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Take-Aways: Parting Words to Keep Conflict Apart from Those Parting Ways

by Paul Fisher1

Probate courts are the land of broken dreams, the arena in which the testator’s plans are laid to waste by conflict and attorney fees, and familial relationships are in ashes. However, there may be a better way. Managing estate conflicts can be implemented at various stages to minimize conflict and maximize the benefits for the testator, beneficiaries, disinherited and contesting parties, trustees, and even the attorneys. In some circumstances, addressing conflict during the estate planning process will be most effective. In most cases, however, conflict is best dealt with post-mortem. Perhaps incorporating additional tools into the testator’s estate planning documents, or holding a meeting in the appropriate circumstances will help to relieve conflict. Managing estate conflicts at an earlier point in time provides a non-traditional, non-litigious, and potentially golden opportunity to resolve conflict both timely and efficiently.

Dig Deeply Into The Relational Estate

Today, the emerging role of estate planners goes beyond simply avoiding death taxes and probate, and should include an in depth conversation with the testator concerning “the whole web of interpersonal relationships that connects [the family] across generations.”2 Digging deeply into the relational estate can reveal “flashpoints” that may lead to conflict after the testator passes. Discovering these conflicts is the first step to addressing them and possibly avoiding traditional trust and estate litigation.

Consider Addressing Conflicts During Estate Planning Process

There are great potential benefits for all the usual players in estate litigation who address conflicts issues during the estate planning process, provided these parties are willing to be flexible. The trustor can rest assured his wishes will not be thwarted by litigation, and his heirs be saved from a court battle. The potentially contesting party can find an early resolution to a claim, and the attorneys can achieve higher professional and financial fulfillment with happier clients and without the tumultuous path of traditional probate litigation.

However, the downside to attempting to address and resolve conflicts during the estate planning process that might arise after the testator’s death is the possible failure of such an attempt. There is the added risk that the last years of the client’s life will be distressing, and take a toll on his quality of life. Still, under the right circumstances, this approach can be beneficial to many.

Address Conflicts Timely Post Mortem

The best alternative to estate litigation for families not suited to earlier conflict management might be within the golden window of opportunity, at a time when the players are able to deal productively with the issues, but before estate litigation commences.

A small percentage of disputed trust and estate matters reach trial. The important issue is at what point on the continuum of conflict the other disputes are resolved. Generally, early resolution, when all the critical ingredients are present, is better for the parties. The best timing post-mortem requires the right dynamics. However, attorneys from around California have cautioned that every case and every circumstance is different.

Incorporate Conflict Management Into Other Estate Planning Documents

Offer new choices to estate planning clients that have the potential of preserving more of the testator’s financial estate and better preserving family harmony and the relational estate so that there truly are survivors.

Preserve the Testator’s Intent

Preserving the integrity of estate planning documents by video taping the signing process or taking copious notes during the estate planning process can protect the estate against claims of incapacity, fraud, or undue influence.

Sway Potentially Contesting Parties With A Side Letter

A side letter from the testator can elicit understanding from beneficiaries and disinherited heirs, making them less likely to bring an estate contest. The side letter expresses why the testator has decided to make the bequests he or she has made, and, in the words of one attorney, if written from the heart, can also bring understanding.

Consider Using A Mandatory or Voluntary Mediation Provision

In the right circumstance a mediation provision in estate planning documents can be beneficial. Many attorneys believe it relays that the testator wishes potential conflicts to be resolved through mediation rather than litigation. However, some attorneys are skeptical of its enforceability. Other attorneys advise against such a provision for purely tactical reasons.

Incentivize the Contesting Party

Several attorneys suggest adding a clause to the no contest or mediation provision such that a failure to mediate is deemed to be a contest; and as a result of failing to mediate, any gift otherwise provided lapses, or results in a significant delay in distribution. Unanswered at this time is to what degree will California’s revisions to its no contest statute have upon each of these suggestions.3 Another attorney believes the best deterrent to a will or trust contest is a substantial gift from the decedent to the possible contesting party combined with a provision authorizing the trustee to defend any claims. In the alternative, providing for a reduced or lapsed gift under a prior estate plan for a beneficiary who successfully challenges a future will or trust may also prevent an estate contest.

Consider Holding a Post Mortem Meeting

The goals of such a meeting, whether held during the estate planning process or post mortem, are to resolve the conflicts that are likely to arise upon the testator’s death in order to avoid post mortem litigation, maintain family harmony, preserve the testator’s plan of distribution and conserve the estate from the huge eroding costs of litigation. If conditions are ripe, all the players will have the same goal: resolution, for a quicker distribution.

Something for Everyone, Including Estate Planners and Estate Litigators

Managing estate conflicts at an earlier point in time presents the opportunity to create more options for practitioners and more value for clients. What is the cutting edge service that the practitioners reading this now can immediately begin providing to their clients in terms of estate planning, estate litigation and conflict management? Having read this article what new choices will you be able to provide to your clients?

The objective of this article on Estate Conflict Management is to add value to your services as advocate and counselor. A primary goal of this article is to provide greater client satisfaction. Another goal is to avoid malpractice claims and prevent future problems while resolving or managing existing disputes. Ultimately, through greater client satisfaction there will be more client referrals and greater personal benefit to the practitioner.

Have Courage to Undertake Uncomfortable Conversations With Your Client

Uncomfortable conversations are those that could be fraught with tension and conflict between counselor and client. As an estate planner it can be uncomfortable to dive into the goo of the client’s painful relationships. Yet, it is necessary to deeply counsel the client about conflict and the client’s choices as to when and how to address those conflicts in a manner that will preserve his estate and carry out his testamentary wishes. As counsel for any of the other characters in the cast of family drama, there is the tension of potential financial gain for the client versus the long term emotional and financial impact extended conflict will have on the client and the client’s family. These conversations can be brutal on the counselor and the client. They may include issues the client does not want to hear about, much less deal with. These conversations can be uncomfortable, painful and challenging at times for the attorney. For some clients who don’t want to even acknowledge certain issues, the attorney faces the potential reaction, backlash, wrath or worse from their most difficult clients. These are courageous conversations that, if not opened at the counseling level, will have to be dealt with during mediation or, worse, during trial.

Push The Envelope: Be Inspired to Change The Culture of How Estate Conflicts Are Resolved

If the envelope is the current paradigm and cultural tradition of estate planning and estate litigation, with its often staggering financial and emotional costs to the parties involved, find the courage to push beyond that tradition and try something new. The something new, in appropriate cases, is to address conflicts at the earliest practical opportunity, and at the same time maintain what is in the best interest of the client.

Twenty-five years ago, in 1984, Chief Justice Warren Burger in his State of the Judiciary Address, urged “The entire legal profession – lawyers, judges, law teachers – has become so mesmerized with the stimulation of the courtroom contest that we tend to forget that we ought to be Healers of Conflicts. For many claims, trials by adversarial contest must in time go the way of the ancient trial by battle and blood… Our system is too costly, too painful, too destructive, too inefficient for a truly civilized people.”

Changing the culture means thinking about things differently, exploring these tools with colleagues on the same side and on the opposing side of conflicts to change the traditional paradigm. Most importantly, changing the culture of conflict means doing things differently. If not now, when?

Endnote:

  • 1. Copyright 2009 by Paul Fisher
  • 2. Gerald Le Van, “A Family Council for the ‘Relational Estate’”, July 2008.
  • 3. The California legislature has enacted legislation that goes into effect January 1, 2010 which repeals the existing law concerning no contest provisions. The new statutes are Probate Code Sections 21311(a) et seq.