Introduction
A wealthy man with four adult children, three daughters and a son, left millions to his daughters when he died, but nothing for his son. Was that the father’s intention? The answer came after much acrimonious litigation culminating in a three-week trial. In the end, a jury found that the sisters exercised “undue influence” over their failing father to exclude their brother from his will and trust. Sadly, this, or some version of this scenario, happens too often. While the attorneys were successful in this instance, this type of case is not easy to prove. That’s especially true if attorneys aren’t accustomed or equipped to litigate complex trust and estate disputes.
In this three-part series we discuss — from our perspective as estate litigators:
Part 1: Understanding and identifying undue influence.
Part 2: Confirming undue influence and planning for action.
Part 3: Knowing the difference between planning an estate and litigating a dispute.
Assessing the Client’s Testamentary Capacity
When suspicions grow stronger and undue influence appears likely, it’s time to dig deeper. Take steps to fully assess the situation. Explore the client’s testamentary capacity. Probe the involvement of individuals in the client’s orbit and explore options for protecting, or insulating, the estate plan from outside factors.
Ask questions that help you get to the reasons behind a person’s choices concerning the elements of their plan or why they want to make changes. This is especially true if the estate will be distributed unequally, as that is often the source of conflicts.
Important: Clear the room! A good practice is to meet with the testator or trustor independently. You want a direct line to their thoughts and intentions, not filtered, influenced, or guided by family, friends, or anyone else. You want the client and a witness from your office. That’s it.
Have a deep and thorough conversation with the client about their estate for as much as an hour. Your objectives are to ensure that they understand what assets they possess, such as a home, and their approximate values. Ask them the names of their children and the reasons behind their distribution choices. Do they understand the ramifications of their various decisions or changes? Do they understand the force and effect of, for example, why they’re giving everything to Suzie and not to Bobby?
Probe with open-ended questions. Ask: “What do you think your home is worth?” Not: “Isn’t your home worth a million dollars?” Ask: “How do you think Bobby will react to Suzie getting the house?” Not: “Don’t you think Bobby will be hurt if he gets nothing?” Ask them to share their intentions and the consequences of their choices. Do you understand what this change means? Is that your intention? Why did you make this decision? Did Suzie tell you she needs more money? What if Bobby says it’s unfair? What would you say to that?
All of this helps you get a sense of your client’s testamentary capacity, that they are capable of making and understanding the legal ramifications of their decisions.
Thoroughly document this meeting. You will want an accurate record of the client’s understanding and comfort with the plan, and that it delivers what they intend. Nothing captures the content of such meetings better than recording them, but you will want to weigh the pros and cons of each situation. If the client is articulate, confident, and collects their thoughts easily, a recording can be useful evidence to have in their file should someone challenge their mental capacity or your characterization of events. On the other hand, if the client comes off as frail, confused, or not confident in their statements, these conditions can be used to paint the client and you in a negative light.
Finally, if there has been a diagnosis of dementia, you will want a statement from a physician stating their opinion of the client’s mental capacity to make important life decisions.
Fully document meetings with clients, heirs, family members, and any other professionals who are serving them. Building and maintaining an accurate record will bolster your ability – should you need it – to defend your client’s intentions and mental capacity or establish the presence of undue influence.
Assess the Involvement of Family Members, Advisors, and Caregivers
Ideally, elderly people, or those who are living with mental or physical disabilities, are surrounded by people who care for them and are dedicated to their best interests. As we all know, however, not everyone’s motives are selfless and wholesome. That is why you want to — as you did with the client — get a sense of the people who play a role in the client’s life, whether it is family, friends, companions, caregivers, financial advisors, or any professionals handling some aspect of their affairs.
Take time to understand who is in their orbit. Who is scheduling their appointments with you? Who is driving them to meet? Who is on email distribution lists when estate-related matters are discussed? Who is asking to review documents before they are signed? These questions are especially crucial when the distribution of assets is not going to be equal. Probate courts look for equity, so you don’t want to raise red flags unnecessarily. If the distribution is unequal, you will want to be sure of your client’s intentions and that they understand the implications.
Insulating the Estate Plan
Winning the lottery is a good surprise. But assuming you’re getting 50% of your parent’s estate and then finding out it’s only 25% is a bad surprise. This kind of revelation — and they can come in many forms — is what often fuels fights that land everyone in probate court contesting the trust or estate.
To avoid incendiary conditions created when an heir’s expectations diverge from reality, you will want to make sure everyone is clear about the details and value of their inheritances.
Whenever it is workable, especially when changes are made, holding a family meeting is a good practice to avoid the kinds of shocks that ignite acrimony and bitterness. Family meetings give your client the opportunity to explain why he or she is making changes in distributions. If son Frank is getting the house — a valuable and often very sentimental asset — do his siblings know? While this may have been shared in advance, you want to be sure, you want to gauge everyone’s comfort level, and you want to give heirs the opportunity to ask questions and your client an opportunity to articulate their thinking. Creating open sharing in face-to-face gatherings like this can serve everyone well, helping alleviate friction or misunderstandings.
Consider this approach as a way of insulating your client’s estate plan from challenges.
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