In this article, we explain the duty of an estate executor to determine creditors of the estate and provide notice of probate in Illinois.

When someone passes away, the person responsible for administering his or her estate (the “executor” or “administrator”) has a responsibility to determine who the deceased owed money to (known as a “creditor”) and to either pay the full amount owed from the estate or provide the creditor with proper notice of the estate.

Creditors of the estate must be paid in full prior to making distributions to beneficiaries and heirs.

If a probate case is opened, the executor must mail or hand deliver notice of the estate to all creditors that the executor knows of or can reasonably ascertain and publish notice for unknown creditors in a newspaper of general circulation in the county in which the probate case is located.

Known or reasonably ascertainable creditors have a deadline to file a claim against the estate of 2 months from the date that they received delivery of the personal notice or 6 months from the date that notice was published in the newspaper, whichever is later.  If a creditor who receives proper notice fails to file its claim within this deadline, the claim is barred and should not be paid from the estate by the executor.

So there is a big distinction between “known creditors” who are entitled to personal notice, and “unknown creditors” who are not entitled to such notice.  If a known creditor fails to receive proper notice, then its claim will not be barred by the 6 month deadline to file claims from the date of newspaper publication.  The known creditor will be able to file a valid claim against the estate up to 2 years from the date the decedent passed away.

If a claim against the estate is filed after the executor has already distributed estate assets to beneficiaries, and the remaining estate cannot cover the claim.  The executor may be personally liable to satisfy the claim, if the creditor did not receive notice due to a failure of the executor to take reasonable steps to determine known creditors and provide proper notice.

What steps must an executor take to determine creditors of the estate?  Statutory and case law is not clear on what is required, and courts will determine what is reasonable on a case by case basis.  However, the minimum standard that courts have set is that the executor is required to perform a good faith inquiry into the deceased’s personal and business financial records, including mail and files.

But what if a creditor who If a creditor fails to receive notice, but personally knows that the deceased has passed away?  This alone does not trigger the claims deadline.  However, some courts have held that the deadline may start to run from the time that a creditor has personal knowledge of the death of the deceased combined with knowledge that the estate has been opened, even if the creditor failed to receive proper notice.