The testator’s intent as set out in a will is usually sacrosanct. Key emphasis on “usually.” Assuming that the will isn’t invalid for any number of reasons such as incapacity, undue influence, fraud, etc., the property should be distributed according to the testator’s intent. But, sometimes family members disagree with how the testator wanted to devise the property, and – shockingly – sometimes family members can even agree to an alternate division of property. Why shouldn’t such an agreement be enforceable? Well, in many jurisdictions it is under the family settlement doctrine.
The family settlement doctrine is a doctrine that allows the heirs of an estate to come up with a valid, enforceable agreement to deviate from the terms of a will when it comes to the distribution of division of property. Here’s how Georgia explains it:
[A]greements among the heirs at law to distribute or divide property devised under a will, in lieu of that manner provided by the will, are valid and enforceable. Such agreements have as their consideration the termination of family controversies, and are upheld albeit perhaps resting on grounds which would not have been satisfactory if the transaction had occurred between mere strangers. They partake of the nature of family arrangements and are, in essence, solely contractual and governed by the rules applicable to all contracts.
Georgia’s appellate court recently reaffirmed this concept in Thompson v. Lovett where it was alleged that the heirs and co-executors of an estate may have entered into an agreement to cancel one’s debt to the estate in favor of an alternate arrangement. The possibility of a family settlement regarding the debt therefore precluded entry of summary judgment in a suit on the note.
Family settlements can be beneficial and can lead to expedited distribution of property. However, if the distribution of the entire estate cannot be resolved through one, it is probably best – if not required – to wait until after the estate is administered and the assets distributed for the family members to trade or exchange property.