Estate Planning -Intent to Disinherit or Oversight?

Copyright 2006 Ronald Hudkins

Sometimes family and estate planning begins before the family is complete, particularly in an age where people (generally) are waiting until later to have children. In that case there could be grandchildren named in a will and others not, who are all in the same family. The reason may simply be that the children who were left out were not born when the will was made and it is too late to remake it.  Fortunately, most states now have laws that are designed to remedy this situation.

Generally children are protected if they are left out, because they are considered to be overlooked as opposed to specifically disinherited.  Some states protect spouses and grandchildren under the theory that they have been omitted rather than excluded.  But, states have a couple different ways of handling omitted relatives.  Many states assume that if the testator (the will maker) had a chance or had not forgotten to do so, that they would have included the omitted relative.  This is important because the suggestion is that naming the individual would have been the testator’s intent had they recognized the omission.  Other states make no mention of what the testator’s intentions would have been, because they want a testator who intends to disinherit someone to do it using positive language rather than just not mentioning that person.  Both of these approaches can fly in the face of the facts regarding what the testator wanted or intended.  But, one thing is clear, if you intend to leave someone out of your will who is a close relative you must do so expressly.  That can be done by saying something like, “And, to my wife Sheila I leave nothing,” or “To my son Thomas, I leave the kick in the rear end I should have given him years ago.”

Such a scenario is a nightmare for your estate planner who knows that Shelia and Thomas will challenge your will because they have no reason not to. As was discussed in a previous article, it is better to leave a relative something that they are afraid to lose and use a no-contest clause in many instances.  However, sometimes a client is clear in the desire not to leave a thing to one of his/her relatives.  This is become increasingly difficult under state laws that protect omitted relatives and disfavor no-contest clauses.  It is another case of laws that are designed to protect our interest also protecting us from being free.  Why shouldn’t the testator be able to disinherit those they don’t like with ease?  Why should the government decide who your assets will go to?  Remember that most people die intestate so the state is used to making these decisions, but why should they be able to do so if you make a will?  Perhaps it is another legal road paved with good intentions or perhaps it is another instance of big brother deciding for you.

This is another pitfall that your estate planner will be able to help you avoid.  If you want to disinherit someone, then let your estate planner clearly know your intention.  There is nothing wrong with that.  Remember that, as an attorney, your estate planner’s job is not to judge your wishes, but to make them happen and guard you and your estate against what you don’t want.  Your estate planner should not, and most likely will not, make you feel judged.  They work for you and have taken an oath to faithfully serve your legal wishes to the extent that they have the legal power to refuse to break your confidence even after you pass away.  Any estate planner who isn’t ready to fight tooth and nail to see your wishes met is not doing their job.

Just remember that if you intend to leave someone out of your will, you can do that.  And conversely, your estate planner can help you provide for extra grandchildren that you may not have been lucky enough to meet, but that you still might help go to college.

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Estate Planning And The Revocable Living Trust

What is a revocable living trust?

According to Plan-My-Estate.com - With a Revocable Living Trust, you transfer the title of any of your assets (such as a house) from yourself as an individual, to yourself as Trustee of the Trust. Then you, as the Trustee of the Trust, manage the assets of the Trust for the benefit of the beneficiary, which is you. In this manner, you keep complete control over the assets. Once you pass on, a Successor Trustee takes over the management of the asssets for the benefit of the beneficiaries that you named in your Trust. Your assets do not have to pass through Probate because the assets are no longer titled in your name as an individual, but are now titled in the name of the trust. Upon your death, the Successor Trustee simply transfers your assets directly to your beneficiaries without the need for court or attorney's fees or costs.

With a Revocable Living Trust you keep complete control over your assets and ensure that your assets are passed to your designated beneficiaries without delay or unnecessary costs.

Why use a revocable living trust as part of your estate planning strategy?

1. Assets funded into the trust avoid probate. This can save your beneficiaries time and money and if there is no probate, there is probably no public record of the distribution of assets. Note, however, that only the assets written into the trust agreement are covered by the trust. If you win the lottery today and die tomorrow without amending the trust, the winning proceeds will not be covered and may have to be run through probate.

2. You decide when and what principal and or income will be passed to which beneficiaries and for what purposes the income or principal can be distributed, ie: so and so can only use the money for educational purposes. If it's not used for educational purposes by a certain date then it goes to another beneficiary. Or, the income from the trust is to go to your current spouse and when she dies or remarries or what ever condition you wish to add, the assets are to be distributed to your children, or your children are to recieve the income from the trust untill they reach a certain age and then the assets are to be distributed as set up in the trust.

3. The trust's assets are normally protected from the beneficiary's creditors as the trust owns the assets not the beneficiary. Note: The trust's assets are not normally protected from your creditors. Because a living trust is revocable your creditors can usually go after the assets.

You should consult with an attorney who specializes in estate planning.

While a living trust can offer many advantages in addition to the foregoing, it also has various disadvantages. The advantages and disadvantages can depend on both your financial and personal situation. A good attorney will go over your both your financial and personal situations and then provide you with proper advice about planning and protecting your estate and assets.

David G. Hallstrom, Sr. is not an attorney and the foregoing information is not given as legal advice. It is instead given as information and opinion gathered and developed through experience over the last thirty years as a private investigator dealing almost exclusivly with attorneys. The author also interviewed various estate planning attorneys prior to writing this article. Although the author believes the information to be accurate no guarantee is made or implied. As in all legal matters the advice of a competent attorney should be sought when planning or attempting to protect your estate.

This article may be reprinted, at no charge, provided that credit is given to the author and that any links contained herein are retained and kept active. ©Copyright 2005 Resources For Attorneys. All Rights Reserved Worldwide.

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Estate Planning - Changing A Will
Copyright 2006 Ronald Hudkins

“I am taking you out of the will,” or “I am going to disinherit Gregory and leave all my money to Steven,” are statements that seem far more like they belong in an Agatha Christie novel than in a serious discussion of estate planning.

Although the world is not filled with conniving relations who maneuver endlessly to gain the favor of a truly despicable older family matron or patron who uses their wealth to control them all until it culminates in murder most foul, this model is instructive regarding how changing a will can cause hard feelings between family members and create legal difficulties.  The chief legal difficulty created by changing a will is that sometimes the two wills look like sequels to a movie and are literally called (Will I) and (Will II).

When this happens there will be, just as in the Agatha Christie mysteries, a group of relatives and friends who are favored by the first will (Will I) and not by the second (Will II). These relatives realize that if they can challenge and get rid of Will II, Will I will take its place, and they set out to get rid of Will II after the deceased is gone and can not take further action.  Of course there are also the relations or friends that are favored by the revised will (Will II) and fight to keep it valid in the eyes of the law.   There are many ways to attempt to invalidate a will that can be the subject of another article.  The point of this article is to make it clear that changing a will by substituting it with another will drafted later in time is an exercise fraught with peril.

A better way to go is to expressly change from one will to the other or to expressly repudiate the first will.  An express change is a change in writing.  For example, if you want to get rid of the first will write that, “I hereby repudiate the first will with this writing and all of its provisions hereby are to be considered void.”  It is difficult to get around the fact that you intend to get rid of the first will entirely if you fail to make such a claim in writing.  Once that is settled, then you can begin the second will by stating again that you made another will before and that it is entirely void and does not in any way reflect your desires with respect to your property.  And finally, include in the second will that it and it alone are a reflection of what you want when you are gone.

Another good way to go is not to let anyone, other than your attorney, know you are making a will or replacing an old will with a new one.  People cannot fight over what they have no idea exists or has existed.  This is a good way to keep the elements of an Agatha Christie novel regarding wills out of your life and the lives of your heirs.  The fictional tyrant who rules the family with their notions of inheritance or disinheritance is the kind of person who has people fighting over their will because they are always blabbing about it.  With wills it is best to adopt the policy that loose lips sink ships when it comes to your relatives fighting over what you meant after you are gone. This is not what anyone wants for their families and, with a little discretion and a lot of planning, it is easily avoided.


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Estate Planning - Capacity Challenges

Copyright 2006 Ronald Hudkins

Wills and trusts have an interesting history in a culture as heavily influenced by British common law as our own.  The bequests of wills have been the pole star around which a great deal of mystery fiction has been written where furtive and anxious relatives wait around a long imposing table to hear what is to become of the family fortune and thus; what is to become of them.  As usual, fiction and the media give one side of what something has been or is, while the other side of the tale exists behind the scenes or on an obscure back page of a newspaper.

What is not often shown about a will is that it is contested.  Perhaps this is because the craving for legal courtroom drama is a relatively new phenomenon, and perhaps because the way the family members behave toward one another over large sums of money is too violent even for television.  Wills are contested in long bitter rivalries that often leave no member of the family unscathed.  Often there are two opposing camps and each relative must decide which “side” they are going to be on.  It is refreshing when the sides earnestly agree that they each wish to bring about what they believe the deceased would have wanted, but it is more often the case in which that is merely the incantation recited to get what each opposing camp thinks is their due.

One means of opposing a will is to suggest that the person making the will was crazy when they made it.  That is why even most lay people begin their will with the phrase, “I (so and so) being of sound mind and body….”  This legal doctrine is not unique to wills, but affects the right to enter into contracts and agreements of all sorts.  In the context of wills, this is called capacity.

Capacity can be broken down into two elements -- first, the will maker must not be mentally deficient. For the most part this means that the will maker must understand what they own, who will get it and the basic arrangements used to get that person whatever it is they are to receive. These elements combine such that the will maker must understand how these elements relate.  It seems that video taped sessions where the deceased explains the whole process are changing the applications of this law.  There is the deceased on-screen explaining who gets what, why and how and in what way that affects the rest of his/her property.  Note that the requirement of mental deficiency is not about what the person understands generally, but what they understand about what they own.  It is tempting to wonder if this requirement stems from the fact that the rich are allowed to be ‘eccentric’ to a certain extent in our society.

The second prong of capacity is whether the will maker is operating under an “insane delusion” or “mental derangement.” However, again, this insane delusion or “false belief against reason,” is not about anything other than the assets in the will.  Provided that someone has an insane belief against reason, it doesn’t matter unless it affects the property divided up by the will.  If someone believes they see dead people, but doesn’t attempt to leave money to any of them, then that is probably all right.  Usually, insane delusions come in the form of an irrational belief that someone is not the deceased’s child or that the deceased spouse has been disloyal in the conjugal sense.  But, again the deceased can hold a whole host of irrational beliefs about matters other than their property, and that would not invalidate their will.

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Estate Planning - Rules and Trustees
Copyright 2006 Ronald Hudkins

If you are wisely attempting to put some assets into a trust (inter vivos) in your lifetime, then you have been paying attention to the important differences between wills and trusts.  A trust created during your life will be far more secure with respect to its ability to withstand challenges to how your assets are to be distributed during estate planning than a will.  Making a trust is a brave thing to do, because it telegraphs, to a certain extent, what you are going to do with your assets while you are still alive.  This is what insulates it from attacks on your capacity, because it is unlikely, for example that, one of your relations is going to say you are insane or feeble and unduly influenced by another of your relatives to your face and this makes the trust a far surer bet than a will, in some cases.

However, the trust also may engender hard feels regarding the exclusion of a relative and those feelings will become known to a person creating a trust while they are still alive.  This is the advantage of a will -- if people don’t like it, you will never know.  The will maker is long gone when those that don’t like what they have done contest the will and those that do like it try to defend it.  Although, it should be noted that clever drafting should be able to alleviate the necessity of either a contest or a defense.  That is why you need a clever estate planning attorney to create your will rather than just a form.  The attorney that creates your will often defends its contents, or in other words, their understanding of your wishes.  The trust is a different story, because your trust will be administered by someone (called the trustee) for the purpose of those that the trust benefits (the beneficiaries).

One of the paramount problems of forming a trust is deciding what powers the trustee has and what powers they do not have relative to the assets you have placed in trust.  Remember that a trustee is already assumed to have a duty to benefit the trust and that many states have laws regarding what a trustee can and cannot do, if the settlor (the creator of the trust) does not specify otherwise.  But, again, you don’t want to leave the financial destiny of your trust up to the state any more than you want the state to decide who gets your assets.  Your wills and trusts attorney will be able to give you a list of the traditional powers of a trustee in your state and tell you what they mean.  Many of the powers concern what type of assets the trustee can invest in on behalf of the trust.  For example, the trustee is sometimes prohibited from buying general securities for the trust because they are considered too risky.  But, if you have chosen your trusted stock broker as your trustee and she has agreed, then this might be exactly the restriction you don’t want.  Consult with your attorney about the kind of trust you would like to create and what the rules are in your state.  Remember, that these rules are there to cover the bases in case you don’t make your own rules.  Understanding the rules that are there, and why, will give you a sense of the kinds of rules that might be good and the ones that you would rather not have.  In addition, you will be able to give the trustee more freedom than the state rules would allow, or less, depending on how conservatively you want your assets to be managed.

Be prepared to have a candid conversation with your attorney regarding what the rules are and what you would like to see happen.  It is good to remember that your estate planning attorney has seen many trusts and understands how they work.  Sometimes restrictions that seem good today might be the very restrictions that cripple your trust in a vastly different economic environment.  In some cases, a trust may span several decades and the trustee may change along with the climate the trust was created in. When radical economic changes have occurred, a trust with greater flexibility will be beneficial.  So you have a lot to think about as you enter the exciting world of forming a trust.  Don’t let rules be off-putting, they are there as guides and when you understand them you will have a greater understanding of what you need.  Ask your estate planner to give you information about the current rules and some general advice about how to choose a trustee.



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Estate Planning ? Considering a Second Marriage Late in Life
Copyright 2006 Ronald Hudkins

As the life expectancy of people in the United States increases, the reality of second and third marriages becomes more likely even for those who tend to marry for a long time if not until the death of their first spouse.  Widows and widowers are increasingly likely to meet and decide that a second marriage is an excellent way to avoid spending their autumn years alone and that love is not the exclusive province of the young.  It is often a surprise to adult children to meet the boyfriend/girlfriend or husband/wife of their elderly parents.

However, remarriage later in life creates a unique set of legal questions that those who are getting married don’t often think through.  For example, many older clients take it for granted that their adult children will inherit from them when they pass away, because the majority of their property and life has been spent with their previous spouse who was often a co-parent to those children and the one who helped to build or sustain the family assets.  But, a new marriage means that the marital property is governed by the laws of the new marriage.  Absent any prenuptial agreement, the surviving spouse would, in most jurisdictions, receive at least half of the marital assets, which means that the adult children from the first marriage might be in for a big surprise if they think the family home that their family has owned for years will become theirs.

Another problem is that as people get older they often move to places where it is warmer.  This means that they move to states where they have not traditionally lived before and these states not only have different (warmer) climates, but different laws as well.   If they spend the colder months (or the entire year) in these states, it becomes increasingly likely that they will pass away in these states.  But, are the laws of the state in which they pass away the ones that control the transfer of their assets or do the laws of where they have lived most of their lives control that transfer?  If they have a will, then this question becomes even more complex.  Often the real property (real estate) assets are governed by the laws of the state in which they sit, whereas the personal property (bonds, stocks, money, possessions) are controlled by the laws of the state that is their final residence.

The problems that are created by second marriages should not be taken lightly.  It is important to talk these things through with your future spouse because, chances are, they want to make sure that their adult children get their assets upon their passing just as much as you do.  If you don’t have a frank discussion with your would-be spouse, you may end up causing all those whom you love a great deal of heart ache and confusion as they struggle to figure out what would be best and what you would have wanted.  This happens every day -- earnest people do their best to honor their deceased loved one, but honestly and simply disagree about what he/she would have wanted; a situation further complicated by those who just want to fight for any dollar they can get.

Consult with an attorney who can help you set up an agreement waiving certain marital rights that may be tailored toward married couples who start out together, rather than those who meet later in life’s journey.  Be prepared to be honest and up front about what you want and ask your attorney what kinds of problems they commonly see with respect to estate planning and autumn romances and how they think such problems are best avoided.  Your attorney will have plenty of good ideas that will ultimately help you safe-guard the important people in your life.


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Estate Planning - The Life Estate
Copyright 2006 Ronald Hudkins

The life estate is something every first year law student learns about when they study the arcane and often bizarre history of property law that harkens back to the days of English knights, lords and serfs, and the transfer of property through the ceremonial throwing of dirt clods with oaths of duty to accompany.  The life estate is about as old as they come as instruments of wealth transfer go and students love it, because it is relatively easy to understand.  Apart from what students love and what is easy to remember, however, the life estate still has practical value today in your estate planning and assets management schemes.

The basic idea of the life estate is that a person can be left a piece of property for life, and upon their passing, the property in question can go to whoever is designated to receive that property afterward.  The individual or group who receives the property after the life-tenant passes is called the remainderman or remaindermen, which is useful only in that it helps one to remember that the person who remains gets the property.  If, for example, one wants to leave a family estate that has been with the family for many generations to their spouse and then have it immediately pass on to their children or another relative who will maintain the estate for the generation to come, then a life estate might be the perfect vehicle to do so.  Another example is the same family estate, left to a surviving spouse until the surviving spouse either dies or remarries.  Again, the aim is to ensure that the estate stays in family, a contingency which is threatened by the remarriage because that creates a new marital joint-tenancy, absent any other provision.  Often the life-estate was used to keep assets, like the family home, headed down a single line of familial ownership.

However, the life estate has other uses, for example, it can leave an asset to be owned by one person until the death of third person.  If an older relative has become incapacitated, such that it is difficult for them to make decisions for themselves, then the asset can be left in the care of another for the incapacitated person’s lifetime.  An example might be, that Blackacre (the fictitious name for a piece of property used in law schools everywhere) is left in the care of cousin Tilly, until great aunt Nelly’s death.  Thus, Tilly is allowed to make Nelly comfortable at Blackacre (the family home) until Nelly passes on.  In this instance, Nelly’s life is what is called, the measuring life of the life estate, and Tilly’s ownership ends when Nelly is gone.

On the whole, the life estate may be falling out of use for a number of reasons and being replaced by the much more fluid instrument of the trust.  But, the life estate still captures, from time to time, our instincts regarding how property is to pass from one generation to another and that is why it is still relevant even for an estate planner who uses it very rarely.  It helps us to ask and to get the answer to very difficult questions, which is part of the act of estate planning.  Both the client and the attorney must face tough questions, and the life estate (even if it is sometimes regarded as a legal relic of the past) tells us how people used to answer questions of intra-generational wealth transfer and why.  We may use different instruments to bring about our legal ends (or we may not), but even if we do, the life-estate still has relevance in helping us think about the questions that underlie the choices to be made in estate planning.


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Estate Planning - Real Property Disbursement Problems
Copyright 2006 Ronald Hudkins

Many parents want to give an equal share of the family home or some other sentimental form of real property (actual land usually) to their surviving children in equal shares.  As an estate-planning attorney, one often sees the strange problems created by such plans.  In particular if there are an even number of children, this may create hardships as voting blocks of family members eventually have to resolve votes that are evenly split in court or at least face the hardship of that choice among their siblings.

Suppose, for example, that well-meaning parents leave the family home to four children who are well intentioned adult human beings who generally wish to treat each other fairly, as family members often endeavor to.  The problem is that four children will usually have some important differences in age, lifestyle and financial needs.   When four such people own property, they must all pay a fourth of the tax and of the general maintenance and upkeep of the property.  Suppose one of the children is unsentimental about the family home and wants to sell the property to finance a business or vacation, and two of the other children want to keep the family home to gather for Christmas (or any other important holiday).  The fourth child has a hard time deciding, but is also having financial difficulty paying their share of the taxes, maintenance and upkeep.   In order to keep the home and avoid going to court, the two children who wish to keep the home will have to pay the other children what their shares of the property are worth.  This can create definite hard feelings even if the children who wish to keep the property have the ability to pay the others for their interest in it.   When family Christmas (or any other important holiday) comes around, the children who sold their share of the property will feel badly about using it for the celebration of Christmas around their siblings who had to pay to keep it. By the same token, the children who had to pay to keep it may feel awkwardly about having to share it with their siblings whom they had to pay.  This kind of thing can create long standing rifts in a family, difficulty between relatives who formerly got along well together.

The problem, from an estate-planning point of view, is that the property was given in equal shares to prevent any of the children from having their feelings hurt or feeling less loved and important than the other children.  If, an estate planner does not help their clients see this possibility, for it is a very likely situation in the real world, it is felt that they (the attorney) have failed.  Unless the family is extraordinarily wealthy the possibility that they will have differing financial needs is very common.  Anyone who is a middle class American is usually at some point in need of money, particularly if they have children.

It is important for both the client and the attorney to face tough questions and to look toward non-idealized versions of the future when crafting estate planning strategies.  The problem of the four children is easy enough to fix, but it illustrates a more important principle.  When you are ready to start your estate planning it is important that you answer hard questions for yourself.  Clients should be asked questions about how they have seen other families handle wills after their loved ones have passed on.  Usually the client is able to tell stories about the greedy children or relations of others, and that helps broach subjects that might otherwise be difficult to bring up.  When you prepare to visit your estate planner remember the worst family you ever heard of and imagine that part of the problem that they were having is because bad estate planning forced them to do things they might not otherwise have done.  If there is any skill estate planners try to hone, it is the ability to talk to their clients about why they are asking for certain bequests and to help them see that there are several options to reach the goal they are seeking, rather than offering them a cookie cutter version of  a will or trust.


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Offshore Trust - Effective Estate Planning, You Decide
Copyright 2006 Ronald Hudkins

The creation of offshore trusts and other financial plans is a way of shielding your assets from the laws of the nation in which you reside.  It can sometimes be used to remove one of the two certainties of life; taxes.  Americans are far less likely than the citizens of other countries to put assets abroad because, although when you receive the benefits of being free of your country’s laws regarding assets (namely taxation) you also lose the aspect of those laws that are designed to protect your assets.  Americans are far more likely to just accept taxes, because our country has an enviable financial system that people around the world wish to participate in already.  However, many people would like to know more about offshore banking options for a portion of their wealth because they view taxes as an all too unnecessary evil.  Whenever we read stories about the government buying a hammer for $500 from a certain large corporation (Name omitted to avoid liability) as part of a no bid contract, we may begin to entertain the idea of placing personal assets offshore.

Another reason many Americans decide not to use offshore asset protection options is that they are advised by their attorneys not to do so.  This is because offshore asset protection (while desirable) is a topic that your attorney may be very unfamiliar with and therefore uneasy guiding you through it.  Attorneys are as afraid of being sued for malpractice as any other professional person is and while most estate planning attorneys in the United States understand the laws that govern asset protection domestically, they are not as well versed in protecting their clients’ interests abroad.  For that reason, many well-intentioned, responsible and highly-able attorneys fear putting their client’s interests into a system where they cannot as easily protect them, and thus, they advise against taking assets abroad.  If your own attorney has discouraged you from taking assets abroad in the past, it is a good sign that he/she genuinely cares about serving your needs as a client and is doing his/her level best to look out for you and your family.  On the other hand, it is often true that asset protection in another country requires an attorney from that country, so it may be that it is simply a matter of greed and a desire not to lose your business to someone else that motivates some members of the profession to discourage offshore asset protection.

But, in an increasingly global marketplace it will become more and more common for estate planners to be well versed in the finer points of offshore asset management and the rewards that it can bring.  Offshore asset management can be a powerful tool in the world of estate planning and it will become the norm for professionals in the field of estate planning to understand this complex field of law or begin to lose business to those who do understand how to take care of their clients needs using every available strategy in a global market.



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Estate Planning - No Contest Clause in your Will
Copyright 2006 Ronald Hudkins

There is value in the story of an older client who had seen a very interesting clause employed in a will.  There was a great deal of money at stake and the many family members had little reason to love each other, because they had never met and never knew of each other’s existence.  It was expected that the will would be heavily contested on several different fronts in every conceivable way.   The testator realized that a truly lengthy contest would result with the bulk of his estate in the hands of people he really didn’t care for in the least: Lawyers.

In fact, that is not an unworthy consideration in a heavily contested will or long fought divorce; lawyers may end up with the bulk of the estate or marital property.  The move to arbitration is one of the ways that the legal profession is trying to prevent these unseemly outcomes.  The clause that this client had seen employed in his grandfather’s will was like the following, “Anyone named in and contesting this will receives the maximum bequest of $1, regardless of the outcome.”  This clause meant that regardless of whether the litigant had proven undue influence or diminished capacity or fraud, they would still only receive $1 as a bequest specifically because of having brought and proven their claim.  Since none of the family knew or trusted one another a great deal, this effectively eliminated potential contests.

Often testators anticipate their will to be contested and they wish to insert what is called a no-contest clause in their will.  The no contest clause is exactly what this elderly client had described, because it was designed to terrorize a would-be contestor of the will into thinking twice about facing the threat of getting just a dollar rather than the sum they had been left.  Such clauses are also sometimes called terrorem clauses, because they are designed to scare the beneficiaries into accepting the bequest they are given.  The no-contest clause described above was executed correctly in that each relative was wisely given something in the will that was worth the fear of losing.

In drafting a no contest clause, it is important not to entirely disinherit someone or to give them a bequest that is not something that they are afraid to lose.  If someone is entirely disinherited, then they risk nothing by contesting the will.  If they are successful, they may be able to have the will nullified in whole or in part.  That is risked when the testator decides not to give someone who would traditionally receive money nothing at all.  That is a mistake, a crucial error in such a clause, where the person who might challenge is given nothing to fear losing and therefore has no reason not to contest the will with every possible means.  This situation is made worse when there is a group of people who are “disinherited,” and contesting the will.  When this happens, the rest of the family must wait to inherit, which may cause substantial hardship on those who have done nothing wrong and are often those who are nearest and dearest to the testator.

Many jurisdictions refuse to strictly enforce no contest clauses because they discourage valid and invalid contests alike.  These states look to “probable cause” to bring the contest and, if there is any, refuse to enforce the penalty against the challenger.  Furthermore, no-contest clauses are falling out of vogue legally and are being construed very narrowly by courts.  Many enquires into the will are not deemed contests in the eyes of these courts, because they wish to see no contest clauses become a thing of the past.

Before deciding to insert such a clause you should ask your attorney how your state is handling them and what is likely to happen in the future.  In addition, you must make sure that those whom you decide not to make a substantial part of your will and attempt to intimidate with a no contest clause are left some amount of money that they would think twice about losing.

However, there may be better ways to leave your assets to those you choose rather than that traditional will.  For many reasons the living trust is the superior instrument for most people’s needs.  It is important to consult your attorney to find out the best way to protect your assets and whether a will with a no contest clause is a viable option in your state. A will, in many ways, is too encumbered with restrictions that make a trust a much better option if you would like to leave your assets to those that you choose and reduce the chances of your desires being challenged.  Again, as always, ask your local attorney for advice about your wishes and find out whether no contest clauses are becoming a thing of the past in your jurisdiction.


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