Maryland Estate Litigation

Month: April, 2017

“For reasons which are known to them” – Disinheriting a Child

by David A. (Andy) Hall

The decision to disinherit a child is generally not made lightly and neither should be the approach to planning.  Careful consideration as to why a parent wishes to exclude a child from her estate planning is necessary prior to preparing the documents.  There may be ways to arrive at alternative solutions that achieve many of the client’s goals without risk of litigation that disinheriting can bring (which I will cover in part 2 of disinheriting a child).

Some may want to disinherit because they want to create incentives for their children to develop a strong work ethic. This is the approach that Sting intends to take with his children.[1]  A number of celebrities, like Bill Gates and Warren Buffet, have similar ideas to Sting.[2]  Celebrities have also disinherited children for reasons that were (allegedly) known only to the children.[3]  Leona Helmsley famously left $12 million for the care of her dog Trouble while also disinheriting two of her grandchildren “for reasons which are known to them.”[4]

Whatever the reason or reasons for choosing to disinherit, a diligent approach to the estate planning and the documentation of the estate planning is necessary.  It is relatively easy to challenge a will.  In Maryland, a Petition to Caveat a Will (a will contest) is a notice pleading.[5]  The Petition needs to contain “an allegation that the instrument challenged is not a valid will . . . and the grounds for challenging its validity.”[6]  In simpler terms, one challenging a will (the “Caveator”) needs to say that the will is not valid and offer a laundry of reasons that it may not be valid.  The list of reasons does not need to be supported by facts.  Many practitioners describe the grounds for challenging a will as including the “kitchen sink” because due to the six-month statute of limitations it is necessary to plead every single possible cause of action or it will be barred despite further evidence that may be generated.

“For reasons which are known to them” is a common refrain in estate plans that disinherit.  This language, however, does no favors for litigation counsel who ultimately defend the will against a disgruntled heir.  The disgruntled heir inevitably has nary a clue as to what the cryptic language is referring to; indeed, they will describe their relationship with the disinheriting parent in glowing terms.

Litigation counsel will then turn to the drafting attorney’s file and look for clues as to the testator/testatrix’s intent for disinheriting a child or grandchild.  In a will contest, the drafting attorney’s file is no longer privileged upon the death of the testator.[7]  Experience has shown that drafting attorneys do not always have the best habits of taking notes when meeting with their estate planning clients.  Even when they did take copious notes, the estate planning file has a tendency to winnow down through the years where the only remaining documents are usually only the final draft or executed version of a will.  The attrition of an estate planning file can seem suspicious to an outsider, but it also makes sense from a logical perspective.  Successful attorneys have thousands of clients that they represent over the course of a career, which generates reams of paper.  As the files build up, a game of survivor begins to take place.  Documents may be destroyed in accordance with a firm’s file retention policy or those documents may be returned to the client upon the conclusion of the representation or the drafting attorney’s retirement from practice.  Absent explanation in the drafting attorney’s notes, litigation counsel is forced to rely on other contemporaneous documents and the testimony of those that knew the testator/testatrix – namely their children or grandchildren – those who stand to lose out on a portion of their inheritance.

The attorney representing the Caveator can attack the lack of evidence and cryptic words of the testator/testatrix in an attempt to extract a settlement from the estate.  Many times a settlement will make sense because of the risk involved in litigating any case and also the attorney’s fees that will be expended by the estate in defending against the caveat.  A little additional care by the planning attorney in maintaining their file or documenting the reasons for the caveat in the first place can go a long way in protecting the client’s ultimate wishes for the disposition of their assets.

We will discuss some other approaches to estate planning where the client wishes to disinherit a child in our next blog in this series.  Should you wish to discuss your estate plan with an attorney who has not only drafted, but also litigated a will or trust, then do not hesitate to call.

David A. (Andy) Hall, Esq.
King|Hall LLC
5300 Dorsey Hall Drive
Suite 107
Ellicott City, Maryland 21042
410-696-2045

andy@kh.legal

 

[1] http://time.com/money/2922231/sting-disinherit-will-kids-heirs-inheritance/

[2] http://time.com/money/2913542/10-other-celebs-besides-sting-whove-cut-their-kids-out-of-their-wills/

[3] https://www.theguardian.com/film/2008/may/25/biography.film

[4] https://static01.nyt.com/packages/pdf/nyregion/city_room/20070829_helmsleywill.pdf

[5] See Md. Rule 6-431.

[6] Id.

[7] See Benzinger v. Hemler, 134 Md. 581, 107 A. 355 (1919).

A Primer on Guardianships – Part Four – Understanding Incapacity

by David A. (Andy) Hall

Clients often talk to us about whether someone is competent to execute legal documents such as a will or a power of attorney (POA).  Talk of competency is generally putting the cart before the horse.  Competency is a legal term, but it has to do with whether a person lacks legal competence, e.g., they are a minor, or they have been adjudicated incompetent.[1]

From an estate planning perspective particularly where the goal is avoid a guardianship, the question is whether someone has capacity to make decisions or execute planning documents. [2]  The capacity required to execute a will is the ability of the testator/testatrix to understand the nature of their assets and the objects of their bounty.[3]  Put more simply, does a person know who their children and/or grandchildren are, and do they know what “stuff” they own.  In order to devise[4] property to a relative, a testator/testatrix[5] needs to know the property they have and who they are giving the property.  It makes sense from an intrinsic level that you need to know these two points in order to give something away otherwise someone could give away things that are not theirs to people they do not know, which is generally not how people approach estate planning.  All in all, the capacity needed to execute a will is pretty low.  A will, however, will not obviate the need for a guardianship.  Additional incapacity planning is required.

The capacity required to execute a trust is the same as that required to execute a contract, which requires that the party must understand the nature of the business conducted. For contracts, the more complicated the contract, then the higher the level of understanding required to be able to execute the contract.   This holds true for advance medical directives (AMD) and POAs.  Overall, the capacity to execute a will is less than the capacity required to execute a trust or other incapacity planning documents (AMDs and POAs).

Incapacity planning documents are important in the realm of avoiding guardianships.  Most of these documents have explicit nominations for persons to serve as guardian should the need arise, but they also serve the role of allowing an agent to make or communicate decisions for a principal during a period of incapacity.  Without these documents, it may become necessary for a relative to file for guardian of the person and/or property.

A guardian of the person may be appointed upon the following grounds:

Grounds. – A guardian of the person shall be appointed if the court determines from clear and convincing evidence[6] that a person lacks sufficient understanding or capacity to make or communicate responsible decisions concerning his person, including provisions for health care, food, clothing, or shelter, because of any mental disability, disease, habitual drunkenness, or addiction to drugs, and that no less restrictive form of intervention is available which is consistent with the person’s welfare and safety.

Estate & Trusts § 13-705(b).  There are three operative components of the grounds for filing a guardianship of the person.  First, the alleged disabled lacks “sufficient understanding or capacity to make or communicate responsible decisions concerning his person.”  Id.  Second, this is due to “mental disability, disease, habitual drunkenness, or addiction to drugs.” Id. Third, there is “no less restrictive form of intervention.”  Id.

Focusing on the first basis, because of the person’s mental disability or other cognitive impairment, the person lacks capacity to make or communicate decisions.  This covers someone in a temporary or medically induced coma to someone who’s dementia has progressed to a point where they can no longer interact with others in any normal sense of the expression.  It can also cover someone who is habitually drunk or addicted to drugs.[7]  A guardianship of the person is necessary because the alleged disabled did not have proper incapacity planning documents in place and are unable to sign documents appointing a healthcare agent to make decisions on their behalf.  Physically a person may still be able to sign and there are many cases brought where someone has been unduly influenced to sign particular estate planning or ancillary documents, but that does not mean that they possess the contractual capacity in order to execute an AMD or POA.

If after a court finds the alleged disabled is unable to make or communicate decisions due to mental disability or other cognitive impairment and there is no less restrictive alternative, then the court will appoint and guardian of the person.  After the appointment of a guardian, then a person has been legally adjudicated incompetent to make legal decisions.  Thus, it is after a long process that the conversation about whether someone is competent is appropriate from a legal perspective.

Filing for guardianship may be a difficult process with unique challenges for those who do not handle these on a regular basis.  If you believe that you need to file for guardianship, then call for a free consultation.

David A. (Andy) Hall, Esq.
King|Hall LLC
5300 Dorsey Hall Drive
Suite 107
Ellicott City, Maryland 21042
410-696-2045

andy@kh.legal

 

[1] In criminal law, competency is the ability of the accused to stand trial and participate in one’s defense.

[2] Note that this distinction is muddled by the Maryland Code, specifically, Estates & Trusts Art. § 4-101 states “Any person may make a will if he is 18 years of age or older, and legally competent to make a will.” (emphasis added).

[3] Sellers v. Qualls, 206 Md. 58, 66, 110 A.2d 73 (1954).

[4] Give away pursuant to a will. See Black’s Law Dictionary [Third Pocket Edition] p. 207 (2006).

[5] A person executing a will.

[6] “To be clear and convincing, evidence should be ‘clear’ in the sense that it is certain, plain to the understanding, and unambiguous and ‘convincing’ in the sense that it is so reasonable and persuasive as to cause you to believe it.” Maryland Civil Pattern Jury Instructions § 1:13 (2013).

[7] Note the language used in the code, it is not referring to someone that has a drinking problem or casually uses drugs.  Also, the use of the intoxicants must prevent them from making or communicating decisions, not necessarily making poor decisions.