In Terrorem ("no contest") clauses are pesky little short –but often sharp– spikes which must be treated with extreme caution lest they deprive a beneficiary of any rights under the will. Such was the case in In re Bernstein v. Lo Pata decided by Nassau County Surrogate John Riordan and reported in the New York Law Journal on May 30, 2006 at page 45.
Decedent’s daughter petitioned for construction of his will. In particular, she claimed that the residuary clause failed because it was vague and indefinite. Her objection was to the provision which stated that "I direct that my Executor/Executrix shall distribute the residuary of my estate to charities of his/her choice." Petitioner was joined in her opposition to this clause by the attorney general. Had she been sustained by the court, the residuary of the estate would have passed by intestacy.
The will contained an in terrorem clause which specifically disinherited an beneficiary who participated in an action "about the provisions of the will". Notwithstanding the court’s ultimate finding that the residuary clause did not fail for lack of specificity or vagueness, it was also determined that by challenging a provision of the will, the petitioner had run afoul of the interrorem clause and would therefore be deprived of any interest under the will.
Once it was found that the petitioner had lost her inheritance, the court reached the conclusion that she no longer had standing to challenge the clause because she no longer had any legal interest in the decedent’s estate. A fatal "one, two" knockout blow.
Given that the attorney general had appeared in the action to object to the residuary clause, one can only wonder as to just why the petitioner found it necessary to weigh in on her own. This case is just another example of how one may be frustrated by the insertion of an interrorem clause in a will. Even though the courts tend to look upon these provisions with disfavor, the risk of losing all is always there.