Is Death the End of Collections?

You are sitting there enjoying a morn­ing coffee and reading the paper when you receive urgent messages from the other Board members. They heard the hor­rid rumor that the owner in Unit Z died.

Your first reaction is horror at the early de­mise of your neighbor, and the second re­action is that gut-wrenching feeling as you recall that the owner of Unit Z was in collec­tions for unpaid assessments, and of a large amount.

You wonder what the Board should do? Can the association recover from a deceased owner? You make the wise move and call your legal counsel for the answer first thing on Monday. So, is there collections after death? The answer is yes.


Often the association can collect that debt, even from a deceased owner. Local courts and attorneys “probate,” or administer, the estate of the deceased. The granting by a court of probate is the first step in the pro­cess of administering the estate of a deceased person. The probate system is designed to resolve all claims and distribute the deceased person’s property. State statutes and codes in our local jurisdictions determine how an es­tate is paid out to creditors and heirs alike.

Figuring out who is entitled to what un­der the probate estate is not easy. There are many factors that need to be determined, most which can’t be resolved quickly. While the Unit Z owner’s family is dealing with the grief of sudden death, they typically will not want to deal with the debts of their deceased.

First, the board and management should determine what debt the Unit Z owner owes the association. Then, the board can make a fiscally responsible determination of wheth­er the amount of the debt is worth pursuing. Boards and management should be advised that at the end of the estate, there may be no funds to pay the association, but it is equal­ly likely that there will be funds to pay the amounts owed to the association. Collection from the estate of the Unit Z owner is a fairly long process, best handled by legal counsel, with no absolute guarantee of recovery.

Virginia, Maryland, D.C., and West Virgin­ia all have probate divisions that deal with the process of distributing the assets of the dead. Estates are handled differently by probate divisions depending on whether a will exists or not.

When a board learns of the death of an owner in the com­munity, it is important to file a claim against the estate of the de­ceased. If at the end of the estate probate process, there is money to pay creditors, the as­sociation can get paid, but only if claims are filed with the probate court divisions. The filing of such claims is handled by legal counsel. Filing a claim involves a pa­per form filing in the coun­ty in which the owner lived or died, so determining the correct place to file is critical. Our local jurisdictions typically have online records, and often searching for estates can be conducted by the association’s legal counsel online; in the alternative, public re­cords can be searched at the local courthouse for information about the estate.

Simply filing a claim in probate does not mean the association will recover, but it is the critical step in the recovery process. What de­termines whether the association will recover upon death is how the claim is secured. Assessments reduced to judgment and memoran­da of lien exponentially increase the chances of recovery. It is criti­cal that the board communicate with the association’s legal counsel, and try to determine if the association has filed liens or judgments against the owner and his unit. When liens or judgments are filed against the deceased, the debt is typically deemed secured debt against any property of the owner.

Often, the family will pay the decedent’s claims. But, if there is no money in the estate, that may also mean that the mortgage on the unit is not being paid either. The unit may likely go through a first trust lender foreclosure. At the end of the foreclosure process, there could be excess proceeds available for creditors, but that is not al­ways the case.

Probate is a long fairly complex process best left to legal counsel, but there can be recovery of the association debt if the proper steps are taken.


By Lella Amiss “Ami” E. Pape, ESQ.
Lella is the principle in her law firm located in the City of Manassas, Virginia serving community associations and business clients throughout Metropolitan Washington and the surrounding areas. She is experienced in real estate and residential and commercial collections for associations and corporations. Mrs. Pape practices in the Virginia, Maryland, the District of Columbia, and West Virginia. She has achieved the designations from CAI of Rising Star in 2007, and CAI Certified Trained Business Partner in 2014.


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