One of the biggest concerns that clients share with me is the fear that after they pass their children, or other beneficiaries, will get into nasty fights. Oftentimes, the fights arise from undealt with familial issues and play out with one child vying to get a larger share or take possession of a beloved family heirloom. This fear is all too real a threat as we have seen countless families torn apart by horrible arguments that go against what the parents stated in their plan.
In all my years as an attorney, I have found that the best way to deal with these potential problems is to cut them off before they have a chance to become a real issue for the estate. The way to do this is by including a “No Contest” clause, also known as an “In Terrorem”. By including this language in an estate plan, the trustors ensure that if any of their beneficiaries try to dispute the terms and take the estate to court, they will lose their share of the assets entirely.
It may sound a bit extreme, but the threat of losing their inheritance is a proven way to prevent beneficiaries from trying to alter the explicit wishes of the deceased. A No Contest clause works best when you leave something to the potential challenger. If the challenger would receive nothing anyway, he or she would have nothing to lose by challenging your wishes. A bequest that is significant under the circumstances might make the challenger think twice before challenging your wishes.
No family is exempt from fights, and it is best to use every tool at your disposal to ensure that your wishes for your loved ones are protected. In addition to including a no contest clause, we highly recommend that you have a conversation with your children and beneficiaries to communicate the decisions you have made. This can be helpful in heading off any future conflict as it gives you the opportunity to explain why you have made the choices in your plan and what you hope for your family when you are no longer here.
If you have questions about your estate plan and protecting your family from possible feuds, contact our office today!