Contracts Entered on Behalf of the Estate
Managing an estate often requires signing contracts. These may include hiring appraisers, listing real estate, or retaining contractors.
The personal representative is protected from individual liability on these contracts. However, they must follow one important rule.
Unless otherwise provided in the contract, a personal representative is not individually liable on a contract properly entered into in his fiduciary capacity in the course of administration of the estate unless he fails to reveal his representative capacity and identify the estate in the contract.
A.R.S. § 14-3808(A)The key is disclosure. The representative must clearly state they are acting on behalf of the estate when signing any contract. Failing to do so can shift the obligation to them personally.
Torts and Ownership Obligations
The personal representative may also face claims tied to estate property. For example, a tenant might get injured on estate-owned rental property.
The question of liability depends on personal fault. Without personal fault, these claims fall against the estate itself.
A personal representative is individually liable for obligations arising from ownership or control of the estate or for torts committed in the course of administration of the estate only if he is personally at fault.
A.R.S. § 14-3808(B)However, if the representative's own negligence causes the harm, they can be held individually responsible. A court accounting or surcharge proceeding can resolve these disputes.