Will a no-contest clause actually work?

On Behalf of | Jul 1, 2024 | Estate Planning

A no-contest clause can be used as part of an estate plan to prevent someone from challenging that plan. If they challenge, the clause states that they have to give up the inheritance that they otherwise would have received.

For example, say that you have two children and you are leaving them $200,000. However, you’re only going to leave $10,000 to one child and $190,000 to the other. You don’t want the child who is getting less to challenge the estate plan just because they wanted an even split. So you put in a no-contest clause saying that, if they do challenge the plan, then they don’t even get the $10,000.

This tactic can be useful for lowering the odds of an estate dispute. But there are certain situations in which it won’t work.

The clause may not be upheld in court

The problem is that no-contest clauses aren’t always upheld in court. One reason why they may not stand is if there was a valid reason for the will contest. This could cause the court to set the no-contest clause aside. 

For example, say that one sibling creates a fraudulent will, including a no-contest clause. The other sibling challenges it, and it is discovered that the will is fake. Because there was a valid legal reason for the challenge, the person who started it likely does not have to give up their inheritance.

So, a no-contest clause can help to lower the odds of a relatively frivolous dispute, but it certainly does not guarantee that there won’t be a dispute at all. While going through this type of litigation, family members need to be aware of their legal options.

 

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