Penalty clauses in testaments: What Louisiana can learn from the common law

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Fox, Irina
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A typical in terrorem clause (also referred to as penalty, forfeiture, or no-contest clause) used in a person’s last will threatens that those who contest the will in court will forfeit their bequest. The Latin phrase “in terrorem” means “into fear.” Indeed, the clauses inflict fear not only upon the heirs but also upon legal practitioners and courts. The chief difficulty for the courts arises out of the need to balance the right of testators to freely dispose of their estate against the heirs’ right to pursue their meritorious claims. To make matters worse, testators can be extremely creative in their phraseology of penalty clauses. The judicial analysis necessarily depends on the language of the clause itself and the circumstances surrounding the contest, which makes the courts’ task even more arduous.|The difficulty in balancing the rights of testators and the rights of heirs is exacerbated in Louisiana. Few cases involving penalty clauses arose during the twentieth century, leaving Louisiana courts without the opportunity to develop a systematic approach to analyzing penalty clauses. Changes in Louisiana successions law have increased the likelihood that testators will resort to such clauses and that litigation regarding them will ensue. Due to the virtual abolition of forced heirship, a testator has more freedom in determining how to dispose of his estate. This increased freedom may prompt testators to resort to penalty provisions as a guarantee that their wills are enforced. With limited exceptions, the estate is now “freely alienable,” which allows testators to be creative in their bequests. At the same time, descendants of testators who are left out of the will are more likely to file suit challenging the will because, save in rare circumstances, they are no longer entitled to a portion of the testator’s estate by law.|This likely increase in the use and litigation of penalty clauses necessitates the clarity that this Article strives to provide by proposing a framework for analyzing penalty clauses in Louisiana. This Article presents the background of penalty provisions in Roman and French history and summarizes the trends in Louisiana jurisprudence, while at the same time identifying the gaps in courts’ analysis. It further examines the history and modern common law in search of the solution for Louisiana’s problems. Finally, this Article establishes a flexible framework for analyzing penalty provisions in Louisiana that combines Louisiana’s civil law heritage with the equitable common law approach.
Irina Fox, Comment, Penalty Clauses in Testaments: What Louisiana Can Learn from the Common Law, 70 La. L. Rev. 1265 (2010).
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