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Prevent After-Death Beneficiary Conflict

What You Can Do Now to Avoid Carping, Whining and Complaining When You are Gone

Trusts that contain a “no contest clause” are often more insulated from legal challenge or squabbling among the beneficiaries. This is because a no contest clause stipulates that if any beneficiary challenges or contests the terms of the trust, they will then be deemed to forfeit their share. The choice is very simple: pipe down and get your share or complain about it and get nothing. 

A recent case involved a no contest clause. In the case a beneficiary hired an attorney to pursue a legal challenge against a trust. The trust contained a no contest clause and it was determined that the challenging beneficiary was not entitled to any distribution because he had instituted legal action against the trust. In turn, the beneficiary filed a malpractice claim against the attorney that represented him for failing to advise of the risks associated with no contest clause. The attorney’s malpractice insurance paid the claim. 

Two takeaways from this case: (1) no contest clauses are effective and (2) attorneys will now think twice before taking a case to challenge a trust and must advise clients of pro and cons. Taken together, the use of a no contest clause will prevent most attorneys from even taking the case in the first place. 

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Dually certified by the National Elder Law Foundation as Certified Elder Law Attorneys and the Ohio State Bar Association as Specialists in the Area of Elder Law.