[PODCAST] JAMS Neutrals on the Evolution of Trusts and Estates Disputes and Considerations for Selecting the Right Mediator

In this podcast, JAMS neutrals Hon. Glen Reiser (Ret.) and Lisbeth Bulmash, Esq., discuss how the pandemic and a shifting landscape around wealth transfers is fueling increased trusts and estates disputes. They weigh in on how preparing adequately and selecting the right mediator are crucial for getting ahead of a conflict and finding a solution that meets the parties’ goals, as well as how the approach to mediation differs across states. The neutrals also discuss capacity and undue influence, two factors that impact estate planning, including how analyses of those factors vary and are impacted by advancements in physiological and psychological science. Finally, Judge Reiser and Ms. Bulmash offer their thoughts on how to select a thoughtful and creative mediator.

[00:00:00] Moderator: Welcome to this podcast from JAMS. Since the start of the pandemic, estate planning has taken on a new urgency and given rise to scores of conflicts. To discuss some of these issues and how mediation can help, we have two JAMS neutrals with us. Our first guest is Judge Glen Reiser. He serves as educational trainer for all trust and probate judges throughout California.

Before coming to JAMS, he spent more than 20 years with the Superior Court in Ventura County, California and before that, more than two decades as a civil litigator. We also have Lisbeth Bulmash who has been a full-time neutral since 2002. Before practicing in the state of Texas, where she is currently based, she had an active ADR practice in Michigan and Ohio. And before starting her ADR practice, she served as a litigation attorney in a diverse array of firms.

Thank you both for being with us. Lisbeth, I'll start with you. What kinds of estate planning disputes have you seen arise over the last two years and have you noticed any patterns?

[00:00:59] Lisbeth Bulmash: Yes. We have seen a high number of deaths resulting from COVID, and these large numbers of unexpected and sudden deaths have meant more confusion and have resulted in a high number of airship disputes where the parties have left and died without a will or any proper estate planning.

I've also seen a large number of will contests and disputes arising from blended families and sibling rivalry. That's really what we've seen as of late.

[00:01:34] Moderator: And Judge Reiser, what have you been seeing?

[00:01:35] Judge Reiser: So actually, it's over a course of years, you know, in America, wealth transfers happen differently than they used to happen a lot. In the old days, there was a significant self-made wealth and today, while that still exists in certain pockets, more frequently wealth is transferred through family deaths and trusts and estate matters. So that seems to be where large amounts of capital are exchanged. Those types of contests have risen dramatically, especially over the last five years.

[00:02:11] Moderator: Lisbeth, can you talk about what attorneys can do to get ahead of these conflicts and talk a little bit about the role mediation plays in helping attorneys resolve estate disputes?

[00:02:20] Lisbeth Bulmash: Well, first of all, I'd like to say that most judges, and maybe Judge Reiser can comment on this, do not want to insert themselves in estate conflicts.

Mediation is that tool that gives the parties an opportunity to not only save time but save money and offer solutions to their clients that the court cannot offer. Attorneys can work with the mediator and other parties to dispute, to craft often creative solutions to family conflict stemming from these estate disputes and not everyone wants the same thing.

So, in being creative, we can have attorneys see more client satisfaction by using the tool of mediation.

[00:03:09] Moderator: Judge Reiser, any advice you'd give to attorneys to get ahead of these disputes?

[00:03:13] Judge Reiser: So it's important to appreciate how judges think about these cases, right? I know in a lot of states will contests and trust contests can be jury matters, but historically trust contests arise in equity and in chancery.

So not in all states, but in most states, these are very judge-centric type cases and because they arise in equity, typically, not always, but typically they're court trials. When you have a court trial, that means the judge at the end of a case, in these cases, tend to be very fact intensive and physician expert intensive.

So, trials last a long time and the judge at the end of the case, instead of asking the jury to return a verdict, will have to sit down and write a 20- or 30- or 40-page opinion and judges’ calendars don't usually allow for that. So many of my colleagues are loath to wanting to engage in this exercise because it is so time-consuming and any opportunity to reallocate that resource outside of the court and get it resolved is a blessing to my colleagues' lives.

So that's a very practical answer, but that's the reality.

[00:04:22] Moderator: What would have been the consequences for parties and lawyers who have not been prepared?

[00:04:29 Lisbeth Bulmash: I think with the advent of zoom mediations recently with the pandemic, there is a real disparity that is evident in the negotiations at mediation. It's pretty obvious when parties come to mediation, and they're prepared. They know what they want, and they educated the mediator ahead of time so that the mediator's in the best position to help the parties. It's pretty obvious if parties and their attorneys are not prepared, and have not thought through why they're at mediation, what they really want to get out of the case at the end of the mediation. So, it's really a cautionary tale that parties need to prepare.

They need to not only know their case but know in and out where their clients coming from and what makes them tick and what they really want to get out of resolving the case, if possible.

[00:05:30] Moderator: Judge Reiser, anything you would add?

[00:05:33] Judge Reiser: So, different courts do it differently, right? Because quite often a court will want an early mediation to resolve a case before a lot of attorney fees become the tail wagging the dog in terms of case resolution and making it difficult to resolve.

But, quite frequently, all these cases or most of them involve a testamentary instrument, right? The testamentary instrument is either a trust or a will. That document in most cases, not always, was drafted by an estate planner or a lawyer who dabbles in estate planning. And so, I see very frequently council who hasn’t interviewed, if the estate planner is still living or still practicing or available, hasn’t interviewed the estate planner to see what their notes say, to see what their recollection is, even as it relates to issues, such as capacity, undue influence, document interpretation, settler’s intent -- all those things.

So that's a critical component of preparation. The second part, I think, really relates to the science, and has the lawyer consulted at least in a work product since with a geriatric psychiatrist or a PhD psychologist with expertise in geriatrics to sort of get a direction on where they ought to go if they have a capacity or undue influence case.

[00:06:57] Moderator: You mentioned capacity and undue influence. Well, let's start with undue influence. Can you help explain that? What role it plays in these kinds of disputes?

[00:07:06] Judge Reiser: So undue influence is a bit of a free for all, right? Because it involves somebody who prevails upon typically an elder to either create or modify a testamentary instrument. Quite often, especially in our mobile society, many family members either move away or aren't as close and someone stays and helps to take care of the parent, normally, or grandparent or aunt or uncle. So, when that person naturally changes their instrument to benefit the person who's taking care of them, the others, wherever they are around the world, sort of look at it as an attempt to influence an equal estate plan. So, it's a very common circumstance. But there's a common law to undue influence and there's rules that everyone knows around the country as to the presumptions associated with undue influence.

But a lot of states now are enacting statutes that more specifically define undue influence. So, it's a state-by-state analysis, but those are free for alls because it really what's going on in somebody's life. You know, are they isolated? Are they competent to write emails? Who's taking who to the lawyer's office? Whose lawyer is it? Who's sitting in on in the meeting with the estate planner? I mean, all these questions arise, and these are not brief trials. They're at least a week.

[00:08:31] Moderator: What about capacity? Can you talk a little bit about how that plays out?

[00:08:35] Judge Reiser: Capacity is interesting because every lawyer in America learns the same rule and it comes from Victorian England.

It comes from Lord Cockburn, who was the Lord Chancellor in the Mid-1800s under Queen Victoria. The rule was if you know who your kids are, the natural objects of your bounty, and you know what your property is and you know you’re making a will or estate trust, then that's all the capacity you need.

But medical science is different now in terms of capacity because capacity involves cognitive deficits that correlate to decision-making. So, the rules vary from state to state, but whether it is the old, learned Cockburn rule from Victorian England or some more modern analyses that correlate the decision-making to cognitive deficit, it's not a lawyer determination, normally, except, perhaps, at the most fundamental level. It really evolves in medical science to a large degree and what's going on in someone's mind. It's more of a scientific analysis, although I've seen more and more psychiatrist and PhD psychologists getting involved in undue influence because of co-dependencies that arise, not just with cognitive dysfunction, but also with physiological issues that cause people to be reliant on others.

[00:09:53] Moderator: Lisbeth, have you seen these issues play out? What's been your experience with capacity and undue influence?

[00:09:59] Lisbeth Bulmash: Well, I have to say that given what's what we've been through recently, there's been a significant cognitive decline in the elderly population. So, when we're seeing undue influence issues, they're so fact specific and with all the seclusion brought on by the pandemic, we've seen a lot of undue influence cases coming up where we have to look at the relationships, the circumstances, the hurried drafting of estate planning before someone's untimely death, perhaps. Look at what the parties' intent was and they're very fact specific as a Judge Reiser has indicated, and they're not a slam dunk. There's a lot of science now that looks at capacity and understanding someone's mental ability to make decisions regarding a will. Now, sometimes that's a low bar, depending on what state you're in, but there's a lot of pitfalls.

If you know one side can bring in a professional that's going to point to the cognitive deficits and there's a lot to point to that someone's brain matter declines over time. So, I think that the issues of both undue influence and capacity are continuing to be unraveled as the science catches up with the circumstances that we're in now.

It really is tricky for attorney professionals to advise their clients as to whether they have a good opportunity to win at trial with some of these issues looming. Sometimes, you know, parties don't want to spend the money on the science, because it's very costly to have experts testify in court and be deposed ahead of time and to gather all the records that are needed and the analysis. There's analysis on the other side.

So that prolongs the trial increases the expense, and there's still someone that's going to lose in this action. So, your client is still taking a great risk in going to trial, you know, perhaps the compromise is a better option to try and get what your client wants at mediation.

[00:12:21] Moderator: Judge Reiser, in California where you are based, how does the court system rely on mediation?

How does it incorporate mediation into the resolution of these estate disputes?

[00:12:31] Judge Reiser: Well, that's actually a really interesting question because the landscape is changing a lot. In California, historically, mediation has been voluntary only under an older appellate authority that said the court system needs to be free and, therefore, if you send people to a cost basis ADR solution, that is contrary to the rights of people and free access to the courts. But now in a case that came out just a few months ago that I happened to be involved in, the appellate court said exactly the opposite and said that probate court has the absolute right to send a matter to mediation and quite often ought to and the California State Supreme Court denied the publication to review, which shows, at least in my mind, that there's a resource limitation with respect to the courts, at least in California. And that the policy body, which is the state Supreme Court, is looking for ADR solutions. So, it's opening up the courts to thinking about compelling mediation, as opposed to just suggesting it.

[00:13:36] Moderator: Lisbeth, how does it work in Texas?

[00:13:39] Lisbeth Bulmash: In Texas, it's different than other parts of the country because Texas has really embraced the use of mediation.

Especially in the probate court setting in across a number of counties in the Dallas Fort Worth area, I have seen the courts order the cases to mediation. Mediation is really an integral part of the court system. They have not only ordered it, but embraced it. They still leave it up to the parties to select the mediator in some circumstances or tell the judge who they want appointed as the mediator, but it really varies on a court-by-court basis.

But overall, I would suggest that all the courts are integrating mediation into the process and making mediation part of the scheduling order for any case.

[00:14:36] Moderator: Judge Reiser, how should parties go about finding a mediator? What should they look for? How does that process work?

[00:14:42] Judge Reiser: So, that's the art as opposed to the science, right?

Because you want to think about your client, recognize who they connect with or might connect with and find a mediator who can build rapport with the client. Then you want a mediator who can be value added. So, you don't want to carrier pigeon who's just going to go back and forth between rooms, either virtually or physically, and to say offer demand, offer demand.

You want someone who can relate to the client, talk to the client, talk about risks and rewards and add value by experience in the subject matter and saying, “well, here's concerns, here's where you ought to try to leverage the other side,” and can be very frank with the client, as opposed to somebody who is the equivalent of a note passing between rooms.

[00:15:38] Moderator: Lisbeth, what characteristics would you look for in a mediator and what kind of questions should clients and lawyers be asking?

[00:15:46] Lisbeth Bulmash: Well, I agree with Judge Reiser and what he has recommended in terms of what you should look for. I think it's important for parties to interview a mediator and ask them how they conduct their mediation and how they go about preparing for their mediation.

I think that's a really integral part of understanding if a mediator is going to be just carrying messages back and forth or going to roll up their sleeves, understand the issues and the facts and the law relating to particular case and add value to that mediation. So, in my particular practice, I approach every mediation that I have differently as a separate case. I look specifically at how best to orient that case to the parties and the circumstances. I may not start with the joint session if there is a high conflict and it's not going to lend itself to getting somewhere constructive. I use different tools in the toolbox and in terms of what circumstances demand it. But you want a mediator that is going to be creative, and that is going to take the time to do the appropriate preparation, to be more than just carrying the one offer from one room to the other.

Do they meet with your clients ahead of time? Do they read things ahead of time? Do they call you and talk about what they've read and ask you questions that are not on the paper that may help get to yes in a particular mediation? I think those are all things that you want to know about. You want to know how hard this mediator is going to work, how passionate they are about their craft to get the parties to yes.

[00:17:35] Moderator: Very good points and a great conversation. I want to thank Judge Reiser and Lisbeth. Thank you so much. You've been listening to a podcast from JAMS, the world's largest private alternative dispute resolution provider. Our guests have been Lisbeth Bulmash and Judge Glen Reiser. For more information about JAMS, please visit www.jamsadr.com.

Thank you for listening to this podcast from JAMS.