Taxation & Estate Planning

Ethics and Estate/Probate Attorneys

By Joel A. Schoenmeyer

Last week I wrote (here) about the question of "who's the client?" in the estate planning context. As one reader pointed out to me in an e-mail, this issue also arises in the estate administration or probate context.

Let's say that you are approached by an individual who is named as Executor in the Will of John Smith. Do you as attorney represent:

-the Executor?
-the Estate of John Smith?
-the beneficiaries?
-some combination thereof?

This can be a tricky question to answer -- most model rules of professional conduct were not written with estate planning or probate in mind. However, The American College of Trust and Estate Counsel (ACTEC) publishes commentaries to these rules. Here is what ACTEC has to say on this issue (the emphasis is mine):

A minority of cases and ethics opinions have adopted the so-called entity approach under which the fiduciary estate is characterized as the lawyer's client. However, most cases and ethics opinions treat the fiduciary as the lawyer's client and the beneficiaries as persons to whom the lawyer owes some duties. See ACTEC Commentaries on MRPCs 1.2 (Scope of Representation), 1.4 (Communication), 1.6 (Confidentiality of Information) and 1.7 (Conflict of Interest: General Rule). The lawyer and the fiduciary, following full disclosure by the lawyer, may agree that the fiduciary estate and not the fiduciary shall be the lawyer's client. Such an agreement may significantly affect the extent of the lawyer's duties to the fiduciary, including the duty of confidentiality. However, such an agreement may not limit the duties that the lawyer or the fiduciary otherwise owe to the beneficiaries of the fiduciary estate.

My engagement letter and other correspondence makes it clear that the fiduciary is my client, but I also make the fiduciary consent to my reporting of any wrongdoing by the fiduciary. Still, this may not be a perfect situation, as my e-mailer points out. If there is a problem with the fiduciary, then the beneficiaries have to pay twice: they pay the fiduciary's attorney, and then they hire their own attorney to go after the fiduciary.

Full post as published by Death and Taxes Blog on May 05, 2009 (boomark / email).