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Will a no-contest clause actually work?

On Behalf of | Jul 9, 2024 | Estate Planning

When you write an estate plan, you may consider using a no-contest clause. As the name implies, this means that no one can contest that estate plan. The goal is to prevent disputes. You do not want one sibling contesting the plan and getting into a long-term legal battle with the other siblings.

But is this clause actually going to work? There is nothing that guarantees an estate dispute won’t occur. A no-contest clause can be useful in some situations, but it may be unenforceable in others.

Do they have a valid claim?

In some cases, the court can decide that the person actually had a valid claim and should have challenged the estate plan. The judge can then decide that they are not going to enforce the no-contest clause. They will allow the challenge anyway, with no penalty.

For example, maybe one sibling has proof that the estate plan was fraudulently altered by a beneficiary after the elderly parent passed away. They are challenging its validity on these grounds. If they win the challenge, the no-contest clause won’t be upheld.

But in other cases, the challenge may be more frivolous. They may have no evidence of fraud, but they’re just unhappy with how the plan was written. If that person doesn’t have a valid claim and still decides to challenge anyway, then they may have to give up the assets that they were granted in the estate plan.

In this sense, a no-contest clause isn’t even designed to stop all will challenges. It’s just there to make sure that they are actually necessary when they occur. Beneficiaries and family members who find themselves involved in such an estate dispute must know what legal steps to take.