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Estate (law)
 
 
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An estate is the net worth
Net worth

In business, net worth is the total assets minus total outside liability of an individual or a company . For a company, this is called shareholders' equity and may be referred to as book value....
 of a person at any point in time. It is the sum of a person's assets - legal rights, interests and entitlements to property
Property

Property is any physical or virtual entity that is ownership by an individual or jointly by a group of individuals. An owner of property has the right to consumption, sell, Renting, mortgage, transfer and exchange his or her property....
 of any kind - less all liabilities at that time. The issue is of special legal significance on a question of bankruptcy
Bankruptcy

Bankruptcy is a legally declared inability or impairment of ability of an individual or organization to pay its creditors. Creditors may file a bankruptcy petition against a debtor in an effort to recoup a portion of what they are owed or initiate a restructuring....
 and death of the person. (See inheritance
Inheritance

Inheritance is the practice of passing on property, Title s, debts, and obligations upon the death of an individual. It has long played an important role in human societies....
.)

Depending on the context, the term is also used in reference to an estate in land
Estate in land

An estate in land is an interest in real property that is or may become possessory.This should be distinguished from an "Estate " as used in reference to an area of land, and "Immovable Property" as used to refer to property in general....
 or of a particular kind of property (such as real estate
Real property

In the common law, real property refers to one of the two main classes of property, the other class being personal property . Real property generally encompasses Estate in land, land improvements resulting from human effort including buildings and machinery sited on land, and various property rights over the preceding....
 or personal estate
Personal property

Personal property is a type of property. In the common law systems personal property may also be called chattels or personalty. It is distinguished from real property, or real estate....
).






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An estate is the net worth
Net worth

In business, net worth is the total assets minus total outside liability of an individual or a company . For a company, this is called shareholders' equity and may be referred to as book value....
 of a person at any point in time. It is the sum of a person's assets - legal rights, interests and entitlements to property
Property

Property is any physical or virtual entity that is ownership by an individual or jointly by a group of individuals. An owner of property has the right to consumption, sell, Renting, mortgage, transfer and exchange his or her property....
 of any kind - less all liabilities at that time. The issue is of special legal significance on a question of bankruptcy
Bankruptcy

Bankruptcy is a legally declared inability or impairment of ability of an individual or organization to pay its creditors. Creditors may file a bankruptcy petition against a debtor in an effort to recoup a portion of what they are owed or initiate a restructuring....
 and death of the person. (See inheritance
Inheritance

Inheritance is the practice of passing on property, Title s, debts, and obligations upon the death of an individual. It has long played an important role in human societies....
.)

Depending on the context, the term is also used in reference to an estate in land
Estate in land

An estate in land is an interest in real property that is or may become possessory.This should be distinguished from an "Estate " as used in reference to an area of land, and "Immovable Property" as used to refer to property in general....
 or of a particular kind of property (such as real estate
Real property

In the common law, real property refers to one of the two main classes of property, the other class being personal property . Real property generally encompasses Estate in land, land improvements resulting from human effort including buildings and machinery sited on land, and various property rights over the preceding....
 or personal estate
Personal property

Personal property is a type of property. In the common law systems personal property may also be called chattels or personalty. It is distinguished from real property, or real estate....
). The term is also used to refer to the sum of a person's assets only.

Inheritance

In the context of probate
Probate

Probate is the legal process of administering the estate of a deceased person by resolving all claims and distributing the deceased person's property under the valid will....
, the estate of a deceased person consists of all the property, whether real
Real property

In the common law, real property refers to one of the two main classes of property, the other class being personal property . Real property generally encompasses Estate in land, land improvements resulting from human effort including buildings and machinery sited on land, and various property rights over the preceding....
 or personal
Personal property

Personal property is a type of property. In the common law systems personal property may also be called chattels or personalty. It is distinguished from real property, or real estate....
, owned by the person at the time of death. Assets that pass to somebody else by operation of law (for example, property held on a joint tenancy basis), do not form part of the deceased estate, even though the person had rights to that property during his or her lifetime. Also, if the deceased owned life insurance
Life insurance

Life insurance or life assurance is a contract between the policy owner and the insurance, where the insurer agrees to pay a sum of money upon the occurrence of the insured individual's or individuals' death or other event, such as terminal illness or critical illness....
 and nominated a beneficiary of the policy, the proceeds of that policy would not pass into the deceased's estate, but would go directly to the nominated beneficiary. Similarly, superannuation death benefits can go directly to a deceased's dependent, bypassing the deceased's estate. (See will
Will (law)

In common law, a will or testament is a document by which a person regulates the rights of others over his or her property or family after death....
 and intestacy
Intestacy

Intestacy is the condition of the estate of a person who dies owning property greater than the sum of his or her enforceable debts and funeral expenses without having made a valid will or other binding declaration; alternatively where such a will or declaration has been made, but only applies to part of the estate , the remaining estate fo...
) The estate (or assets) of a deceased person is administered by an executor
Executor

An executor, in the broadest sense, is one who carries something out .Executor is also a legal term referring to a person named by a maker of a will , or nominated by the testator, to carry out the directions of the will....
 (in the case of a will) or administrator
Administrator (law)

In law an administrator can be:* a person appointed by the court to handle the Estate of someone who died without a will .* In United Kingdom bankruptcy law, an office holder appointed under an Administration Order in relation to a company in financial difficulty, as an alternative to liquidation....
 (in the case of intestacy). The function of the executor and administrator is to protect the assets of the estate, pay out all expenses and the deceased's liabilities and distribute the balance in accordance with the directions in the will, or as required by law.

Bankruptcy

Under US bankruptcy law
Bankruptcy in the United States

Bankruptcy in the United States is permitted by the United States Constitution which authorizes Congress to enact "uniform Laws on the subject of Bankruptcies throughout the United States." Congress has exercised this authority several times since 1801, most recently by adopting the Bankruptcy Reform Act of 1978, codified in Title 11 of the...
, a person's estate consists of all assets or property of any kind available for distribution to creditors. The estate (or assets) of a bankrupt person is administered by a trustee in bankruptcy
Trustee in bankruptcy

United States In the United States, a Trustee in Bankruptcy is a person who is appointed by the United States Department of Justice or by the creditors involved in a bankruptcy case....
. The legal position in all common law
Common law

Common law refers to law and the corresponding Legal systems of the world developed through legal opinion of courts and similar tribunals , rather than through statute law or Executive ....
 countries is similar in this respect.

Legal estate in land

In land law, the term "estate" is a remnant of the English feudal system, which created a complex hierarchy of estates and interests in land. The allodial or fee simple
Fee simple

A fee simple is an estate in land. It is the most common way real estate is owned in common law countries, and is ordinarily the most complete ownership interest that can be had in real property short of allodial title, which is often reserved for governments....
 interest is the most complete ownership that one can have of property in the common law system. An estate can be an estate for years, an estate at will, a life estate
Life estate

A life estate is a concept used in common law and statutory law to designate the ownership of land for the duration of a person's life. In legal terms it is an estate in real property that ends at death....
 (extinguishing at the death of the holder), an estate pur auter vie (a life interest for the life of another person) or a fee tail
Fee tail

Fee tail or entail is an obsolescent term in common law. It describes an estate of inheritance in real property which cannot be sold, devised by will, or otherwise alienated by the owner, but which passes by operation of law to the owner's Inheritance upon his death....
 estate (to the heirs of one's body) or some more limited kind of heir (e.g. to heirs male of one's body).

Fee simple estates may be either fee simple absolute or defeasible
Defeasible

Defeasible may refer to:*Defeasible reasoning, a type of convincing but not rigorous philosophical reasoning*Defeasible estate, an estate created when a grantor transfers land conditionally...
 (i.e. subject to future conditions) like fee simple determinable and fee simple subject to condition subsequent; this is the complex system of future interests
Future interests

Future interests is the subset of actuarial math that divides enjoyment of property -- usually the right to an income stream either from an annuity , a Trust law, royalties, or rentings -- based usually on the future survival of one or more persons ....
 (q.v.) which allows concepts of trusts and estates to elide into actuarial science
Actuarial science

Actuarial science is the discipline that applies mathematics and statistics methods to Risk assessment in the insurance and finance industries. Actuary are professionals who are qualified in this field through education and experience....
 through the use of life contingencies.

Estate in land can also be divided into estates of inheritance
Inheritance

Inheritance is the practice of passing on property, Title s, debts, and obligations upon the death of an individual. It has long played an important role in human societies....
 and other estates that are not of inheritance. The fee simple estate and the fee tail estate are estates of inheritance; they pass to the owner's heirs by operation of law
Operation of law

The phrase "by operation of law" is a legal term that indicates that a right or liability has been created for a party, irrespective of the intent of that party, because it is dictated by existing legal principles....
, either without restrictions (in the case of fee simple), or with restrictions (in the case of fee tail). The estate for years and the life estate are estates not of inheritance; the owner owns nothing after the term of years has passed, and cannot pass on anything to his or her heirs.

Legal estates and interests are called rights "in rem", and said to be "good against the world".

Equitable estates

Superimposed on the legal estate and interests in land, English courts also created "equitable interest
Equitable interest

An equitable interest is an "interest held by virtue of an equitable title or claimed on equitable grounds, such as the interest held by a trust beneficiary." The equitable interest is a right in Equity that, if violated , is subject to satisfaction by an equitable remedy....
s" over the same legal interests. These obligations are called trust
Trust law

In common law legal systems, a trust is an arrangement whereby property is managed by one person for the benefit of another. A trust is created by a settlor, who entrusts some or all of his or her property to people of his choice ....
s which will be enforceable in a court
Court

A court is a body, often a government institution, with the authority to adjudication legal disputes and dispense private law, criminal justice, or administrative law justice in accordance with rules of law....
. A trustee
Trustee

Trustee is a legal term that refers to a holder of property on behalf of a beneficiary . A Trust law can be set up either to benefit particular persons, or for any Charitable trust : typical examples are a testamentary trust for the testator's children and family, a pension trust , and a charitable trust....
 is the person who holds the legal title to property, while the beneficiary
Beneficiary

A beneficiary in the broadest sense is a natural person or other legal entity who receives money or other benefits from a benefactor. For example: The beneficiary of a life insurance policy, is the person who receives the payment of the amount of insurance after the death of the insured....
 is said to have an equitable interest in the property.

See also

  • Estate tax
    Inheritance tax

    Inheritance tax, estate tax and death duty are the names given to various taxes which arise on the death of an individual. It is a tax on the estate, or total value of the money and property, of a person who has died....
  • Estate tax (United States)
  • Inheritance
    Inheritance

    Inheritance is the practice of passing on property, Title s, debts, and obligations upon the death of an individual. It has long played an important role in human societies....