Summary
The Supreme Court of Texas held that an attorney retained to draft a will or trust owes no professional duty of care to intended beneficiaries whom the attorney did not represent. The court preserved the common-law privity rule and affirmed summary judgment for the attorney and law firm in a malpractice action brought by the decedent’s grandchildren. The opinions also address, and reject, a third-party-beneficiary contract theory of recovery.
Topics
Practice areas
Questions Presented
- Whether an attorney who drafts a will or trust for a testator or settlor owes a professional duty of care to persons named as beneficiaries when the attorney never represented those beneficiaries.
- Whether intended beneficiaries may recover against the estate-planning attorney under a third-party-beneficiary contract theory despite the absence of a tort duty.
Holdings
- An attorney retained by a testator or settlor to draft a will or trust owes no professional duty of care to persons named as beneficiaries whom the attorney did not represent.
- Intended beneficiaries may not avoid the no-duty rule through a third-party-beneficiary contract theory because Texas legal-malpractice actions sound in tort and are governed by negligence principles; the same policy considerations foreclose extending the attorney's duty to nonclients.
Key quotations
“We believe the greater good is served by preserving a bright-line privity rule which denies a cause of action to all beneficiaries whom the attorney did not represent.” (923 S.W.2d at 578-79)
“We therefore hold that an attorney retained by a testator or settlor to draft a will or trust owes no professional duty of care to persons named as beneficiaries under the will or trust.” (923 S.W.2d at 579)
Factual background
Frances Barcelo retained attorney David Elliott to prepare a will and inter vivos trust intended to benefit her children, siblings, and grandchildren. The trust was allegedly never funded and was declared invalid and unenforceable by the probate court after two of Barcelo's children contested it. The grandchildren settled for a substantially smaller share of the estate and alleged that Elliott's negligent drafting and implementation of the estate plan caused their loss.
Procedural history
Frances Barcelo retained David Elliott to prepare estate-planning documents. After the probate court declared the trust invalid and unenforceable, Barcelo's grandchildren filed a malpractice action alleging that Elliott's negligence caused their loss. The trial court granted summary judgment for Elliott, and the court of appeals affirmed. The Supreme Court of Texas affirmed the court of appeals.