Saturday, March 2, 2013
Testatrix died with a will leaving her entire estate to the trustee of her inter vivos trust. Seven years later, a dispute arose regarding the validity of the will and thus the passage of the estate under the trust. Distant intestate heirs (first cousins, twice removed) were successful in getting the trial court judge to order the production of the trust instrument. Executor sought a writ of mandamus asserting that the contestants lacked standing.
In in re Paschall, the Waco Court of Appeals denied the writ. The court explained that the contestants have a contingent pecuniary interest in the estate, that is, if they are successful in setting aside the will and proving they are the intestate heirs, they would be entitled to the property that is now being held in Testatrix’s trust. Accordingly, they have standing to seek discovery of the trust instrument.
Moral: An inter vivos trust may not be as private as believed as even remote claims to the trust property may result in the trust instrument being discoverable.
See Trial Court Did Not Abuse It's Discretion in Ordering Production of Trust Documents, Texas Probate Litigation Blog, Feb. 27, 2013.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.