Perfect Estate Plans (On Paper) Can Still Lead to Litigation


Having handled approximately 100 estate disputes, I’m frequently asked what people can do with their estate plans to try to prevent disputes from arising among their family members. Having a proper estate plan in place is unquestionably a key component to preventing a dispute among family members. But perhaps equally important is naming competent, honest people to the fiduciary positions in an estate plan.

Here’s what I mean.  The most well-written estate plan can’t prevent the following scenarios: a trustee who mismanages a trust, a trustee who refuses to inform and report to the beneficiaries as required by law, or an executor who refuses to make proper and timely disbursements. Granted, Virginia and most other states have laws in place to deal with these scenarios, and to provide relief to the wronged parties. Yet litigation is not only time-consuming and costly, but it also takes an emotional toll on the parties involved. In short, the moral character of a person who is named to a fiduciary position in an estate plan (executor, trustee, agent under a power of attorney, etc.) is a key factor in determining whether an estate dispute will arise.

Why do parents name certain children or other people of questionable moral character to these key fiduciary positions (despite the fact that the parents know that such children have historically been unreliable, dishonest, etc.)? Some parents don’t want to offend their children; others are eternal optimists; others believe that their passing will “bring the family together” so as to inspire cooperation and good behavior. Unfortunately, such false optimism, naiveté (or both) can have disastrous real world consequences when an estate dispute erupts (regardless of how well written the estate planning documents are). If you’re considering revising your estate plan, I encourage you to learn from the mistakes of others: if you have a child or friend of questionable moral character, please think long and hard before naming them to a fiduciary role in your estate plan.

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