Will My Son Contest My Trust?

Today, I feature a guest for the blog. Local estate planning attorney and colleague Merwin Miller writes a wonderful newsletter that I get every month. In his letter to the author section he brings up a great question…what happens if your trust is contested? How can we avoid that problem?

Here is Merwin’s take on that subject:

Dear Mr. Miller:

I have a Living Trust that leaves everything to my two kids. But I am not
dividing it equally between them. The daughter has been very helpful to me in my golden years, helping me out where necessary and visiting constantly. My son, has been around but not with the same frequency. Further, my son doesn’t really need my money that much. My daughter could use the help. What are your thoughts on this?
—-Loving Mom

Dear Loving:
There is nothing wrong with leaving your assets unequally to your children. It’s your money; you can leave it equally, unequally, or leave it all to charity.  That’s the theory, now here’s the reality. Although you can leave it anyway you want, you probably don’t want to create a problem between your children where none presently exists or exacerbate a sibling rivalry. As a judge friend of mine mentioned to me once, “One can sue anyone, anytime, about anything! Whether or not they can win is another story.”

If you leave an unequal distribution to your two kids, will the son be upset? Will he be upset enough to file suit on the basis of your mental incompetence or your daughter’s undue influence over you? Again, he may not be able to win but that does not stop him from commencing and prosecuting the lawsuit.

Safeguards-The Appointment with the Attorney:

Leaving your estate unequally is a significant move, so think it through very carefully, make sure it is what you want to do and not what someone else has told you that you should do. Further, when you see the lawyer, don’t have your daughter sit in the meeting, don’t have her drive you, and don’t have her make the appointment. If she does any of these things, it just strengthens the argument that she was exercising undue influence over you.

Safeguards-The Family Meeting:

If you think your son might actually contest, there are a couple of things you can do. But the one thing you should not do is leave it to the attorney to explain it to the family after you are gone. That is a plan that is fraught with peril since you will not be there to explain your actions.

First, and foremost, you should hold a family meeting where you can talk to both your children and tell them what you have done (or are going to do). Note, I say tell them what you have done (or are going to do) because you are not asking for permission, you are simply explaining what your plan is and why, so that they understand. You should be able to judge from this discussion and your son’s reaction how problematic this approach may be after you are gone.

Safeguards-No Contest Clause:

Second, if you think there may be a problem, you can place in your Trust and Will a “no contest” clause. Although cut back in its effectiveness by legislation a few years ago, this type of clause still can pack a punch where necessary. Essentially, this clause dictates that if a beneficiary of the Trust contests unsuccessfully, then that beneficiary loses what he was going to inherit.

Safe Guard -Estate Planning Review:

And last, don’t be one of those who think that once a trust is written and signed it never needs to be revisited again. You should review the situation every few years (I say every 2-3, others every 5-6.) That way, if the situation changes with your son, you can modify your plan as appropriate.

About Jeffrey Berson

40 years in and around the industry has made Insurance a part of my DNA. I have had the pleasure of working with and for some of the greatest minds in our industry. My "Bersonal" View is an attempt to capture some of the best ideas, the best concepts and the best practices in a way that can lead to success for others. It will certainly be my point of view, so please...don't take it "Bersonal".
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