The Power and Pitfalls of No Contest Clauses in Wills
Estate planning is a complex process that involves careful consideration of various legal instruments, including wills. A will is a legal document that outlines how an individual’s assets will be distributed after their death. In some wills, a “no contest” clause, also known as an “in terrorem” clause, may be included. This clause aims to discourage beneficiaries from challenging the validity of the will or engaging in legal disputes by imposing penalties or forfeitures for doing so.
By including such a clause, a testator (the person making the will) hopes to discourage disputes and ensure that their final wishes are carried out without delay or contention. No contest clauses are often used when there are concerns that beneficiaries may contest the will, leading to costly and time-consuming litigation that could potentially undermine the testator’s intentions.
A typical no contest clause may provide that if a beneficiary contests the will and is unsuccessful, they will forfeit their share of the estate or receive only a nominal bequest. The clause may also stipulate that any beneficiary who challenges the will shall be deemed to have predeceased the testator, effectively disinheriting them. The intention behind such clauses is to create a financial disincentive for beneficiaries to challenge the validity of the will.
No contest clauses are not enforceable in all jurisdictions and are subject to certain limitations. In some states or countries, these clauses may be unenforceable as a matter of public policy or may be strictly construed by the courts. For example, in some jurisdictions, a no contest clause may only be enforced if the beneficiary had probable cause to contest the will, meaning they had a reasonable belief that the will was invalid or that their rights were being infringed. Additionally, some jurisdictions may require that the testator’s intent to enforce the clause be expressed clearly and unambiguously in the will.
Another limitation of no contest clauses is that they may not prevent challenges based on certain grounds, such as claims of fraud, duress, undue influence, lack of capacity, or forgery. Courts may be reluctant to enforce a no contest clause if there are valid reasons to challenge the will based on these grounds, as public policy dictates that individuals should have the right to challenge a will that may have been obtained through improper means.
The mere presence of a no contest clause does not guarantee that beneficiaries will be deterred from challenging the will. Some beneficiaries may still choose to contest the will if they believe they have valid grounds for doing so, even if it means risking the forfeiture of their inheritance. Additionally, no contest clauses may lead to strained family relationships and disputes among beneficiaries, even if no formal legal challenge is made.
No contest clauses are one tool that may be considered when drafting an estate plan, but they may not be suitable or advisable in all cases. Our office provides free consultations to all new clients so that you can feel confident and empowered as you establish an estate plan best suited for your needs.
The information provided herein is intended as a general overview and discussion of the subjects dealt with, and we accept no responsibility for any actions taken or not taken based on this publication. It is not intended, and should not be used, as a substitute for taking legal advice in any specific situation.