It is hardly uncommon for family members to disagree about the validity or meaning of a will. Even when they disagree, though, few people actually go to the trouble and expense to file a formal contest. A recent will contest case in Georgia provided a different wrinkle that invites further explanation: the will contests filed a “declaratory judgment” request.
Declaratory judgment explained
Sometimes a lawsuit asks the court to simply declare the respective rights of the parties. It might not seek any dollar damages, or for any court order directing anyone to do anything. The lawsuit just asks the judge to declare whether the complainant has the rights he or she asserts.
American courts avoid rendering “advisory” opinions. They will only rule when there really is a legal controversy. By rendering a declaratory judgment, the court can skirt that prohibition but help resolve controversies before they become larger.
Louise Burkhalter’s will
When Georgia resident Louise Burkhalter signed her will, she was trying to head off family disputes. She knew that there might be disagreement, though; in her opinion, one of her children (and a grandchild) had taken advantage of her. Ms. Burkhalter divided her estate into three shares, with one for each of her children. But she added an unusual step: the other two children were given absolute discretion to “make a calculation on loss sustained due to the actions of my daughter and grandson.” Her daughter’s share was then to be reduced by that loss.
This arrangement set the family up for obvious conflicts. Ms. Burkhalter’s daughter very likely would object to any figure her brothers might calculate. That lead Ms. Burkhalter to also include a no-contest clause (sometimes called an in terrorem provision).
As we have previously explained, an in terrorem provision in a will penalizes any beneficiary who challenges the will itself. Ms. Burkhalter’s will specified that if anyone contested her will, or the calculation made by her sons, they would be disinherited. The share of any contesting beneficiary would become part of the distributions to the other children. In other words, if her daughter disagreed with her brothers’ calculations, she (and her son) would receive nothing.
Challenging an in terrorem provision
Most states will recognize non-contest clauses in wills — and even in trusts. Sometimes, though, the provision is itself questionable. A body of law has grown up around challenges to in terrorem provisions.
Generally speaking, states recognize that a contestant can file a will challenge without triggering the no-contest provision if there is “probable cause” for the challenge. The challenge does not have to be successful, but it does have to be well-taken and based on real evidence. Thus, the potential contestant has to weigh the possibility of establishing probable cause against the likelihood of disinheritance.
One way to do that is to ask a court to declare that the will contest does not violate the in terrorem provision. That would be a declaratory judgment action. And that is exactly what Ms. Burkhalter’s daughter and grandson filed — except with an interesting twist.
When a potential claimant files a declaratory judgment lawsuit, that can itself trigger the in terrorem disinheritance. So Ms. Burkhalter’s daughter and grandson filed a declaratory judgment petition. They asked for a ruling that, if they later filed a declaratory judgment action challenging the will, or the brothers’ calculation, that they would not be disinherited.
The probate court ruling
The Georgia probate court agreed, and granted the declaratory judgment request. The judge ruled that it would not be a challenge to the will itself if Ms. Burkhalter’s daughter filed a later declaratory judgment action seeking “clarity” about the validity of the provision. The daughter could also decide to file a petition to remove her brothers as personal representatives of their mother’s estate if she wanted to at a later time; that would not be a will contest, according to the probate judge.
Ms. Burkhalter’s daughter did not get everything she asked for. She had also sought a ruling that she could challenge her brothers’ calculation of her share of the estate. The probate judge noted that it was too early to determine whether such a challenge would be permitted, since they had not yet made that calculation.
The court of appeals
Ms. Burkhalter’s two sons appealed. They argued that what their sister had filed was a request for blanket authority. Without her actual complaint at hand, the probate court could not determine whether she had triggered the in terrorem provision.
The Georgia Court of Appeals agreed with that argument. It ruled that there is no such thing as a declaratory judgment petition seeking authority to file another declaratory judgment action. Without looking at the actual allegations and language of the petition, it would be impossible to authorize its filing.
The appellate court vacated the probate judge’s rulings. It remanded the entire probate proceeding for further action by the probate court — which may or may not include a challenge to the will, or to the calculations made by the brothers about their sister’s share of the estate. Estate of Burkhalter, October 27, 2017.
The underlying message
No-contest / in terrorem clauses in wills and trusts are very powerful. They really can have the effect of reducing family legal disputes — though they might not encourage family harmony and good will.
Ms. Burkhalter’s will provision giving her sons power to decide how much to reduce their sister’s share of the estate was hardly likely to bring the family together. But her in terrorem provision will probably keep the family dispute from appearing in court records or enriching lawyers.
After the Burkhalter case was remanded to the trial court, her daughter refiled her petition. Of course, it ended up back in the Georgia Court of Appeals. We checked in on the updated status while writing about two other, unrelated, Georgia cases decided in 2020 — just months after the final (?) resolution of the Burkhalter family dispute.