The Fear of the No Contest Clause
One of the most common fears clients have is that if they challenge a Will or Trust they will trigger the no contest clause found in the Will or Trust (the vast majority of testamentary instruments have a no contest clause as almost all attorneys put them in as a default provision).
It is very understandable for people to be concerned about triggering this provision as it has very scary language. The general nature of this provision is that if any beneficiary challenges any provision of the will/trust, they will be treated as predeceasing the testator and the gift will lapse (go back into the estate to be distributed to the other beneficiaries).
Prior to legislation enactments in 2008 the no contest clause was much more concerning for most cases. However, in 2008 the legislation removed most of the teeth from the no contest clause. Now, a no contest clause is only enforceable if you lose on a direct contest and the direct contest was filed without probable cause—and in the rare circumstances of challenging the transfer of property by stating that the testator didn’t own that property or by filing a creditor’s claim and the no contest clause prohibits those filings (which it rarely does).
When analyzing whether the no contest clause applies to you, the first thing you should do is look objectively at what you are set to inherit under the current Will/Trust. If you are completely disinherited under the Will/Trust then while legally the no contest clause applies to you, practically it does not because even if you lose and it is found that the no contest clause applies to you, you lose nothing. If, however, you are to inherit significant amount of money but you would inherit even more if the Will/Trust was invalidated then you have to make the determination as to whether the risk of losing everything is worth it to you.
The next step is to look at whether your filing would actually constitute a “direct contest.” A direct contest is when you claim the entire Will/Trust is invalid due to forgery, improper execution, lack of capacity, menace, duress, fraud, or undue influence or you claim the testator revoked the Will/Trust. A claim is also a direct contest if you claim a gift to a beneficiary is invalid due to the fact that the beneficiary was an interested witness (this applies to Wills only) or if you allege the person was a prohibited beneficiary (which I will cover in another blog post as the determination as to who a prohibited beneficiary is, can be complicated).
As you can see, most anything you file with the court that challenges the validity of the Will/Trust will be considered a direct contest—although most notably challenging the Trustee/Executor’s actions is not a direct contest—but the no contest clause is only triggered if the direct contest was filed without probable cause. Probable cause exists the facts known at the time of filing would cause a reasonable person to believe there is a reasonable likelihood of success if given time to investigate their claim through discovery. This is a very low threshold to hit in order to not trigger the no contest clause. For example, if your parent was diagnosed with severe dementia at the time they executed the instrument that might be sufficient to create probable cause for filing. However, because there are so many permutations on fact patterns that would allow you to challenge a Will/Trust with probable cause it is recommended to go to an attorney prior to filing any contest to help you in assessing your situation.
Something to keep in mind though, is even with a low threshold to create probable cause, and therefore not trigger the no contest clause, this is all determined by a judge. Judges are human and therefore fallible, so even if you have probable cause, the judge might disagree and find that you did trigger the no contest clause—although these situations are exceedingly rare.