The Contract Means What It Says; Signer Beware!The Contract Means What It Says; Signer Beware!

The planned giving programs of most charities derive the bulk of their revenue from matured bequests. Their finance departments understandably seek a reasonable estimate about timing of payment. Counsel for the donor’s estate usually will cooperate in projecting the availability of the funds. Without exception, counsel asks the charity to sign a Family Settlement Agreement (FSA), sometimes referred to as a “Receipt, Release and Indemnification Agreement,” committing the charity to the return of funds in the event the share was calculated incorrectly or needed for payment of unavoidable obligations like federal, state and local taxes. This arrangement generally works well for all the parties. The recent case of Austin Trust Company v. Hou...