Avoiding Litigation You Can't Manage: Planning Your Estate and Talking About It
You will not be around to manage any litigation that might arise over your estate.
That’s why we took notice of a recent New York Times article by David Cay Johnston which made an excellent case for informing your beneficiaries about the particulars of your estate plan. (“Learning to Share”).
Essentially, the point of the article is that being up front about your plans may be difficult but will serve you well in the long run. Quoting Mitchell Gans, a law professor at Hofstra University, the Times points out the particular problem that occurs when the plan is not an equal distribution among the beneficiaries and the less favored beneficiaries react with anger:
Kids do get angry at being cut off, but if you say nothing their anger will be directed not at you, but at the favored child. You need to ask yourself, ‘Why should this kid be the target of the anger?’ Why would you do that to them?
I recommend the entire article. When we talk about the “long run” here, we are talking about a run so long that you are no longer there to smooth things over or straighten things out.
In our experience, estate and trust litigation is quite likely to occur where there is an unequal distribution and the beneficiaries do not find out about it until the will is offered for probate or a trustee takes charge after death has occurred. Estate and trust litigation tends to be especially bitter. We know of cases where the parties lose all perspective and dissipate large portions of the estate. Most attorneys who practice in this field will have had similar experiences. The majority of cases eventually settle but getting to a settlement can be a long, expensive effort.
We include trust and estate matters in the general category of “business litigation” (although many would not) because most of our small business clients do not create an artificial boundary between their business and their personal finances. And, it is possible to extract “better practices” from litigation developments for personal financial issues, such as estate matters, just as it is for business issues.
In this case, the Times article rightly suggests that the better practice, although difficult, is to communicate openly with your intended beneficiaries.
