Your revocable living trust should carry out your wishes based on your current situation in life, but it should also be flexible enough to account for potential unexpected events. Here are some of the things that one might consider:

1. Death of a child or other family member
2. Incapacity of a child or other family member
3. Birth of additional children or other family members
4. Possibility that a beneficiary may be suffering from substance abuse
5. Possibility that a beneficiary may have creditors
6. Possibility that a beneficiary might be a victim of fraud or undue influence
7. Possibility that a beneficiary may be relying upon special government assistance

By taking precautions to think through these possibilities, one may be able to avoid the need to amend his or her estate planning documents by incorporating provisions to deal with these contingencies. 

Broadly speaking, the term "issue" refers to a person's lineal descendants.

Formally, California Probate Code Section 50 provides:

“Issue” of a person means all his or her lineal descendants of all generations, with the relationship of parent and child at each generation being determined by the definitions of child and parent. 

Often, an estate planning lawyer will provide that a bequest will go to a beneficiary's "issue" if that beneficiary doesn't survive. It's also important to remember that the term "issue" is also used for purposes of intestate succession and anti-lapse statutes. 

A Trustor also has the ability to broaden or narrow the definition of issue to ensure that the Trustor's estate planning documents properly reflect his or her wishes. Thus, a Trustor may wish to include adopted persons who were under a certain age at the time of adoption or to include stepchildren. (One may also exclude certain individuals.) 

A no contest is a special provision that you may include in your Will or Trust that causes a beneficiary to forfeit what he would have received if he challenges your Will or Trust. In this post, we explore the enforceability of no-contest clauses to gain a better understanding of their limitations. Let's first start with some technical definitions. California Probate Code Section 21310 is the relevant place to look. It states the following:

(a) “Contest” means a pleading filed with the court by a beneficiary that would result in a penalty under a no contest clause, if the no contest clause is enforced.

(b) “Direct contest” means a contest that alleges the invalidity of a protected instrument or one or more of its terms, based on one or more of the following grounds:

(1) Forgery.

(2) Lack of due execution.

(3) Lack of capacity.

(4) Menace, duress, fraud, or undue influence.

(5) Revocation of a will pursuant to Section 6120, revocation of a trust pursuant to Section 15401, or revocation of an instrument other than a will or trust pursuant to the procedure for revocation that is provided by statute or by the instrument.

(6) Disqualification of a beneficiary under Section 6112, 21350, or 21380.

(c) “No contest clause” means a provision in an otherwise valid instrument that, if enforced, would penalize a beneficiary for filing a pleading in any court.

(d) “Pleading” means a petition, complaint, cross-complaint, objection, answer, response, or claim.

(e) “Protected instrument” means all of the following instruments:

(1) The instrument that contains the no contest clause.

(2) An instrument that is in existence on the date that the instrument containing the no contest clause is executed and is expressly identified in the no contest clause, either individually or as part of an identifiable class of instruments, as being governed by the no contest clause. 

Although no-contest provisions may seem to be a good way to inhibit beneficiaries from challenging your Will or Trust, effective as of January 1, 2010, new laws were enacted to limit their scope of power. In essence, no-contest clauses are enforceable in three types of situations.

1. A person makes a direct contest (defined above) without probable cause (i.e., the facts do not allow a reasonable person to believe that there is a reasonable likelihood that the contest would prevail).

2. A contestant is challenging the transfer of property on the basis that the deceased person didn't own it. 

3. A creditor's claim is filed or if actions are taken based on a creditor's claim by the contestant.

In the second and third scenarios, the no-contest provision must make explicit mention of the fact that the provision applies in those situations. See California Probate Code Section 21311:

(a) A no contest clause shall only be enforced against the following types of contests:

(1) A direct contest that is brought without probable cause.

(2) A pleading to challenge a transfer of property on the grounds that it was not the transferor’s property at the time of the transfer. A no contest clause shall only be enforced under this paragraph if the no contest clause expressly provides for that application.

(3) The filing of a creditor’s claim or prosecution of an action based on it. A no contest clause shall only be enforced under this paragraph if the no contest clause expressly provides for that application.

(b) For the purposes of this section, probable cause exists if, at the time of filing a contest, the facts known to the contestant would cause a reasonable person to believe that there is a reasonable likelihood that the requested relief will be granted after an opportunity for further investigation or discovery.

Although the enforceability of no-contest clauses are somewhat limited, they are fairly common in estate planning documents, and it's a good idea to understand their limitations.

A challenge faced by some is the possibility that a beneficiary will challenge the the terms of a trust. A "no-contest" clause is a way to dissuade a beneficiary from contesting the terms of a trust. The clause, in essence, provides that a beneficiary would forfeit what he or she would've received under the trust if he or she challenges it.

Whether a no-contest clause is enforceable and how effective they may be in California will be topics explored in a subsequent post.