A probate dispute can occur during the probate process for a variety of reasons. For example, beneficiaries and heirs may disagree as to whether the will is valid, or beneficiaries my challenge the how the fiduciary is performing their duties, or creditors may disagree with the personal representative over payment of claims. When the parties cannot resolve the dispute on their own through negotiation, the dispute may escalate into full-blown litigation that must be resolved by a District Court judge. Litigation during probate can greatly impact the administration process, causing significant delays and increasing the administration expenses.
A will contest is an objection to the validity of a will. Typically, will contests are initiated by a family member who was disinherited or who did not receive as much as they expected or what they felt they deserved. However, to object to a will, the objectant must be more than angry about the contents of the will. The must have a legitimate, legal basis for challenging the will. Legal grounds for will contests include:
- Lack of testamentary capacity. For a will to be valid, the testator must have a certain level of mental ability. For example, the testator must understand the extent of their estate and what it means to make a will. NM Stat § 45-2-501. Typically, testimony is required from a doctor who treated the testator around the time that the will was executed to support claims regarding the testator’s mental capacity.
- Undue influence. Undue influence typically occurs when a testator is vulnerable due to illness, age, or isolation, and is dependent on someone else who they have come to trust. If that person takes advantage of the close, confidential relationship to illegally pressure the testator to creating a will favorable to them and that the testator would not have otherwise made, then undue influence would have been present. The will would not be valid.
- Improper execution. A will can be contested if it was not properly executed. With few exceptions, under New Mexico law a will must be written. To be valid, a will must also be signed by the testator or in the testator’s name by someone else in the testator’s conscious presence and at the testator’s direction. In addition, the will must be signed by at least two witnesses. NM Stat § 45-2-502
A successful will contest will result in the will being invalidated. Unless there is a prior or later valid will, the estate will be subject to New Mexico’s law of intestate succession. NM Stat § 45-2-103
Breach of Fiduciary Duty
A common type of probate litigation occurs when there are challenges to the way the personal representative, guardian, trustee, or other fiduciary is doing their job. Persons serving in these roles are fiduciaries and are legally required to perform their responsibilities with the utmost care, loyalty, and honesty. They are required to act in the best interests of the estate, their wards, or beneficiaries and not in their own self-interest. If an interested party believes that a fiduciary has breached their fiduciary duty by acting in an improper or irresponsible manner, they can initiate a lawsuit in the District Court.
Common reasons for fiduciary litigation include:
- Disagreements over who should serve as guardian
- Improper investment of estate or trust assets
- Improper use of estate funds
- Objections to an accounting
- Wasting estate assets
If the fiduciary is found to have breached their duty the court may revoke their authority and the court may hold the fiduciary personally liable for the losses or damage that they caused.
Upon receiving a claim against the estate, the personal representative must determine the validity of the claim and either allow or disallow it. If the personal representative disallows a claim, the creditor has the right to file a petition for allowance in the District Court. NM Stat § 45-3-806. The petition must be filed no later than 60 days after the mailing of the notice of disallowance.