DEATH OF A PARTY
The Person You Were Suing Suddenly Dies, Now What?
The answer lies within the statutory language found in California Code of Civil Procedure and the California Probate Code. See Code of Civil Procedure Sections 337.40 through 377.42; and Probate Code Sections 550 through 554. When a party to a lawsuit dies, the opposing party must take action quickly or their lawsuit may be terminated.
Of course, a dead person cannot be sued. Therefore, any claims against a deceased party (including those already in progress by way of an existing lawsuit) must be brought against the decedent’s estate. The deceased person’s “estate” is the real and personal property owned by the decedent at the time of his or her death that is subject to collection.
Not all Claims Survive Death
California Code of Civil Procedure identifies claims that may “survive” the death of a party. Examples of claims that survive death include: fraudulent property transfers; creditor’s claims; actions for recovery of property belonging to decedent; elder abuse claims; civil rights claims under 42 U.S.C. § 1983; and collateral issues in post-judgment marital dissolution (i.e., property rights, spousal and child support, fees and costs).
Deadline to File
When a party or potential party to a lawsuit dies, you must act quickly. There are two very important deadlines you must remember if you have a claim against a decedent.
First, you must file your claim within one year! There is a one-year statute of limitations provision in California Code of Civil Procedure section 366.2.
“If a person against whom an action may be brought on a liability of the person, whether arising in contract, tort, or otherwise, and whether accrued or not accrued, dies before the expiration of the applicable limitations period, and the cause of action survives, an action may be commenced within one year after the date of death, and the limitations period that would have been applicable does not apply.”
This strict rule requires a suit to be brought within one year of the decedent’s death. If not brought within this short window, your claim may be forever barred. Note that this rule applies even if you are unaware that the person died!
Second, if a person dies and his heirs/beneficiaries open a probate estate, then the deadline to file is even shorter! You have only 4 months from the date an executor is officially appointed to file a claim.
The Lifecycle of a Claim
If you have an ongoing lawsuit against a party that suddenly dies, the first step to take is to file a “Creditor’s Claim” with the decedent’s estate. This is not a lawsuit, this is a claim made directly to the decedent’s estate representative, if one has already been appointed.
If a probate estate is not opened, and an estate representative has not yet been appointed (and this happens often where the decedent died with a trust because no probate is necessary to transfer his assets), then YOU must file to open a probate. Once probate is opened and an estate representative has been appointed, then you can file a claim with the estate.
The estate representative has to either accept or reject the claim. If after 30 days, the estate representative has not responded, the claim is deemed rejected. Once a claim is rejected, you can then file a lawsuit against the estate to force the estate to pay the claim. If a lawsuit is already pending against a dead defendant, then the estate representative or “Executor” must be substituted in as the party to the lawsuit.
There is an Exception to Having to Open Probate!
There is an exception to having to open probate which applies when there is a surviving spouse of the deceased party. Probate Code sections 13550 and 13551 make a surviving spouse personally liable for the debts of the deceased spouse …” Collection Bureau of San Jose v. Rumsey (2000) 24 Cal.4th 301, 303.
So if a defendant dies and the assets transfer to the surviving spouse without probate, the creditor can and should be able to recover from: (1) all of the community property of the couple and (2) the separate property of the deceased spouse. Probate Code sections 13553 and 13554.
This means that the surviving spouse steps into the shoes of the deceased spouse and you can enforce a debt against a surviving spouse in the exact same manner as if the deceased spouse was still alive. However, the surviving spouse has the exact same right to assert any defense, cross-complaint or set-off which the deceased spouse could have raised if they had not died.
If a judgment is achieved as part of the lawsuit, then that judgment can be enforced against the estate. If there are no assets in the estate, then you can go after the decedent’s trust.