Contesting a trust is a serious legal undertaking that can arise when beneficiaries or interested parties believe that a trust is invalid, unfair, or improperly managed. Trust disputes often happen during emotionally challenging times, such as the death of a loved one, and involve complex legal considerations. If you are considering contesting a trust, understanding the process, the grounds for contesting, and the options for resolution can help you navigate this complicated area of law.
Grounds for Contesting a Trust
The first step in contesting a trust is identifying valid legal grounds. A trust cannot simply be contested because someone is unhappy with its terms. There are several common reasons for contesting a trust.
Lack of Capacity: For a trust to be valid, the person who created it (the settlor) must have had the mental capacity to understand its purpose, the nature of their assets, and the beneficiaries involved. Conditions such as dementia or mental illness may call the settlor’s capacity into question. If it can be proven that the settlor did not understand the implications of their actions at the time the trust was created or amended, the trust may be invalidated.
Undue Influence: This occurs when someone exerts excessive pressure or manipulates the settlor into creating or changing a trust to unfairly benefit themselves. Courts often look at factors such as isolation of the settlor, the nature of the relationship between the influencer and the settlor, and whether changes to the trust seem suspicious or out of character.
Fraud or Duress: Fraud involves tricking the settlor into creating or signing the trust under false pretenses, while duress refers to threats or coercion that force the settlor to act against their true wishes. Both scenarios require substantial evidence, such as witness testimony, correspondence, or expert analysis.
Improper Execution: Trusts must meet specific legal formalities, such as being in writing and signed by the settlor. If these formalities are not met, the trust may be deemed invalid. Errors in execution are more likely to occur when individuals attempt to create trusts without professional legal guidance.
Options for Resolving a Trust Dispute
Resolving a trust dispute can be done through mediation, settlement, or litigation, depending on the complexity of the case and the willingness of the parties to cooperate. Mediation is often the preferred route because it is less adversarial, faster, and more cost-effective than court proceedings. A neutral mediator helps the parties reach a negotiated resolution, which can preserve relationships and avoid prolonged legal battles.
If mediation fails, the dispute may escalate to litigation in probate court. During this process, the party contesting the trust must present evidence supporting their claims, such as medical records or testimony from witnesses. The court will carefully evaluate the circumstances surrounding the trust’s creation and decide whether legal grounds for invalidation exist.
Preventing Trust Disputes
The best way to avoid trust disputes is through careful and thorough estate planning. Settlor’s should work with an experienced estate planning attorney to ensure the trust complies with all legal requirements. Steps like documenting the settlor’s mental capacity at the time of signing, using clear and precise language, and discussing the trust’s terms openly with beneficiaries can help prevent misunderstandings and reduce the likelihood of challenges. Tools such as video recordings or medical evaluations during the trust’s creation can also serve as valuable evidence if the trust is contested in the future.