Estate planning is the process of creating a plan for how your assets will be distributed after your death. It is an important component of your overall financial planning, and it can help to ensure that your wishes are respected and that your loved ones are taken care of after you die. However, even the most carefully drafted estate plan can be challenged. There are several reasons why someone might challenge an estate plan, including:
- Disputes over the interpretation of the Will or Trust: If there is any ambiguity in the language of the Will or Trust, it can lead to disputes about what the testator or settlor intended.
- Allegations of undue influence: If a family member believes that the testator or settlor was coerced into drafting the estate plan, they may challenge it on the grounds of undue influence.
- Allegations of lack of testamentary capacity: If a family member believes that the testator or settlor was not mentally competent at the time they signed the estate planning documents, they may challenge the plan on the grounds of lack of testamentary capacity.
Strategies for Reducing the Risk of Estate Planning Disputes
- Have your estate planning documents drafted by an experienced estate planning attorney: An experienced estate planning attorney can help you to draft clear and concise estate planning documents that are tailored to your specific needs. They can also help you to identify and address potential areas of conflict.
- Communicate your wishes to your loved ones. Once you have created your estate plan, it is important to communicate your wishes to your loved ones. This will help to avoid any surprises after your death and can reduce the risk of disputes.
- Keep your estate planning documents up to date. As your family and financial circumstances change, it is important to update your estate planning documents. This will help to ensure that your plan still reflects your wishes and that it is valid.
- Be thoughtful about distributing your assets. While an equal distribution among your beneficiaries may seem fair, business owners may want to avoid distributing an interest in their business to children not involved in the business, i.e., equal may not always be equitable.
- Be clear and specific in your estate planning documents. Avoid using ambiguous language or leaving things open to interpretation.
- Choose personal representatives and trustees who are trustworthy and competent and who understand your wishes.
- Keep your estate planning documents confidential. Avoid sharing them with anyone who may be tempted to challenge them.
If an estate plan is challenged, the dispute will likely involve all of the plan’s beneficiaries, not just the contesting party(s). It is important to consult with an experienced estate planning or probate attorney as soon as possible who can help you to understand your rights and to choose the best dispute resolution strategy for your case. There are different ways to resolve estate planning disputes, including:
- Mediation: Mediation is a process in which a neutral third party helps the parties try to reach a mutually agreeable resolution. Mediation can be a very effective and efficient way to resolve estate planning disputes, as it allows the parties to control the outcome of the dispute without the formalities and expense of a judicial proceeding.
- Arbitration: Arbitration is a process in which a neutral third party renders a binding decision on the dispute. Arbitration is often faster and less expensive than litigation, but it is important to note that the parties are not always satisfied with the arbitrator's decision.
- Litigation: Litigation is the process of resolving a dispute in court. Litigation can be costly and time-consuming, but it may be necessary if the parties are unable to reach a resolution through mediation or arbitration.
The best dispute resolution strategy for you will depend on the specific facts and circumstances of your case. If you are involved in an estate planning dispute, it is important to consult with an experienced counsel to discuss your options and to choose the best strategy for your case.
Estate planning disputes can be complex, expensive and difficult to resolve without hard feelings and significant expense for all concerned. However, with careful planning and drafting by an experienced estate planning attorney, you can reduce the risk of disputes.