Probate disputes are often resolved using family settlement agreements. These agreements can avoid the costs and delays of full will contests. But they can also lead to additional disputes. The Locasico v. Mongrain, No. 07-18-00280-CV (Tex. App.–7th Dist. 2019) case provides an example of a dispute involving a family settlement agreement in probate court.
Facts & Procedural History
This is a probate case. The mother died. Her will left her ranch to her four children.
Prior to her death, the mother had entered into a written agreement that her son-in-law could keep his cattle on the ranch land at no cost.
The daughter named as executor probated the will and was appointed independent executrix. She used this power to enter into another written agreement whereby the son-in-law could keep his cattle on the ranch land at no cost.
The probate estate took five years to resolve. During this time, the son-in-law continued to keep his cattle on the ranch land.
The probate process was contested. The parties entered into a family settlement agreement, which provided that the land was to be divided up, a fence installed, and an access road constructed. The parties ended up disputing whether they complied with the terms of the family settlement agreement and additional litigation ensued.
Ultimately, the property was partitioned and a jury concluded that both parties had breached the family settlement agreement. The jury awarded damages and the appeals court considered whether the damages were allowable.
About Family Settlement Agreements
Family settlement agreements are the preferred way of handling probate disputes in Texas. These agreements are intended to allow the parties to avoid the uncertainties and costs of litigation. This provides finality that is often desired in probate matters.
When a family settlement agreement is entered into during the probate process, it has to be filed with the court. This is set out in Rule 11–which gives us the term “Rule 11 agreement” used to describe probate settlements.
Violating the Family Settlement Agreement
Whether there is a breach of a family settlement agreement is viewed as any other agreement.
In this case, one of the siblings argued that the other had breached the agreement by failing to sign an easement. The court describes it as follows:
The proposed Release and Settlement Agreement originally provided by counsel for Nina and Charles, in December 2015, deviated from the terms of the Rule 11 settlement agreement by including a provision for a fifty-foot access and utility easement instead of the agreed-to easement following the “existing all-weather road.” In response, counsel for Anthony and Nicolas emailed Nina and Charles’ attorney writing, “I know my folks will not agree to add a wider utility easement. . . . [S]end me a partition deed and easement consistent with the signed agreement that limits the easement provided as expressed in that agreement—access along the existing all-weather road?”
The court concluded that there was no breach for failing to sign the easement that included terms different than the family settlement agreement.
Avoiding the Need for Family Settlement Agreements
There are other arguments involved in this dispute. Without going into those in detail, for purposes of this post, we just note that this type of dispute is common.
The death of a loved one can be challenging. Family members often believe the decedent would have wanted things to be handed a certain way. But other family members may have other beliefs as to intent. Family settlement agreements can be used to resolve these disputes. But even then, the parties have to be agreeable to implementing the terms of the agreements.
To a probate attorney, this type of dispute over land might have been foreseeable. The decedent may have intended the son-in-law to have this type of benefit, but it isn’t clear from the case.
When preparing agreements that will influence events after the property owner dies, as with the management agreement in this case, it can be helpful to recite the property owners intent in the agreement. This can then be referenced to show what the property owner would want. The same could be spelled out in the owner’s estate planning documents. This can go a long way in avoiding situations where family settlement agreements are needed.