Estate litigation can arise when there’s a dispute among heirs over the terms of an estate plan. It can also occur when someone believes the deceased person wrongfully excluded them from inheritance or denied them rightful access to estate assets. By understanding 13 common causes of estate litigation and how to prevent them, you can help protect your family’s financial security and legacy.
1. Lack of Revocable Living Trust
In some cases, families may not have established sufficient legal protections from estate litigation. For example, they may not have a properly drafted revocable living trust. Or there may be assets that no one ever transferred to the trust.
Without a properly drafted, properly funded trust in place, heirs may need to go through a probate process to transfer property. That can then open up disputes among family members in a heated dispute over assets. That’s one of the reasons it’s important that people create revocable living trusts and keep them updated.
2.Inaccurate, Misleading or Conflicting Will or Trust
One of the major sources of estate litigation is providing inaccurate instructions in a will or trust. The other is having conflicting documents.
Inaccurate or Misleading Documents
This often happens when a person writes their own will or trust and does not provide clear instructions on how to distribute their property upon death. For example, if someone wrote “I give my house to my son” but doesn’t specify which one, then it could lead to a dispute among heirs as to which son should receive the house. To help avoid this problem, it’s important for those creating a will or trust to be as clear and precise as possible. That’s one of the main benefits to having an estate plan attorney draft your documents.
Estate Litigation Over Conflicting Documents
An heir might receive conflicting versions of a will, or believe that a certain asset is theirs by right, but their name was excluded from the will. If a person notices any inaccuracies in the documents, they should seek counsel from an experienced probate litigation attorney who can help them evaluate their case and pursue justice.
Second Marriages and Blended Families
The story of Cinderella focuses on the stepdaughter’s journey from having conflict with her stepmother and stepsisters, to finding her own true love and freedom. However, think about what created that situation. At one point, Cinderella’s dad fell in love with another woman. Then, unfortunately, her dad died. The story doesn’t talk about the poor estate planning. But here’s what really happened. Cinderella’s dad had set everything up so it went to his new wife if he ever died. When he actually died, that’s what happened. Cinderella was left out of any inheritance. Her father’s promises to her meant nothing from a legal standpoint. This type of situation is very common today, just as it was hundreds of years ago. A lot of estate litigation is caused by this situation. Of course, it can be avoided or at least mitigated with a properly drafted estate plan.
3. Estate Litigation By Disinherited/Omitted Heirs
One of the most common sources of estate litigation is when one or more heirs are disinherited or omitted in a will. When someone dies, they may not have properly updated their will to include any new heirs. This can leave some family members feeling ignored or forgotten and upset over their omission. If an heir feels that they should be included in the will, they should speak with an attorney and make sure they pursue legal action if necessary.
4. Estate Litigation Over Undue Influence Claims
Estate litigation can also occur when an executor or beneficiary uses undue influence.
What is Undue Influence?
This occurs in Arizona when an individual is active in procuring the execution of a will or that the decedent’s free will was overpowered so that the decedent makes their wishes and desires conform to the influencer’s. See In re McCauley’s Estate, 101 Ariz. 8, 415 P.2d 431 (Ariz. Ct. App.1966). In other words, someone convinces another person that they should amend their last will or trust and change the beneficiaries. It also applies to signing other documents, such as deeds to property, bank account beneficiaries, and so forth.
Basically, when a person’s free will has been overborne to benefit another party, either through threats, manipulation, or other forms of coercion, they may have a claim for undue influence. This can occur before death, if the decedent was made to change their will under duress, or after death in various disputes related to executors or fiduciaries.
How Do You Know if Undue Influence Occurred?
In addition, there are eight indicators that undue influence may or may not have occurred:
1. Whether the alleged influencer has made fraudulent representations to the person making the will;
2. Whether the execution of the will was the product of hasty action;
3. Whether someone concealed the execution of the will from others;
4. Whether the person benefited by the will was active in securing its drafting and execution;
5. Whether the will as drawn was consistent or inconsistent with prior declarations and plannings of the person making the will;
6. Whether the will was reasonable rather than unnatural in view of the will-maker’s circumstances, attitudes, and family;
7. Whether the will-maker was a person susceptible to undue influence; and
8. Whether the will-maker and the beneficiary have been in a confidential relationship.
Beneficiaries may try to control the decision-making process of the deceased in order to get what they believe is their rightful share. If you believe any of these suspicious acts happened, take legal action.
5. Will Contests in Estate Litigation
Another common source of estate dispute is will contests. A will contest is a legal action that seeks to set aside or modify the terms of a will based on the manner in which the deceased person executed it, or due to its contents. This type of litigation most often occurs when there is a sense that the deceased’s wishes are being neglected or ignored. Examples include as exclusion of an heir, changes in bequests, questionable distributions, and other factors.
6. Breach of Fiduciary Duty Issues
One of the most common sources of estate litigation involves challenges to a fiduciary’s actions prior to or during the administration of an estate. This breach of fiduciary duty can range from dishonesty or self-dealing with assets, to failing to properly account for funds, or providing inaccurate information to heirs and beneficiaries. In some cases, litigation may even involve the fiduciary taking advantage of other vulnerable parties within the context of the estate proceedings. Such breaches can be committed not only by executors, but guardians or agents named in power of attorney documents as well.
7. Murky Family Dynamics And Emotional Arguments
Estate litigation is often rooted in more than just practical money issues. Probably the most common source of estate litigation is M]murky family dynamics can be a source of conflict between heirs. Feuding among family members, or between families and their hired professional fiduciaries, can lead to disputes over assets that are otherwise unimportant to all parties. Such disputes often become exponentially more complicated due to the emotional elements of the argument. The only way to guard against this type of legal issue is for family members to carefully consider how best to handle potential sources of competitive tension with one another before any differences flare up into full-blown estate litigation.
8. Missing Or Faulty Estate Planning Documents
All too often, families are thrown into turmoil when it becomes clear that there are no estate planning documents in place. It can also happen when the deceased person’s documents don’t accurately reflect their wishes. Important items like a will, powers of attorney, and other essential paperwork must be properly drafted and filed before the court can officially approve an inheritance distribution. When these documents are missing or invalid, litigation may be necessary to legally divide assets among heirs.
9. Discrimination Among Heirs.
It’s important for estate plan administrators to treat all heirs equally and fairly. When the will favors one heir more than another, it can easily lead to tension and feelings of injustice among other beneficiaries. To avoid this, make sure your estate plan correctly identifies all heirs as entitled beneficiaries. Also, make sure that your will or trust treats all the same (or at least fairly) in regards to distributions and percentage of the estate they will receive.
10. Unanticipated Beneficiaries or Gifts.
The introduction of an unanticipated beneficiary or gift can be a major cause of estate litigation among heirs. When the deceased person left someone out of a will or trust inexplicably, it’s reasonable for those who were beneficiaries to assume the person who wrote the will intended the omission. This could cause estate litigation over distribution of assets, as well as undue stress and painful emotions among family members. To prevent this from happening, ensure that any omitted person is included in the estate plan and that their share is well documented.
11. Estate Litigation Over a Novice Executor Being Appointed.
Another common reason for estate litigation is when a novice executor (the person appointed to administer the estate) handles an individual’s estate plan. To ensure smooth administration of the will, it’s best to appoint someone familiar with the process. Alternatively, you can appoint someone who can acquire experience in navigating probate and avoiding mistakes. If a friend or family member is not confident in their ability, it’s best to consult a professional like an attorney or trust officer to avoid costly mistakes.
12. Inadequate Estate Planning or Outdated Documents.
Estate laws change over time, and many people fail to update their wills and other documents including trust funds after a life event or change in the law. It’s important to review any will every few years to make sure it is up-to-date with state and federal laws, as well as your personal wishes for your estate. If an executor or beneficiary finds outdated or inadequate documents, these can be contested in court.
13. Estate Litigation About Mismanagement of Funds.
Unscrupulous executors may think they can pocket the money from an estate, but heirs can and should challenge this crime. If someone has mismanaged a will, the heir may file suit in probate court and demand an accounting of all assets and how the person in charged spent the funds. In extreme cases, criminal charges might be brought against the executor depending on state laws.
Need Help With Estate Litigation?
We have over 20 years of experience handling estate litigation matters. We’ve seen just about every type of situation. You won’t shock us. Give us a call at 602-443-4888 and let’s see how we can help resolve your family’s estate litigation dispute.