If you’re planning on cleaning out an estate yourself, rather than hiring a professional company to do the work, you could be opening up yourself and the estate to a wide range of costs and liabilities that won’t necessarily be covered by insurance.
Most families don’t take these risks into consideration, which usually turns out just fine. It’s when something breaks or someone gets hurt that problems can crop up.
It’s our job to dig into the full legalities of estate settlements. As part of our DIY estate settlement series we take a careful look here at the top four legal liabilities and risks of cleaning out an estate, and share tips on how you can protect yourself.
If it’s financially feasible, pay at least minimum wage to everyone who is going to help with cleaning out an estate and distribute items to beneficiaries, and have them fill out a form 1099 - even family members. This is important for two reasons. First, turning your help into contract workers can protect you and the estate if Cousin Jon injures his back while emptying the attic. Second, trading work for items from the estate creates the risk of unfairly distributing valuable items.
Unfair distribution of assets could be a fiduciary liability for the estate executor, and could also generate unnecessary strife among family and friends who are otherwise working with the best of intentions. This is why we don’t allow our teams to take tips or be gifted anything from a house we are working on. A small keepsake may seem like a low-value item to one family member, but represent huge financial or emotional value for another.
Whenever possible avoid letting people come into the house. For example, if items are being donated to a charity, and the non-profit is going to pick them up, place them on the curb instead of having the driver come onto the property to collect them. If the donated item is a piano or anything else too big or heavy to move before it gets picked up, again, make sure the recipient is covered by their own insurance or have them sign a waiver of liability before they come into the house. Similarly, if someone is coming to collect the vacuum they bought on Craigslist, move it outside before they get there, or have them sign a waiver. Of course, if you hold an estate sale on the property you’re going to have to let people come through the house. To protect yourself and the shoppers, close off any areas that aren’t necessary for them to access, and put up warning signs around anything potentially dangerous. If feasible, you can also set up a table at the door or in the garage and manage it like a checkout counter. You might need some additional assistance to bring items out to people as they come to pick them up, but that’s a small cost relative to facing a lawsuit.
"Cheap" labor is not cheap if someone gets hurt and sues the estate or the family member you are trying to help. Volunteers may not be covered if they inadvertently damage a valuable family heirloom. Not every homeowner’s policy includes some form of insurance to cover damage incurred while cleaning out an estate.
To avoid that liability, we recommend that you consult with an attorney, and then have everyone who is going to be helping with the project, even close family members, sign a waiver of liability. And if you hire professionals to come in, such as contractors or a moving company, make sure they they provide their own insurance. Without those waivers you are literally risking your family's assets every time you let someone come onto the property, especially if they are doing anything resembling work on the premises.
Even if a home is in pristine condition we still recommend using a full array of protective gear when cleaning out an estate. Wearing protective footwear (ideally steel toed boots - you never know when you might drop something) and gloves help protect the home, its contents and anyone doing any form of work in or on the house. If there is concern of tracking dirt into the home, we always recommend putting some booties over shoes or boots.
We also recommend workers wear masks and goggles, no matter what they are doing in a house or how clean it appears to be. Even in the cleanest houses you’re going to kick up dust and particles when you start moving things around, so protect yourself and those helping you from hazards that can damage the eyes or cause allergic reactions. Lastly, although not strictly required in most cases, purchasing cheap hard hats for all of your “crew” is usually a good idea. You’d be surprised by the variety of ways you can bump your head.
Nobody expects accidents to happen, but the fact is that cleaning out an estate is the type of hands-on project where someone could get hurt or valuables could get broken. Taking prudent precautions from the beginning can help protect you, the estate and your helpers.