CREDITORS' CLAIMS

NMSA 1978 ch. 45, art. 3, pt. 8

in effect

NMSA 1978, § 45-3-801 Notice to creditors

45-3-801. Notice to creditors A. A personal representative upon appointment may publish a notice to creditors once a week for three successive weeks in a newspaper of general circulation in the county in which the probate proceeding is pending, announcing the personal representative's appointment and address and notifying creditors of the estate to present their claims within four months after the date of the first publication of the notice or be forever barred. B. A personal representative may give written notice by mail or other delivery to a creditor, announcing the personal representative's appointment and address and notifying the creditor to present the creditor's claim within four months after the published notice, if given as provided in Subsection A of this section, or within sixty days after the mailing or other delivery of the notice, whichever is later, or be forever barred. C. The personal representative is not liable to anyone for giving or failing to give notice pursuant to this section. 1953 Comp., § 32A-3-801, enacted by Laws 1975, ch. 257, § 3-801; 1993, ch. 174, § 71; repealed and reenacted by Laws 2016, ch. 69, § 715.

NMSA 1978, § 45-3-802 Statutes of limitations

45-3-802. Statutes of limitations A. Unless an estate is insolvent, the personal representative, with the consent of all successors whose interests would be affected, may waive any defense of limitations available to the estate. If the defense is not waived, no claim that was barred by any statute of limitations at the time of the decedent's death shall be allowed or paid. B. The running of a statute of limitations measured from an event other than death or the giving of notice to creditors is suspended for four months after the decedent's death but resumes thereafter as to claims not barred by other sections. C. For purposes of a statute of limitations, the presentation of a claim pursuant to Section 45-3-804 NMSA 1978 is equivalent to commencement of a proceeding on the claim. 1953 Comp., § 32A-3-802, enacted by Laws 1975, ch. 257, § 3-802; 1993, ch. 174, § 72; 1995, ch. 210, § 41.

NMSA 1978, § 45-3-803 Limitations on presentation of claims

45-3-803. Limitations on presentation of claims A. All claims against a decedent's estate that arose before the death of the decedent, including claims of the state and any political subdivision of the state, whether due or to become due, absolute or contingent, liquidated or unliquidated or founded on contract, tort or other legal basis, if not barred earlier by another statute of limitations or nonclaim statute, are barred against the estate, the personal representative and the heirs, devisees and nonprobate transferees of the decedent unless presented within the earlier of the following: (1) one year after the decedent's death; or (2) the time provided by Subsection B of Section 45-3-801 NMSA 1978 for creditors who are given actual notice and the time provided in Subsection A of Section 45-3-801 NMSA 1978 for all creditors barred by publication. B. A claim described in Subsection A of this section that is barred by the nonclaim statute of the decedent's domicile before the giving of notice to creditors in this state is barred in this state. C. All claims against a decedent's estate that arise at or after the death of the decedent, including claims of the state and any political subdivision of the state, whether due or to become due, absolute or contingent, liquidated or unliquidated or founded on contract, tort or other legal basis, are barred against the estate, the personal representative and the heirs and devisees of the decedent unless presented as follows: (1) a claim based on a contract with the personal representative within four months after performance by the personal representative is due; or (2) any other claim within the later of four months after it arises or the time specified in Paragraph (1) of this subsection. D. Nothing in this section affects or prevents: (1) any proceeding to enforce any mortgage, pledge or other lien upon property of the estate; (2) to the limits of the insurance protection only, a proceeding to establish liability of the decedent or the personal representative for which the decedent or personal representative is protected by liability insurance; or (3) collection of compensation for services rendered and reimbursement for expenses advanced by the personal representative or by the attorney or accountant for the personal representative of the estate. 1953 Comp., § 32A-3-803, enacted by Laws 1975, ch. 257, § 3-803; 1993, ch. 174, § 73; 2011, ch. 124, § 47; 2016, ch. 69, § 716.

NMSA 1978, § 45-3-804 Manner of presentation of claims

45-3-804. Manner of presentation of claims Claims against a decedent's estate may be presented as follows: A. the claimant may deliver or mail to the personal representative a written statement of the claim indicating its basis, the name and address of the claimant and the amount claimed, or he may file a written statement of the claim with the appropriate court. The claim is presented on the first to occur of receipt of the written statement of claim by the personal representative or the filing of the claim with the appropriate court. If a claim is not yet due, the date when it will become due shall be stated. If the claim is contingent or unliquidated, the nature of the uncertainty shall be stated. If the claim is secured, the security shall be described. Failure to describe correctly the security, the nature of any uncertainty and the due date of a claim not yet due does not invalidate the presentation made; B. the claimant, without the necessity of filing a claim, may commence a proceeding against the personal representative in any court where the personal representative may be subjected to jurisdiction, to obtain payment of his claim against the estate, but the commencement of the proceeding must occur within the time limited for presenting the claim. No presentation of claim is required in regard to matters claimed in proceedings against the decedent which were pending at the time of his death; and C. if a claim is presented under Subsection A of this section, no proceeding thereon may be commenced more than sixty days after the personal representative has mailed a notice of disallowance. However, in the case of a claim which is not presently due or which is contingent or unliquidated, the personal representative may consent to an extension of the sixty-day period, or, to avoid injustice, the district court on petition may order an extension of the sixty-day period, but in no event shall the extension run beyond the applicable statute of limitations. 1953 Comp., § 32A-3-804, enacted by Laws 1975, ch. 257, § 3-804; 1983, ch. 194, § 6.

NMSA 1978, § 45-3-805 Classification of claims

45-3-805. Classification of claims A. If the applicable assets of the estate are insufficient to pay all claims in full, the personal representative shall make payment in the following order: (1) costs and expenses of administration, including compensation of personal representatives and of persons employed by the personal representatives; (2) reasonable funeral expenses; (3) debts and taxes with preference under federal law; (4) reasonable medical and hospital expenses of the last illness of the decedent, including compensation of persons attending the decedent; (5) debts and taxes with preference under other laws of New Mexico; and (6) all other claims. B. No preference shall be given in the payment of any claim over any other claim of the same class, and a claim due and payable shall not be entitled to a preference over claims not due. 1953 Comp., § 32A-3-805, enacted by Laws 1975, ch. 257, § 3-805; 1976 (S.S.), ch. 37, § 12; 1995, ch. 210, § 42.

NMSA 1978, § 45-3-806 Allowance of claims

45-3-806. Allowance of claims A. As to claims presented in the manner described in Section 45-3-804 NMSA 1978 within the time limit prescribed in Section 45-3-803 NMSA 1978, the personal representative may mail a notice to any claimant stating that the claim has been disallowed. If after allowing or disallowing a claim the personal representative changes his decision concerning the claim, he shall notify the claimant. The personal representative may not change a disallowance of a claim after the time for the claimant to file a petition for allowance or to commence a proceeding on the claim has run and the claim has been barred. Every claim that is disallowed in whole or in part by the personal representative is barred so far as not allowed unless the claimant files a petition for allowance in the district court or commences a proceeding against the personal representative not later than sixty days after the mailing of the notice of disallowance or partial allowance. Failure of the personal representative to mail notice to a claimant of action on his claim for sixty days after the time for original presentation of the claim has expired has the effect of a notice of allowance. B. After allowing or disallowing a claim the personal representative may change the allowance or disallowance as hereafter provided. The personal representative may prior to payment change the allowance to a disallowance in whole or in part but not after allowance by a court order or judgment or an order directing payment of the claim. He shall notify the claimant of the change to disallowance, and the disallowed claim is then subject to bar as provided in Subsection A of this section. The personal representative may change a disallowance to an allowance, in whole or in part, until it is barred pursuant to Subsection A of this section; after it is barred, it may be allowed and paid only if the estate is solvent and all successors whose interests would be affected consent. C. Upon the petition of the personal representative or of a claimant in a proceeding for the purpose, the district court may allow in whole or in part any claim presented to the personal representative or filed with the clerk of the district court in due time and not barred by Subsection A of this section. Notice in this proceeding shall be given to the claimant, the personal representative and those other persons interested in the estate, as the court may direct by order entered at the time the proceeding is commenced. D. A judgment in a proceeding in another court against a personal representative to enforce a claim against a decedent's estate is an allowance of the claim. E. Unless otherwise provided in any judgment in another court entered against the personal representative, allowed claims bear interest at the legal rate for the period commencing sixty days after the time for original presentation of the claim has expired unless based on a contract making a provision for interest, in which case they bear interest in accordance with that provision. 1953 Comp., § 32A-3-806, enacted by Laws 1975, ch. 257, § 3-806; 1993, ch. 174, § 74.

NMSA 1978, § 45-3-807 Payment of claims

45-3-807. Payment of claims A. Upon the expiration of the earlier of the time limitations provided in Section 45-3-803 NMSA 1978, the personal representative shall proceed to pay the claims allowed against the estate in the order of priority described, after making provision for family and personal property allowances, for claims already presented that have not yet been allowed or whose allowance has been appealed and for unbarred claims that may yet be presented, including costs and expenses of administration. By petition to the district court in a proceeding for the purpose or by appropriate motion if the administration is supervised, a claimant whose claim has been allowed but not paid may secure an order directing the personal representative to pay the claim to the extent funds of the estate are available to pay it. B. The personal representative at any time may pay any just claim that has not been barred, with or without formal presentation, but he is personally liable to any other claimant whose claim is allowed and who is injured by its payment if: (1) payment was made before the expiration of the time limit stated in Subsection A of this section and the personal representative failed to require the payee to give adequate security for the refund of any of the payment necessary to pay other claimants; or (2) payment was made, due to negligence or willful fault of the personal representative, in such manner as to deprive the injured claimant of priority. 1953 Comp., § 32A-3-807, enacted by Laws 1975, ch. 257, § 3-807; 1993, ch. 174, § 75.

NMSA 1978, § 45-3-808 Individual liability of personal representative

45-3-808. Individual liability of personal representative A. Unless otherwise provided in the contract, a personal representative is not individually liable on a contract properly entered into in his fiduciary capacity in the course of administration of the estate unless he fails to reveal his representative capacity. B. A personal representative is individually liable for obligations arising from ownership or control of the estate or for torts committed in the course of administration of the estate only if he is personally at fault. C. Claims based on contracts entered into by a personal representative in his fiduciary capacity, on obligations arising from ownership or control of the estate or on torts committed in the course of administration of the estate may be asserted against the estate by proceeding against the personal representative in his fiduciary capacity, whether or not the personal representative is individually liable therefor. D. Issues of liability as between the estate and the personal representative individually may be determined in a proceeding for accounting, surcharge or indemnification or other appropriate proceeding. 1953 Comp., § 32A-3-808, enacted by Laws 1975, ch. 257, § 3-808.

NMSA 1978, § 45-3-809 Secured claims

45-3-809. Secured claims Payment of a secured claim is upon the basis of the amount allowed if the creditor surrenders his security; otherwise payment is upon the basis of one of the following: A. if the creditor exhausts his security before receiving payment (unless precluded by other law), upon the amount of the claim allowed less the fair value of the security; or B. if the creditor does not have the right to exhaust his security or has not done so, upon the amount of the claim allowed less the fair value of the security determined, if applicable, by the terms of the agreement pursuant to which the security was delivered to the creditor, or by the creditor and personal representative by agreement, arbitration, compromise or litigation. 1953 Comp., § 32A-3-809, enacted by Laws 1975, ch. 257, § 3-809.

NMSA 1978, § 45-3-810 Claims not due and contingent or unliquidated claims

45-3-810. Claims not due and contingent or unliquidated claims A. If a claim which will become due at a future time or if a contingent or unliquidated claim becomes due or certain before the distribution of the estate, and if the claim has been allowed or established by a proceeding, it is paid in the same manner as presently due and absolute claims of the same class. B. In other cases the personal representative or, on petition of the personal representative or the claimant in a special proceeding for the purpose, the district court, may provide for payment as follows: (1) if the claimant consents, he may be paid the present or agreed value of the claim, taking any uncertainty into account; or (2) arrangement for future payment, or possible payment, on the happening of the contingency or on liquidation, may be made by creating a trust, giving a mortgage, obtaining a bond or security from a distributee or otherwise. 1953 Comp., § 32A-3-810, enacted by Laws 1975, ch. 257, § 3-810.

NMSA 1978, § 45-3-811 Counterclaims

45-3-811. Counterclaims A. In allowing a claim, the personal representative may deduct any counterclaim which the estate has against the claimant. B. In determining a claim against an estate the district court shall reduce the amount allowed by the amount of any counterclaims and, if the counterclaims exceed the claim, render a judgment against the claimant in the amount of the excess. 1953 Comp., § 32A-3-811, enacted by Laws 1975, ch. 257, § 3-811.

NMSA 1978, § 45-3-812 Execution and levies prohibited

45-3-812. Execution and levies prohibited No execution may issue upon nor may any levy be made against any property of the estate under any judgment against a decedent or a personal representative, but this section shall not be construed to prevent the enforcement of mortgages, pledges or liens upon real or personal property in an appropriate proceeding. 1953 Comp., § 32A-3-812, enacted by Laws 1975, ch. 257, § 3-812.

NMSA 1978, § 45-3-813 Compromise of claims

45-3-813. Compromise of claims When a claim against the estate has been presented in any manner, the personal representative may, if it appears for the best interest of the estate, compromise the claim, whether due or not due, absolute or contingent, liquidated or unliquidated. 1953 Comp., § 32A-3-813, enacted by Laws 1975, ch. 257, § 3-813.

NMSA 1978, § 45-3-814 Encumbered assets

45-3-814. Encumbered assets If any assets of the estate are encumbered by mortgage, pledge, lien or other security interest, the personal representative may pay the encumbrance or any part thereof, renew or extend any obligation secured by the encumbrance or convey or transfer the assets to the creditor in satisfaction of his lien, in whole or in part, whether or not the holder of the encumbrance has presented a claim, if it appears to be for the best interest of the estate. Payment of an encumbrance does not increase the share of the distributee entitled to the encumbered assets unless the distributee is entitled to exoneration. 1953 Comp., § 32A-3-814, enacted by Laws 1975, ch. 257, § 3-814; 1976 (S.S.), ch. 37, § 13.

NMSA 1978, § 45-3-815 Administration in more than one state; duty of personal representative

45-3-815. Administration in more than one state; duty of personal representative A. All assets of estates being administered in New Mexico are subject to all claims, allowances and charges existing or established against the personal representative wherever appointed. B. If the estate, either in New Mexico or as a whole, is insufficient to cover all family exemptions and allowances (as determined by the law of the decedent's domicile), prior charges and claims, after satisfaction of the exemptions, allowances and charges, each claimant whose claim has been allowed, either in New Mexico or elsewhere in administrations of which the personal representative is aware, is entitled to receive payment of an equal proportion of his claim. If a preference or security in regard to a claim is allowed in another jurisdiction but not in New Mexico, the creditor so benefited is to receive distributions from local assets only upon the balance of his claim after deducting the amount of the benefit. C. In case the family exemptions and allowances, prior charges and claims of the entire estate exceed the total value of the portions of the estate being administered separately, and New Mexico is not the state of the decedent's last domicile, the claims allowed in New Mexico shall be paid their proportion if local assets are adequate for that purpose, and the balance of local assets shall be transferred to the domiciliary personal representative. If local assets are not sufficient to pay all claims owed in New Mexico in the amount to which they are entitled, local assets shall be marshalled so that each claim allowed in this state is paid its correct proportion as far as possible, after taking into account all distributions on claims allowed in New Mexico from assets in other jurisdictions. 1953 Comp., § 32A-3-815, enacted by Laws 1975, ch. 257, § 3-815.

NMSA 1978, § 45-3-816 Final distribution to domiciliary representative

45-3-816. Final distribution to domiciliary representative The estate of a nonresident decedent being administered by a personal representative appointed in New Mexico shall, if there is a personal representative of the decedent's domicile willing to receive it, be distributed to the domiciliary personal representative for the benefit of the successors of the decedent unless: A. by virtue of the decedent's will, if any, and applicable choice of law rules, the successors are identified pursuant to the local law of New Mexico without reference to the local law of the decedent's domicile; B. the personal representative of New Mexico, after reasonable inquiry, is unaware of existence or identity of a domiciliary personal representative; or C. the court orders otherwise in a proceeding for a closing order under Section 3-1001 [45-3-1001 NMSA 1978] or incident to the closing of a supervised administration. 1953 Comp., § 32A-3-816, enacted by Laws 1975, ch. 257, § 3-816.

Source: New Mexico Compilation Commission (nmonesource.com)URL: https://nmonesource.com/nmos/nmsa-unanno/en/item/18546/index.doFetched: 10/20/2026