Quote of the Day - The finest inheritance you can give to a child is to allow it to make its own way, completely on its own feet.
In terrorem clauses in trusts and wills have the (some would say nasty) effect of reducing the inheritance to something like $1.00 if someone challenges the validity of the trust or will. But what if you make an amendment or a codicil to your trust or will, and don't put the in terrorem clause into the amendment? Does it still apply?
That's what John tried to do in challenging his father's second amendment to the trust he set up for his children, John, Toinette and Valerie. Toinette was appointed administrator of the trust. As you have likely guessed, the second amendment reduced John's share of the inheritance. John filed an application to determine whether his challenge to the second amendment would invoke the in terrorem clause. Toinette, of course, took the alternate position since her inheritance was, of course, consequently increased.
You would think that because the trust (and for that matter the underlying pour-over will) contained in terrorem clauses, that would be enough. But if you did, then you would be wrong. The trial court's ruling in favor of John's position was upheld by the appellate court. So, if you want to place someone "in terror" of challenging your will or your trust, you must do so every time.