Legal mistakes in estate planning may lead to litigation later
It is not uncommon for individuals to want to save money by opting to do estate planning without using the services of a representative. However, this can mean they may be foregoing the chance to ensure that all documents are legally sound and less likely to be challenged in court. Nevada residents may wish to learn how saving money on something like estate planning could be very costly in the end. Seemingly insignificant errors may render self-done documents legally invalid.
Two individuals in another state were co-owners of a business and, to protect the interests of both, they purchased life insurance policies in the value of $2 million apiece, each naming their business partner as the beneficiary. This was apparently intended to provide the surviving partner with funds to buy the other partner’s shares in the event of death. However, a buy-sell agreement was never legally recorded, and when one partner died, the surviving partner received the proceeds from the insurance. The deceased partner’s family wanted the proceeds of the insurance in exchange for the shares, but the surviving partner refused. Due to the nonexistence of a legally binding agreement, the court found in favor of the surviving partner.
In another incident, a woman created a will on a form that was pre-printed, detailing her wishes regarding asset division, but made no mention of the beneficiary of the estate residue. Upon the death of her main beneficiary, she added a handwritten appendix to indicate her brother to be the recipient of all her assets. After his sister’s death, his claim to her assets went all the way to the Supreme Court after the deceased’s nieces claimed that her will was invalid. The Supreme Court found that, although her intentions were clear, the codicil she added was not a valid legal document.
Considering the examples above, Nevada residents may agree that it could be unwise to attempt to save money in the short-term on vital matters such as estate planning. Help is available for avoiding legal mistakes that may lead to litigation after one’s demise. Obtaining the necessary assistance to ensure these documents will not fail when challenged in court may ensure that the wishes of the deceased are carried out as intended.
Source: Forbes, “Legal Mistakes That Haunt After Death: Three Cases“, Steve Parrish, May 13, 2014