As an experienced estate litigator at Bradley & Hammond, I have witnessed firsthand the turmoil and heartache that can arise from estate disputes. When families find themselves in conflict over inheritance, emotions often escalate, resulting in a downward spiral of hostility and legal battles. This "conflict spiral" typically starts with minor disagreements and miscommunications that gradually snowball into larger disputes, culminating in litigation. Understanding the leading factors that drive estates into litigation can help you better prepare for and navigate these challenging situations. In this article, I will discuss the five most common factors that contribute to estate litigation in Texas and share my insights on how to resolve these issues effectively. Factor 1: Will Contests One of the primary factors leading to estate litigation is disputes over the validity of a will. A will contest occurs when an interested party challenges the legitimacy of a decedent's will, usually on one or more of the following grounds: Lack of testamentary capacity: The testator (person creating the will) must have been of sound mind and capable of understanding the nature and extent of their property, the people they were benefiting, and the implications of the document they were signing. An example would be a situation where an elderly parent creates a new will shortly before passing, leaving their estate to a caregiver while excluding their children, raising suspicions about the parent's mental capacity at the time of drafting the new will. Undue influence: This occurs when the testator's free will is overcome by the coercion or manipulation of another person, often to that person's advantage. For instance, a relative who isolates the testator and pressures them to change the distribution of their estate in favor of that relative could be exerting undue influence. Fraud: Fraudulent conduct can lead to a will contest if the testator was deceived or tricked into signing a document they believed to be something other than a will. For example, a family member might present the testator with a document claiming it to be a power of attorney but is, in fact, a new will that benefits the family member. Improper execution: In Texas, a will must comply with specific formalities to be considered valid. This includes being signed by the testator (or someone at the testator's direction and in their presence), in the presence of two or more credible witnesses who also sign the will (Texas Estates Code § 251.051). A will can be contested if it fails to meet these requirements. As a fierce advocate for my clients, I always strive to resolve will contests through negotiation and mediation, when possible. One of the best ways to avoid will contests is through meticulous estate planning and open communication with all interested parties. Factor 2: Trust Disputes Trusts are valuable tools in estate planning, but they can also be a source of conflict. Trust disputes often arise due to disagreements over the interpretation of trust provisions, trustee management, or allegations of breach of fiduciary duty. Here are some common trust-related issues that can lead to litigation: Interpretation of trust provisions: Trust documents can sometimes contain ambiguous language or unclear instructions, resulting in disputes among beneficiaries or between beneficiaries and the trustee. In Texas, courts can be petitioned to resolve ambiguities in a trust document (Texas Property Code § 112.054(a)). Trustee mismanagement: Beneficiaries might allege that a trustee has mismanaged trust assets, failed to provide proper accounting or failed to distribute assets according to the trust terms. A trustee has a duty to act in the best interests of the beneficiaries, and failure to do so can lead to litigation. In Texas, a trustee's actions can be subject to judicial review, and the court may remove a trustee if it finds a breach of fiduciary duty (Texas Property Code § 113.082). Breach of fiduciary duty: Trustees have a legal obligation to act in the best interests of the trust beneficiaries. This includes managing the trust assets prudently, avoiding conflicts of interest, and providing accurate and timely information to the beneficiaries. When a trustee is accused of breaching these duties, a dispute may arise that requires litigation to resolve. Like will contests, many of the issues that materialize with trusts can be avoided with careful estate planning. Trustee mismanagement issues in particular can be avoided by properly educating the trustee on his or her duties, picking the proper person to serve as trustee from the outset, or providing proper oversite and mechanisms for trustee removal. Factor 3: Guardianship Disputes Guardianships are established to protect and manage the affairs of individuals who are unable to make their own decisions due to mental or physical incapacity, including minor children. Disputes can arise when there is disagreement over the appointment of a guardian, the actions of the guardian, or the necessity of a guardianship. Some common reasons for guardianship disputes include: Necessity of guardianship: Family members or other interested parties may dispute whether a guardianship is truly necessary or whether a less restrictive alternative, such as a power of attorney or a supported decision-making agreement, might be more appropriate. Qualifications of the proposed guardian: Disagreements may arise over who should be appointed as a guardian, with family members or other interested parties questioning the qualifications, character, or motives of the proposed guardian. Breach of fiduciary duty by the guardian: A guardian has a legal obligation to act in the best interests of the ward (the person subject to the guardianship). If the guardian is accused of mismanaging the ward's assets, neglecting the ward's needs, or otherwise acting improperly, a dispute may arise that requires litigation to resolve. Factor 4: Joint Ownership and Beneficiary Designation Conflicts Joint ownership and beneficiary designations play a significant role in estate planning, but they can also lead to disputes. Here are some common issues that arise from joint ownership and beneficiary designations: Ambiguous or outdated designations: If a beneficiary designation is unclear, outdated, or inconsistent with other estate planning documents, disputes may arise among potential beneficiaries or between beneficiaries and the estate's personal representative. It is crucial to review and update beneficiary designations regularly, especially after major life events like marriage, divorce, or the birth of a child. Disagreements among joint owners: When property is jointly owned, disputes may arise over the management, use, or disposition of the property, particularly when one owner passes away, and their interest in the property passes to their heirs or beneficiaries. If the disagreements cannot be resolved outside of court, it often devolves into a partition action (in the case of real estate) which can be time consuming and costly for the joint owners. Family dynamics and disputes: Conflicts can arise due to pre-existing tensions among family members, differing opinions on how assets should be managed or distributed, or concerns about favoritism or unequal treatment. Factor 5: Creditor Claims Estate litigation can also arise from creditor claims against a decedent's estate. When a person passes away, their debts do not simply disappear; instead, their estate becomes responsible for settling any outstanding debts. Some common issues with creditor claims include: Disputed debts: Heirs or beneficiaries may challenge the validity of a debt, claiming that the debt has been paid, is invalid, or is otherwise unenforceable. Disputes can arise over the amount owed, the terms of the debt, or the legitimacy of the creditor's claim. Insufficient estate assets: If the decedent's estate lacks sufficient assets to cover all outstanding debts, disputes may arise among creditors or between creditors and the estate's personal representative over the priority and distribution of assets. Priority of claims: In Texas, certain creditor claims take priority over others (Texas Estates Code § 355.102). Disputes can arise over the proper classification and priority of claims, particularly when there are insufficient assets to satisfy all outstanding debts. Estate disputes can be complex, emotionally charged, and challenging to navigate. Understanding the leading factors that drive estates into litigation is crucial for anyone facing estate litigation in Texas or looking to initiate litigation. You should also understand, however, that winning any of these battles in court is extremely difficult and rare. Predicting success is almost impossible unless you have a slam-dunk case. When you approach an attorney for representation in an estate dispute, you should put your feelings aside and ask for a neutral evaluation of your case to help you determine whether litigating is worth your time, money, and stress. Will litigation itself cost you more than the inheritance you seek is worth? Can you resolve the issue with mediation instead of going to court? At Bradley Law Firm, our goal is to help clients avoid estate disputes through careful planning and open communication. If litigation is inevitable, however, we educate our clients and empower them with the information they need to initiate successful litigation or defend their rights. If you are facing estate litigation or concerned about a potential dispute, I encourage you to reach out to our experienced estate litigation team. We are here to guide you through the process and protect your interests every step of the way.

When it comes to estate planning, creating legally valid documents, such as wills, trusts, and powers of attorney, is crucial to ensure that your assets are distributed according to your wishes upon your passing and that your healthcare and financial affairs are properly managed. In Texas, as in every state, there are specific legal formalities that must be adhered to when signing these estate planning documents. Failing to follow these formalities could render your documents invalid, leaving your estate to be distributed according to state intestacy laws, which may not align with your intentions, or making it difficult for your loved ones to manage your affairs during times of incapacity. In this comprehensive guide, we will delve into the intricacies of estate planning document signing formalities in the Lone Star State. Our aim is to equip you with the knowledge necessary to create legally sound estate planning documents that stand up to scrutiny and provide the peace of mind that your final wishes will be honored and your affairs properly managed. First though, you need to understand some legal terms of art: A testator is a person who makes and executes a will. A person who dies with a will is said to die testate , while a person who dies without a will is said to die intestate . A will is a legal document that outline's a person's wishes regarding the distribution of their assets, property, and care of any minor or disabled persons upon their death. A holographic will is a will that is written in the testator's handwriting and signed by the testator. A non-holographic will is a type-written will signed by the testator in the presence of two credible witnesses. Sometimes it will be self-proving, meaning it has a self-proving affidavit signed by the testator, witnesses, and a notary public. A trust is a legal arrangement (contract) in which one party, known as the grantor or settlor , transfers assets to another party, called the trustee , who holds and manages those assets for the benefit of one or more beneficiaries . Trusts can be established for various purposes, such as estate planning, asset protection, or providing financial support to minors or individuals with special needs. Trusts can be revocable , allowing the grantor to modify or terminate the trust during their lifetime, or irrevocable , which cannot be changed or terminated once established (although they sometimes can through decanting or court order). The trustee has a fiduciary duty to manage the trust assets in accordance with the terms of the trust document and in the best interests of the beneficiaries. A durable power of attorney (POA) is a legal document that allows an individual, known as the principal , to grant authority to another person, called the agent or attorney-in-fact , to make decisions and act on their behalf in financial, legal, and personal matters. The term " durable " means that the POA remains in effect even if the principal becomes incapacitated or mentally incompetent , unlike a general power of attorney , which would become invalid under those circumstances. A durable POA can be tailored to the principal's specific needs and preferences, granting either broad or limited powers to the agent. It can be effective immediately upon signing or become effective only upon the principal's incapacity, known as a " springing " durable power of attorney. A Physician's or Medical Directive is a written instrument where the declarant , the individual who makes and executes the directive, expresses their preferences and instructions regarding medical treatment and end-of-life care. The declarant specifies their wishes in the document to guide healthcare providers and appointed agents in making medical decisions on their behalf, particularly when the declarant becomes unable to communicate or make decisions due to illness or incapacity. A medical directive may include a living will , a durable power of attorney for healthcare , or a combination of both. Wills A non-holographic will must be signed by either the testator in person or by another person on behalf of the testator in the testator's presence and under the testator's direction. Additionally, a non-holographic will must be attested by at least two (2) credible witnesses who are at least 14 years of age and sign the will in their own handwriting in the testator's presence. A credible witness is a competent witness who receives no financial benefits under the will and is therefore competent to testify regarding the will's execution. A will is not automatically invalidated if a beneficiary or other interested person serves as a witness, but it could significantly affect any intended bequest to the witness. A gift in the will to a witness is void unless certain conditions are met, such as the witness being entitled to a share of the estate had the testator died intestate. On the other hand, a holographic will must be written entirely in the testator's handwriting and signed by the testator. A holographic will cannot be signed by another person on the testator's behalf and does not need to be attested by any subscribing witnesses. Despite being less formal, holographic wills can still be legally recognized in Texas as long as they meet the necessary requirements. There is no requirement for a will to be notarized in Texas unless the will is self-proved. A self-proving affidavit or simultaneous attestation is not required to make a valid will, but it will simplify the probate process and is a best practice among estate planning attorneys. Trusts In Texas, a trust can be created orally (in limited circumstances) or in writing (Tex. Prop. Code Ann. § 112.001). Unless the trust meets the limited exceptions for a valid oral trust, a trust is only enforceable if its terms are evidenced by a written instrument that is either: (1) Signed by the settlor or the settlor's authorized agent or (2) Created by the court. Texas law does not require a revocable trust instrument to be witnessed to be valid. Texas does not require a trust instrument to be notarized to be valid, but notarization is a best practice. If the trust may hold real property and need to be recorded in the real property records, you should have the trust acknowledged and notarized so the trust instrument can be recorded. Financial institutions also often require that trust instruments be written and notarized to avoid fraud. Durable Power of Attorney To be valid, the durable power of attorney instrument must be signed either by the adult principal, in the adult principal's conscious presence by another adult at the direction of the principal to sign the principal's name. Texas does not require the power of attorney to be witnessed. The power of attorney however must generally be acknowledged by the principal before a notary public. Medical Power of Attorney To be valid, a medical power of attorney instrument must be signed by the adult principal. If the adult principal cannot sign, it can be signed in the adult principal's presence by another person at the direction of the principal to sign the principal's name. The principal's signature must be either made in the presence of two witnesses or in the presence of and acknowledged by a notary public. Physician's or Medical Directive The declarant must sign the directive to physicians. The declarant's signature must be either made in the presence of two witnesses or in the presence of and acknowledged by a notary public. HIPAA Release The principal must sign and date the HIPAA release. Other people, referred to as personal representatives under the HIPAA regulations, sometimes may sign the HIPAA release on the individual's behalf. These people include the health care agent or agent for an adult or emancipated minor, the parent or guardian of an unemancipated minor in some situations, the fiduciary in charge of a deceased individual's estate. Witnesses are not required for a valid HIPAA release, and neither is a notary. Can you sign estate planning documents with an electronic signature? Texas has adopted the Uniform Electronic Transfers Act (UTEA). The UETA authorizes electronic signatures for certain transactions. A transaction is defined as "an action or set of actions occurring between two or more persons relating to the conduct of business, commercial, or governmental affairs. However, the UETA does not apply to laws governing the creation and execution of wills, codicils, or testamentary trusts, and is generally understood to not apply to other documents executed with an estate plan (such as powers of attorney and advance health care directives) because these types of documents are typically not related to a transaction as defined under the UETA. What about witness signatures? Wills, trusts, powers of attorney, and advance health care directives generally cannot be witnessed electronically in Texas. There is an exception for Advance Directives Not Prepared by Attorney. Advance health care directives in Texas can be signed, witnessed, and notarized electronically in certain circumstances. These electronic executions are specifically authorized under the Texas Health and Safety Code, not the Texas UETA, and include various restrictions that prevent most attorneys from recommending that clients execute these instruments electronically. What about remote notarization? Texas law permits notaries to conduct notarizations remotely, as authorized by a statute. According to the statute, an individual may "personally appear" before a notary using a two-way audio and video communication system, as long as it adheres to the procedures established by the Secretary of State. Nonetheless, the statute's wording implies that online notaries are only allowed to notarize electronic signatures . Since the Texas Uniform Electronic Transactions Act does not authorize testators to sign wills and codicils electronically, it is not possible to notarize wills online in Texas. In conclusion, navigating the complexities of estate planning and ensuring that your will and other essential documents are legally valid is crucial for safeguarding your assets and fulfilling your final wishes. Understanding the specific requirements for signing wills, trusts, durable powers of attorney, and medical directives in Texas can provide peace of mind and help you create a solid estate plan. By adhering to the state's guidelines and seeking professional advice, you can ensure that your will and other documents will stand up to scrutiny and protect your family's future. As you embark on this important journey, remember that knowledge is power. This guide has provided you with an overview of the legal formalities and processes involved in creating and executing wills and other estate planning documents in Texas. Armed with this information, you can confidently take the necessary steps to secure your legacy and provide for your loved ones. Estate planning is an ongoing process, so be sure to review and update your documents periodically to account for any changes in your life or the law. Contact us at Bradley & Hammond for a consultation if you have any questions. Have more questions about estate planning? Check out our blog for more helpful information, or visit our estate planning page.

Many approach estate planning as a one-and-done event, when it is, in fact, a process that should be revisited throughout your lifetime. The people in your life, your financial status, health, career, investments, dreams and goals, and even the law affecting estates and trusts, are not static. Your estate plan should change in step with your life and applicable laws. As a rule of thumb, estate planning documents should be updated every 5 years, or if there is a change in your personal or financial circumstances. Consider revisiting your plan if it has been a while, or if any of the following situations apply to your life: 1. Change in marital status After you get married, you need to revise your will to include your new spouse as a beneficiary. You will also want to remove or add any property that was gained, lost, or consolidated as a result of your marriage. You should also revise your will upon divorce to remove your ex-spouse as a beneficiary and re-title any joint property accordingly. This is especially important if you have or plan to get remarried in the future. 2. A significant change in financial situation (good or bad) Major changes in your finances may necessitate revision to your estate planning documents. If you expect a windfall financial year, or if you had a rough year, you may be concerned about asset protection from creditors, and tax planning. Your estate plan should reflect your present circumstances. 3. Your previously-appointed fiduciaries passed away, or are no longer the best person for the job In most estate plans, you can alter your fiduciary designations anytime. Your fiduciaries are your POA agents, trustees, and executors. If you need to change your designations for any reason, you should update your documents as soon as possible. 4. The birth or adoption of a child or grandchild Adding a new family member can also require a change to your estate planning documents if you wish to include them in the division of your estate or wish to appoint a guardian or trustee to care for them and their inheritance if you pass away before they can manage their own affairs. 5. You have received a diagnosis which requires more intentional financial and contingency planning Health is everything. Maybe you first began your estate planning process in peak health with young children, but now, years later, you are worried about medical expenses. Having fiduciaries appointed to manage your affairs has a new weight and importance. You should review your plan to ensure it reflects your current wishes and reality. 6. You moved to a new state or acquired real estate in another state If you move to a new state, you should promptly check with your attorney to determine whether your estate planning documents need to be updated and/or revised to be compliant with the new state’s laws. Similarly, things can get complicated if you own property in multiple states because each state has different laws affecting land and taxes. There are strategic ways in which to title your property in different states to avoid the probate process, or mitigate estate taxes or property reassessments. 7. There has been a change in gift or estate tax laws Laws change frequently. It is crucial to monitor changes so your estate plan reflects the most effective and efficient ways to preserve your legacy for future generations. For more information on gift or estate tax law changes in 2023, visit our blog post on the topic here . 8. Death or disability of a family member Death, disability, or illness to a family member should prompt you to make a change to your estate plan. You may want to create a special needs trust for your child or spouse that allows preservation of your assets that improves their quality of life without disqualifying them from other programs (Medicaid, supplemental security income, etc.). Do not wait until it is too late -- update your plan to reflect important changes in your life. The attorneys at Bradley & Hammond are actively scheduling estate planning appointments. Give us a call to reserve your spot to update your estate planning documents.

In October of 2022, the IRS increased the estate and gift tax exclusion amounts for 2023 to adjust for inflation. The Annual Gift Tax Exclusion was increased from $16,000 per person in 2022 to $17,000 per person in 2023. The Annual Estate Tax Exclusion was increased from $12.6 million in 2022 to $12.92 million in 2023, with the combined exclusion for a married couple to $25.84 million. Now through the end of 2025 is prime time for doing some real planning with lifetime gifting strategies. The federal exclusion amounts will be dramatically reduced on January 1, 2026, unless congress acts to extend them. It is also possible that congress could reduce the amounts or eliminate the exclusions entirely before 2026 by tax reform, but that is looking unlikely given the current makeup of congress after the 2022 midterm elections. So how does lifetime gifting work? Assume a married couple has three married adult children and a combined estate worth more than $25.84 million. Without employing strategies to reduce their taxable estate, their children would pay a 40% federal estate tax on their inheritance to the extent it exceeds $25.84 million. Amounts given over the annual limit of $17,000 per recipient will reduce the married couple's estate tax exclusion. If the married couple gives one of their children $1,017,000 in a year, their estate tax exclusion would be reduced to $24.84 million, meaning their heirs would need to pay the 40% estate tax on the excess over $24.84 million rather than $25.84 million. By employing a lifetime gifting strategy in advance, however, the married couple could reduce their estate by $34,000 per recipient annually ($17,000 from each spouse), without eating into their estate tax exclusion. If they repeat the gifts every year, or spread the gifts among enough separate recipients, they could reduce the value of their estate to a point at which their heirs will no longer be subject to the 40% estate tax on their inheritance. We encourage you to act now to lessen, or even eliminate, your federal estate and gift tax liability. If you have any questions regarding estate and gift tax matters, or other strategies to reduce your estate tax liability, give us a call to schedule an estate planning appointment.