Legal Question in Wills and Trusts in New Jersey

Re: Release and Refunding Bond

Yes. The applicable statute is quoted below. It is based on the pricniple that all debts of the decedent must be satisfied before a beneficiary is entitled to receive any inheritance.

3B:23-24. Refunding bond of devisee or distributee

A personal representative shall, on paying a devise or distributive share or on delivering an instrument of distribution to the person entitled, take a refunding bond therefor, to be filed in the office of the surrogate of the county wherein he received his letters or in the office of the clerk of the Superior Court, if he received his letters from the Superior Court.

L.1981, c. 405, s. 3B:23-24, eff. May 1, 1982.

Re: Release and Refunding Bond

In NJ a Refunding Bond and Release is required to be executed (signed and notarized) prior to the distribution. The Refunding Bond and Release states that you accept the accounting of the Executor and that if there are any claims against the estate, you will refund your distribution if needed. This gets filed with the Surrogate's Office to close the estate.

I have additional informatin at:

www.saveyourestate.com

I hope this helps!

Ron Cappuccio

Re: Release and Refunding Bond

It is possible that a delayed claim against the estate may come after a distribution is made and the estate may not have sufficient reserves to pay the claim. Refunding Bonds and Releases are required for several purposes, including acknowledgement of receipt of your distribution, to eventually close out the estate with the Surrogate's Office, and to assure that if legitimate claims are asserted against the estate after the assets are distributed, there is a means of getting a return of the the distribution, or a pro rata portion, to pay these late bills. This is standard procedure in every estate. If this was not done, distributions could be held up for lenghty time periods.