Occasionally, the estate of a loved one becomes involved in litigation. The source of the estate litigation can vary. However, two of the more common sources are related to creditor’s claims and disagreements between the beneficiaries of an estate.
Litigation arising out of a creditor’s claim occurs when the creditor formally files a claim against the estate in which they demand payment for services to the estate or services rendered to the decedent prior to their death. The creditor could be a credit card company, a bank, a business, an individual who provided care to the decedent while they were ill, or a variety of other potential sources. A personal representative can pay the claim, attempt to seek a compromise with a creditor, or, where appropriate, deny the claim in full. In the event that no compromise can be reached or where the claim is denied in full, a hearing before the Orphans’ Court is often necessary to resolve the dispute. Given the personal representative’s duty to safeguard the estate’s assets, it is important that they only pay legitimate claims. Therefore, the personal representative needs to be advised of what constitutes a validly filed claim as well as to be able to accurately judge the claim’s merits.
Often disagreements arise among the beneficiaries of an estate. Sometimes, an individual can attack the validity of the decedent’s Will. This is referred to as “Caveating a Will”. In such an instance, the individual contesting a Will typically claims that the decedent’s Will was the product of undue influence or that the decedent lacked the proper mental capacity to execute their Will. The individual accuses someone else of taking advantage of or manipulating the decedent into executing their Will. The objective of a Caveat proceeding is to nullify the decedent’s most recent Will. This type of estate litigation can be extremely costly to prosecute or defend. Often, experts are required to examine the decedent’s handwriting or to testify to their competency when the decedent executed their Will. If the Caveat is successful, either the decedent’s earlier Will is admitted to probate or, if there is no earlier Will, their estate is administered pursuant to the laws of intestacy.
Another more common form of estate litigation arises when there are disagreements about the administration of the estate or the division of the decedent’s personal belongings. Disagreements regarding the administration of the estate often arise when beneficiaries question the appropriateness of the personal representative’s actions. They may take issue with the personal representative’s payment of a creditor. Or someone may take issue with the pace that the personal representative is administering the estate. In either event, beneficiaries have a right to demand a hearing before the Orphans’ Court to present their grievances.
Alternatively, disagreements may arise regarding the division of the decedent’s personal belongings. This is particularly true if the decedent did not have a Will instructing the personal representative on who were to receive certain items. Often, the items that are fought over have far more sentimental value than monetary value. Occasionally, an individual will claim that the decedent told them during their life that they were to receive certain items. However, unless such a wish is properly memorialized in a valid Will, such testimony has little legal effect. The settling of these disputes often necessitate judicial intervention to resolve the issue. Often, in the event where two individuals are arguing over a particular item, a Court may order the item sold and that the proceeds be split between the parties. As noted above, as many of these disputes pertain to items with a high sentimental value, this result often fails to satisfy any party.
There is no fool proof method to ensure that one’s estate will be free from any form of litigation. However, there are steps you can take prior to your death to help minimize the prospects of beneficiaries contesting a Will. The first is to execute a well thought out Estate Plan. By having a Will which clearly outlines your wishes you help reduce the chances that someone will disrupt your plans after your death. Moreover, if you own certain valuable items or family heirlooms, you can use your Will to indicate how such items are to be divided among your family and/or friends. Where appropriate, clients can share their estate plan with their family members prior to their death to help educate them and explain why certain decisions were made.
Should you already be in the process of administering an estate, having a Maryland estate planning attorney with a firm understanding not only of the relevant law but also of the emotional dynamics that are often involved in the probate process can be very helpful. In certain instances, mediation between the parties may be an appropriate solution. This can be particularly effective in situations where there is an emotional component between the parties or about a particular issue. Mediation can help the parties address their feelings as well as to give them the power to forge their own solution to their dispute. This can often lead to a more satisfactory resolution for the parties instead of the outcome a judge may impose if the dispute was settled in court.