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What happens when estate documents contradict each other?

On Behalf of | Jun 10, 2022 | Estate Planning |

Many people start with a will when creating an estate plan and then add more documents as their family grows and their personal circumstances change. They will make updates occasionally, likely to remove beneficiaries or add new assets.

When you draft new documents or update one or more of your estate planning documents, you will best protect yourself by simultaneously reviewing all of the other documents in your estate plan. Otherwise, you run the risk of having contradictions between your different documents. That might complicate the administration of your state and cause issues among your loved ones.

What happens when your documents contradict each other?

Some documents have precedence over others

The documents that you include in your estate plan and the nature of the discrepancy between them will obviously differ from case to case. The kind of contradiction and the documents involved will determine which one has the final say.

Sometimes, there is a straightforward answer about which document has authority. If you designated property to a certain person in your will and then transferred that property to a trust and name someone else as the beneficiary, the trust will typically determine the descent of the property because the property does not belong to you and is therefore not part of your estate.

If you name someone as the beneficiary for your life insurance in your will and then have a different beneficiary designated with the insurance company, the policy documents rather than your estate planning documents will typically have authority. In some scenarios, there could be two documents with similar functions, like a health care directive and medical power of attorney, naming two different people for the same role. Such issues may require court review.

Contradictory documents cause serious issues

Family members confused by the contradictions may start to believe that there was some kind of fraud and may feel angry about what they didn’t receive. When you take the time to review your estate plan and eliminate any contradictions between the documents, you reduce the likelihood of challenges and disputes that will damage the relationships among your beneficiaries and diminish how much you leave for people to inherit.

Understanding the rules that apply to help you avoid common mistakes when creating or updating your estate plan.