No-Contest Clauses in Estate Plans
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There are many stories, articles, and news blurbs that have covered cases in which inheritors have decided to contest a will and the argument has entered the public sphere. These high-profile cases generally have to do with celebrities or multi-millionaires, but they also provide valuable lessons for those of us who are not in the public eye.
To avoid having beneficiaries argue over who gets the antique furniture or who inherits Mother’s wedding rings, you can include a no-contest clause in your will or trust. This clause is exactly what it sounds like: should any beneficiary dispute the validity of the document in court, they will inherit nothing. Some clauses may be written in such a way as to empower the executor of the estate to determine whether beneficiaries’ arguments even outside of a court situation constitute contesting the will. The latter, in theory, should help prevent any disagreements among siblings or other inheritors, while the former prevents legal battles but not squabbling outside of a courtroom.
A legal contest of a will requires a beneficiary to file a formal challenge with the court, and that beneficiary must have a legal standing in order to bring the challenge, such as a financial stake or custody interests. Typical grounds for contesting a will may include accusations of fraud, undue influence, duress, or testator’s lack of mental capacity to sign the will. In some cases, the challenge may be brought in order to present a newer version of the will or estate documents and argue that the newer version is the valid one.
A no-contest clause doesn’t mean that it will dissuade all parties from arguing the will or its validity. In addition, the clause doesn’t include anyone who isn’t a named beneficiary, so if an outside party claims an interest and challenges the will, they don’t need to fear repercussions under the clause because the clause does not apply to them. A no-contest clause should also be carefully considered and all documents double- and triple-checked with great care before signing, because once the no-contest clause is included, any beneficiary who discovers legitimate errors in the estate documents is left with little or no recourse to challenge the errors.
In the case of Maryland, the state is part of a group of 22 states that allow enforcement of no-contest clauses unless the contest is based on probable cause.
