WHO WOULD ARGUE WITH GEORGE WASHINGTON?

George Washington’s self made will had some wonderful features. I’m thinking of re-popularizing at least one of them. You see, he had a well constructed clause to direct the settlement of disputes in the event there should be any.

As an estate planning attorney, I have long been a proponent of using revocable living trusts in the process. They avoid probate, make the settlement go smoothly, and cost less money in the long run. And they generally avoid conflicts in settling an estate.

A living trust is a written document to perform the same functions as a Last Will and Testament. But it does so without probate, if properly written and funded. Thus keeping the estate out of Court. So in order to dispute the trust, a new lawsuit must be filed. This was often considered unworkable.

Often the drafter of a living trust will include an “In Terrorum Clause” often referred to as a “No Contest Statement.” Such a clause instructs the Trustee of the Trust to consider anyone who should contest (or bring a lawsuit) against the Trust, to have died without any children. The outcome of this is to discourage anyone from causing a dispute over the settlement of the estate.

Unfortunately, the probate judges now-days sometimes take to looking askance at such clauses. Their reasoning is that if there is a real injustice caused by the document, by the Trustee, or the other heirs, then a person pointing out such an injustice should not be punished by cutting him out of the estate. And you know how good lawyers have become at arguing such things!

So perhaps we should look to George Washington’s solution and add it to our trust language. In so many words, George said that in the event of a disagreement, the disagreeing parties should follow his instructions. His instructions were that in such a case there should in essence be a mediation committee formed.

Each party to the disagreement should select one prominent and distinguished gentleman who was known for his wisdom and integrity. Then these two gentlemen would select a third person by mutual agreement. These three would then mediate any dispute and the parties would be bound by their decision, from which there would be no appeal.

I suppose such a clause would work until some judge would say that such disputes should always be decided at Court! “A mediation committee,” the Judge might shout, “Poppycock!” But I still think it’s worth a try.

Comments

WHO WOULD ARGUE WITH GEORGE WASHINGTON? — 4 Comments

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