How can a former spouse or survivor assert entitlement to surplus funds following the owner’s death or divorce?

Detailed Answer

When a property sale (usually a foreclosure) generates proceeds in excess of the debt, Georgia law requires the sheriff to deposit those “surplus funds” with the clerk of the superior court. Former spouses and survivors may have a legal right to part or all of those funds if they can show an interest. Below is an overview of the steps and statutes involved.

1. Identify the Surplus Funds Process

After a foreclosure sale, O.C.G.A. § 44-14-162 mandates that the sheriff deposit surplus proceeds with the superior court clerk within 15 days.
See § 44-14-162.
The clerk then publishes or posts notice and holds the funds available for claimants for 40 days under O.C.G.A. § 44-14-163.
See § 44-14-163.

2. Grounds for a Former Spouse’s Claim

In a divorce, the final decree often allocates property rights. If the former spouse was awarded all or part of the real estate or its proceeds, they may claim surplus funds as described in the divorce judgment or settlement agreement.

Obtain a certified copy of the divorce decree or marital settlement agreement specifying rights to sale proceeds.
Prepare a verified petition in the superior court where the surplus funds are deposited, describing your interest and attaching the decree.
Serve notice on all parties with known claims (e.g., the former owner, lienholders, other claimants) at least seven days before the hearing.
See O.C.G.A. § 9-11-4 on service.
Attend the court hearing. If the court finds your claim valid, it will order distribution.

3. Grounds for a Survivor’s Claim After Death

When the property owner dies before or after a foreclosure sale, surplus funds become assets of the decedent’s estate. The surviving spouse may claim a share under Georgia’s intestacy or the terms of the will.

Obtain a death certificate and marriage certificate.
If there’s a will, secure letters testamentary; if no will, obtain letters of administration from probate—see O.C.G.A. § 53-3-10.
See § 53-3-10.
File a petition in probate court or superior court (depending on local procedure) to collect estate assets, explicitly including surplus funds on deposit.
If the estate qualifies for summary administration (under O.C.G.A. § 53-2-41 for estates under $10,000), you may use the simplified process.
See § 53-2-41.
The court will approve distribution to the surviving spouse consistent with intestate shares (O.C.G.A. § 53-2-1) or the will.
See § 53-2-1.

Helpful Hints

Act promptly: Claims against surplus funds must be filed within 40 days of the clerk’s notice. Late claims may be barred.
Gather documentation: Divorce decrees, marital settlement agreements, death certificates and probate letters are critical.
Check local rules: Counties may have specific filing or service requirements—visit your superior court clerk’s office for details.
Provide accurate notice: Ensure you name and serve all potential claimants to avoid delays or dismissal.
Consider legal advice: While this guide explains the process, an attorney can ensure compliance with procedural nuances and deadlines.
Monitor public notices: Counties often publish foreclosure and surplus notices online or in local newspapers.
Keep copies: Retain all filed documents, certificates of service and court orders for your records.