Massachusetts Lawyers Weekly recently quoted Atty. David J. Correira regarding a Massachusetts Superior Court ruling that the existence of an in terrorem clause (also known as a no-contest clause) in a trust did not bar a plaintiff-beneficiary from bringing a claim against the trustee for breach of fiduciary duty and other wrongdoing.

The Court reaffirmed long-standing Massachusetts law for such clauses in wills, while expanding those principles to include trusts, stating “‘[A no contest] clause does not prevent a contest by the beneficiary under the will . . . If the contest is successful, that clause fails with the rest of the will . . . David J. Correira of Boston said the case reflects a common misconception that an in terrorem clause on its own will prevent litigation. ‘That’s just not correct,’ he said, ‘From a litigation point of view, trying to rely on an in terrorem clause to dismiss a wills and trusts case is more than likely a fool’s errand.’ From a drafting standpoint, Correira said, no-contest clauses are still useful in wills and trusts, but it is important to document the decision-making involved by which the estate plan has been created or changed if distributions are unequal.’”

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