Avoiding Disputes Over Your Estate Plan – Part 1

Avoiding Disputes Over Your Estate Plan – Part 1  

No matter how well you think you know your family, it’s impossible to predict their behavior when you die or become incapacitated. Nobody wants to believe their family would ever end up fighting in Court over inheritance issues or  life-saving medical treatment. But sadly, we see this happen all the time.

When tragedy strikes, even minor tensions and disagreements can explode into bitter conflict. And when money is at stake, there’s even a greater risk for conflict.

The good news is you can drastically reduce the odds of such conflict through estate planning. You can do this with the support of a lawyer who understands and can anticipate these dynamics. This is why it’s so important to work with an experienced law firm like ours when creating your estate plan. Never rely on generic, do-it-yourself planning documents found online.

By learning about some of the leading causes of such disputes, you’re in a better position to prevent those situations.

#1 Reason for Conflict: Putting the Wrong Person in Charge

Many estate planning disputes happen  the person you chose to handle your affairs after your death or incapacity fails to carry out his or her responsibilities properly. Whether it’s as your power of attorney agent, executor, or trustee, these roles can entail a variety of different duties, some of which can last for years.

The individual you select, known as a fiduciary, is legally required to carry out those duties and act in the best interests of the beneficiaries named in your plan. The failure to do either of those things, is referred to as a breach of fiduciary duty.

The breach can be the result of the person’s deliberate action, or it could be something he or she does unintentionally, by mistake. Either way, a breach—or even the perception of one—can cause serious conflict among your loved ones. This is especially true if the fiduciary attempts to use the position for personal gain, or if the improper actions negatively impact the beneficiaries.

Common breaches include failing to provide required accounting and tax information to beneficiaries, improperly using estate or trust assets for the fiduciary’s personal benefit, making improper distributions, and failing to pay taxes, debts, and/or expenses owed by the estate or trust.

If a suspected breach occurs, beneficiaries can sue to have the fiduciary removed, recover any damages they incurred, and even recover punitive damages if the breach was committed out of malice or fraud.

Solution

Carefully choose your fiduciaries and make sure everyone in your family knows why you chose the fiduciary you did. You should only choose the most honest, trustworthy, and diligent individuals. Be careful not to select those who might have potential conflicts of interest with beneficiaries.

Moreover, it’s vital that your planning documents contain clear terms spelling out a fiduciary’s responsibilities and duties, so the individual understands exactly what’s expected of him or her. And should things go wrong, you can add terms to your plan that allow beneficiaries to remove and replace a fiduciary without going to court.

We can help you choose most qualified fiduciaries and draft the precise, explicit, and understandable terms in all of your planning documents. We can also help your family understands your choices, so they do not end up in conflict when it’s too late. That way, the individuals you choose to carry out your wishes will have the best chances of doing so successfully—and with as little conflict as possible.

Next week, we’ll continue with part two in this series discussing common causes for dispute over estate planning. 

Myrna can guide you to make informed, educated, and empowered choices to protect yourself and the ones you love most. Contact us today to get started with a Planning Session. This article is a service of attorney Myrna Serrano Setty, Personal Family Lawyer®. Myrna doesn’t just draft documents she ensures you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why she offers a Planning Session, during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love.

Call us at (813) 514-2946 to schedule a Planning Session. Mention this article and ask how to get this $500 session at no charge.