Type: Law Bulletins
Date: 04/19/2017

Ohio Supreme Court Rejects "Substantial Compliance" Theory and Rules That Claims Against Decedents' Estates Must Be Presented in Strict Accordance With Statutory Language

The Ohio Supreme Court issued a decision on April 19, 2017, that is significant to persons or businesses who are owed money by a person who passes away. The court issued a 6-1 decision in Wilson v. Lawrence, Slip Opinion No. 2017-Ohio-1410, confirming that under Ohio statutes, persons or businesses with claims against estates must present those claims directly to the persons listed in the statute and in the precise manner provided in the statute.[1]

In the Wilson case, Gorman, a recently deceased businessman, owed a balance of $200,000 to Wilson in connection with Gorman’s purchase of an interest in Wilson’s Marine 1 L.L.C. Ten days after Gorman died, Wilson sent a letter attempting to present the claim to Gorman’s secretary and to his trustee/personal accountant, rather than to the court-appointed executor for his estate, Lawrence. The secretary immediately forwarded the letter to Lawrence, and the trustee/personal accountant did so very soon thereafter. But under the language of the controlling Ohio statute, this was not sufficient to present Wilson’s claim against the estate, and the court held that Lawrence, as executor of Gorman’s estate, properly could reject and refuse to pay the claim to Wilson.

The controlling Ohio statute, R.C. 2117.06, provides: “(A) All creditors having claims against an estate, including claims arising out of contract, out of tort, on cognovit notes, or on judgments, whether due or not due, secured or unsecured, liquidated or unliquidated, shall present their claims in one of the following manners: (1) After the appointment of an executor or administrator and prior to the filing of a final account or a certificate of termination, in one of the following manners: (a) To the executor or administrator in a writing.” In Wilson, the creditor failed to present the claim to the executor, even though those to whom the creditor sent the claim forwarded the claim to the executor without delay.

Chief Justice Maureen O’Connor, writing for the Ohio Supreme Court, rejected the argument that Wilson should be permitted to pursue his claim because he had substantially complied with the statute. The opinion emphasized that statutes such as R.C. 2117.06 exist to foster expedient administration of estates and that the state has a strong interest in the orderly settlement of estates. It noted that Wilson, the creditor, bore the burden to identify the administrator or executor.

Not only does Ohio law require presentment to the proper person, it also requires that claims against estates be presented within the proper time frame — in most cases, within six (6) months of death. Ohio law provides a mechanism for creditors to open estates in order to timely present claims where no executor or administrator has been appointed.

If you or your business has a claim against a deceased person, contact your Taft attorney to ensure that your claim is properly and timely presented in accordance with Ohio law. And if you are serving as an executor or administrator of an Ohio estate, consult with your attorney to ensure that you do not pay claims that were improperly or untimely presented to the estate. 

[1]  The syllabus, or official holding, of the case is: “A claim against an estate must be timely presented in writing to the executor or administrator of the estate in order to meet the mandatory requirements of R.C. 2117.06(A)(1)(a), and under that subdivision, delivery of the claim to a person not appointed by the probate court who gives it to the executor or administrator fails to present a claim against the estate.”

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