Can a Living Trust Be Contested by Heirs?

A living trust is much more difficult to contest than a will. If an heir or other family member feels slighted by your living trust, he must file lawsuits against every beneficiary and prove that the trust was invalid the day it was filed and each day afterward. Meanwhile, all assets can be distributed by the trustee, unlike assets named in a will, which are frozen the minute someone files a dispute with the courts.

How Courts View a Living Trust

A living trust differs from a will in many areas, but especially in how the courts view its legitimacy. When a person dies with only a will, all of his assets must go through probate court because the courts have to verify that the will is valid before anything can get distributed. A living trust is considered legitimate from the day it was created and notarized because courts assume that the trustee (the creator of the trust) was competently managing his trust on an ongoing basis. If an heir wants to prove a trust is invalid, the heir must show evidence that the trustee was coerced or mentally incapacitated when creating or making changes to the trust.

Heirs and Public Disclosure of Trusts

Another example of how challenging it is for an heir to contest a living will lies in the notification process of the estate's distribution of assets. If someone doesn't have a living trust, his estate must go through probate court, which is a public process that must be published in a local newspaper's legal notices section in order to allow anyone to contest the will. But if a person dies with a living trust, the public does not need to be notified of the estate's upcoming assets distribution. As a result, in many cases, distant heirs are not even aware of their inclusion in the trust or exclusion from the trust, which keeps legal disputes to a minimum.

Contesting a Living Trust

Anyone who wants to contest a living trust should be aware that his chances of successfully proving that a trust is invalid are extremely low. Before contesting the trust, an individual will need to hire a competent attorney who specializes in living trust litigation. Upon examination of the heir's case, the attorney should provide the litigant with an estimate of what it might cost to go through the court system as well as a warning that winning the dispute is highly unlikely.

Avoiding Disputes

Anyone with children who wants to create a living trust will need to give careful thought to how his assets will be distributed to the heirs. If some heirs will receive more assets than others, a carefully crafted letter explaining why should be included in the trust to help avoid hurt feelings and subsequent legal disputes. When the trustee dies, if an heir wants to contest the allocation of assets, the law states that ultimately the heir may receive nothing at all if there is no legal validity to the dispute.

References

• University of Minnesota Extension: Ag Business Management: Revocable Living Trusts
• The 'Lectric Law Library: Avoiding Financial Disaster With a Living Trust
• Pennyborn: How to Contest a Will
• Heritage Living Trust: Questions & Answers to Common Living Trust Issues
• Nolo: Make Your Own Living Trust; Dennis Clifford; February 2011

Resources

• Estate Planning Links: What is a Living Trust?