No-contest Clause

A no-contest clause (also known as an in terrorem clause, contest clause, or forfeiture clause) is a legal provision included in a will or trust that discourages beneficiaries from challenging the validity or terms of the document. If a beneficiary contests the will or trust and loses, the clause typically results in the forfeiture of that beneficiary’s inheritance or a significant reduction in their share.

Key Features of No-Contest Clauses:

• Purpose: To deter beneficiaries from initiating legal disputes over the estate, thereby reducing litigation costs and preserving estate assets.
• Effect: If a beneficiary violates the clause by contesting the will or trust, they may lose their inheritance or receive only a nominal amount.
• State Law Variations: The enforceability and scope of no-contest clauses vary by jurisdiction. Some states strictly enforce them, while others limit their application or provide exceptions—such as allowing challenges made with probable cause or in good faith.
• Exceptions: In certain states, no-contest clauses are not enforced if the challenge is based on probable cause (e.g., suspected fraud or misconduct), or if the beneficiary acted on the advice of an attorney after disclosing all material facts.

Example of a No-Contest Clause:

“If any person shall, in any manner, directly or indirectly, attempt to contest or oppose the validity of this agreement, or commences, continues, or prosecutes any legal proceedings to set this agreement aside, then such person shall forfeit his or her share, cease to have any right or interest in the trust property, and shall, for purposes of this agreement, be deemed to have predeceased both of us.”

Summary Table

Feature	Description
Purpose	Deter legal challenges to wills/trusts
Effect	Forfeiture or reduction of inheritance for violators
State Law Variations	Enforceability and exceptions vary by jurisdiction
Common Exceptions	Challenges with probable cause or good faith may be allowed

No-contest clauses are a common estate planning tool to promote harmony among beneficiaries and protect the estate from unnecessary litigation.