If I’m a signer on a business account and the owner just passed away, am I allowed to deposit checks and pay debits owed out to companies that we hired?
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If I’m a signer on a business account and the owner just passed away, am I allowed to deposit checks and pay debits owed out to companies that we hired?
With wife and family approval, am I allowed to continue running the business? The Will has not been found and the owner was sole owner, yet we have lots of jobs already agreed to do before his death.
Asked on June 19, 2012 under Estate Planning, California
Answers:
Cameron Norris, Esq. / Law Office of Gary W. Norris
Answered 11 years ago | Contributor
If you were sharing profits with the decesased, then it sounds like you were part of a partnership with him. The Uniform Partnership Act gives you options of what to do upon the death of a partner, but usually the partnship is dissolved, you buy-out his family's equity in the business and you move on.
Under contract law, the death of the owner does not absolve you of the obligation to fulfill contracts that you have already signed. So, you need to see those through.
I would keep the family well informed, keep making deposits and debits, and slowly transition to a new account without the deceased.
If the deceased has no will, the estate may be tied up in probate for awhile, so after probate processes start, your access to the business account may cease.
You may want to inquire if the deceased has a P.O.D./Payable on death/Totten Trust instruction with the bank that would pass the account on to the wife upon his death. THen you can just present the death certificate and she can collect the funds and start a new account with you as a signer.
Best of luck.
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