Nevada Governor Joe Lombardo recently enacted Senate Bill 404, which aims to reform the state’s probate laws in response to alarming findings from a Las Vegas Review-Journal investigation.
The investigation revealed that an unregulated network of individuals, including private administrators, real estate agents, lawyers, and house flippers, had been profiting from the sale of deceased individuals’ homes without family involvement.
Previously, Nevada law allowed virtually anyone to manage a probate case and sell a deceased person’s property with minimal oversight from the courts.
This lenient approach resulted in situations where family members felt sidelined while outsiders financially capitalized on estate sales.
Senate Bill 404, which will take effect on October 1, establishes more stringent requirements for taking control of a deceased person’s estate and restricts who can gain court authority to expedite home sales in probate court.
The bill was unanimously passed by both the Nevada Senate and Assembly and was introduced by the Senate Judiciary Committee after the Review-Journal’s alarming findings prompted legislative action.
Sen. Melanie Scheible, a Democratic representative from Las Vegas and chair of the Judiciary Committee, expressed her surprise at the issues highlighted by the Review-Journal.
She stated that prior to reading the coverage, she was unaware of the widespread exploitation occurring in probate cases.
Once the details came to light, she became determined to create a solution to prevent these troubling situations from happening in the future.
“It has been great to see our bill become a law, especially after hearing from people who, although they might not have had bad experiences, still felt strongly that only family members should manage their relatives’ estates,” declared Scheible.
The law will alter existing probate procedures by prioritizing family members to oversee an estate while imposing stricter criteria for those considered ‘legally qualified’ to manage cases.
Under previous regulations, any adult in Nevada without a felony conviction could oversee a probate case.
This broad eligibility contributed to the issues identified in the Review-Journal investigation, where independent administrators could begin cases without family consideration.
The newly approved bill requires that any individual who is legally qualified to administer the estate must now provide evidence to obtain a “finding of good cause.”
This entails submitting a statement of qualifications and an affidavit affirming efforts to locate any living heirs.
These changes aim to reduce exploitation and ensure that estate management is placed in the hands of rightful heirs rather than external parties.
Sen. Scheible further elaborated on amendments concerning independent administration, which allows administrators to sell properties without a judge’s approval or competitive bidding.
This provision has now been modified to effectively limit independent administration to family members only, thereby increasing oversight and protecting against potential abuses.
The Review-Journal’s investigation revealed that two prolific private administrators in Southern Nevada, Thomas G. Moore and Cynthia “Cyndi” Sauerland, managed over 500 probate cases.
Both frequently sought independent administration and sold homes to a narrow group of investors who would flip the houses for profit.
The newspaper reported that these administrators often initiated probate cases without family involvement, leading to concerns about transparency and fairness in the sales process.
Critics, including Adam Fenn from Compass Realty & Management who opposed the bill, have argued against the new law, describing its requirements as ambiguous and problematic.
Fenn claimed that the necessity for a statement of qualifications could lead to inconsistent applications of the law, potentially harming experienced professionals committed to lawful practices.
He characterized the proposed regulations as a misrepresentation of the realities within the probate system, inspired by a narrative shaped by recent media scrutiny.
Despite opposition from some within the real estate and legal community, the introduction of Senate Bill 404 represents a significant shift in Nevada’s probate law, aimed at preventing future misuse of control over deceased individuals’ estates.
The backing of the bill by a unanimous bipartisan vote signifies a collective acknowledgment of the ethical concerns surrounding probate practices in the state.
As the new law takes effect on October 1, it is expected to restore family authority in estate management and safeguard the interests of deceased individuals’ heirs.
image source from：https://www.reviewjournal.com/business/housing/lombardo-signs-probate-bill-after-review-journal-investigation-3383713/
