Inez and Jack Forrester had two children, Jennifer and Jack, Jr. Inez’s brother and sister-in-law, the Beasons, were killed in a tragic plane crash, leaving their only son, Tommy, age 6, an orphan. Inez and Jack took Tommy Beason in and raised him as their own. However, they never formally adopted him. Jennifer and Jack moved to distant cities, while Tommy remained close to home, resulting in his becoming the primary caregiver for both Inez and Jack in their last years. Inez died in 2010, leaving all her property to Jack. Jack died last year. His will leaves three quarters of his estate to Tommy, with the rest to be divided between Jennifer and Jack, Jr. Jennifer and Jack are furious about the will and are threatening to challenge the will in court. Tommy doesn’t want any trouble.
There is a solution to this family’s dilemma that avoids expensive litigation over the will. Jennifer, Jack and Tommy can enter into an agreement not to probate the will and instead divide the assets in an alternative manner. The three beneficiaries of the will would first agree not to probate the will. Then they would agree to an alternative scheme for dividing Jack, Sr.’s property. The agreement is called a Family Settlement Agreement.
A will contest does not have to be commenced. A threat of a will contest is sufficient. Here that threat is present. Many attorneys would advise filing an application to probate the will and through the probate process agree not to follow through with administration of the estate and instead file the Family Settlement Agreement approved by the court. Following this procedure can help protect against any subsequent challenge to the agreement.
A Family Settlement Agreement is a contract. It must contain all the elements required by Texas law to create a valid contract: (1) an offer; (2) an acceptance; (3) consideration (4) age requirement of 18 years or represented by a guardian; and (5) capability of taking possession of the decedent’s property.
“Consideration” entails one party to the contract promising something of value to the other. In this case, each party would be giving up his or her right to the property in the estate as to be distributed in accordance with Jack, Sr.’s will.
The Family Settlement Agreement must provide a distribution scheme that takes the place of that under the will. The alternative scheme can be any division agreed upon by the three parties. For instance, they might determine that the property be divided equally among the three beneficiaries.
In any situation in which there may be a will contest, the Family Settlement Agreement can be a valuable tool for avoiding the expense and stress of litigation.
Sandra W. Reed is an attorney with Katten & Benson, an Elder Law firm in Fort Worth. She lives in beautiful Somervell County, near Chalk Mountain.