Is the estate of a deceased person a legal entity?

Question

This question is inspired by the discussion in the comments of this answer to another question. In those comments I claimed that the estate of a deceased person is not a legal entity and that it is the personal representatives (executors if testate, administrators if intestate) who hold legal title to the assets of the estate and can sue and be sued in relation to those assets. That assertion was challenged by several people, which leads me to wonder if this is something which varies by jurisdiction.

To avoid any confusion, I'm taking "legal entity" to mean an entity which can hold legal title to an asset and be named as a party to a lawsuit in relation to that asset. There was some talk in the discussion about entities being represented in court by a natural person, but I do not consider that the same as being the person named as the party. So e.g. an assertion that "to sue for the assets in an estate, you sue the executor" would suggest that an estate is not a legal entity, while "to sue for the assets in an estate, you sue the estate itself which is then represented in court by the executor" would suggest that it is a legal entity.

Is the estate of a deceased person a legal entity?

Given the level of disagreement, I'd prefer if possible to see jurisdiction tags and citations of which at least one is an authoritative legal source (ideally primary sources such as legislation or precedents, but secondary sources such as legal textbooks, journal articles, or practice notes aimed at practitioners would suffice).

It was pointed out that the IRS refers to an estate as a legal entity but my research indicates that carries a different meaning to the legal one and is relevant only in the context of federal tax filings. If intending to cite the IRS I'd be grateful if this could be backed up with a legal source to show that their use of "legal entity" carries the same meaning as the one defined above.

I will self-answer to provide some citations which I believe support my proposition.

Answer 1

Good news: it behaves like a legal entity.

An estate is a collection of assets and liabilities that belonged to the deceased. The collection behaves a great deal like an LLC or other legal entity, although states don't call it that.

• The collection is isolated from anyone else's collection of assets and liabilities. For instance, it's not part of the executor's personal assets, nor liabilities. That's very important because...
• If the collection is sued e.g. by a creditor, the suit can only make claims against assets in the "collection". That is to say, the executor's own assets are not at risk. That's very important if you're thinking about volunteering to become an executor or manager of a trust. You can do so without fear of personal liability. Asterisk here *, but don't panic, it's a harmless asterisk.
• The collection can buy and sell goods and services (more the latter generally). A typical service purchased by an estate is storage unit rental.
• The collection can hire, fire and generally do business. Consider an estate which owns an apartment building. Life goes on: rent must be collected, utilities paid, leaky toilets fixed, contractors and managers hired and fired. In this case, the estate is a going-concern business behaving a lot like an LLC.
• The collection/estate could potentially do business indefinitely, if the will of the heirs is to continue doing so. This might happen if splitting the assets equitably amongst the heirs wasn't possible (e.g. the estate of Leonard Cohen collects a lot of royalties)... or too complex to easily back out of (say: the deceased owned 5 McDonalds franchises and had bet the farm on opening two more; backing out now would bankrupt the estate, so the estate might oddly open two McDonalds.)
• The collection can also sue, and proceeds from the suit or settlement go into the collection. Asterisk again. *
• The collection has its own Taxpayer Identification Number (aka SSN or EIN).
• The collection files its own 1040 tax form, and may do so for years or even decades.

The point of all these practical examples is that an estate looks, walks and quacks like a "legal entity". To the point where the IRS even calls it one.

And to a boots-on-ground executor, manager or trustee, the reality is it handles like a legal entity, and the experience you have managing legal entities will largely apply, almost in full. Almost.

* Now, that asterisk. Due to state court rules in many states, if you attempt to sue an estate, you have to use the right name. And that's what this question is all about.

It's a naming convention, and that is all.

And courts treat it as such.

Take Roe v. Wade. "Roe" is an adaption of "Doe" as in "John Doe". Wade, however, was the district attorney of Dallas County at the time of filing. Wade wasn't being sued personally. It's just the quirky naming convention the court uses.

What you have identified is a similar quirk in court rules, where instead of suing

• Estate of John Q. Example,

the syntactically correct thing is to sue

• Jane Doe, in the capacity of, Executor of John Q Example's estate.

And the italic parts are optional, because the court knows that.

Why is this important?

It's not important, and that's what the Florida Court of Appeals said in florida Spradley v Spradley 213 So. 3d 1042 (Fla. Dist. Ct. App. 2017. The plaintiff had made exactly the above error: suing "the estate of" instead of suing "Derreck Spradley et.al. (implied: in their capacity as executor)". The judge threw out the case, saying in essence "You forgot to "dot an i". The appeals court said no, the distinction is trivial and the court should have simply let the brother "dot their i" and continue with an entirely valid case.

In other words, it was a distinction without a difference.

So if sued, the executor should not panic about being "named personally" in the suit - you're not personally liable. And it is a waste of time to pick nits over how the name of the defendant is spelled, so says the Florida court at least... and in my humble opinion that precedent would be well received in other state courts, as it avoids wasting docket time and citizen filing fees on an action that will simply be re-filed correctly the next day.

Not a license to cheat, however.

One way an executor can manage to create personal liability is to abuse or mishandle the role with extreme negligence. In that case, yes, the executor's personal assets could come under fire, basically as punishment for misdeeds. An executor who is careful, honest and gets help when needed won't have any trouble at all.

Answer 2

A substantial wall of case law notwithstanding, according to the IRS, "An Estate is a legal entity created as a result of a person's death". So it depends in part on who you ask.

Answer 3

Self-answer: An estate is not a legal entity. Legal title to the assets in the estate are held by the personal representatives of that estate and it is they who can sue or be sued in relation to those assets.

EDITED DISCLAIMER: One of the commenters is concerned that this answer may give the impression that an executor can be held personally liable with the implication that being an executor is a dangerous activity. For the avoidance of doubt, the fact that personal representatives hold legal title which can be the subject of a lawsuit, does not mean in general that they are personally liable. Most lawsuits involving an executor are merely to compel them to dispose of the estate's assets in a particular way (e.g. to pay a creditor or a beneficiary). Those types of lawsuits cannot go beyond the estate's assets and into the executor's personal assets. However, if the executor mismanages the estate, fails to place the creditor's rights ahead of the beneficiary's, pays the beneficiaries incorrectly, spends the estate's assets for himself, or otherwise breaches their fiduciary duties, then they can be held personally liable; in this sense it is quite similar to the way that personal liability works for a trustee or company director. In summary, a well behaved and careful executor will have nothing to worry about, but it also isn't a role to be taken lightly.

On to the full answer:

Authoritative sources

florida Spradley v Spradley 213 So. 3d 1042 (Fla. Dist. Ct. App. 2017:

to the extent that Mr. Spradley attempted to sue his mother's estate, we find that the trial court erred in failing to grant Mr. Spradley leave to amend his complaint to substitute the proper party. Although there does not seem to be a Florida case directly on point, it is well-settled that "an 'Estate' is not an entity that can be a party to litigation

[...]

Since estates are not natural or artificial persons, and they lack legal capacity to sue or be sued, an action against an estate must be brought against an administrator or executor as the representative of the estate

new-york DuBois v Beaury No. 1:20-CV-86 (FJS/CFH):

"[U]nder New York law, `[a]n estate is not a legal entity and any action for or against the estate must be by or against the executor or administrator in his or her representative capacity.'" Wilmington Tr., Nat'l Ass'n v. Estate of McClendon, 287 F. Supp. 3d 353, 373 (S.D.N.Y. 2018) (quoting Visutton Assocs. v. Fastman, 44 Misc. 3d 56, 58, 991 N.Y.S.2d 240, 242 (2d Dep't 2014) (quoting Grosso v. Estate of Gershenson, 33 A.D.3d 587, 822 N.Y.S. 2d 150, 150 (2d Dep't 2006)) (other citation omitted). Moreover, as the court held in Grosso v. Estate of Gershenson, 33 A.D.3d 587 (2d Dep't 2006), "[t]he plaintiff could not bring an action against the decedent's estate since no executor or administrator had been appointed." Id. at 587.

united-states As noted in DuBois v Beaury, this is a matter for state law, not federal law:

Rule 17(b)(3) of the Federal Rules of Civil Procedure provides, in pertinent part, that "[c]apacity to sue or be sued is determined. . . by the law of the state where the court is located.. . . ." Fed. R. Civ. P. 17(b)(3). Thus, New York law applies to this case.

england-and-wales s 33, Administration of Estates Act 1925:

On the death of a person intestate as to any real or personal estate, that estate shall be held in trust by his personal representatives with the power to sell it.

england-and-wales 'Hanbury & Martin: Modern Equity 21st Ed', 2-020:

A legatee or devisee does not, on the testator’s death, become equitable owner of any part of the estate. The executor takes full title to the testator’s property, not merely a bare legal estate.

Non-authoritative sources

Wikipedia:

In most circumstances, the executor is the representative of the estate for all purposes, and has the ability to sue or be sued on behalf of the estate. The executor holds legal title to the estate property, but may not use the title or property for their own benefit, unless permitted by the terms of the will.

florida Florida Probate Trust Litigation Blog:

lawyers speak in terms of suing “the estate,” or transferring property to “the estate,” or collecting a bill that’s payable by “the estate.” This kind of loose talk usually doesn’t matter, but sometimes it does. To be clear, under Florida law there’s no such thing as a separate legal entity known as an “estate.” If you want to sue, get paid from, or transfer property to, an “estate,” all of that needs to happen via the estate’s court-appointed personal representative (PR). [...] This should be basic stuff, but you’d be surprised how often lawyers (and judges) get this wrong.

Further point in response to comment

For the avoidance of doubt, the fact that personal representatives hold legal title which can be the subject of a lawsuit, does not mean in general that they are personally liable (i.e. can be compelled to pay out of assets which are not part of the estate). They can be personally liable, but only if they have breached their fiduciary duties.