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New York Surrogate's Court Procedure - Article 21 - § 2108 Proceeding by Fiduciary for Continuation of a Business

Legal Research Home > New York Laws > New York Surrogate's Court Procedure (SCP) > New York Surrogate's Court Procedure - Article 21 - § 2108 Proceeding by Fiduciary for Continuation of a Business

 
  § 2108. Proceeding by fiduciary for continuation of a business
    A fiduciary may petition for the continuation of a business other than
  a  profession,  of  which  decedent  or the person whose estate is being
  administered was sole owner and it is desired to  continue  it  for  the
  best  interests  of  the estate; provided, however, that a fiduciary may
  petition for the continuation of a deceased  dentist's  practice  for  a
  period  not  to  exceed eight months, if such practice is continued by a
  person licensed to practice dentistry in this state. In such proceeding:
    1.  If the petition be entertained the court may make an  intermediate
  order without notice authorizing continuance of the business pending the
  return of process and final decree.
    2.    Any  respondent may serve and file an answer within 8 days after
  the return of process or such further time as the court directs.   After
  inquiring  into  the  facts  and  hearing  the  parties, if the court is
  satisfied the best interests of the estate require the  continuation  of
  the business, it may make a decree accordingly.
    3.      The  decree  may  provide  such  restrictions,  conditions  or
  requirements and  such  incidental  relief,  including  a  direction  or
  permission for incorporation of the business, as the court may order.
    4.    Whenever  a  fiduciary shall be authorized under this section to
  continue a business in  other  than  corporate  form  the  decree  shall
  provide  for  the  extent of the liability of the assets of the business
  and the assets of the estate apart from the assets of the  business  for
  debts  and  other liabilities arising out of its continuance.  The court
  may make such directions in this regard as it  deems  advisable  in  the
  circumstances.   The decree shall further provide for the period of time
  for continuance.
    5.  If under a decree granted under this  section  a  fiduciary  shall
  continue  and  carry on a business other than in corporate form he shall
  file a certificate of doing business under an assumed name  pursuant  to
  the  provisions  of  section  one hundred thirty of the general business
  law.  The certificate shall include in addition  to  the  other  matters
  required  by  that section a statement showing the fiduciary capacity in
  which he is conducting and carrying on the business and  the  extent  to
  which the debts and other liabilities incurred in the continuance are to
  be  chargeable  to  the  assets of the estate as provided in the decree.
  The fiduciary shall be relieved of personal liability if  acting  within
  the  authority  granted and having filed the certificate above provided,
  but shall be liable only in a fiduciary capacity.  Any person  having  a
  claim,  demand  or  cause of action arising out of or in connection with
  the conduct of the business after the filing of  the  certificate  above
  provided  shall  thereafter be limited in the payment or satisfaction of
  such claim, demand or cause  of  action  to  such  assets  as  are  made
  available  for  the  payment or satisfaction of debts and liabilities in
  the decree, provided,  however,  that  nothing  herein  contained  shall
  relieve  the  fiduciary  from personal liability for the consequences of
  his own wrongful act or negligence in the continuance  of  the  business
  and   provided  further  that  nothing  herein  contained  shall  render
  ineffectual any provision in a will or  other  instrument  directing  or
  permitting the continuance of a business.
    6.    Unless  otherwise provided in the decree all funds collected and
  received in continuing and carrying on the business of a decedent  shall
  at  all  times be kept separate and apart from the funds in the hands of
  the fiduciary forming part of the general assets  of  the  estate  as  a
  whole.
    7.    Notwithstanding the foregoing provisions, any creditor or person
  interested may at any time apply to the court for an order requiring the
  fiduciary to discontinue and wind up the  business  and  the  court  may

  thereupon make such order as to it appears for the best interests of the
  estate, the creditors and all persons interested.

Last modified: February 18, 2012