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Tennessee Appeals Court Rules Settlement Agreement Precludes Challenge to Will
Posted by Martin Heller Potempa & Sheppard, PLLC on July 18, 2016
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In an estate dispute involving a will contest, interested parties file a formal objection during the administration proceedings, challenging the validity of the decedent’s Last Will and Testament. In In re Estate of Dalton (Tenn. Ct. App. June 28, 2016), the Court of Appeals of Tennessee reviewed such a challenge by one of the decedent’s three adult children.
In Dalton, the executrix of the decedent’s estate sought approval from the trial court to distribute the decedent’s estate equally among his three children, claiming that it was in accordance with a settlement agreement entered into by the three siblings in 2009. However, one of the siblings challenged the distribution, claiming that the decedent had granted her an option to purchase his farm for the original purchase price. She further alleged that the written option agreement had been lost, but she produced affidavits of two witnesses who claimed to have knowledge of the agreement. The sibling also admitted that she had never exercised the option prior to the decedent’s death. The trial court granted summary judgment in favor of the executrix, finding that the siblings’ settlement agreement provided that they would not file suit to challenge the decedent’s will. When the sibling challenging the will would not execute documents to effectuate the sale of the farm, the trial court allowed the executrix to sell the property without approval from the heirs. The sibling then appealed that decision to the higher court.
One of the issues on appeal was whether the settlement agreement was dispositive of the sibling’s claim regarding the farm. The sibling argued that the farm was not part of the decedent’s estate and therefore was not controlled by the settlement agreement. The appeals court disagreed, finding that even if the option existed, the farm would still be an asset of the decedent’s estate to be administered according to his will. The court cited Tennessee Code Annotated § 31–2–103, which provides that the real property of a testate decedent vests immediately upon his death to the beneficiaries named in the will, unless the will contains a specific provision directing that the real property be administered as part of the estate, subject to the control of the personal representative.
The court went on to explain that the settlement agreement also reflected that the siblings agreed not to file any action challenging the terms of the decedent’s will. Instead, the siblings agreed to abide by the terms of the settlement agreement to resolve any claims regarding the distribution of the decedent’s estate. The settlement agreement also expressly provided that the farm was an asset of the estate. The court noted that the sibling executed the settlement agreement without mentioning or attempting to exercise the option at that time. The court, therefore, concluded that the trial court properly determined that the sibling’s claim was precluded by her execution of the settlement agreement, and the farm was an asset of the decedent’s estate.
A skilled trusts and estates attorney can help individuals in planning for the settlement and distribution of their estate, as well as anticipate any issues that may arise in the course of probate administration. At Martin Heller Potempa & Sheppard, our Nashville lawyers offer comprehensive legal advice in matters involving estate planning, family law, and personal injury law. To discuss any concerns you may have regarding a legal issue, contact Martin Heller Potempa & Sheppard by phone at (615) 800-7096 or through our website.
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