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Is there a probate code for the continuation of a business and does this code allow for business to run during probate?

San Antonio, TX |

my father owned a business that is still operating. IN his holographic will he gives his half to his business associate. From my understanding he gets his shares in the company upon my dad's death. Since the death the associate has been running the company under my father's license. Does the probate code allow for the company to continue running the same as it was before death until the 90-120 days that it takes for probate to be completed by the executor?

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Attorney answers 4

Posted

Your question shows you are knowledgeable. You give too few facts. An attorney needs to review your questions with more factual information.

You don't say what type of business, and an "associate" may or may not be able to lawfully continue operations under your dad's license. . Some licenses, such as a real estate broker's license, require that another sponsoring broker step in to obtain new listing agreements and buyer's representation agreements upon the death of the broker (even if the associate is also a broker).

What the associate takes at your dad's death may be governed by the organizational documents of the entity. You do not describe the entity type, or the associate's interest.

Proving up a handwritten or holographic will is not always easy.

A lawyer can't answer your questions without more information. It often takes far longer than 120 days for probate to be completed by the executor.

Get a lawyer!

John Zgourides
(281) 453-5312 direct
Web: www.zgourides.com

My responses to questions on Avvo are never intended as legal advice and must not be relied upon as legal advice. I give legal advice only in the course of an attorney-client relationship. Exchange of information through Avvo's Questions forum does not establish an attorney-client relationship with me. That relationship is established only by individual consultation and execution of a written agreement for legal services.

Asker

Posted

My father owned a water treatment company. All I know is that you have to have a special license. In a conference call, which is the only time anyone has given me information to work with, they do not answer my calls, the associate, whom was employed by my father for close to 20 years, says, ". I am the only one with a class 3 license, so I am the only one that can pull permits". The only thing mentioned was shares and his interest in the company, my father giving him his 1/2. The company caters to both residential and commercial. I have called close to 10 attorneys and they all want the quick story and then let me know they want a $500 retainer fee. Not really answering my questions. I do not have the $ to pay being a very low income family of 6 and can not seem to find help even though my fathers estate is large and when I mentioned the amount to the last attorney I spoke with the retainer fee went to $3000.00 but he would take $1,500 to get the ball rolling. I am sure this is how it goes, I just want to be able to get my inheritance.

John Gus Zgourides

John Gus Zgourides

Posted

If your dad left a will, it needs to be probated. If he left no will, then his estate needs a dependent administration (a more complex probate proceeding). If the estate has value, some lawyers will agree to wait to be paid after the will is probated or an ordewr is signed appointing an administrator of the estate. If you cannot afford a lawyer, you should try to get pro bono (free) legal services. Try this link to the San Antonio Bar's pro bono section: http://www.sabar.org/displaycommon.cfm?an=1&subarticlenbr=100. You should hurry, as this "associate" may be running the company into the ground (or milking it dry). Good luck. John Zgourides www.zgourides.com

Posted

You need to have a probate attorney review the documents. Not just a will, but other documents such as the organization documents, whether there was a buyout, etc....

Posted

You need to take the matter to a probate attorney. Oftentimes, a business can be run following the death of the primary management. One should look to the business' organizational documents for assistance. In regards to actual ownership of the company, one would probably look to probate. Remember, ownership and management are two different things.

The above statements are provided as general information and not intended as legal advice. Each matter has its own set of unique circumstances that cannot be adequately addressed without consultation. You are strongly advised to hire an attorney licensed to practice law in your state to represent you.

Posted

In addition to the previous answers, I do not think that the shares pass automatically (but would require a corporate resolution as well as the personal representative of the estate's approval). Once a personal representative is appointed to the Estate (you might need a Temporary Administrator if the holographic will does not name an executor), the Temporary Administrator could seek Court permission to operate and exercise your late father's interest or ask that the court appoint a receiver for those interests.

Texas Probate Code Sec. 238 provides guidance to a dependent administrator (be it a business, farm, ranch, or factory) in this situation.

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