Tag: no contest
This week on Hull on Estates, Natalia Angelini and Lisa Haseley discuss drafting and litigating no-contest clauses in Wills.
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While some may find the contents of certain Wills frightening, there is one type of clause that has the name to go with the concept: the in terrorem clause.
In terrorem is Latin for in terror, fright, threat or warning. An in terrorem clause is drafted to discourage frivolous Will challenge litigation by beneficiaries. The clause provides that if the validity of the Will is challenged by a beneficiary who receives gifts, that beneficiary’s entitlement to the gift is forfeited.
A condition of this nature imposed on a gift can be effective in avoiding litigation in situations where the testator wishes to leave unequal gifts among beneficiaries (his or her children, for example), which is likely to be perceived as unfair.
If a gift to a disappointed beneficiary is substantial, that beneficiary should be seriously dissuaded from a frivolous or spiteful challenge to the validity of a Will containing an in terrorem clause.
Such a clause should be limited to challenges to the validity of the Will and not to proceedings relating to interpretation or related matters over which the court has exclusive jurisdiction, otherwise the clause may be ineffective.
For some helpful discussion of the in terrorem doctrine see Bellinger v. Fayers 2003 BCSC 563 (CanLII).
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