.
- Public Auction: Conduct an auction by a licensed auctioneer. Auction sales often generate competitive bids and transparent market value, but they carry auction fees and may require advertising in local newspapers.
3. Uncontested Sales Without Court Approval
If all heirs and beneficiaries agree in writing, the personal representative can sell personal property without going back to court under Probate Code §10306 and §10310. However, documentation of unanimous consent is critical to avoid future disputes:
- Written Consent Form (Prob. Code §10306): Obtain signed statements from all heirs.
- Accounting & Distribution Plan: Prepare a proposed allocation showing how sale proceeds will reimburse expenses and equalize shares.
4. Reimbursement and Equalization of Shares
Sale proceeds first pay valid estate expenses in priority order (Prob. Code §§11420–11426). After creditor claims and administrative costs are satisfied, remaining funds distribute to beneficiaries:
- Reimbursement: Funeral, medical, and estate administration costs come off the top.
- Equalization: If one heir receives non-liquid assets of greater value, sale proceeds can equalize the monetary share to ensure fair distribution.
Personal representatives often prepare a distribution worksheet to track “cash in, cash out” for each heir.
Helpful Hints
- Obtain professional appraisals for valuable items to support sale price and court filings.
- Review California Probate Code and local court rules for notice requirements and timelines.
- Compare auctioneer and estate agent fees to maximize net proceeds.
- Keep detailed records of all expenses and sale proceeds for accounting and beneficiary review.
- Consult with a probate attorney if heirs dispute the sale or distribution plan.