Don’t Allow a No Contest Clause to Intimidate You

No contest, or in terrorem, clauses are designed to discourage beneficiaries from contesting a decedent’s Will.  Basically, it states if a beneficiary attempts to contest a Will and loses, then they forfeit their right to whatever they were left in the original Will.

Do not let the no contest clause deter you from contesting a Will especially if you feel strongly that something is not “right”.  In Texas, the courts typically do not enforce these types of clauses if the complainant can show that their objection was made in good faith and the allegations are not frivolous or unsubstantiated.

There are several reasons why you may feel the Will to be invalid or suspicious. The courts generally recognize only a few arguments. These arguments include:

Lack of testamentary capacity: This means that the decedent did not understand what was being given to whom or, in some cases, did not realize they were signing a Will.

Due execution: There are certain things that must be present in order a have a Will be considered valid.  If some of these items are missing, this can be considered grounds for contesting the document.  Witness signatures would be a requirement.  If a Will is handwritten (holographic), then it must be written in the testator’s handwriting and signed by them.

Undue influence: This refers to the case where certain individuals have sway over the testator and influence the distribution of the assets of the estate.  Typically, the majority of the assets are bequeathed to that individual instead of being distributed among other family members or friends. This distribution of assets is typically the opposite of what the decedent may have indicated in the past verbally or in previous Wills.

One of the most important decisions you will be required to make when considering to contest a Will is who you will choose to represent your interests in court.  This is certainly not a case where you will want to represent yourself.  Probate and estate law is extremely complex and can involve tax and inheritance laws as well.

You would be best served by choosing an attorney who is not only well-versed in the applicable laws, but also one who is experienced in estate litigation.

Give us a call to schedule a consultation with one of our attorneys to discuss your concerns.

Can a Guardian Change the Trustee of Their Ward’s Trust?

If you have created a trust to protect your estate for your family when you pass on, typically you maintain a certain control over it.  However, what happens if you become incapacitated?  If you become unable to take care of yourself or make decisions, the courts may appoint a guardian to look over you and your affairs.  Yet, how much power does this guardian have?  If they so choose, can they remove a trustee and take control of your trust or award it to someone else without your approval?

The answer to that varies depending on the unique circumstances of the case.  In some cases, your guardian does have that power, but they need to go to court to get it.  If your previous trustee has passed away and your successor trustee is about to be appointed, your guardian may be able to step in and say no.  Your successor trustee doesn’t even need to be exhibiting suspicious behavior.  If their mental capacity or ability to effectively manage the trust is called into question, the courts may grant the right to guardian to appoint another as long as it is in the best interests of their ward.

However, if a trustee has long taken care of a trust, has been doing so legally and successfully, and is as stable in mind as they always have been, there is very little chance that the guardian can remove them.  All a guardian needs to do is plead their case for a new trustee in court, but the court will only allow a trustee to be removed by a guardian if the trustee is somehow detrimental to the ward or their estate.

If you are a guardian of the estate and suspect wrongdoing to your ward’s trust on behalf of a trustee, contact us today. As a guardian, it may not seem like your place to step in, but you were appointed to care for your ward and their interests. Making sure a trust is well run is definitely well within their interests.

Can Probate Possibly Be Avoided? Four Ways You Can Do It

Is it possible to avoid the entire probate process? Probate is the process of having your Will recognized by the Court and having your wishes fulfilled following your death.  It is the process where your debts are paid and your remaining assets are transferred to the people you have named in your Will.

Create a Trust

One way to avoid probate is by creating a revocable living trust. Once you transfer your assets to the trust and they aren’t under your name anymore, the assets won’t have to go through probate.  Creating a trust to avoid probate can be very problematic if you do not get all of your assets transferred into the trust prior to your death.  In that case, your estate may still have to go through probate even though you have the trust.

Designate Beneficiaries

Another way is to designate beneficiaries on your accounts. Listing beneficiaries isn’t limited to life insurance and retirement plans. You can list beneficiaries on your financial accounts, such as your bank and investment accounts, so that the money goes straight to the beneficiary after death, without going through probate. This is also known as pay on death accounts. In some states, you can do this on real estate and vehicle registrations as well.

Join Tenancy Arrangements

If you co-own real estate with your spouse or someone else, you can execute a joint tenancy deed that results in the property transferring automatically upon death to the surviving spouse or co-owner.  When you do this, the property transfers directly and avoids probate.

Give It Away

Of course, you can always just give your property as a gift before you pass away. This obviously is not an option for everything, and you may have to pay taxes on your gifts.  However, many estate plans can include gifts during life to reduce someone’s estate prior to death.

For more help with estate planning, contact us today!