Episode 16 – New Law May Increase Disinheritances: Real Lawyers, Real Answers

[Music] It's almost time for another live session we'll wait just a little bit to allow people to get online the meantime how you doing Stuart I'm doing well it sounds like you may be getting through the tail end of a cold I'm on the back end of a cold so I hope so my voice is super Basie today I've got a little Barry White going on well let's not get carried away but ok and you about ready to head off on vacation I am yep gonna be gone on vacation yeah I just got back from Hawaii yeah tanner no no no you still look like well I'm not gonna say that we'll save that for later yeah all right why don't we get started welcome to the stam fight when live stream real lawyers real answers were broadcasting live on Facebook and YouTube as we always do and you can find a recorded version of this video on Facebook and YouTube once we're done so I am Keith Davidson I'm Stuart Albertson and we are here today to talk to you about no contest clauses it seems like we're constantly talking about no conscious clauses doesn't that we we talk about them a lot yeah and you know I was thinking about this because first of all I think no contest clauses are confusing would you agree in terms of how they apply when they apply when they don't apply how they block the exceptions to them and the other thing that's interesting about it is it's the one area of trust law that seems to change a lot because most of the stuff that we deal with in trusts and Will's have been with us for centuries and centuries like creating a will is pretty much the same as it's been for hundreds of years right but no contest clauses it seems like there's been a lot of change right in the last few years yeah so people keep trying to get it right and today what we want to talk about as an appellate case that came out that is probably going to be a major change to how No contest clauses are applied and this is the case of Sarah key versus Elizabeth Tyler came out from the second appellate district appellate court on April 19th and the site for anybody wants to look it up it's a 20-19 case is thirty-four kallab v five zero five and thirty four Cal op v five zero five that's it all right so this is a long case you mean I printed it out it's fifty some odd pages because there's a lot of different issues going on in this case but there's only one issue that I really want to talk about today and that is in this case you have a party who and that's key Sookie brought the truss contest trying to set aside an amendment claiming that the amendment was based on undue influence and so she's challenging the validity of a document and the other party Tyler defended against that and said no no the the amendment was valid and was not undue influence and Tyler lost the amendment was tossed out as being a product of undue influence which doesn't all happen all that often in trial court level Sookie won the trust contest okay well she's not gonna be disinherited because she didn't challenge a valid part of the trust she challenged the amendment the amendment was invalid she's good I think the key that you're setting up here is is that key filed a trust contest yes and normally the person file in a trust contest is the one that is triggering the no contest clause in our minds in our minds and that's been the way that all practitioners have viewed this and so who's the second individual here I like Tyler so Tyler comes along and she just comes along as she served papers in the trust contest that has been filed by key and she goes no no no this is a valid amendment I don't know what you're talking about it's valid and I'm filing an opposition to your trust contest that you chose to file and of course you're triggering the no contest clause because your saying that this is not a valid trust I'm just here saying it's a valid document yeah and so I think that's a perfect summary of what I was trying to get at and so so would Tyler the person who's just defending against this trust contest for the trust amendment she loses but would in our minds before this case would she be triggering the no contest clause well not a quote not according to what we've read in the past I've always felt that there was something funny about the idea that you could get mom or dad to change their original trust a day before they died and then you have the good Amendment that gives everything to you and that you're not going against the no contest clause and the original trust I've always thought in my mind that didn't make sense but I've never put two and two together fully until I read this opinion yeah because I would have said no if you're defending a trust contest you're not triggering the no contest clause because you're not taking an affirmative action defending against a Truscott is defending against a trust contest you're not taking affirmative action to set aside a trust amendment therefore you're not triggering the no contest clause in this case key verses Tyler says no you are potentially tricking the no contest clause if you defend against a trust amendment and it turns out that that trust amendment is in fact invalid because of undue influence and lack of capacity right which I find a little bit shocking and I I think I have a different view of it than you did is yep you're not bringing a case when you're defending you're not bringing a case but what the court said is but you are making a filing in court right and if you look under the no contest Clause statute one of the types of when they define a pleading what particular statute is probate code what are you looking at it's twenty one three ten okay so if you look under twenty one 310 it defines a pleading and a pleading includes an objection a response and answer a cross-complaint so okay I guess that that could be that and the other thing though is a direct contest is when you say this this document is not valid because of undue influence that's what key did but Tyler just said no no it is valid that's all right that's all she said she didn't say that some other part of the trial was valid or invalid because of undue influence right what the court said is yes but by defending against that you have by by defending the bad Amendment you effectively are revoking a former portion of the trust that was there otherwise and that's what I always felt funny about it always felt funny that the one let's let's call it the bad actor getting a invalid amendment and it always hits me and I'm interested to hear your thoughts on this that the invalid amendment is presumed to be valid it's a presumption that it's a valid amendment if it's been signed right that's a legal presumption and so I always thought that if you changed the original intent of what somebody had said and there's a no-contest clause in that original document that original intent aren't you changing that document and aren't you the one that's triggering that no-contest clause and the court would agree with you and so the court says yeah and the in the way the court it was kind of an interesting way the way they did the analysis because they said well one of the things that you that constitutes a direct contest is if you attempt to revoke a trust or any of its provisions and this effectively is doing that if by you advocating for a bad amendment you're effectively revoking what the proper trust terms are and so that is a contest you're entering into a contest of the trust terms the proper trust terms and and I forgotten the name of not ki but Tyler Tyler is really I mean if you think about if she's an involuntary contestant yeah she doesn't I mean if she doesn't do anything more likely the courts going to say that the amendments invalid right but if you do something well now you're putting yourself in a position where maybe either no contest Clause could be used against you well and I guess the court would say but this no con this amendment fell because the court found that yes there was undue influence on the part of Tyler so I guess in theory Tyler should have known what she did and she should have not tried to defend the amendment assuming the right decision was made by the judges but yeah you know if I mean let's say that there that Tyler truly did do bad acts here she would have known that but what if Tyler didn't do bad acts here and this is a good amendment and now you're in a position where you have to come forward to support an amendment and you're essentially entering the trust contest whether you like it or not yeah you're being forced to do it but you know it's kind of like what we talked about in the past on creditors claim which is it's a forced election so you can either choose to defend against a trust contest knowing you're risking it right or you can choose not to you have to make an election at the beginning right and you know maybe you make the right choice maybe you make the wrong choice but it's a tough it's a tough position to be in and you know the funny thing in my mind is Tyler who's defending the trust contest I'll bet you anything you could have gone out and talked to 100 trust litigators throughout California and not one of them would have said Tyler's risking anything by defending that's right they would have said no no Tyler can defend and so now Tyler surprised and yeah yeah yeah very well more importantly Tyler's attorneys are probably pretty surprised that hey right now your clients can be disinherited just for defending right so not only did you lose the trust contest on the amendment yeah but that you've lost your gift even though the original trust you know you know I I've said for a long time that California and you're right the no contest Clause legislation has changed at least four times since 2000 I mean that's 1819 years has changed four times and has changed significantly and that's a lot with each one those iterations yeah I've said just get rid of no contest clauses if you would just get rid of them yes they don't I mean they do work to some extent but that they work negatively they work in a way they shouldn't work in many cases and so just get rid of the no contest clause let people fight it out I know this there was one state that you had pointed out to me a while back that actually allowed you to do a trust contest while the trust graders were still living yes and so that way you could get all of the evidence and everything for the future maybe that's the way you do it but but having these no contest clauses first of all nobody knows the future they don't know how these no contest clauses will be interpreted they're all drafted differently and then of course judges are people and as we've seen in many cases we've been involved with you can go into one court and get one decision and you'll go in with that same issue to another court another judge and you're gonna get the exact opposite decision that's neither right nor wrong I'm just saying that judges are people they're gonna look at these cases one judge may see a contest where in the same case another judge may not see a contest and so right it causes so many problems let's just get rid of these no contest clauses I think you're right and I don't think it would I don't think it would increase the amount of litigation we have because in a vast majority of the cases people are completely disinherited so there's no incentive to not sue anyway to challenge a trust amendment right and the problem with this is it's an appellate court decision that kind of throws a wrench into the works and I was thinking about that too is that when you have a change in the statute by the legislature that goes through the California Judicial Committee and practitioners people who practice you know work in this area have a chance to comment on those laws before they come into effect this is just an appellate court doing the best they can I mean they read the statute they interpreted it they said that while defending under the statute is a triggering event for no contest clauses but it wasn't vetted the way legislation is about it now California Legislature could go back and change this result of this appellate case but I think you're right I think the problem with no contest clauses is they're just so complex half the time they don't work when they do work they work in all the wrong ways it's just it's time to go let me ask you in this case and I don't remember when I proves this law couple weeks ago and you gave it to me did the amendment in this case have a provision that said that they were essentially restating and reincorporating everything from the original trust I believe so I don't remember B and the reason I raise this is because the whole protected instrument idea behind no contest clauses and there's a whole series of rules they're complex analysis that goes into what is and what is not a protected instrument and so this is this is again why this case is gonna cause more problems because in some cases you're clearly going to have an amendment that's a quote unquote protected instrument and would fall under this analysis and then you're gonna have other cases where it's maybe not a protected instrument and the question is does it still fall under this analysis yeah is it still a contest at the end of the day if you end up losing when you're saying this is the valid amendment and so there there there that's again where it goes back to let's get rid of no contest clauses or let's go back to what we had before when the court system was overwhelmed with safe-harbor applications where we were allowed to present to the court our trust contest ahead of time saying can we file this and if we do what we do well we be triggering the trust no contest clause and the court would tell us either yes or no you are you are not and that made it easier for us so that we weren't getting heirs to basically lose their inheritance by filing an action that's the hardest part is how do you tell somebody if they're gonna lose their inheritance if they lose the lawsuit it's hard to know even with probable cause so if you bring in trust contests and you have probable cause you won't be disinherited the court can let you off the hook but we won't know if you have probable cause until the very end of the lawsuit after you lose and not only when we not know that one judge may say you have probable cause and another judge might under the same identical set of facts they know you don't have probable cause and I you can even take it a step further and say anybody who's defending an amendment and then they lose based on undue influence they'll never have probable cause because if they're the ones doing the bad actions and the court says yes those were bad actions that's undue influence you should have known at the beginning so how do you ever have probable cause if you're defending against a trust contest I got a question for you and this one I'm throwing out from right field if you will and that is let's say that somehow someway we bring it financial elder abuse cause of action and that goes to a jury trial and the jury comes back and says that the bad after here extra is guilty of financial elder abuse by getting someone to create an amendment by undue influence you know is that a triggering of the no contest clause that's a possibly I mean I said isn't that isn't the jury if they come back and say that you basically got an amendment by financial elder abuse yeah through the use of undue influence I think so I mean I think now that's the next logical step now it usually be to trust contest we get heard first in the probate court but not always I mean somehow someway a financial elder abuse cat cause of action which is a civil can it goes in front of the jury in a civil court and I haven't seen early if that goes through and there's a finding of bad faith and undue influence and those types of things boy I'm gonna be thinking about filing if I'm on the winning side of that I'm gonna think about filing a petition to disinherit that individual who lost in that civil case because there's a finding of undue influence yeah and the court even said that the definition of pleading is very wide it includes complaints cross complaints answers objections responses I mean that that's all the stuff that you use both in civil court and probate right so it's it's certainly possible right it definitely this case I think blew a huge hole into what we thought what most practitioners thought of for no contest clauses it subjects people who are defending against no contest clauses it subjects them to possibly triggering the no contest clause and being disinherited so the amount of diss inheritances will increase because of this and who knows I mean people start using it in the civil context for financial abuse then the chances of disinheritance are gonna go up even more but this is one person this you know the the the losing party here Tyler this is one person it was disinherited who wouldn't have been under previous law well is it there also a common law count for undue influence with with contracts so what if you show what if you show that you have a beneficiary that got grandma to sign a contract for care right and it was brought by undue influence and you were trying to resend the contract and you win that case and the other person opposes that says no it's a good contract right I should have been able to care it can we now take a I'm working a little bit far here but the point is you show undue influence or bad actions by somebody I want to come and say hey they're trying to defeat the estate plan of that person yeah well you know on the one hand if we're gonna have no contest clauses maybe it's good that it applies to both sides the person bringing in the person defending as you said you always thought the person defending against these things especially if they lose they should be disinherited right so maybe it's not such a bad thing I think the better thing is get rid of no contest clauses because they're not doing any good and they're not serving the purpose that people think they're gonna serve but this case might have just blown it wide open to where you're gonna see a lot more of that right I don't doubt that right any other thoughts I mean the only other thought I have is that look this stuff's not black and white and you know we go to mediations with clients quite often and they're very frustrated because we can't give them you know hundred percent this I 100 percent that and in many people's lives their lives are black and white and and then the legal profession unfortunately doesn't lend itself to that and I also think that these judges and by the way these judges I think the majority of judges out there are hardworking they're good judges I'm not just saying that because maybe a judge sees this some day I really do think judges really want to make good decisions they want to be good citizens they want to fulfill their obligations that that's the reason they're there is to help resolve disputes that have arisen between people and we don't want people shooting each other in the street so we come in in front of judges but I can tell you the fact that one judge reading this case and another judge reading this case they're going to come away with completely different ideas and we don't always know what judge we're gonna end up in front of when we go to trial and I know that there's a question later on about settlement and will this induce settlements to happen you know most cases end up settling because it's so expensive but also because you don't know what the outcomes gonna be you don't know what judge you're gonna get and you might get a judge that's a stickler you might get a judge that's a little bit more open-minded you never know who you're gonna get all the judges again I think try very hard and I think they're doing the best they can but you're getting different results yeah I think people have different experiences different backgrounds and one of the things we said in our book you're a lawsuit and in the beginning of it is that people are the law laws aren't the law laws are just guidelines people are the ones that apply the law judges lawyers witnesses juries and these people are going to ultimately decide you know whether you win or lose and there's just it's a gamble you don't know what they're gonna do and it's it's a very wide latitude that's why people at the very beginning of the case when you say okay you're you're risking something if you defend if you're the client I'm the lawyer and I say okay defend against his trust contest guess what you're risking something and you're gonna ask me what am i risking and what's the chances right that risk is gonna come to light and I'm gonna say well you're risking whatever your interest would be under the trust which if it's zero you're risking nothing if it's a million dollars you're risking a million dollars and the chances I don't know it depends it depends it could be a 1% chance it could be a 90% chance that's right and it's gonna change over time that's right so it's very difficult to advise a client of that but you know we do the best we can and this is just one area of trust litigation I mean this is just one area that we deal with yeah this is a complex area it is and there's a there's a lot of parts to it and then of course there's litigation which litigation in and of itself just plain Jane litigation it's complex and difficult as well as Center that's right yeah it like a soap opera yeah let's see if we get to some questions and see if we can make some more sense out of this so Kayla how you doing today oh there's King : why don't you let me take a stab with that it's watch y'all why don't I ask you and you can define it so okay thank you I will take a stand you ask okay please what is a no-contest Clause what are these things we're talking so when we meet with clients in our conference room and we their Avenue by the way this is the one area well it's not just the one area but it comes up over and over again where clients have googled this and they seem to know what no contest clauses are so if I can I think I've shared this in the past on these videos please don't come in here and educate me on no contest cause this I actually know about it's like educating a heart surgeon on how to do not that I'm that good as a heart ventricle yeah yeah let me do my work let me do my job at least give me a chance to explain what a no contest call a sporting chance so so the general rule is is that no contest clauses are outlawed in California they're no longer applicable except in three situations and so those are the three situations that unfortunately come up over and over again and one of those is what we call a direct contest where you're trying to invalidate either a trust or some part of a trust an amendment or a statement doesn't matter what it is you're trying to invalidate that dog based on undue influence lack of capacity to rest fraud the ones we see over and over again or undue influence and lack of capacity if you file that trust contest you are triggering the no contest clause which means if you lose you'll be disinherited which means if you lose the case there's a chance you could be disinherited on that prong remember we said there was three prongs that you still that still allow for no contest clauses to apply that's the first prong and there's a probable cause exception that applies to that prong and maybe you can walk us through that I know you had done some work on that in a recent trial we worked on so what is the probable cause exception to that first prong you file in a trust contest against the most final amendment of the trust and you end up losing that case and you've certainly triggered the no contest clause the question is are you gonna forfeit your inheritance now in that space um yeah if you have probable cause which really means did you have a reasonable basis to believe that you had a chance of winning your case after further discovery which means you have to have some suspicion it can't just be nothing so you know grandma was had dementia and you know my brother was isolating her and not allowing me to go see her and she always was gonna leave all our assets equally to the grandkids and then a week before her death she changed it and left it all to this one brother who was isolating her that would be an example of a fact pattern that is suspicious and the brother ended up taking her to a new lawyer she had never met in fact didn't even take her to the lawyer just got the documents drafted up brought him in front of her signed him I mean there's all of that raises suspicion yes and so then the court can say even though you lost the trust contest against the amendment which in that case it would be hard to lose but if you did we're not going to hold the loss against you and hold this okay so that's the first prong then there's two more prongs and we don't see these as often but they do come up from time to time and that is the first one is if you file a creditors claim if you follow my credits claim because dad promised you the condo in Hawaii and he forgot to take it out of the trust and now you're saying no I've been paying on it for the last you know five years and I want all my money back and I you know I want to enforce the transfer the property out well now you've triggered a no-contest clause and there's no probable cause exception there you make you election and the third and final is simply saying that your parents the people that created the trust the trust doors did not have the power or authority or ownership rights to transfer property to their trust and so let's say there's a house that you own jointly with your or you you somehow there's an interest you own but maybe it's not on title with the recorders office and your parents and everybody knows about it your brothers and sisters know about it and then your mom and dad transfer that asset a hundred percent to the trust even though everyone understands you own 50 percent of that property well if you come along and say they didn't have the authority to transfer the whole 100 percent into the trust well now you're in a position where you've triggered the no-contest clause with no probable cause exceptions so in summary no conscious clauses don't apply except in three circumstances the first being a direct trust contest based on undue influence like a capacity filing a creditors claim and challenging your parents right to transfer property to the trust that's where no contest clauses apply and essentially it says that if you trigger the no conscious clause and you lose on two of those prongs you're gonna forfeit your entire inheritance on the first prong and that is undue influence lack capacity you may or may not forfeit your entire inheritance depending on whether you have probable cause to bring the trust contest it's that simple key it's just it's that simple we even had a case where somebody did file a creditors claim did trigger the no contest clause and the trial court said yes we agree that all that happened but we're not going to disinherit them and that case is now up on appeal yeah and that's and that's that judge and that judge would view it that way but I can guarantee you you go over one County to another judge that I know of and that case goes in front of that judge it's gonna be a contest yeah so right yeah it's next question Kenneth the next question is is there any way to discourage a contest without violating the no contest so Keith what I'm seeing here is I think what I'm seeing here is under this new case that you read and let's say that you know you think somebody's gonna file a trust contest and you don't want to be involved in that trust contest because it may apply to one or both sides how can you discourage a trust contest well are you talking about it so if you're if you're the set lor the person creating the trust the way the best way to create an incentive is to leave the disinherited person something don't leave them nothing if you if I disinherit you you're my son I disinherit you you have nothing to lose by contesting but if I leave you a sizable gift half a million dollars assuming that sizable to you then you're gonna stop in your tracks and say maybe I won't contest this we've had cases where we've had clients that went from they just lost 5% they were gonna get 40% they went down to 35% but it still is a very large estate it wasn't worth contesting it wasn't worth the risk just for that extra 5% that's how you create an incentive not to contest now let's say you're not the parent let's say you're what you're you know you created an amendment you're my brother I don't like the amendment I'm gonna sue you how do you create an incentive so that you don't have to risk filing a lawsuit to defend that amendment you offer something before litigation right and that's where you get into these pre litigation mediations where you say hey why don't we go and talk about this and see if we can work something out because it might be better to work out a deal pre litigation rather than having to file defend for you to have to file in court defend your action and potentially lose your inheritance so those are the two things that came to mind what do you think no I think that's right and I think that the question as I read it was going to the the ladder and that is you know you you think that your brother's sister are going to file a trust contest and you're concerned now based on this new case that if you if they do file that trust contest and you end up saying no this is a good amendment you theoretically may be triggering the no contest clause as well I guess there's a couple of comments I have to that number one 95% of cases settle 92% 9300 a majority of cases settle so you're never gonna get to a court actually making it a determination in most cases but in those cases where you think that it may go all the way I like your idea and we've been doing these I was against these for years because I didn't think we you can go very far with them but recently we've been doing some pre lawsuit mediations and and at a minimum they helped us all at least understand the issues that on both sides the opposing side and our side to understand what the issues are that we disagree on and what needs to be resolved but in a majority of those cases within the last couple of years they've actually settled in pre mediation litigation pre litigation mediation and so I think that that may be a way to answer this question and that is at least reach out to the other side and see if there's a way to resolve the matter before either side files and that way nobody's risking anything and you can hopefully work it out but that's it's not it's still a rarity to be able to do that it's a rare case that can settle before the lawsuit but it's something that to at least try by the way the court I've always had a question and I'll put you on the spot here and I've never got any answer to it let's say that we want to do a pre litigation mediation but more than 120 days is gonna run after the staff notice can you can the parties extend out 820 day statute of limitations on a trust contest or is that just absolutely I've seen people enter into these tolling agreements where they agree to toll that statute I don't know without a percent certainty if it's valid because the statute doesn't allow for that but you certainly can do it in other areas we do it on malpractice cases we'll ask you know an attorney who made a mistake to sign a tolling agreement to toll you know being able to file a lawsuit so it seems to me that if all the parties agree there's nothing wrong with you doing that the only problem is the trust is not necessarily it there could be part beneficiary to the trust that aren't signing on to that tolling agreement and I think that's where you run into problems if I and are knowin tolling agreement we myself and the trustee but not with the other beneficiaries I think those other beneficiaries could come forward and and cause a problem well I think also it leaves the trustee in a bad situation because what if I think the trustee is ultimately liable if they enter into a a tolling agreement other beneficiaries that haven't said anything that's far in the trust contest may come after the trustee saying you shouldn't have entered into that that causes some litigation there too so sounds like if you're gonna do a pre litigation mediation it needs to be done pretty quickly yeah and to get a good mediator it takes sometimes 60 days 70 days 80 days to get in with that mediator right so you're gonna be pushing the edge of that 120 days that notice or what you do is you have you know the people are going to contest they file and then rather than filing your objection or response you all agree to push it out push it out yeah that's interesting that's a good way to do too all right we got we got a little carried away there Kayla so why include yeah well Stuart have all the no contest causes that we see how many people do you think the trust creators asset lure is how many of them thought understood that it was even in there probably I would say less than one percent yeah and and they don't know any of any of the other provisions of their trust either they have a rough idea of what the distribution provisions are gonna be yeah but but even then when you get trusts involved for one kid because the kids not responsible they don't understand how all that works yeah must trust a 30 to 50 pages long yeah no contest clauses if it's a 50 page trust a no contest clause is usually found on page 47 yes yeah it's the same one that you see over and over again now there's different iterations of it because the law has changed here so much but now we see the new one over and over again that just simply copies the statute so you already mentioned the benefit of no contest clauses and that is if you know you got a real savvy estate planning lawyer that's advising a mom and a dad and a blended family and let's say there's one child what we call the one child that's bad I mean we used to call them the Stuart we call them Stuart we have the child that you know never never went educated themselves and you know has basically maybe has a drug problem or alcohol problem and doesn't do anything with their life you might want to say out of a ten million dollar estate you might want to carve off 1 million dollars for them and I've heard people what I used to do is State Planning might have clients tell me I don't want to give them a penny I said that's fine don't give them a penny but then you've given them no incentive not to final a trust contest that's right so give them something give them something that's meaningful you know half a million dollars that's usually when it starts to talk to people right because $500,000 that's real money tax-free that's real money that's a million dollars worth of earnings you know because the rest fifty percent goes to taxes right so you give somebody five hundred thousand dollars cold hard cash and a distribution yes their brothers and sisters end up with two or three million each but they get their $500,000 and they have to put that on the line if they funnel a trust contest yeah that's the problem with estate planning is most people don't do the planning part they don't really understand what the trust because there's a lot of legalese the estate planning attorney says no no don't worry about it we put that on everything you want that you don't know any better how would you know but if you're actually planning out like we want to figure out how to do this the right way like what you just described then yeah no contest clauses can work and they can serve their purpose but when you just put them in willy-nilly in every trust that's ever created and you don't think about it then they're a mess and they don't work and they just cause even more litigation and unintended results so I'm not sure that it is such a great thing anymore but they can be used if you talk about it and think about it and plan it out that's what a planning is about but that's what's so often missed in the state planning that's right all right Kayla all right Keith so this is where your final and trust contest based on undue influence or lack of capacity and let's say you have a million-dollar gift coming under that trust and you realize that if you file this you're gonna trigger the no contest clause and I myself would like to know since you're the wise one yes how do we make sure that we have probable cause before filing the trust contest well there is one point in time when you will know a certainty you have probable cause and that point in time comes at the very end of the case once you went through the entire trial if you lose it and then somebody brings a no contest Clause but petition to try and force it against you and then the court rules on it at that point in time you will know a certainty okay whether you had probable cause or not I think this quote the person that asked this question was wanting you to be a seer I see and help them like that point I don't like that point I'm I want to know before I go back so you want the point in time at the begin in the case yes okay the answer is you'll never know what the hundred percent certainty it can't happen but what you can do and what we've done a lot is you can't try to increase your chances and the way you increase your chances is you send inquiries to the trustee asking to see things so can I see the other amendments can I see the original trust can I see the medical records can I see this and that it doesn't matter if they send them to you or not in fact it's even better if they don't I suppose because you can say hey I tried to give them informed as possible they kept this information from me therefore I have a reasonable basis to think that I might win after doing further discovery and so you can kind of stack the deck in your in your favor right that's one thing number two judges don't really want to disinherit people unless they have to or unless the person is just seen as a very bad person so if you have any type of equities on your side then you want to try to enhance that if you can just to show that look we were just innocent kids we thought that mom was being taken care of and lo and behold the caretaker did a new trust amendment what are you gonna do right so some cases are gonna be better than others and then lastly what are you risking so if you're getting a gift of 25 grand but you're doing a trust contest and if you win that trust contest you're gonna get 5 million well you're willing to risk 25 thousand for 5 million I would be that's just my own personal thought of it everybody's different but I think that you need to go into the litigation just assuming that you will be disinherited can you live without that gift if you lose so let's say that you you were you had a right if you win the trust contest you will get 5 million dollars what point if there's a gift to you do you say I'll take that gift and not file the trust contest this is a million dollars is it 1.5 million is that 500,000 I think it depends on my own personal financial situation so if I if it was a if I was gonna get a million dollars and I needed that money to live on or retire and you know let's say let's say if I got that million dollars I could retire and live a happy life I would take the million and I wouldn't risk even though you knew your siblings are walking away with five million each it would be tough but I think it depends on this is the point that people miss I think is that looking as heinous as it is to see people do the wrong thing I think you got a look at what's best for you and so if you're going through one of these things if you really need a million dollars and it would make a difference in your life and it would allow you to have a happy retirement I can guarantee you that it's better to take that million and walk away then and try and fight because the fights not gonna be pleasant now if I was independently wealthy and I didn't need the million dollars and I just want to you know give you know set the situation right then yeah I would risk a million for five million absolutely so it kind of depends on your own personal situation and what that means Monni will mean to you and your lifestyle how would you view it I I would risk a million I'd risk 1.5 million I possibly risk two million but if I start getting a 2.5 million and my Delta is just another 2.5 and it's funny that I would say that just another 2.5 million on top of that 2.5 million is life-changing money right and that would be hard to file a trust contest with that on the line what I would need to see myself if I was going to go more than 2.5 million would be that grandma had to mention for the last 10 years that she was living in a skilled nursing facility that she had been diagnosed by five neurologists that said she didn't know where she was the last three years and the amendment came within a week of her death now I'm gonna be a little bit more bold in my abilities to go forward on that but I think you made a great analysis there and that is is a very personal decision it depends on you it depends on how much money you have to make in your lifetime it depends on where you're at currently if a million dollars would make it so you could move to I mean I don't know anybody in Nebraska I've heard Nebraska you can live there cheap because nobody wants to live there but you know you go to Nebraska with a million dollars you're gonna have a very nice retirement no professional football but you know it's you know it's Nebraska so there's plenty of football you can watch in Nebraska and just other teams but yeah so they'd be saving us with college teams they're - they're not very good but yeah the college teams so your point is when the amount that you're gonna receive is less than the amount that you're going for like at some point you said when it's 2.5 that I'm getting but 2.5 that I could get you know now you're not so sure right gonna get three million would you risk 3 million to go for another 2 million No so that's what your point is you don't want to risk no matter what no matter whether I'm wealthy or whether I need it because I mean that's life-changing money that's money that's tax-free for the most part there may be a small amount of capital gains and there somewhere but let's just call it tax-free money that's essentially 5 million dollars of earnings to get a $250,000 gift so for you the amount that you're risking has to be less than the amount that you could potentially get that's right and that's right and once it's which is the other way you're not willing to take that risk and then you change up the numbers and I now let's say that it's a hundred thousand dollars that I could get under the amendment or I could go for five hundred thousand I'm going in all day long cuz it's not enough money to change my life right so I'll go ahead and I'll litigate that's just me I'll litigate for the full five hundred thousand and that's what I always tell people is very personal decision you have to make up your own mind as to what's right and what's not right but it's a tough it's a tough call have any other questions Kayla do I have to file an objection to a trust contest and don't the courts independently evaluate the petition to determine whether there there is problem probable cause so this kind of interesting question so let's say I file a trust contest trying to invalidate an amendment and you're favored by that amendment Stuart do you really have to object to that or will the courts do their own independent investigation and determination on my petition or will they just rubber-stamp it and say granted so this is one of those questions I'd love to give you a 100% answer to I can give you a 90 percent answer to it I think I know why you're smiling at this one because there's an instant you had yes yeah so 90% of the time the courts are gonna rubber stamp it because nobody else opposes it and the courts not gonna look that closely at it this is not an accounting that's filed with the court where the courts gonna independently look at what a trustee did with the money or an executor did with the money or in a conservatorship action what money was spent on the conservator this is simply somebody coming to saying this is an invalid final amendment to the trust nobody no beneficiary shows up to contest that chances are the courts get a rubber stamp it that's gonna be an invalidated amendment and your sibling who filed the trust contest is gonna win by default essentially we did one time file something in front of a particular judge who will remain nameless I actually respect this judge a lot judge a very good judge and nobody showed up to oppose it it was not a trust contest but it was something similar to a trust contest and I was so happy because no beneficiaries we had done all the notices nobody had a post it and I came in as a judge you just you know we win and the judge goes oh no I did Sarah Lee I have to give you my analysis of this and he gave his analysis and went against or was it a she was a he or she went against the analysis and basically on their own said no but I would say to a person that asked me this question now currently and we don't know the answer you know if you think you need to follow that objection you better file it because if you don't chances are that the courts not going to get all not gonna care too much about your interest under the trust amendment say 99.9 percent of the time if somebody files a petition the courts going to approve it if nobody comes to object I mean the court does review these petitions but they don't have the staffing or the resources to independently investigate them they don't do depositions they don't question people they don't look into the medical records they don't determine what's right and what's wrong on their own and that's even true of accountings I mean they look at a cappings but the courts resources are limited they can't just go in and do a full-blown forensic accounting on every accounting that's ever filed with the court right they only can do so much and so if somebody files a petition to invalidate something and nobody of jacks most of the time it's out well and I would think as a judge me personally I mean I've ever been adjudged but if I'm sitting here as a judge I would say well the fact that everybody got notice of this and nobody has abroad and nobody has promised that they must be okay with right so I'm not gonna take it one step further yeah I say oh okay everybody's on board with this right that's right so yeah if unfortunately if you want to stop somebody from overturning an amendment and they file a petition to contest a trust or a lawsuit that contested trust you're gonna have to respond some way if you don't want that to happen all right Kayla I think we have one more question violation of the no contest clause occur at the party settle outside of course well this could be a theoretical answer or it could be a practical answer but the question is you know what happens I mean obviously there probably has been at there probably has been a violation of the no contest clause but now the parties have settled and agreed to in the lawsuit outside of court so what's the impact from that regarding no contest clause it depends so if you did a mediation like we've been talking about a pre lawsuit mediation then no you haven't triggered the contest because in order to trigger the no contest you have to file something in court that's another question people have a lot of times is like well somebody's saying that the trust is invalid can't they be disinherited have they filed in court no they haven't okay no it doesn't it only applies to court they don't ask that as a question they tell us oh that person's disinherited because yeah because they're saying it's invalid Yeah right where did you read that oh no you need to look that up mr. Robert sounds like it's like no that's not that's not how that works yeah so if you haven't file anything in court you've not triggered anything so that's the first thing secondly if you work out a settlement your settlement document should say what happens and so the the settlement should say that you know you get this and he hits that and she gets that and that's the way we're gonna do it and nobody's gonna fight and then you get a full release which means you're not gonna file anything further including a no contest but if you don't get a full release and if you don't have a term and they're saying nobody is gonna file to violate to contest or to enforce the no contest clause then I guess in theory even after a settlement somebody could file a petition and try to trigger the no contest clause but I don't think it would overturn the settlement agreement so the settlement agreement at the end of the day is the contract is the new document that controls so I think from a practical standpoint a no-contest Clause is not going to apply if you settle outside of court or prior to your trial would be my view of it what do you think the question was what does a violation occurred I look at the term violation that to me is a triggering event and so theoretically yes there's been a triggering event if they file in court if they file in court yes but because there's a settlement agreement we generally I can't think about a settlement we haven't done this there's general waivers there's mutual waivers you know overly general releases and so but do you do you think that a violation occurs if the parties settle outside of court having never filed a lawsuit to be no no because the statute says there has to be a file and there's many things the statute says but one of those components is there has to be a filing right and so there's not a filing and a mediation is not a filing right and by the way courts love judges in my experience love love love they love pre lawsuit mediations they love mediations during the case they love settlements they love settlements and so I it's gonna be hard to find a judge it's gonna give anyone a hard time from going to to go to a mediation in fact anything you say or do to mediation can never be raised in a court that's all privilege it's all privileged and so mediations are favored and so I think that that would be in in all cases I don't think a court would hold a no-contest calls against anybody for doing pre lawsuit media yeah once they settled the courts happy yeah take your settlement and right get out of here right absolutely do you have any other questions Kayla okay well I want to thank everybody for joining us Thank You Stuart for your time sorry about my voice today a little hoarse but we got through it horse versus Barry White I'm gonna take horse I take bad guy and we want to thank Kayla and Manisha they make us you know we basically just show up and blab and they actually get all this put together for us so thank you so much a lot of hard work goes into this yeah you'd be shocked at how much work goes into it right thank you for joining the Sam fight win live stream this will be available by recording on YouTube and Facebook you can also find an audio-only version on our website or on audible.com where you can listen to all of our live episodes as much as you want what better thing is there to do than to listen to our melodious voice I do it look going to sleep every night so put you right out yeah all right thank you for joining us.