When planning an estate, a person may consider many different provisions that can be a part of a Last Will. Of course, many of the Will terms concern the disposition of assets and bequests to various beneficiaries. A Will may contain a bequest of an amount of money or a devise of a specifically identified parcel of real property.
There are parts of a Will that contain a residuary clause and also the nomination of executors or trustees. Some provisions also are inserted to create a testamentary trust or provide for the appointment of a guardian for a minor.
New York estate lawyers are also familiar with “No Contest” clauses which are also known as “In Terrorem“ clauses. These types of clauses are discussed in Estates, Powers and Trusts Law section 3-3.5 which is entitled “Conditions qualifying dispositions; conditions against contest; limitations thereon”. The effect of this clause is that if a person engages in certain actions like a Will contest, he loses the right to receive any bequest under the Will.
According to this statute, a No Contest clause cannot, however, be used to prevent certain acts or proceedings. For instance, such a clause will not be violated if an infant or incompetent Contests a Will. Also, there is no violation and thus, no forfeiture, if a person engages in discovery under Surrogate’s Court Procedure Act section 1404. Under SCPA 1404 a respondent can obtain pre-objection discovery from the attesting witnesses, the Will preparer, the nominated executor and the proponent of a Will.
Some In Terrorem provisions are very broad in scope and attempt to restrict contests or objections regarding numerous issues concerning a Will. Such was the situation in a recent Manhattan estate case entitled “Estate of Merenstein”. This case was the subject of a decision on October 5, 2018 by Manhattan Surrogate Rita Mella. In Merenstein the Court reviewed a rather expansive clause. However, it was found that such broad provisions could not prevent an estate beneficiary from seeking to remove or suspend a fiduciary due to a breach of fiduciary duty . It was also found that there would be no forfeiture where an accounting is demanded from a fiduciary or objections are filed to an accounting or if relief is sought when a fiduciary failed to account pursuant to a Court order. The Court also felt that there would be no risk of forfeiture if a beneficiary sought limited letters to investigate the existence of estate assets. However, the Court did make a distinction that seeking to suspend a fiduciary appointment before there was any indication of wrongdoing would violate such a clause since it appeared to challenge the Will provision which nominated the executor.
I have represented numerous individuals in contested Will cases where a No Contest clause was contained in a Will. If you have a question or issue regarding a Will Contest or an In Terrorem clause, call me now for a free review.
New York Trusts and Estates Attorney Jules Martin Haas helped many clients over the past 30 years resolve issues relating to probate and estate settlement throughout New York City including Nassau County and the Bronx. If you or someone you know has any questions regarding these matters, please contact me at (212) 355-2575 for an initial consultation.