In re Estate of Schmier.

2025 COA 19. No. 24CA0261. Probate—Formal Closure of Testate Estate—Applicability of CRS §§ 15-12-1001 and -1002.

February 20, 2025

The decedent died in 2018 with a will that she executed in 2013. The decedent’s husband, Raymond, and three adult children, including Tim, survived her. As relevant here, the will provided for establishment of the “Alice K. Schmier Family Trust” (family trust); designated Raymond as the primary beneficiary and trustee of the family trust; and directed that, upon Raymond’s death, the balance of the family trust be distributed by representation to the decedent’s descendants. On Raymond’s request, the will was admitted to informal probate and Raymond was appointed as personal representative. Raymond’s attorney filed information about Raymond’s appointment pursuant to CRS § 15-12-705 and mailed copies of the information of appointment to Raymond, Tim, and the decedent’s two other children. The case remained inactive until 2023 when Tim filed a petition for accounting, requesting an inventory of and interim accounting for the estate. Raymond responded to the petition by requesting to proceed with the formal closing of the estate. He also filed a petition for final settlement pursuant to § 15-12-1001, and notice of hearing on the petition for final settlement (the notice) that identified the date of the hearing without appearance (nonappearance hearing). Raymond’s attorney served the notice on Tim’s attorney. The next day, Raymond filed a “Receipt and Release” indicating that all distributions from the decedent’s estate had been satisfied in accordance with the family trust. A few hours later, a magistrate entered estate closing orders. Fourteen days after the magistrate issued the estate closing orders, Tim filed a reply in support of his petition for accounting that included an objection to the petition for final settlement. He also requested a hearing on the issues he raised in the petition for accounting and that the district court set aside the estate closing orders and direct Raymond to file a proper inventory and accounting with supporting financial documents. Raymond timely responded to Tim’s petition for review. Tim then filed this appeal, alleging that the magistrate erred by closing the probate estate without a hearing as required by § 15-12-1001. The district court took no action on Tim’s petition for review due to the pendency of this appeal.

As an initial matter on appeal, the court of appeals considered its jurisdiction to review the magistrate’s closing orders. A personal representative may petition the probate court to hold a formal proceeding to adjudicate the final settlement and distribution of the estate under § 15-12-1001 or § 15-12-1002. Section 1001’s procedures apply to proceedings to formally terminate the administration of both testate and intestate estates, while § 1002’s procedures apply only to such action in testate estates. Section 1001 and section 1002 both allow a probate court to consider accountings and distributions and to adjudicate the final settlement and distribution of an estate. But the court may only enter orders under section 1001 after notice to interested persons and a hearing, while section 1002 only requires notice to all devisees and the personal representative and a hearing. The court determined that section 1001 governed Raymond’s petition for final settlement and that Tim is an “interested person” under that section who was entitled to a hearing before the magistrate acted on the petition. And because Tim objected to the petition for final settlement, the magistrate was also required to obtain his consent under C.R.M. 6(e)(2)(A) before entering the estate closing orders. Because the parties’ consent to the magistrate was required for the magistrate to act on the petition for final settlement, C.R.M. 7(b) governs, and the magistrate’s order or judgment is appealed in the same manner as an order or judgment of a district court. Accordingly, the court determined it had jurisdiction to review the magistrate’s estate closing orders under C.R.M. 7(b).

Raymond argued that section 1001 doesn’t apply because the decedent had an existing will and no one challenged its validity, essentially maintaining that the formal closing of a testate estate in which testacy hasn’t been adjudicated must proceed under § 1002 unless there is a request to determine testacy. When, as here, a decedent dies with a will and no party has sought a testacy determination, either § 1001 or § 1002 may apply to the formal closing of the decedent’s estate. Under these circumstances, § 1001 authorizes the formal closing of a testate estate with testacy remaining unadjudicated but also allows for adjudication of testacy on the parties’ request; § 1002 authorizes the formal closing of a testate estate with testacy remaining unadjudicated, but prohibits the parties from resolving that issue. When determining which section applies, the court concluded that a court considers (1) whether the party’s request for formal estate closure also included a request that testacy be adjudicated and (2) whether the orders settling the estate may affect persons other than the personal representative or a devisee of the will. Here, the proceedings became formal when Raymond filed the petition for final settlement. The court concluded that § 1001 was the proper procedure for the formal estate closing, and because Tim is both a child of the decedent and a contingent beneficiary of the family trust, he was entitled to notice of the petition for final settlement and a hearing on it. But while Tim received proper notice of the request for a nonappearance hearing, the magistrate did not provide Tim with the opportunity to object at or before the noticed nonappearance hearing. And the magistrate did not hold a hearing before taking action on Raymond’s petition for final settlement. Accordingly, the magistrate erred by denying Tim the opportunity to challenge Raymond’s accounting of the estate’s inventory, and the errors substantially impacted his rights as an interested party.

Both parties requested an award of their respective appellate costs, and Raymond requested an award of his appellate attorney fees. Because the estate closing orders were reversed, the court granted Tim’s request for costs and denied Raymond’s. And because Raymond failed to cite a basis for his attorney fees request, the court declined to address it.

The estate closing orders were reversed. This case was remanded to the district court with directions to reopen the estate and calculate the amount of Tim’s appellate costs award. If Tim maintains his objection to the closure of the estate, the district court must hold a hearing as required by § 15-10-1001 after proper notice.