If the client’s current spouse is not the mother of his children, a reasonable precaution against future litigation is to ensure that second-wife and children are not co-fiduciaries. In the trust context this issue can be addressed by appointing different trustees for different sub-trusts and giving the respective beneficiaries of such trusts the independent authority to vote in successor trustees as needed. For example:

After my Disability. If my personal rights under this Trust Agreement are suspended, my son, SON#1, if he is age 21 or older, shall be appointed as the successor Co-Trustee. If my son fails or ceases to serve, I appoint my mother, MOTHER, as the successor Co-Trustee. My successor individual Trustee shall designate a Corporate Co-Trustee to serve with him or her.

After my Death. After my death, I appoint the following persons as successor Trustees under this Trust Agreement:

(a) Marital Trust and Family Trust. I appoint my wife as the sole Trustee of the Marital Trust and the Family Trust.

(b) Trusts for Descendants. I appoint each of my descendants as Co-Trustee of his or her separate trust, but only when that descendant has reached age 18. The successor individual Trustee shall designate a Corporate Co-Trustee to serve with him or her.

(c) Other Trusts. I appoint my son, SON#1, if he is age 18 or older, as the successor Co-Trustee of all other trusts created by this Trust Agreement. If my son fails or ceases to serve, I appoint my mother, MOTHER, as the successor Co-Trustee. The successor individual Trustee shall designate a Corporate Co-Trustee to serve with him or her.

Lord Acton was right when he observed that “power tends to corrupt; absolute power corrupts absolutely.” No matter how ethical and well-intentioned a trustee may be, or how close the family relation between trustee and beneficiary, basic human nature is such that a person’s sense of morality often lessens as his or her power increases (see here and here). In the trust context this dynamic can produce unintended consequences when trust beneficiaries are left with no viable recourse short of costly litigation in the face of a trustee that has clearly ceased acting as an “agent” for the original trust grantor, and has instead convinced himself that this is “his” money and he knows what’s best for the now middle-aged beneficiaries who “just want to cause trouble."  One middle-ground approach is to require an independent trustee for the trust, but also giving a majority (or super majority?) of the trust’s beneficiaries or some other trusted person (or committee) the discretion to periodically replace the independent trustee and appoint a new independent trustee without court order. For example:

Unrestricted Right to Remove. Upon the third anniversary date of my death, and every three years thereafter, the persons listed in Section ____ may remove any Independent Trustee for any reason by giving 30 days’ written notice to that Trustee and to the permissible current income beneficiaries, including the natural or legal guardians of any beneficiaries who are then disabled.

A presumably basic question, like “who’s a beneficiary?” can be the source of costly – yet avoidable – litigation. First, the testamentary document should explicitly define the client’s “children,” taking into account if any children are being disinherited and also the possibility of later-born children, adopted children and illegitimate children. For example:

Family. I am married to WIFE, who is referred to as “my wife” in this Will. My wife and I are both citizens of the United States. My wife and I have three children, SON#1, SON#2 and DAUGHTER. References to “my children” mean my children named above, as well as any other children of mine born or adopted after the execution of this Will; except SON#1, whom I expressly exclude from any provision of this Will and who is to receive no benefit under it; references to “my descendants” mean my children named above (except SON#1) and their descendants, but not the descendants of SON#1, whom I expressly exclude from any provision of this Will and who are to receive no benefit under it.

Effect of Adoption. A legally adopted child (and any descendants of that child) will be regarded as a descendant of the adopting parent only if the petition for adoption was filed with the court before the child’s thirteenth birthday. If the legal relationship between a parent and child is terminated by a court while the parent is alive, that child and that child’s descendants will not be regarded as descendants of that parent. If a parent dies and the legal relationship with that deceased parent’s child had not been terminated before that parent’s death, the deceased parent’s child and that child’s descendants will continue to be regarded as descendants of the deceased parent even if the child is later adopted by another person.

Infant in Gestation. For all purposes of this Will, an infant in gestation who is later born alive will be deemed to be in being during the period of gestation for the purpose of qualifying the infant, after it is born, as a beneficiary of this Will.

What if the definition of “family” changes due to divorce? Florida has two statutes that treat a spouse as being predeceased for purposes of a will (F.S. §732.507(2)) and a revocable trust (F.S. §737.106) executed prior to the dissolution of marriage. Note, however, that while a divorce is pending the surviving spouse still has homestead, elective share and exempt property rights under Florida law. Moreover, non-probate assets, such as insurance policies, IRAs, and pension plan benefits are governed by their beneficiary designation forms – not the subsequent divorce of the named beneficiary (see here). Bottom line, no amount of drafting will address all issues for a divorcing client. All estate planning documents should be reviewed and appropriately revised as soon as divorce proceedings are commenced.

But what about divorce not involving the client and his or her spouse directly? For example, what about divorce at the next generational level? The following sample clause addresses this issue within the context of a trust agreement:

Marital Relationships. The following rules apply to each person who is a beneficiary or a permissible appointee under this Trust Agreement and who is married to a descendant of mine. Such a person will cease to be a beneficiary and will be excluded from the class of permissible appointees upon: (a) the legal termination of the marriage to my descendant (whether before or after my death), or (b) the death of my descendant if a dissolution of marriage proceeding was pending when he or she died. The Trust will be administered as if that person had died upon the happening of the terminating event described above. If that person is not disqualified as provided above, he or she will remain a beneficiary (or permissible appointee), even if that person remarries after the death of my descendant.

“To fight and conquer in all your battles is not supreme excellence; supreme excellence consists in breaking the enemy’s resistance without fighting.”  Sun Tzu, The Art of War

Properly drafted estate planning documents can both decrease the likelihood of an estate claim and, in the event of an attack by a disgruntled heir or beneficiary of the estate, increase the chances that the estate plan will be successfully defended. Ideally, properly drafted estate planning documents will in fact dissuade a potential challenger from even commencing litigation. That is in fact the ultimate goal: dissuading a potential litigant from ever even filing his or her lawsuit.

The following discussion assumes Florida law will be governing the testamentary instrument. As such, drafting techniques commonly employed in other jurisdictions but unenforceable in Florida are not addressed. (For example, in terrorem clauses are enforceable in New York, but not enforceable under Florida law – see here).

• Who’s in and Who’s Out (Identifying Beneficiaries)?
• Who Picks The Trustee and When Can You Fire Him?
• Who Pays Uncle Sam?
• Who Gets The House?
• What If Surviving Spouse Wants More?
• Do You Have To Sell The Family Business?
• How Much Are Current And Remainder Beneficiaries Entitled To?
• Are Arbitration Clauses Enforceable?
• Can You Tilt the Litigation Playing Field to Your Advantage?
• What if Undue Influence is Suspected?
• What if Some Family Members Get More Than Others?

By anticipating evidentiary issues unique to estate claims planners can ensure the proper record is developed to shield an estate plan against future attack and also make sure clients avoid inadvertently creating a record that might undermine their estate plans in the future.

1.         General Rule; Self-Proving Affidavits

The initial burden is upon the proponent of a will to establish prima facie formal execution and attestation of the will. F.S. §733.107(1). The value of self-proving affidavits should not be underestimated with respect to this evidentiary point. Under F.S. §733.201(1) a will that is “self-proved” in accordance with the statutory form provided in F.S. § 732.503 is admissible to probate without the testimony of the attesting witnesses. If the will is not self-proved under F.S. § 733.107 the proponent of the will has the burden of establishing “prima facie” its formal execution and attestation via the alternate options spelled out in F.S. §733.201(2) and (3).

A simple statutory form can make all the difference in the world if it shifts the burden of proof in a will contest. A recent example underscores this point. In Jordan v. Fehr, 902 So.2d 198 (Fla. 1^st DCA 2005), one of the attesting witnesses described his role as follows:

“I’m like a monkey, I wrote my name and address and I was gone.”

Based on this kind of testimony is it any wonder that the First DCA reversed the trial court’s refusal to grant summary judgment in favor of the party challenging the will? Would the outcome have been different if the attesting witnesses had simply signed a self-proving affidavit and thus shifted the burden of proof to the challenging party? Maybe not, but then again, maybe it would have been just enough to tip the case the other way. Yes, a simple statutory form can be a big deal.

2.         Shifting Burden of Proof in Undue Influence Cases

Effective April 23, 2002, F.S. §733.107 was amended to add a new subsection (2) providing: “The presumption of undue influence implements public policy against abuse of fiduciary or confidential relationships and is therefore a presumption shifting the burden of proof under ss. 90.301-90.304.” F.S. §90.302(2) provides a presumption affecting the burden of proof; it “imposes upon the party against whom it operates the burden of proof concerning the nonexistence of the presumed fact.” In other words, once the presumption of undue influence is established by a challenger, the proponent must affirmatively disprove the existence of undue influence. Obviously, planners must be sensitive to any situation that might give rise to such presumption. In general the presumption is created by showing that one having a substantial benefit under the will possessed a confidential relationship with the decedent and was active in the procurement of the will. The prong to focus on here is “active procurement.” Planners need to be especially sensitive to the existence of factors considered relevant by Florida courts when determining if the alleged undue influencer “actively procured” the will or trust benefiting him or her. These factors include: 

• presence of the beneficiary at the execution of the will; 
• presence of the beneficiary on those occasions when the testator expressed a desire to make a will; 
• recommendation by the beneficiary of an attorney to draw the will; 
• knowledge of the contents of the will by the beneficiary prior to execution; 
• giving of instructions on preparation of the will by the beneficiary to the attorney drawing the will; 
• securing of witnesses to the will by the beneficiary; and 
• safekeeping of the will by the beneficiary subsequent to execution.

3.         Attorney as Witness

Communications concerning a will by the testator to his or her attorney are not privileged after the demise of the testator. F.S. §90.502(4)(b). See also Swidler & Berlin v. U.S., 524 U.S. 399, 118 S.Ct. 2081 (1998):

[T]he general rule with respect to confidential communications . . . is that such communications are privileged during the testator’s lifetime and, also, after the testator’s death unless sought to be disclosed in litigation between the testator’s heirs. [Citation omitted.] The rationale for such disclosure is that it furthers the client’s intent.   [Citation omitted.] Indeed, in Glover v. Patten, 165 U.S. 394, 406-408, 17 S.Ct. 411, 416, 41 L.Ed. 760 (1897), this Court, in recognizing the testamentary exception, expressly assumed that the privilege continues after the individual’s death. The Court explained that testamentary disclosure was permissible because the privilege, which normally protects the client’s interests, could be impliedly waived in order to fulfill the client’s testamentary intent. [Citation omitted.]

Attorneys should also consider whether or not they might be needed as litigation counsel for the estate. The preferred practice appears to be for an attorney who anticipates testifying to decline to serve as advocate for either side of the controversy. See Rule Reg. Fla. Bar 4-3.7. The following excerpt from the official “Comment” to Rule 4-3.7 articulates the prejudice/conflict-of-interest concerns underlying the rule:

Combining the roles of advocate and witness can prejudice the opposing party and can involve a conflict of interest between the lawyer and client.

The opposing party has proper objection where the combination of roles may prejudice that party’s rights in the litigation. A witness is required to testify on the basis of personal knowledge, while an advocate is expected to explain and comment on evidence given by others. It may not be clear whether a statement by an advocate-witness should be taken as proof or as an analysis of the proof.

In Eccles v. Nelson, 919 So.2d 658 (Fla. 5^th DCA 2006), the trial court’s ruling disqualifying the will-drafting attorney as litigation counsel was upheld on appeal by the 5th DCA on the following two grounds: First, Rule 4-3.7 supports disqualification and, second, disqualification of the will-drafting attorney did not violate his client’s constitutional First Amendment right to association because Florida courts have a substantial and legitimate governmental interest in protecting the integrity of the litigation process.

Attorney-client privilege issues also need to be considered anytime a trustee is the target of breach-of-trust allegations. In those instances whether or not the trustee’s confidential communications with his or her attorney are privileged may turn on the court’s determination of who the attorney’s “real client” is: the trustee or the beneficiaries. The Second DCA recently addressed this issue in Tripp v. Salkovitz, 919 So.2d 716 (Fla. 2d DCA 2006), articulating the governing Florida rule as follows:

Usually, a lawyer retained by a trust represents the trustee, not the beneficiary, even though the fees are paid with trust funds that would otherwise go to the beneficiary. If the attorney represents the trustee, the trustee holds the lawyer-client privilege. In some circumstances, however, the beneficiary may be the person who will ultimately benefit from the legal work the trustee has instructed the attorney to perform. See, e.g., Riggs Nat’l Bank of Washington, D.C. v. Zimmer, 355 A.2d 709, 711 (Del.Ch.Ct.1976) (noting that legal memorandum concerning trust tax issues, written before beneficiaries’ litigation against trustee began, was prepared for the benefit of the trust beneficiaries) (cited in [ Barnett Banks Trust Co., N.A. v.] Compson, 629 So.2d [849, 850 (Fla. 2d DCA 1993)]). In that situation, the beneficiary may be considered the attorney’s “real client” and would be the holder of the lawyer-client privilege. But if the “real client” is the trustee, the beneficiary would have to prove the existence of some exception to overcome the privilege. [Citation omitted.]

Another way of framing this issue is by asking the following question: who would have “standing” to challenge the client’s will or trust? In Florida that question is answered largely by determining if the potential litigant would be considered an “interested person” in the client’s estate. The term “interested person” is broadly defined in F.S. §731.201(21), and explicitly includes personal representatives and trustees. Any “interested person” may petition for revocation of probate. F.S. §733.109. Note also that F.S. §733.109(1) specifically expands the class of possible interested persons to disinherited beneficiaries of prior wills. The prudent approach is to consider all heirs at law as interested persons in the estate. The class of persons potentially falling within the class of a person’s heirs may also include a child that was raised by the decedent but never legally adopted under the doctrine of “virtual adoption.” See Williams v. Dorrell, 714 So.2d 574 (Fla. 3d DCA 1998).

Standing may also be the product of contractual rights if the claimant alleges the decedent breached an agreement to make a will validly created under F.S. 732.701(1). This claim is technically not an attack against the decedent’s will, but rather one for breach of contract that would have to be prosecuted like any other creditor’s claim under Part VII of Chapter 733.

It is also important to note that certain potential probate litigants can be essentially “bought out” if they receive their specified share of the estate. At that point they lose any standing to challenge any other aspect of the probate administration process. For example, in Cason ex rel. Saferight v. Hammock, 908 So.2d 512 (Fla. 5^th DCA 2005), the Fifth DCA held that the trial court was wrong when it ruled that the party seeking to remove the personal representative lacked standing because she did not fall within the definition of an “interested person” under F.S. §731.201(21). The estate had argued that because the petitioner was only entitled to a specific devise of $5,000 and there were sufficient estate funds to pay this specific devise, she was not an “interested person” and therefore under Fla. Prob. Rule 5.440(a) she lacked standing. The Fifth DCA held that the estate would have been correct . . . if the devise had already been paid. Because the devise had not been paid, the petitioner continued to have standing (oops!).

“The truly wise man, we are told, can perceive things before they come to pass; how much more than those that are already manifest.”  Sun Tzu, The Art of War

The following discussion is not intended to cover every conceivable claim that could arguably be asserted by disgruntled beneficiaries or disinherited family members. The focus here is on highlighting the most likely avenues of attack. The operative assumption is that thoughtful estate planners who are sensitive to these dangers and proactively engaged with their clients in guarding against them will in all likelihood greatly diminish the likelihood of estate litigation in all of its possible permutations.

1.         Execution Formalities

Although execution formalities should be second nature to estate planners, it is helpful to periodically review them nonetheless. F.S. §732.502 requires that a will be in writing, that it be signed at the end by the testator or by another at the testator’s direction, and that the testator sign, or acknowledge signing or directing another to sign, in the presence of two witnesses. It is not required that the testator sign in the presence of the witnesses if he or she acknowledges his or her signature to them. It is mandatory, however, that the witnesses sign in the presence of each other and of the testator. F.S. §732.502(1)(c). F.S. §737.111 provides that the testamentary aspects of a trust executed on or after October 1, 1995, are invalid unless the instrument is executed by the settlor with the formalities for the execution of a will.

2.         Lack of Testamentary Capacity

F.S. §732.501 provides that the testator must be of sound mind and be at least 18 years of age or an emancipated minor. Testamentary competency means the ability to understand generally the nature and extent of one’s property, the relationship of those who would be the natural objects of the testator’s bounty, and a general understanding of the practical effect of a will. Although there is no provision in the trust statute similar to F.S. §732.501, general law as to the inability of an incompetent person or a minor to contract should be applicable to execution of a trust.

3.         Fraud, Duress, Mistake & Undue Influence

F.S. §732.5165 specifically provides that a will, or any part of it, is void if procured by fraud, duress, undue influence, or mistake. Under F.S. §737.206 fraud, duress, mistake, or undue influence may be asserted as grounds for trust contests as well.

A fraud claim would be based on the general elements applicable to all fraud claims: false representations of material facts, knowledge by the perpetrator that the representations are false, intent that the representation be acted upon, and a resulting injury. Fraud defeats the testator’s wishes through deceit. Examples of duress would include the execution of a will or trust under threat of blackmail or force. Here the idea is that the testamentary instrument is not the voluntary act of the testator and is thus invalid. Undue influence is a substitution of the mind of another for the mind of the testator that induces the testator to act contrary to his or her wishes. In Zoldan v. Zohlman, 915 So.2d 235 (Fla. 3d DCA 2005), the Third DCA recently articulated the rule as follows when it reversed a trial court ruling finding undue influence based on the decedent’s alleged desire to please his spouse:

The Florida Probate Code provides that a will is void, either wholly or in part, if its execution is procured by fraud, duress, mistake, or undue influence. § 732.5165, Fla. Stat. (2003). The undue influence required for invalidation of a testamentary document is conduct amounting to duress, force, or coercion to such a degree that the free agency and willpower of the testator is destroyed. Mere affection and attachment or a desire to gratify the wishes of one who is esteemed or trusted may not alone be sufficient to amount to undue influence. E.g., In re Peters’ Estate, 155 Fla. 453, 20 So.2d 487, 492 (Fla.1945); Derovanesian v. Derovanesian, 857 So.2d 240 (Fla. 3d DCA 2003), rev. denied,868 So.2d 522 (Fla.2004); Raimi v. Furlong, 702 So.2d 1273, 1287 (Fla. 3d DCA 1997); Coppock v. Carlson, 547 So.2d 946 (Fla. 3d DCA 1989); and cases cited therein.

Estate claims based on “mistake” are predicated on the decedent’s execution of one instrument under the belief that he or she was executing another. “Mistake” in this context does not mean a mistake in the decedent’s understanding of a factual situation, a mistake in wording, or a scrivener’s error in drafting the will.

4.         Spousal Elective Share Claims

The right to an “elective share” is granted to the surviving spouse of any decedent domiciled in Florida with no restriction as to the residence of that surviving spouse. F.S. §732.201. The elective share is equal to 30% of the “elective estate.” F.S. §732.2065. The “elective estate” includes both probate and non-probate assets. F.S. §732.2035. The elective share is in addition to a surviving spouse’s rights to homestead property, exempt property, and allowances as provided in Part IV of F.S. Chapter 732. F.S. §732.2105.

5.         Tortious Interference in Estate Planning

The tort of interference with an expectancy of inheritance authorizes the injured beneficiary to bring what amounts to a derivative action to recover damages. The tort is recognized to advance a public policy for the protection of the testator’s interest in freely disposing of his or her property by gift or devise, rather than the disappointed beneficiary’s expectancy. The most significant characteristic of this action is that it is not a probate-centered lawsuit. In fact the claim may be brought only under circumstances that do not usurp the jurisdiction of the probate court, constitute an impermissible collateral attack on an order or judgment entered in probate, or improperly delegate, to disappointed beneficiaries, the responsibility for the protection of a competent testator’s right to dispose of property freely and without improper interference. 

It should also be noted that in light of the 2006 U.S. Supreme Court opinion involving tortious interference claims asserted by former Playboy model Ana Nicole Smith, these claims may become more common – in federal court. Martha Neil in her article More Probate Suits Seen in Smith Ruling, ABA J. e-Report, May 5, 2006, reported that the Ana Nicole Smith case is expected “to open federal courtroom doors to a deluge of new estate-related litigation.” Here is an excerpt from her article:

Meanwhile, even those on the other side expect the Supreme Court decision in Smith’s case to open federal courtroom doors to a deluge of new estate-related litigation. 

“I think it’s going to be read primarily by litigators and it’s going to create another new litigation opportunity,” says James R. Wade, a Denver lawyer and former probate judge who filed an amicus brief on behalf of the National College of Probate Judges. “I think that the litigators are going to see opportunities which they hadn’t even thought of before of bringing probate cases in federal court.”

“All happy families resemble one another, but each unhappy family is unhappy in its own way.”  Leo Tolstoy

Strained relations between client and family or among the presumptive beneficiaries of the estate are the primary “red flags” to be considered when planning for future estate litigation. In truly troubled families, where substance abuse, cult influence, extreme profligacy or other deviant behavior is evident, considering the likelihood of estate litigation and properly planning to guard against it could be the difference between abject poverty and substantial comfort for the estate’s beneficiaries. Estate planning in the absence of this information is akin to a pilot flying blind. However, once the “red flags” are spotted, effective prophylactic estate planning is very feasible and a true bargain when compared to the cost of litigation.