Enforceable Arbitration Clauses in Wills and Trusts: A Critique

Former Playboy model Anna Nicole Smith fought for a decade over a purported $300 million gift from her late husband J. Howard Marshall. When Marshall died in 1995, after just one year of marriage to Smith, his will left nothing to his new bride. Smith promptly sued, arguing that Marshall's son Pierce used fraud and undue influence to convince his father to cut Smith out of his will. After a series of lawsuits that bounced between bankruptcy, probate, and appellate courts, the will has been upheld. Here, Murphy offers two broad recommendations for a framework of a state's arbitration law on the subject. First, legislatures should be careful to empower the donor to require arbitration in all cases for the life of the trust or will, even if circumstances later change, and even if a given dispute is not foreseen by the donor. Second, states should consider allowing arbitration or mediation not only for disputes over interpretations of an instrument or the management of a trust or estate, but also for disputes over the validity of a trust or will.