A living trust contest occurs when someone believes that the “trustor” (the person who created the trust) was mentally incapacitated and/or unduly influenced when s/he signed the trust document.
A contest petition is filed in court, and requests that the improper trust instructions be stricken.
One BIG caveat: Most living trusts contain a clause that states that any beneficiary who challenges any of the terms of the trust will be automatically disinherited. This is called a “no contest” clause.
You need to tread really carefully here. In some jurisdictions, the mere act of filing a petition to challenge the trust will automatically disinherit you.
Under other jurisdictions, a petition to challenge the terms of a trust may be allowed, without violating the no-contest clause, so long as the court ultimately determines that the petitioner (beneficiary) had “probable cause” to believe that the facts warranted a reasonable person to conclude that the trust’s terms were obtained only through mental incapacity, undue influence, or a variety of other improper means.
Generally, most trust contest petitions are difficult to win. The policy of the courts is to honor the intent of the trustor. The courts knows that, many times, trust contests are made simply because a family member or friend of the deceased thought that they would receive a certain portion of the estate. When they found out they were disinherited, they got upset and automatically concluded that the decedent must have been tricked or fooled into disinheriting them.
However, there are many cases where the trustor was susceptible to undue influence or lacked the mental capacity to understand what they were doing when they signed the trust document. When this occurs, a trust contest can sometimes be filed to challenge the document’s validity.
The evidence must be focused on proving the trustor’s mental state at the time the document was signed. This can be difficult, especially when the only witness present during the signing may be the person who unduly influenced the trustor.
The test for determining whether sufficient mental capacity existed to make a trust is not a high standard, but the test is greater than that required to simply create a will. As stated, the court will bend over backwards to honor the written instructions of the trustor and to presume this is what the trustor’s wishes were. It must be shown that the trustor knew what his/her estate consisted of (house, bank accounts, furniture, etc.) and was aware of the “natural objects of his bounty”. These natural objects would be a spouse, children, brothers, sisters, etc.
If the trust made no mention of these people and, instead, instructed that all estate assets were to be given to a person that the trustor had only met a few times, a red flag would be raised, indicating foul play and the liklihood of undue influence.
Medical records are a great source of evidence, if they have discussed the trustor’s mental capacity at or near the time that the questionable trust document was signed. It’s unlikely that you’ll find a medical document that attests to the trustor’s lack of mental capacity, and was prepared on the same day the questioned trust document was signed. However, these records can be subpoened and then examined to determine whether they support the case of undue influence or lack of mental capacity.
Family members and friends can also be a valuable source of evidence, particularly if these people spent a great deal of time with the trustor and were intimately familiar with his or her beliefs, wishes, mental state, and relationships with family members and others. This personal knowledge can greatly assist the court in determining whether the trustor possessed the requisite mental capacity.
Expert witnesses can also assist. Great care needs to be exercised in the selection of such an expert. This person must be thoroughly qualified and reputable in order to provide a meaningful and persuasive opinion as to mental capacity.
Although the standard of proof is sometimes difficult to meet, the law does provide a remedy when the truth is that the trustor lacked mental capacity or was unduly influenced into signing the trust document.
If you’re involved in a trust contest, then by all means obtain assistance from an experienced attorney.
But if you’re simply interested in learning more about living trusts in general, when they’re needed and how they work, then please review all of the pages in this site (Living Trust Advocate). You’ll then have more than enough info to speak intelligently with an attorney if you decide to hire one to help create your own living trust.
Do you need an attorney to help create your own living trust?
For simple estates (like the majority of people have), then probably not. If, after reading all of the information contained in this website, you still feel uncomfortable about the concepts of living trusts, then you should most definitely seek legal counsel.
However, if you’re like most people and feel like you’ve now got a pretty firm grasp of the concepts regarding a living trust, then maybe you’d like to obtain information on a solid alternative (to hiring your own lawyer). An alternative that will create a valid, enforceable trust, and probably save you a thousand dollars, or more.
Before you consider this alternative, please make sure you’ve digested all of the information contained in this website. If you then want to learn more about this cost-effective alternative, CLICK HERE.