How can you disinherit a child or other immediate family member in ways that will hold up to legal challenges from the disinherited heir? How critical is it to prove your competency and capacity when disinheriting a child? Can a judge overrule your Will if you disinherit children? Is it advisable to put a “no contest” clause into your Living Trust? Will a legal challenge to your Trust require mediation?
By James L. Cunningham Jr., Esq.
(With thanks for contributions from Attorney Randy Catanese of Catanese & Wells, Westlake Village, California)
Maybe you’ve become estranged from your daughter. Maybe you are so angry you even want to disinherit her. It seems like that move should be pretty easy, doesn’t it? Maybe you just don’t include her name when you write up your Will and Trust. Or maybe you draft new documents that explain that you have “moved on from that family group.”
Sorry, disinheriting a child is not that simple. Here in California, it’s not completely easy to create a living trust or Will that says to a child or a spouse, “I’m not giving you any of my property.”
In theory, you do have a right to leave your assets where and how you wish. You could, for example, leave all your money to charity and nothing to your children. But you have to do it pr. You need a qualified lawyer to help you disinherit someone and designate a new beneficiary correctly – and it’s an area of law where you want to hire a dedicated specialist, not a general practitioner.
Here at CunninghamLegal, we work with families to design Estate Plans that will withstand scrutiny and, if necessary, hold up under legal challenges. Meanwhile, let’s look at the fine art of disinheriting an heir. Vital factors to consider in disinheriting a child
Let’s imagine that an 85-year-old man named Peter hires me to write up his Estate Plan. He says, “My daughter Tori hasn’t talked to me in five years, even though she lives only ten miles away! I don’t want to leave her anything. Or if I do leave her something, I want it to be just a token amount, say a thousand dollars.” Then, in the same breath, Peter says, “I want to give everything to my son, Alan. He’s been living with me and taking care of me for the last five years!”
To Peter, this all seems very straightforward. To me, as an estate planning attorney, it’s anything but straightforward. Indeed, his words raise a lot of red flags.
Frankly, the first thing I would do is try to talk him out of disinheriting his child. I might begin by saying, “If you do this after you’re gone, is your family ever going to want to get together for Thanksgiving? Might they hate each other forever? Are you in danger of setting up a situation where Tori and Alan never want to reconcile, even 20 years after you are gone? Have you thought about how the rest of your family will think of Alan? Will they suspect him of manipulating you?”
When it’s put that way, many parents, however angry they may be, often rethink the idea of disinheriting a child in a Will.
The second thing I would do is try to get a lot more information about Peter and his personal circumstances. Does he have other children from a previous marriage he’s not mentioning? What was his spouse’s role in this decision? Is there an ex-spouse involved? Is the child potentially part of a Federal or State protected class—be that race, religion, gender, marital status, or sexual orientation?
I will tell Peter that he must hide nothing from me as his attorney, or I cannot help him properly—and I tell him to remember that when someone dies, everything sees the light of day. “Remember that nothing will be hidden, and there will be no more secrets. If Tori sues, it will come out what you said to her and when, and exactly how Alan acted. Everything will be dragged out publicly, and it may not look the same to others as it does to you now.”
Is there undue influence on a decision to disinherit? Does the principal have capacity?
The third thing that I am ethically obligated to consider is undue influence on my client, for their own sake as well as everyone else’s. I am compelled to ask myself, “if this were challenged in court later down the line, would a probate judge be convinced that Peter had the mental capacity to disinherit his daughter Tori? Was there someone whispering in his ear to Tori’s detriment and creating an undue influence on the relationship? His son has been living with him and taking care of him for five years. Is that expected in their situation, or does that imply something in Peter’s decision to disinherit Tori?
Sometimes, influence is a good thing and lawyers and judges call that “due influence.” If Peter needs help and Alan is there helping and protecting Peter, Alan is using his relationship for good and not evil purposes.
The older Peter is the more likely such questions about “undue and due influence” will arise. This isn’t only because of the effects of aging. By definition, more has happened to an older person: perhaps a second or third marriage, a preexisting trust or will, or a business arrangement within the family. Things are generally a lot more complicated when you’re older than when you’re younger.
This is where an attorney must ask: “Who do I represent? Who don’t I represent? What level of inquiry do I now need to undertake to determine if something bad or untoward is happening?”
And importantly, I must also ask, “What would I say to a judge about this upon Peter’s death?”
In most states, including California, the underlying legal presumption is that people do have capacity—that they know what they’re doing. And while they’re alive and have capacity, they have the right to dispose of their property however they want. In California, for instance, anyone over the age of eighteen who is of sound mind can make a will.
California Probate Code Section 811 lays out the factors to be considered as evidence of incapacity—against which Tori might sue. Was Peter evaluated? Suppose a medical evaluation at some point determined that Peter had dementia or another relevant medical condition. The California Probate Code states: “A deficit in the mental functions…may be considered only if the deficit, by itself or in combination with one or more other mental function deficits, significantly impairs the person’s ability to understand and appreciate the consequences of his or her actions with regard to the type of act or decision in question.”
Usually, an expert witness must testify to such impairment. But read the words of the law carefully: The court will use a kind of “sliding scale” based on the nature and complexity of the estate’s will, trust, and other documents—was Peter capable of understanding these complexities at the time he changed his will? That will be up to a judge, and you can’t be sure what will happen.
The double-edged sword of a mental evaluation
To be sure a future probate court agrees that Peter had capacity to make this decision, we might decide to get Peter’s competency medically evaluated. But that could be a double-edged sword. Even if the evaluation showed competency, the response of a future judge could be: “Well, why did you get a medical evaluation in the first place? There must have been a problem, or you wouldn’t have gone to a doctor.” Even worse, the evaluation, right or wrong, could find diminished capacity—a fact that could not later be hidden from the court.
Such are the complications into which Peter is entering.
Any child of yours can challenge a will or trust
Any child of yours can challenge a will or trust because they have “standing” or the right to have a matter heard before a Judge.
I would tell Peter that if he truly wants to take this step, he must do so in a way that both minimizes the chances of a lawsuit and minimizes the possibility a lawsuit will succeed in litigation.
You may be setting up a time bomb for your family if you disinherit children, but you at least want to avoid the courthouse whenever you can, especially if there’s a lot of money involved.
However careful we are in drawing up a trust or will, it’s possible someone may want to sue. Especially, frankly, an immediate family member who has been disinherited by their parent or spouse. That doesn’t mean they will sue or that the court will permit prosecution of the suit. Courts don’t have to take a frivolous lawsuit seriously. For starters, in order not to have the court throw a suit out summarily, the plaintiff must have that “standing.”
Standing means that you have skin in the game and the right to have a matter heard before a Judge. There has to be a connection or nexus between you and the issue at hand, along with the potential damage that you’re suffering because of another party’s actions.
Not just anyone can sue to overturn your will or trust—and it’s unlikely that a random first cousin or fired nanny would have standing in court. But if you’re a child who’s been disinherited, like Peter’s daughter Tori, you’ve definitely got skin in the game and legal standing. If you have reasons to believe you’ve been wronged by the undue influence of an Alan or other factors, you probably have standing to sue.
How to disinherit a child in a will
You must mention a child in a will to properly disinherit them.
Let me be clear: If you think someone, like your child, has standing to challenge your will, you must be careful to directly mention them and specifically state that you do not wish them to inherit. In particular, your documents must identify all your children and make it clear that a particular child is to receive nothing.
There’s an axiom in science that nature abhors a vacuum, and there’s an equivalent axiom in the legal world that says the law abhors a forfeiture. If you leave out a child, they will be considered an “omitted heir,” sometimes referred to as a “pretermitted heir,” and you may cause a legal issue by leaving them out. If Peter goes forward, he should state a reason, preferably a valid “reasonable” reason, that he wants to disinherit Tori, like “she stole money from me regularly to support her drug habit.” Would a judge accept that reason? Maybe.
If a child files a lawsuit to oppose the disinheritance, it’s better to record a valid reason than no reason for the disinheritance—but it may be worse to express a bad reason, like “I hated her mother.”
If you had a child with someone when you were a teenager 70 years ago and never met that child, you should still mention that child in the will and specifically why you are not leaving them anything.
Why do you need to give a reason when disinheriting a child? Can’t you do what you wish?
You need to give a reason because a Judge always retains the power to invalidate or “interpret” the terms of a will or trust and to re-inherit the disinherited person.
No kidding.
A probate court does more than apply strict laws; it applies “equity”
If there is a challenge to a trust or will, it will be heard in a probate court. Probate courts are “courts of equity.” What’s that? As Wikipedia puts it, “A court of equity is a court that is authorized to apply principles of equity, as opposed to those of law, to cases brought before it.”
Come again? What’s equity, and how do its principles differ from legal ones? Don’t all courts exist to uphold the law?
The distinction between a court of law or criminal court and a court of equity is ancient and goes back to medieval times. Courts of law are the king’s court, and courts of equity are, or at least were, the church’s courts. The king’s court oversaw the laws of man, and the church court the laws of God. One deals with the body, and the other with your soul, or so the thinking went.
This distinction may sound old-fashioned, but it has evolved over the years and centuries into the system we have now. Courts of law deal with criminal matters, while courts of equity can set the law aside in favor of what judges, at their sole discretion, determine to be fair.
If Peter changes his Living Trust to disinherit his daughter, Tori, that trust may be a perfectly legal and rational document—and remember that once Peter dies, his trustee, likely his son Alan, is required to follow the specific terms of the trust to the letter. Alan cannot decide on his own to overturn the terms of the trust.
But when a disinherited and very angry Tori contests the trust in probate court, the presiding judge will look not only at the letter of the law but also at the spirit. Is what Peter did fair? Is it right? Did he give a reason?
And if he gives a reason, can Tori say, “That isn’t true. I visited my dad every week! He was confused, and Alan probably helped confuse him!”
If the judge decides that the trust isn’t fair, if they feel Peter’s actions were unconscionable, or if Alan, because of mental infirmity, forgot that Tori visited regularly, the judge can set the trust aside and remedy the situation with a “constructive trust” that would transfer some of Alan’s inheritance to his sister.
Yes, we live in a world and a country where a judge can throw out the trust you’ve gone to so much trouble to set up because it’s considered unfair or unjust. I should add that there is no right to a jury trial in probate—so the judge’s word really does become law, and it’s very rare that an appellate court will overturn the decision of a court of equity.
Can you see now why it’s so important to get a trust drawn up properly without letting animus or emotion render it null and void? Can you see why a competent and ethical estate attorney must take into consideration all the issues, including your provable capacity as the principal?
What is a no-contest clause, and does it protect a will or trust?
When I lay all this out to him, Peter asks me, “Why don’t we just insert a no-contest clause into the trust?” This means a clause that specifies that if anyone, such as Tori, contests or challenges the trust and loses, they also lose any gift or bequest they might have had. These are called in terrorem clauses in legal Latin because they are meant to instill terror in those thinking about making such a challenge.
Courts in California don’t particularly like no-contest clauses, and for the last 10 years or so, they have been effectively unenforceable. Nevertheless, we typically include no-contest clauses in every estate plan, even if they are rarely enforced.
In Peter’s case, his estate is a million dollars, all of which he wants to go to Alan and none to Tori except for a token amount of a thousand dollars. However, the potential loss of a thousand dollars isn’t going to instill much terror in Tori’s mind. If she contests the trust and loses, she’s not losing very much.
I recommend that Peter leave Tori not half his estate—half a million dollars—but fifty or a hundred thousand dollars. If she challenges that trust and loses, she’ll be forfeiting a significant financial sum.
I also gather evidence that the revised trust accurately reflects Peter’s wishes to ensure that they are legitimately carried out. In this case, I ask Peter for a handwritten letter saying why he is distributing his estate primarily to Alan rather than Tori.
We also discuss the risks of making a video of Peter expressing Peter’s wishes. The problem is that if you film a video and something untoward happens—perhaps Peter gets angry and does sound off about hating Tori’s mother—you’re stuck. If you destroy the video and there’s a challenge, somebody’s going to ask, “Why did you destroy the video?” If you keep and eventually show the video to the probate judge, you could also be in trouble.
The bottom line is that if there’s a need to do a video, it’s probably a bad idea. Much more control can be exerted over a handwritten letter. Another alternative would be an interview of the principal by a lawyer who would sign an affidavit affirming that they observed competence and valid intent—if it goes badly, the interview will be protected by attorney-client privilege.
Perhaps you’re beginning to understand how disinheritance can be a very slippery slope and why you need to get an attorney who really knows what they’re doing to advise you.
What is a disinheritance letter?
A letter of disinheritance serves as a communication explaining the reasons for excluding a child, spouse, or others from a settlor’s inheritance. It is a valuable tool that offers clarity about the settlor’s intentions, providing insight into the decision to disinherit someone.
Mediation for a disputed will or trust
People like to say that 90 percent of cases are resolved before they go to trial. But how are cases resolved? Many are resolved through a process called “mediation.”
In California, and I think most other states are the same way, the courts are very busy. One of the requirements that will be imposed on the parties to a lawsuit is to go to mediation and see if the matter can be resolved before going to court. The court can’t force you to settle, but it can force you to go into mediation.
Mediation is not “arbitration,” which is binding. If you can’t come to an agreement, you can still go to court. Generally, everyone involved meets together with the mediator, who is generally a judge or retired judge, for a conversation. The parties and the lawyers are generally coming in and out of the room for little chats, something like when you’re buying a car. That’s not a bad analogy: everybody’s trying to make a deal and get it approved.
It’s generally in your best interest to settle in mediation. For starters, what happens in mediation is confidential—as opposed to the courtroom. And in the courtroom, it is possible for the judge to rule in a way that is unacceptable to both sides. At least in the mediation, you have some control over what happens, and the general public won’t have access to the information.
Let’s say that after Peter dies, Tori isn’t intimidated by the “no contest” clause and takes Alan to court to get half of Peter’s inheritance. Yes, Alan will be able to use estate funds to pay for an attorney, but it will still be a very long, very messy, and very expensive process.
A successful mediation will reduce the cost, but perhaps not by that much.
Let’s see how it might play out.
Say that Tori’s lawyer realizes that although Tori’s case has some merit, there is a risk that she will lose at trial. Likewise, Alan realizes that although his case is strong, it is possible for Tori to prevail. So what deal will be cut to avoid the expensive and unpredictable trial, and how does the process work?
The parties agree to meet and the issue of attorney fees inevitably comes up. Everybody wants the mediator to award them their legal fees. Six hours into the mediation, just before the end of the day, the mediator generally tells them that they’re not getting those fees. I always say to my clients before we start mediation, “I know you want your fees, but you have to realize you might have to give up on that to get the case resolved.”
Also, right at the end of the day, to get Tori to drop her suit and move on, Alan might agree to drop the no-contest clause and let Tori have her fifty or hundred thousand dollars, even though she brought the suit. Alan might even kick in another $200,000.
Everyone pays their own enormous legal fees, but Peter’s Will and Trust prevail. Tori ends up with some money—fine, except that everyone hates each other for the rest of their lives, and everyone in the extended family ends up taking sides, with a good part of them blaming Peter for the disaster he left behind. Nobody gets together for Thanksgiving again.
Is it possible to disinherit a child? Yes. Is it a good idea? Talk to a competent lawyer before you decide.
What do we do?
When you disinherit children from your will, you need a trusted team of lawyers on your side. The lawyers and staff at CunninghamLegal help people plan for some of the most critical times in their lives; then, we guide them when those times come.
Make an appointment to meet with CunninghamLegal for Corporate and Tax Planning, Estate Planning, and much more. We have offices throughout California, and we offer in-person, phone, and Zoom appointments. Just call (866) 988-3956 or book an appointment online.
We look forward to working with you!
Best, Jim
James L. Cunningham Jr., Esq.
Founder, CunninghamLegal
We guide savvy, caring families in the protection and transfer of multi-generational wealth.
