The South Carolina Probate Code provides that all liabilities of a decedent, whether arising in contract, tort or otherwise, may be presented to the personal representative of the decedent’s estate. Creditors must “present” claims arising before the decedent’s death within the earlier of one year after the decedent’s death or eight months after the date of the first publication of the notice to creditors. S.C. Code Ann. § 62–3–803.

Claims that are not presented during the time period specified in section 62-3-803 are barred as against the estate, the personal representative, the decedent’s heirs and devisees, and non-probate transferees of the decedent (i.e., beneficiaries of life insurance, retirement accounts, revocable trusts, etc.). Importantly, even if the personal representative has actual notice of a claim, the claim will be barred if the creditor fails to present the claim within the time period set forth in §62-3-803.

The probate code also establishes the mechanism for presenting claims. A written statement of the claim “may” be delivered to the personal representative and “must” be filed with the probate court. Certain additional information must be included for certain types of claims, but the failure to provide the additional information does not invalidate presentation of the claim. It is sufficient for the creditor to mail to the personal representative an invoice including the basis for the claim (e.g., medical services rendered), the amount of the claim, and the name and address of the claimant within the limitations period, even if the statement of claim is filed outside the limitations period. The safer practice, however, is to file a claim within the limitations period.

In lieu of presenting a claim via the procedure set forth in the probate code, a creditor may sue the personal representative in any court with jurisdiction, but suit must be filed within the time for presenting claims. If the creditor does not sue the personal representative in the probate court where the estate is being administered, they must file a written notice with the probate court that a legal proceeding has commenced for allowance of the claim, setting forth the court in which the legal proceeding is pending.

In some cases, a creditor may pursue claims against people who have received distributions from the estate. A person receiving an improper distribution from the estate may be liable liable to return the property improperly received or its value, if the property was not retained. Creditors or others seeking to recover improper distributions must assert their claims within three years after the decedent’s death or, for creditors, one year after the time of the challenged distribution. Fraudulent transfers, however, may not be subject to this limitation.

The personal representative could also be liable to a creditor for making improper distributions. Generally, the personal representative is liable to interested persons for damage or loss resulting from actions which constitute a breach of his fiduciary duty. The probate code also provides a specific remedy against the personal representative where a claim has been allowed but has not been paid and the payment was made before the expiration of the applicable time limit or was made in such manner as to deprive the injured claimant of his priority. In most cases, claims against a personal representative for breach of fiduciary duty must be asserted within six months after the filing of the final accounting, proposal for distribution, petition for settlement and proofs required by the code.

An aggrieved creditor may sue the personal representative for allowance of a claim in any court where the personal representative may be subjected to jurisdiction, provided it is asserted within the time limit for presenting the claim. If the creditor provides written notice of the claim to the probate court, the probate court shall not permit the closing of the decedent’s estate until the legal proceeding has ended.

Creditors should be aware of these and other specific provisions of the probate code in South Carolina in making efforts to protect and collect debts owed by a decedent.