For some, creating a trust is a valuable and important piece of their financial and estate plans. By placing estate assets into a trust, the creator of the trust can be sure that their assets will be able to benefit certain specifically named trust beneficiaries. Ideally, the trust will have been created in a manner which comports with the trust creator’s intentions. However, sometimes situations arise which can cast doubt as to whether a trust truly reflects its creator’s wishes. Under those circumstances, there are steps which can be taken to contest a trust.
What is a trust?
A trust is a legal construct wherein the trust creator places assets into the trust and no longer has legal ownership of them. Instead, the assets are held by a named trustee who is responsible for managing and safeguarding them for the benefit of the trust beneficiaries. Trust can be revocable, meaning the creator retains the power to change several aspects of the trust, or irrevocable, meaning that in most cases, the trust cannot be changed once it is created.
Challenging a Trust
In Michigan, like many other states, the law and policy typically do not favor changing the terms of someone’s final disposition of their estate. However, under certain circumstances, a party may be able to challenge a trust. For a person to contest a trust following the death of the creator, they have to be or have been a trust beneficiary or someone who can show they would have inherited from the trust creator if the creator died without a will.
Once it is established that you are someone who can challenge the trust, you may only do so for specific reasons. However, the trust may include a “no contest” clause which essentially disinherits any beneficiary who improperly raises a challenge to the trust. Therefore, it will be very important to carefully evaluate the validity of the trust challenge before raising a claim.
Grounds for Contesting a Trust
One basis for contesting a trust is that it was not created according to the requirements of Michigan law. If it can be shown that the law was not properly observed, the trust can be held to be invalid. This challenge can include an allegation that the trust was forged. Another basis is if the challenger can show that the trust was created or amended as a product of undue influence by a third party. If there is evidence that the trust was induced by coercion by another person or the creator was under duress when they created the trust, this can be a basis to challenge the trust. A challenge can also be brought on the basis that the trust creator did not have the mental capacity to create the trust at the time it was executed. Further, if there is evidence that the trust was created because of a mistake on the part of the creator, a challenge to the trust may be brought.
Contesting a Trust in Court
Once it has been established that the person contesting the trust is someone legally allowed to do so and that their challenge is on a permissible ground, they must bring their case before the applicable probate court within a certain number of days. From there, the person challenging the trust will need to provide evidence to support their claim.
Challenging a trust can be a complicated process. Before raising a legal challenge, it is essential to consult with an experienced attorney who can advise you about your case. Our office has attorneys who are experienced in contesting trust and can help you evaluate and prepare your case. Please contact us online or by phone if we may be of assistance.