Can I Use the Estate Funds to Pay Legal Fees?
April 16th, 2020 in Estate Planning and Working with NC Planning
How Much Can Legal Fees Be?
Estate funds may certainly be used to pay for any legal fees incurred in your capacity as Administrator. However, it is wise to monitor how much you are spending on legal fees vs. the value of the total probated estate. There’s a limitation on how much an attorney can collect in fees, and often times this can fall on the clerk’s office to decide when to cap legal fees – especially if it starts to appear excessive.
It’s common that the clerk’s office will not approve above 5% of the probated estate value, to pay legal fees. If you start to feel that legal fees are starting to outweigh assets in total value, you should request that your attorney file a Petition for Counsel Fees before issuing your next payment, if they’re not already.
Bear in mind that should any legal fees not be approved and ordered paid by the clerk’s office, you’ll want to revisit the terms and conditions of your Representation Agreement, with the Attorney’s office. Oftentimes, the remaining balance not approved by the clerk’s office will become a personal liability of the client. If you don’t recall signing an Agreement, it’s important to obtain transparency on how you’re to be billed for ongoing services.
