The executor of an estate is the administrator. Her job is primarily to take care of all the legal paperwork that needs to be dealt with when someone passes away, and to notify all interested parties such as legal counsel, debt collectors and heirs. Estate laws vary from one location to another in the United States, and each estate varies in complexity. Generally, however, the estate executor cannot be held liable for the deceased person's debts.
The probate court process varies from one state to another, but its basic purpose is to help smooth the process of transferring assets and paying off debts for a deceased person. The estate executor is the person who must file the probate case, and provide a complete list of assets and liabilities for the deceased person. Sometimes the executor is required to contact all creditors or post death notices in local newspapers.
When a deceased person has outstanding debts, the executor is expected to make sure those debts are paid from the assets of the estate. If liquid assets are available, such as a regular bank account with enough funds, the executor can simply pay the debts directly. When there are no liquid assets the executor may be required to sell some physical items in order to pay any remaining debts. Once all debts are settled, any remaining assets are distributed to heirs according to the deceased person's will if there was one; otherwise they are distributed according to state law.
Negligence or Fraud
Estate executors are sometimes sued by relatives or heirs of the deceased person, when the relatives or heirs feel the executor did not handle the estate properly. Creditors rarely attempt to sue the executor for a deceased person's debts because the executor cannot be held liable for debts he didn't incur. In rare cases, however, if the creditors believe the executor fraudulently distributed assets as a way to avoid having them liquidated in probate court, they can sue the executor.
One other exception to the liability law is when the estate executor was a joint account holder with the deceased person. If the executor was a joint account owner on a credit card account, or she guaranteed a car loan by co-signing, she can be held liable for repaying those debts.