Articles Posted in Probate Disputes

For many years, litigating parties have engaged in alternative dispute resolution for the purpose of attempting to resolve their disputes without judicial intervention. Mediation, one of the more common forms of alternative dispute resolution, is a process where a neutral mediator “acts to encourage and facilitate the resolution of a dispute between two or more parties . . . [by] assisting the parties in identifying issues, fostering joint problem solving, and exploring settlement alternatives.” Fla. Stat. 44.1011. Mediating a dispute prior to litigating has numerous potential benefits, including efficiency, cost savings, confidentiality, and probably most importantly, the ability of the parties to reach a resolution among themselves. This last benefit is of particular importance because, unlike a trial where litigants are forced to put their fate in the hands of either a judge or a jury, participants in a mediation are not only afforded the ability to have a say in the resolution of their dispute, but they are able to be actively involved in the process of creating that resolution.
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Will a final judgment in the State of Florida be recognized and given the same effect the judgment would have in a territorial probate court of the United States? Any final judgment rendered in a Florida probate court regarding the validity of a decedent’s last will and testament, for example, will be treated in the same manner as a judgment from any territory of the United States (Puerto Rico, the U.S. Virgin Islands, etc.), so long as the Florida court had adjudicatory authority over the subject matter and persons governed by the judgment. Furthermore, the Florida judgment will “have the same effect and shall be subject to the same procedures, defenses and proceedings for reopening, vacating, or staying” as a final order of the respective territorial court. 5 V.I.C. § 553.
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Did a hospital coerce a reclusive copper heiress to give away part of her $300 million dollar estate? That is what relatives of Huguette Clark are claimed in a suit filed in Manhattan Surrogate’s Court. Ms. Clark was admitted to Beth Israel Medical Center in Manhattan in 1991 when she was 85 years old, after she was found in her Fifth Avenue apartment emaciated and in poor health. Despite recovering just a few months later, Ms. Clark remained in the hospital for the next 20 years until she died in May 2011 at the age of 104. During her time at the hospital, she paid over $800 per day and made numerous substantial donations to the hospital, including a Manet painting valued at $6 million, at least $4 million in cash donations, and another $1 million left to the hospital in her will.
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In Florida, a beneficiary under a will or trust can only inherit property from a decedent if the beneficiary survives the decedent for a specified length of time. Yet, the advent of the train, automobile, and airplane brought an increase in deaths of closely related persons in common disasters, particularly husbands and wives. In these unique situations, estates were dislocated, trusts were disturbed, and the law of descents was frequently shunted off its regular course. The legal question thus arose: When a person dies simultaneously with his or her heir or devisee, does the heir or devisee succeed to the person’s property, so the property becomes part of the heir or devisees estate?
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Probating a will can be an expensive process when the procedure involves contentious matters, such as will contests, determination of beneficiaries, etc. However, who bears the potentially great cost of such litigation? Does the estate have to pay? Is the estate always responsible for paying the attorney’s fees? Who decides from which part of the estate the fees and costs will be paid?
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When someone passes away and there is probate property, there is always the possibility of a lawsuit. When beneficiaries do not agree on the distribution of the decedent’s property, litigation ensues. Probate disputes are inherently unique: they are wrapped in a shroud of emotion; the issues are complex; the parties are stubborn; and lawyers’ creativity is often put to the test. Given the nature of probate disputes, another means of dispute resolution often proves to be a more efficient method of resolving probate cases. This is where Alternative Dispute Resolution comes in. Alternative Dispute Resolution is a means of resolving a claim outside of the court, usually through arbitration or mediation. It is a beneficial option to pursue before entering into litigation.

The benefits of litigation are that it gives a clear definition of the issues. The court and the parties know exactly what they are asking for and the grounds on which they seek relief. The rules of civil procedure give the parties the right to full discovery of the necessary facts of the case. Litigation also excludes irrelevant or frivolous issues. The decisions of the court are also final and binding. However, litigation can be time consuming, expensive, and onerous for everyone involved. It can also take years for a case to be completely resolved.
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A person may want to disclaim an inheritance or gift in order to maximize gift and estate tax exclusions, or simply because he or she does not want the property and/or the resulting tax burden. A disclaimer is a refusal to accept an interest in the power over property, including a power of appointment. Fla. Stat. § 739.102. A person can disclaim property or an interest in property in whole or in part, and may make the disclaimer conditional or unconditional. Through the use of a disclaimer, beneficiaries may take a retrospective look at the decedent’s estate plan, and determine whether, based on current circumstances, there is a more advisable way to distribute assets.
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With estate tax rates that could reach 55 percent in 2013 along with a falling exemption, it is not surprising that taxpayers will look for every way possible to reduce their tax burden, and one potential way of accomplishing this is with deductions. Typically, after an estate is valued, it is entitled to certain deductions from its value. For example, if an estate was valued at $ 20 million and the estate was entitled to 3 million dollars of deductions, the taxable estate would only be $ 17 million. The most common deductions are the charitable deduction and the administrative expense deduction. Generally, when a sum of money is paid by an estate, it is considered deductible if it is supported by adequate consideration and not attributable to the testator’s testamentary intent, i.e., the testator must not have intended to give anything away and some type of service must be provided for the estate). I.R.C. 2053(c)(1)(A). Thus, distributions to beneficiaries are usually not deductible. In Estate of Bates v. Comm’r, the Tax Court disallowed a deduction by the estate because the deduction related to a settlement from a claim brought by a beneficiary. Decedent had a longstanding and extremely close relationship with the claimant, expressly provided that he would receive estate assets, and memorialized her testamentary intent. In addition, the court resolved the amount of estate assets that the claimant was entitled to receive, and the settlement payment was paid in full satisfaction of any claim relating to the estate.
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