What is a No-Contest Clause, and Do I Need One in My Will?
The physical and mental decline that often comes with old age can lead to misunderstandings, disagreements, and hurt feelings among family members. In extreme cases, a family member who is dissatisfied with what they received under a person’s last will and testament may file a lawsuit to challenge the terms or validity of the will. This can lead to lengthy delays in distributing estate assets and thousands of dollars in legal fees. In an effort to avoid probate litigation and the expense and delay that comes with it, some people include a no-contest clause in their will.
A no-contest clause, also known as an in terrorem clause, essentially states that any beneficiary who challenges the validity of a will or its terms forfeits any inheritance or other benefits they would have received under the will.
While lawyers have been using no contest clauses for decades, they can be contentious, and not all states enforce them. Even states that enforce no-contest clauses, like Washington, still recognize a “probable cause” or “good faith” exception, which means that the no-contest clause will not be enforced if the beneficiary had a good faith belief to challenge the validity of the will.
If you are thinking about including a no-contest clause in your will, you should consider allowing a will contest for legitimate reasons, such as forgery, if someone believes you lacked testamentary capacity at the time your will was executed, or if you were unduly influenced to change your will.
Advantages and Disadvantages of a No-Contest Clause
A no-contest clause has advantages in certain situations. But there can also be considerable downsides to including one in your will. If you decide to include a no-contest clause in your will, be sure you understand the nature and extent of the no-contest clause. You should also consult with your estate planning lawyer to ensure that it includes a “good faith” exception.
Advantages of a No-Contest Clause
Including a no-contest clause ensures that your assets will be transferred to the people or organizations of your choosing, in the way that you specify as expressed in your will. A no-contest clause discourages people from challenging your will for selfish reasons, such as if someone thought they were entitled to more. Including one can also avoid costly and time-consuming litigation initiated by a disgruntled beneficiary who is just trying to force your estate into a quick settlement.
Disadvantages of a No-Contest Clause
A no-contest clause discourages people from challenging the validity of your will. In many cases, this is exactly what you want. But the art of estate planning comes in considering the variety of circumstances that could arise, and planning to address as many of them as you can. Suppose, for example, that you were suffering from dementia during your final days and an unscrupulous relative worked their way into your good graces. Unbeknownst to the rest of your family, they convinced you to alter your will, naming them as the sole beneficiary.
If you included a no-contest clause in your will, your family members would be discouraged from challenging its validity will and this distant relative would receive the fruits of your labor. But even in a less sinister case, a beneficiary might choose not to challenge the validity of your will for fear of forfeiting their share of the inheritance, and a probate court will be less likely to consider investigating the validity of your will.
Explore Alternatives to a No-Contest Clause
A good estate plan anticipates potential problems that could arise after your death and includes a plan to address them. The overarching goal of your estate plan should be to keep the peace between your heirs and beneficiaries so your estate is processed as efficiently as possible, preserving estate assets so your legacy can be passed on to future generations.
If you believe a will contest is possible, there are steps you can take to minimize its likelihood. In some cases, a no-contest clause is an effective part of an estate plan. But you should consider other alternatives that discourage a will contest and prove that you had testamentary capacity at the time you executed your will.
One strategy is to create a video recording of you signing your will. In the video, your lawyer will ask you questions to prove that you had testamentary capacity at the time you executed your will. Then, if someone is considering a challenge to your will, the video can be used to prove that the will is valid and that you had the capacity to execute your will at the time it was signed.
Another alternative is to hold a family meeting to discuss the reasons you chose to distribute your assets in the way you did.
Contact The Campbell Law Firm for Estate Planning in Northwest Washington
If you are concerned that beneficiaries of your estate will challenge the validity of your will, you should discuss the matter with your estate planning attorney. He can use this information to craft a strategy that will preserve your wishes and minimize the likelihood of a will challenge.
To learn more about our estate planning services, contact The Campbell Law Firm today to schedule a confidential consultation to discuss your situation and how we can help with your Washington estate planning needs.