In New York probate and estate administration, there is typically someone appointed either by the court or through the wishes of the deceased who is supposed to act on behalf of the estate. That includes ensuring that the heirs receive what is rightfully theirs, and that rightful claims against the estate are satisfied. To help illustrate this, it may well be worthwhile to examine the actions of the trustee who is acting on behalf of the estate of Bernard L. Madoff Investment Securities LLC.
In this case, the trustee is not acting on behalf of the estate of a deceased person but rather of a bankrupt company. Nonetheless, the duties remain largely the same. Here, the trustee is attempting to satisfy the claims of creditors. These creditors are the customers who lost money due to the criminal conduct of Madoff as he carried out his infamous Ponzi scheme.
The trustee recently filed a $19.9 billion lawsuit against JP Morgan, which was Madoff's main bank for two decades, to attempt to recover funds for former customers. However, a district court judge in Manhattan reduced that amount to $425 million, saying that any claims against the bank for harm caused to former Madoff customers must be made by those customers themselves. The trustee then reached an agreement with JPMorgan to allow an immediate appeal of the ruling.
Estate administrators such as the trustee in this situation have a duty to perform their responsibilities with all due diligence. Thus, they must act on behalf of the estate to ensure that all rightful claims made against it are eventually satisfied to the fullest extent possible while also preserving as much wealth as possible for the heirs. In order to help make sure that estates are not constantly tied up in lawsuits, it may be worthwhile to meet with a qualified New York attorney.
Source: Reuters, "Madoff trustee can appeal JPMorgan $19 billion loss," Jonathan Stempel, Dec. 1, 2011