Is a No-Contest Clause Enforceable in Texas?

 Posted on March 03, 2023 in Estate Planning and Probate

For many people, one of the biggest concerns regarding estate planning is that their family members will argue over the terms of asset distribution. When this happens, the situation may lead to a will contest which can cost substantial time and money for everyone involved. Even more concerningly, will contests can lead to family disputes and intense animosity that lasts years.

To prevent these arguments, some estate plans include a no-contest clause or forfeiture clause. A no-contest clause states that if any beneficiary of an estate challenges the terms of the will in court, they may forfeit their inheritance altogether. Some states do not allow no-contest clauses. However, these provisions are allowed in Texas estate plans.

What is a No-Contest Clause in a Will?

A no-contest clause discourages a beneficiary from contesting or challenging the will. If a beneficiary does contest the will, this clause may allow the executor to exclude that beneficiary from receiving their inheritance. For example, a no-contest clause may say, "If any person contests or attempts to contest the validity of this agreement, he or she forfeits his or her share of the inheritance."

Consider an example of a situation in which someone may wish to include a no-contest clause: A grandmother has two grandchildren. One of the grandchildren is capable of managing money responsibly. The other grandchild has a gambling addiction. The grandmother decides to give a greater share of her wealth to the grandchild who can manage the money appropriately. However, she worries that if she does this, her other grandchild will challenge the validity of the will in an effort to increase his inheritance.

In a situation like this, the grandmother may choose to include a no-contest clause in her will. This way, if the grandchild with the gambling addiction challenges the validity of the will, he would forfeit his entitlement to any inheritance.

Of course, a no-contest clause is not the only way to handle a complicated situation like this. The grandmother could also choose to set up a trust or other legal instruments that would protect the assets from being squandered by the grandchild. A "spendthrift trust" is designed specifically for this purpose. Instead of receiving his inheritance all at once, the grandchild would receive funds incrementally.

As you can see, there are many different types of estate planning instruments to choose from as you create your estate plans. To discuss your situation in detail and learn more about your options, contact an experienced estate planning lawyer.

Contact Our San Antonio Estate Planning Lawyer

Geoffery Ray Mayfield is a Bexar County estate planning attorney with over 15 years of experience. He can help you develop an estate plan that fulfils your wishes and minimizes the chances of a will contest. Call Geoff Mayfield, Attorney at Law at 210-535-0870 today and set up a free initial consultation.

Source:

https://statutes.capitol.texas.gov/Docs/ES/htm/ES.254.htm