In a recent post, I wrote about common disputes that arise from estate planning: changes in circumstances, mistrust of personal representatives/trustees, and coercion or undue influence. In this post, I want to briefly answer the question: How are will/trust disputes resolved?

In short, the answer largely depends on the nature of the disagreement. Resolving a dispute can be as simple as replacing a personal representatives/trustees, or as difficult and tedious as filing a lawsuit. At the end of the day, however, the decision is entirely up to the client. An estate planning attorney, like me, Vince Taormina, can only give advice on the best course of action. So, with that in mind, here are some of the top ways to resolve estate planning disputes, from the simplest to the hardest.

Replace the Personal Representative/Trustee

Beneficiaries of an estate, both in the estate planning documents and under Missouri law, have the authority and ability to remove a personal representatives or trustee for many different reasons. RSMo. § 473.140 deals with removal of a personal representatives in the will and probate context. RSMo. § 473.140 allows a court, or any interested person in the estate, to revoke the appointment of a personal representatives.

In other words, an interested party to the will or probate estate can file a petition with the court to remove and replace the personal representatives if the personal representatives fails to uphold his duty to the estate.

Likewise, in the trust context, beneficiaries may request a court to remove the Trustee. RSMo. § 456.7-706 allows the court to remove the trustee if the following circumstances apply:

• If the trustee has committed a serious breach of trust.
• For lack of cooperation.
• Because the unfitness, unwillingness, or persistent failure to administer the trust effectively.
• If the trustee substantially or materially reduces the level of the services provided to the Trust.

While removal of a personal representatives or trustee may require the filing of a complaint before a court, working with an estate planning law firm like The Taormina Firm can prevent the need for initiating an action in court. When I draft estate planning documents for my clients, I usually lay out the procedure for removing a trustee. In the trust context, I give my clients the option to allow a majority of the beneficiaries of the trust, so long as they are over the age of eighteen (18), to remove a trustee when the trustee is not acting in the best interest of the trust or the beneficiaries. A majority of the beneficiaries can then appoint a new trustee if there is no one else qualified to serve under the terms of the trust.

Mediation or Arbitration

RSMo. § 456.8-816(23) grants a trustee the ability to resolve a dispute by way of mediation or arbitration. If a Trust Agreement requires mediation or arbitration, the provision is considered unenforceable unless all interested parties to the trust with regard to the dispute consent to the mediation or arbitration. RSMo. § 456.2-205.

Mediation means working with a disinterested third-party to resolve a dispute in an informal manner. Typically, parties to an estate planning dispute hire a third-party mediator to settle the dispute. The mediator separates the parties and acts as a go-between in an attempt to settle the dispute out of court. Mediation is an incredibly informal process, and for relatively minor estate planning disputes, it can be particularly effective.

Arbitration is a little more formal. There are actually rules and procedures which parties must follow in the arbitration process (see https://www.fairclaims.com/ or https://www.adr.org/ for more information). Parties bring in a third-party arbitrator to formally settle the matter without going to court. The problem with arbitration, however, is that it can be expensive and does not necessarily provide the same protection that a court would otherwise provide.

The best approach to settling an estate planning dispute is likely mediation or something akin to mediation. If a minor dispute arises, parties to the estate planning dispute, and their estate attorneys, should meet privately to discuss the dispute outside of the confines of the court. This is much less expensive and tends to be more amicable than arbitration or litigation.

Litigation

Litigation over a will or trust dispute should be considered a last resort. Litigation is both expensive and time consuming and can cause severe damage to the family. In order to bring litigation, an individual must be a potential inheritor of the estate and must also have sufficient grounds to bring the claim. Parties will hire estate attorneys to work on their behalf and resolve the estate planning dispute through the court system. These fees can run into the tens of thousands of dollars. These cases can go on for a long time, and could result in appeals, which are an added expense to the parties.

The outcome of litigation is not guaranteed. There are three potential outcomes: (1) damages awards, (2) redistributions of property, or (3) nothing.

A damage award is simply compensation for the loss sustained due to the mismanagement of the estate or compensation for other issues relating to the decedent's will or trust.

If the estate was wrongfully distributed, after litigation the court may order that the estate be redistributed according to the original arrangement in the will or trust or be redistributed to individuals now entitled to receive under the decedent's estate plan.

There is also the potential that a party bringing a suit will receive nothing. Litigation is not a sure thing. Because we live in an adversarial legal system, there will be a winner and a loser to a will or trust contest.

Conclusion

A good estate planning attorney can help mitigate the potential for disputes. If you have concerns about your will or trust, or the will or trust of a loved one, it is important that you have a discussion with an will or trust attorney like The Taormina Firm as soon as possible. Additionally, if you want to ensure that your estate planning documents never come into question, consider visiting an experienced estate planning attorney at The Taormina Firm to ensure your wishes are followed after your death.

The Taormina Firm, as an estate planning law firm, is always happy to assist clients in either reviewing or reforming their will or trust to prevent disputes. If you have any questions or concerns, please give us a call today to schedule your free consultation!