No family expects that they will undergo a bitter dispute over a family member’s will; however, you might be surprised how often it happens. When a will isn’t crystal clear regarding who gets which assets, arguments can begin. And often, it isn’t the most valuable items that family members squabble over: it could be the piece of antique furniture or painting that holds sentimental value for more than one person.
A recent Wall Street Journal article explores this very topic as well as ways to overcome familial dispute as easily and inexpensively as possible.
According to the article, mediation has grown more popular, and for good reason.
If a dispute can be settled in mediation, it can prevent the problem from becoming a bitter, all-out battle in court. Moreover, mediation can be cheaper than fighting it out in court.
Mediation has become more prevalent also because of a new, “unprecedented intergenerational transfer of wealth.” A recent report forecasts that $10.4 trillion will be given to the baby-boom generation from their parents between 1990 and 2044. Yes, that’s trillion!
In an interview with New York attorney William Zabel, the article examines why disputes so often arise from wills. Zabel opines that parents often don’t leave very detailed instructions regarding the division of assets. This is true: most people don’t like to think about being gone, so they tend to focus on reducing estate taxes and avoid the other aspects of estate planning. And many children don’t let their parents know about the dinner set or painting they love. Fights can break out over “intangibles” as well. If you pick on child as the executor of your will but don’t explain your decision, this can breed resentment among the others.
Mediation involves a “mediator” who acts as neutral third party. The mediator helps all the parties negotiate, and then drafts an agreement. Each party can have their own lawyer review the agreement if they wish. Some ways to mediate a dispute include creating a “lottery,” in which all parties draw straws to determine the order that they pick among the assets, or an equal division of the whole estate based on a valuation of all the assets.