[WSBAPT] Questions regarding wrongful death claims and probate

Thu Aug 20 11:37:12 PDT 2015

I think we are, as a profession, sometimes a little too paranoid about potential conflicts of interest between a PR's fiduciary and personal roles in an estate. But I do think I'd rather over-caution the client about the limits of our representation, than leave a PR with the impression that I can be relied on to maximize their own, personal, financial gain.

I think I could represent a PR in filing her/his own creditor claim, but I'd make sure any other beneficiary had every opportunity to contest it, so it's absolutely clear that the PR isn't taking advantage of her/his position. In general, if I'm in a position where my client has fiduciary duties that are nominally in conflict with personal interests, and the client wants to do something that arguably causes greater personal benefit compared to other beneficiaries, I advise that we take the matter to the court for approval. That's what I have done for approval of wrongful death settlements, where the PR is the child who had the closest tie to the deceased parent, and the other children were largely estranged and so should receive lesser compensation.

My mantra in those situations is, if in doubt on a PR's self-interested matter, get the court to approve the plan of action.

All that said, I do think my preference is to set the client's expectation that s/he might need a separate attorney, and then walk it back in scenarios where the conflict isn't so critical.

Sincerely,

Eric

Eric C. Nelsen
SAYRE LAW OFFICES, PLLC
1320 University St
Seattle WA  98101-2837
phone 206-625-0092
fax 206-625-9040

From: wsbapt-bounces at lists.wsbarppt.com [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Thomas M. Culbertson
Sent: Thursday, August 20, 2015 9:21 AM
To: WSBA Probate & Trust Listserv
Subject: Re: [WSBAPT] Questions regarding wrongful death claims and probate

Doug raises a very good point that has bothered me for years, but I fear he and I are swimming upstream on this one.

Nevertheless, if the conflict between a fiduciary’s personal interests and her fiduciary duties is manageable enough that she need not resign as fiduciary, then why should the attorney have to limit his services to one role and not the other? As we all know, the same individual being fiduciary and beneficiary is extremely common, but it is always a potential minefield.  Shouldn’t that one individual be able to rely on a single advisor to help her navigate that minefield? How can we expect a layperson to make sense of the inevitably conflicting advice she’ll get from two different advisors?

As a bit of an aside, quite a few years ago an attorney was admonished for representing an individual who was PR and who filed a creditor claim against the estate, and the position taken by the office of disciplinary counsel was alarmingly ignorant of the law – it reasoned that the attorney was representing two adverse clients, the individual and the estate, and under that analysis it missed this issue entirely. We all know that attorneys represent fiduciaries, not estates and trusts. I don’t know whether wiser heads prevail now at the Bar, but I certainly don’t wan to be a test case.

Back to Doug’s point, the prevailing view does seem to be that a fiduciary with a conflicting personal interest in the estate/trust needs two attorneys.  It seems to me that the law should be that one attorney can ethically represent a fiduciary/beneficiary at least until the individual’s conflict does not require her to resign. Even then it strikes me that the issue should not be an ethical one, but one of malpractice; ie did the attorney give bad advice regarding continuing to serve as fiduciary under untenable circumstances.

________________________________________
THOMAS M. CULBERTSON  I  Lukins & Annis, PS
717 W. Sprague Ave, Suite 1600, Spokane, WA 99201
(509) 455-9555  I  fax (509) 363-2500  I  tculbertson at lukins.com<mailto:tculbertson at lukins.com>

From: wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com> [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Doug Schafer
Sent: Wednesday, August 19, 2015 4:20 PM
To: WSBA Probate & Trust Listserv
Subject: Re: [WSBAPT] Questions regarding wrongful death claims and probate

I have some doubts: Paul's fee agreement states, "My services ... are, by law, limited to representing you as personal representative of the estate.  ... [I]f you got into a dispute with other beneficiaries over distribution of assets, you might have to hire separate counsel for that matter."  Since the PR's duty includes distributing estate assets among beneficiaries, why shouldn't the PR expect his attorney to represent him regarding any dispute relating to that duty?  Granted, a PR's lawyer could withdraw (abandon the client) whenever a dispute arises, or if the client is not heeding the lawyer's advice.

That brings to mind a long-standing concern I have about lawyer-client conflicts.  I often see it said that an individual client who has conflicting interests (e.g., beneficiary and fiduciary of a trust or estate, shareholder and director/officer of a closely held corporation) must retain separate lawyers to advise him concerning each interest.  I disagree.   My view is that a lawyer serves essentially as a supplemental brain for the individual client -- it's as if the individual client hires and then possesses the brain (legal knowledge) of a lawyer.  If the individual client actually were a knowledgeable lawyer, he'd not be required to somehow bisect his brain so as to address each interest separately without regard to the other interest, but he would "juggle" those interests based upon his legal knowledge.   So in cases in which the law tolerates one individual acting with conflicting interests (e.g., PR and estate beneficiary), the law should permit him to be advised by a single lawyer concerning the juggling of those competing interests.

Doug Schafer, in Tacoma.
P.S. please forgive the use on masculine pronouns, but it got cumbersome with repeated him/her's.
On 8/19/2015 2:10 PM, Eric Nelsen wrote:
That's great language Paul--thanks. Clear and succinct. I may use that myself.
 Eric C. Nelsen

From: wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com> [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Paul Neumiller
Sent: Wednesday, August 19, 2015 10:39 AM
To: 'WSBA Probate & Trust Listserv'
Subject: Re: [WSBAPT] Questions regarding wrongful death claims and probate

Eric, thanks for the clarification.  I use the following language in all of my fee agreements for probates:

“You are personally responsible for payment of all amounts due, for example, if the estate has insufficient funds for their payment.  My services on behalf of the estate are, by law, limited to representing you as personal representative for the estate.  I do not represent you as an individual, or your interests as an individual beneficiary.  I do not represent the estate itself, or any of the estate's beneficiaries.  So, for example, if you had a claim against the estate for services rendered to the decedent, or if you got into a dispute with other beneficiaries over distribution of assets, you might have to hire separate counsel for that matter.  My job is to assist you in your work as personal representative throughout the probate process, with a primary focus on assisting you in carrying out your fiduciary duties according to the law.”

In other words, I gotta get paid.

--

This message has been scanned for viruses

and dangerous content by Lukins & Annis, P.S.

NOTICE: This email may contain confidential or

privileged material, and is intended solely

for use by the above referenced recipient. Any

review, copying, printing, disclosure, distri-

bution, or any other use, is strictly prohibited.

If you are not the recipient, and believe that

you have received this in error, please notify

the sender and delete the copy you received.

Thank You!

-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://mailman.fsr.com/pipermail/wsbapt/attachments/20150820/7fdb88a0/attachment.html>