2020 Georgia Code
Title 53 - Wills, Trusts, and Administration of Estates
Chapter 4 - Wills
Article 6 - Construction of Will; Testamentary Gifts
§ 53-4-63. (For Effective Date, See note.) Payment of Debts of Testator and Expenses of Estate Administrator

1. Unless otherwise directed, the debts of the testator and expenses of administration of the estate shall be paid out of the residuum. Unless otherwise provided in the will, a residuary gift or any part thereof, including a residuary gift to a surviving spouse in lieu of year's support, shall be deemed a gift of the net residuum or part thereof remaining after all debts of the testator and expenses of administration of the estate, including taxes, have been paid.
2. If the residuum proves to be insufficient for the payment of the debts of the testator and the expenses of administration of the estate, then general testamentary gifts shall abate pro rata to make up the deficiency. If general testamentary gifts are insufficient, then demonstrative testamentary gifts shall abate in the same manner. If both general and demonstrative gifts are insufficient, then specific gifts shall abate in the same manner.
3. After the estate assets in the hands of the personal representative are exhausted, a creditor may proceed against each beneficiary for that beneficiary's pro rata share of the debts to the extent a testamentary gift has been distributed to that beneficiary.
4. Realty and personalty shall be equally liable for the payment of debts.
5. Unless otherwise expressly directed in the will, nothing in this Code section shall be deemed to limit any rights to reimbursement for federal estate taxes, generation-skipping transfer taxes, or any other taxes that may be available to personal representatives under federal law.

(Code 1981, §53-4-63, enacted by Ga. L. 1996, p. 504, § 10; Ga. L. 2020, p. 377, § 1-14/HB 865.)

- For article, "The Time Gap in Wills: Shifting Assets and Shrinking Estates - Obsolescence and Testamentary Planning in Georgia," see 6 Ga. L. Rev. 649 (1972). For article surveying legislative and judicial developments in Georgia's will, trusts, and estate laws, see 31 Mercer L. Rev. 281 (1979). For article, "Tax Apportionment Problems under the Georgia Probate Code," see 8 Ga. St. B.J. 16 (2003).

This section carries over former OCGA Sec. 53-2-101 with changes to reflect demonstrative testamentary gifts. The language of paragraph (c) is modified to clarify that, under certain circumstances, a creditor may proceed against a beneficiary when the executor has distributed testamentary gifts to the beneficiary. Similar concepts appear in Code Sec. 53-7-43. New subsection (e) clarifies that this statute is not intended to limit any of the rights to reimbursement that appear in federal tax law, such as Internal Revenue Code Sections 2205 through 2207B. Former OCGA Secs. 53-2-100 (relating to direction by testator that real property be converted to personalty) and 53-2-102 (relating to annuities or debts charged on land) are repealed.

ANALYSIS

• General Consideration
• Priority

General Consideration

Editor's notes.

- In light of the similarity of the statutory provisions, decisions under former Civil Code 1910, § 3912, former Code 1933, § 113-821, and former O.C.G.A. § 53-2-101 are included in the annotations for this Code section.

- Purpose of the General Assembly in passing this statute was to treat the costs of the administration of the estate as much a debt of the decedent as any other obligation to which the decedent may be subject. Woodall v. First Nat'l Bank, 118 Ga. App. 440, 164 S.E.2d 361 (1968) (decided under former Code 1933, § 113-821).

- While it is true that the commissions of the personal representative of a decedent do not, strictly speaking or primarily, constitute a debt due by the decedent, still the commissions due the personal representative of a decedent must be construed as part of the costs, and fall under the head of necessary expenses of administration. It is only another way of saying that of the property of the decedent, whether personalty or realty, is subject to the payment of the decedent's obligations. Colyer v. Huntley, 179 Ga. 332, 175 S.E. 901 (1934) (decided under former Civil Code 1910, § 3912).

Immunity of real estate from sale to pay the commissions of an executor has been abrogated, and commissions of an executor or administrator are expenses of administration to which any property of a decedent is subject. Colyer v. Huntley, 179 Ga. 332, 175 S.E. 901 (1934) (decided under former Code 1933, § 113-821).

Statute refers to "debts" owing by the deceased in his or her lifetime; it does not apply to such a demand where, long after the death of the testator, a bank fails and by operation of law there is a liability against the stock formerly owned by such testator and except as provided by law, there is no person authorized to contract a debt against an estate of a deceased person. State Banking Co. v. Hinton, 178 Ga. 68, 172 S.E. 42 (1933) (decided under former Code 1933, § 113-821).

Words "debt" or "debts" of an estate, used in a refunding bond given to an executor "are obviously the debts of the decedent, due by him in his life time, and not the claims of the executor for remuneration and expenses of the estate." State Banking Co. v. Hinton, 178 Ga. 68, 172 S.E. 42 (1933) (decided under former Code 1933, § 113-821).

Debt in its general sense is a specific sum of money which is due or owing from one person to another, and denotes not only the obligation of one person to pay, but the right of the other party to receive and enforce payment by judicial action. Woodall v. First Nat'l Bank, 118 Ga. App. 440, 164 S.E.2d 361 (1968) (decided under former Code 1933, § 113-821).

Taxes due a county or municipality come within the generally accepted meaning of personal debts, the collection of which is enforceable by appropriate judicial action. Woodall v. First Nat'l Bank, 118 Ga. App. 440, 164 S.E.2d 361 (1968) (decided under former Code 1933, § 113-821).

Will provision directing that "all just debts be paid without unnecessary delay," without more, is not an instruction to pay debts out of the gross estate rather than out of the residuum. American Cancer Soc'y v. Estate of Massell, 258 Ga. 717, 373 S.E.2d 741 (1988) (decided under former O.C.G.A. § 53-2-101).

Cited in Chamblee v. Atlanta Brewing & Ice Co., 131 Ga. 554, 62 S.E. 1032 (1908); May v. Braddock, 91 Ga. App. 853, 87 S.E.2d 365 (1955); Chamblee v. Guy, 218 Ga. 56, 126 S.E.2d 205 (1962); Alston v. United States, 349 F.2d 87 (5th Cir. 1965); Gibson v. McWhirter, 230 Ga. 545, 198 S.E.2d 205 (1973); Anderson v. Groover, 242 Ga. 50, 247 S.E.2d 851 (1978); Moore v. Lindsey, 662 F.2d 354 (5th Cir. 1981).

Priority

Priority generally.

- As between the devisee of property on which there is a mortgage lien, and a devisee of other property, both being specific devises, the mortgage debt should be borne by the devisees of the mortgaged property. Raines v. Shipley, 197 Ga. 448, 29 S.E.2d 588 (1944) (decided under former Code 1933, § 113-821).

In regard to priority, debts and legacies stand on precisely the same footing and one can no more be diminished by the payment of commissions than the other. The expenses of administration, among which are the commissions of the representative, must first be paid whether enough be left to satisfy debts and legacies, or not. Alston v. United States, 228 F. Supp. 216 (N.D. Ga. 1964), aff'd, 349 F.2d 87 (5th Cir. 1965) (decided under former Code 1933, § 113-821).

- Legacy accepted by a widow under a will in lieu of other marital rights will not abate with other legacies to pay debts. Daniel v. Denham, 223 Ga. 544, 156 S.E.2d 906 (1967) (decided under former Code 1933, § 113-821).

Testamentary legacy to a wife, specifically given in lieu of year's support, is entitled to preference over other legacies and devises although the legacy exceeds the value of the year's support. When the remaining estate is adequate to pay all the obligations of the estate, such legacy of the wife will not abate to pay the debts and obligations of the testator. Killingsworth v. First Nat'l Bank, 237 Ga. 544, 228 S.E.2d 901 (1976) (decided under former Code 1933, § 113-821).

Bequest accepted by a widow in lieu of year's support (or, previously, dower) has a priority over other bequests insofar as abatement is concerned. DuBose v. Box, 246 Ga. 660, 273 S.E.2d 101 (1980) (decided under former Code 1933, § 113-821).

Bequest for the support and maintenance of a near relative is given priority over other bequests of the same class when no other provision is made for the near relative's support. DuBose v. Box, 246 Ga. 660, 273 S.E.2d 101 (1980) (decided under former Code 1933, § 113-821).

RESEARCH REFERENCES

Am. Jur. 2d.

- 31 Am. Jur. 2d, Executors and Administrators, § 685. 80 Am. Jur. 2d, Wills, §§ 1485 et seq., 1499, 1510, 1526.

- 34 C.J.S., Executors and Administrators, § 501. 97 C.J.S., Wills, §§ 1720, 1728, 1729.

- What amounts to an ademption or abatement of a legacy of a business or professional practice, 13 A.L.R. 173; 16 A.L.R.2d 1404.

Preferences among general legacies as regards abatement, 34 A.L.R. 1247.

Gift by will of mixed residue of real and personal property as subjecting residuary realty to payment of pecuniary legacies, 42 A.L.R. 654.

Specific devises and specific legacies as subject to ratable contribution for the payment of debts, 42 A.L.R. 1519.

Legacy or devise to creditor of testator as satisfaction in whole or part of debt, 86 A.L.R. 6; 47 A.L.R.2d 1140.

Construction and effect of provisions of will regarding abatement of legacies or devises in event of insufficiency of assets to pay all in full, 101 A.L.R. 704.

Direction in will for payment of debts of testator, or for payment of specified debt, as affecting debts or debt barred by limitation, 109 A.L.R. 1441.

Preference as regards life interest created by will as carrying similar preference in respect of remainder interest, 117 A.L.R. 1339.

Law of domicil or of place of ancillary administration as governing rights and priorities of creditors of decedent in respect of assets in ancillary jurisdiction, 124 A.L.R. 1281.

Priority received by creditors as regards ancillary assets of receivership or decedent's estate as justification for reducing their claims or dividends upon distribution in the primary or domiciliary jurisdiction so as to effect ultimate equality among creditors as regards total assets, 127 A.L.R. 504.

Property over which the testator had power of appointment which is exercised by residuary clause, as available for payment of pecuniary legacies after exhaustion of testator's own property, 129 A.L.R. 826.

Right of retainer in respect of indebtedness of heir, legatee, or distributee, 164 A.L.R. 717.

Priority of surviving spouse who accepts provision of will in lieu of dower or other marital rights over other legatees and devisees and creditors, 2 A.L.R.2d 607.

Phrase in will, "subject to payment of debts," and the like, as charging particular devise or bequest with debts, in exoneration of property otherwise subject thereto, 2 A.L.R.2d 1310.

Right to intrench upon corpus, when income is insufficient, to pay stated sum which trust instrument directs to be paid periodically to beneficiary out of income, 67 A.L.R.2d 1393.

Right of devisee of real estate specifically devised but subject to mortgage to contribution or other relief from specific devisee of other property, 72 A.L.R.2d 383.

Liability for debts and expenses as between personalty generally bequeathed and realty passing by the residuary clause or left undisposed of, 74 A.L.R.2d 553.

Right of heir or devisee to have realty exonerated from lien thereon at expense of personal estate, 4 A.L.R.3d 1023.

Devise or bequest pursuant to testator's contractual obligation as subject to estate, succession, or inheritance tax, 59 A.L.R.3d 969.

Construction and effect of will provisions expressly relating to the burden of estate or inheritance taxes, 69 A.L.R.3d 122.

Construction and effect of will provisions not expressly mentioning payment of death taxes but relied on as affecting the burden of estate or inheritance taxes, 70 A.L.R.3d 630.

Liability for wrongful autopsy, 18 A.L.R.4th 858.

Proper disposition under will providing for allocation of express percentages or proportions amounting to more or less than whole of residuary estate, 35 A.L.R.4th 788.