Family Arrangement

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(Free-Press-Release.com) April 20, 2011 --

A family arrangement is a transaction between members of the same family which is for the benefit of the family generally. It is arrangement between member of a family descending from a common ancestor or near relation trying to sink their differences and disputes, settle and solve their conflicting claims once and for all to buy peace of mind and bring about harmony and goodwill in the family by an equitable distribution or allotment of assets and properties amongst member of the family. The object is to preserve the property and the good name of the family by recognising that it is not in the good interest of the family or the members to engage in fights or disputes.

Some of the important terms are described below:

1. Family
A family arrangement necessarily needs to be among family members, and not with outsiders. The term “family” has not been defined under any law. However, the courts have generally held that the term has to be understood in a wider connotation. A common tie of relation is enough to bring a person within the fold of a family. Also, the existence of legal/succession right to the family property is not a prerequisite to determine whether a person is a family member.

2. Property

The family arrangement should be for working out the rights in the family property. Typically, common property or joint property in the family is considered for the purpose of family arrangement. Individual or self-acquired properties are generally not considered unless antecedent title, claim or interest in the property is shown to be in existence. In essence, an antecedent title of the participants in the subject property is the guiding factor for evaluating a bona fide family arrangement.

It is, however, not necessary that every party taking benefit under the arrangement must necessarily have, under the law, a claim to the property. It suffices if the parties are related to one another and have a possible claim to the property or a claim or even semblance of a claim on some other ground such as, say, affection.

3. Dispute

Normally, a dispute is a prelude to a family arrangement. However, a pre-existing dispute is not always necessary. So, a bona fide arrangement in anticipation of a plausible dispute and to maintain harmony has also been held to be a valid family arrangement.

4. Family Dispute
The dispute could relate to any aspect, but is usually relates to the rights or claims in respect of property, assets, enjoyment of rights in respect of properties, claims, shares, possible claims, family feuds, refusal to recognise rights of family members, etc.

It could relate to any aspect which may threaten the rights of any member or the family as a whole, if the disputes are prolonged or escalated or in the nature of creating situations or circumstances that the members are not able to meet eye to eye. It could be a genuine dispute or a controversy, rival claims, assertions and denials. It is unfortunate that many disputes revolve around the sheer ego of the persons involved. The law takes it that these disputes are not in the best interest of the members of the family.

Valid Arrangements
The following are examples of family arrangements which have been supported by the Court.
1. A settlement made by parents on the occasion of their child's marriage making provision for the mother, though outside the marriage consideration, on her giving up her right to dower in her husband's estate.
2. An agreement between father and son altering the limitations of a family settlement.
3. An agreement providing for payment of the son's debts in consideration of his giving up his interest in the family business.

4. A covenant to settle property on a nephew, alienated from his father by a marriage without his father's consent, in order to reconcile father and son.
5. A resettlement of the family property making provision for an illegitimate child.
6. An agreement between members of a family to divide equally whatever they obtain under the will of an ancestor.
7. An agreement between co-heiresses dividing the property between them.

Invalid Arrangements
The following are examples of family arrangements which cannot be supported:
1. Any dealing between parent and child, before the latter is fully emancipated, exclusively for the advantage of the parent.

2. A compromise of claim to estates founded on a mistake as to the title induced by misrepresentation of one of the parties to the compromise.
3. An agreement as to division of property where the heir gave up property to which he had undoubted rights without consideration, and where he was ignorant, a drunkard, and without professional assistance, though there was no evidence of fraud or undue influence.
4. An agreement as to family property not executed by all the intending parties to it..........................
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