Barcelo v. Elliott
923 S.W.2d 575 (1996)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
In Texas, 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.
Facts:
- Frances Barcelo retained attorney David Elliott for estate planning services.
- Elliott drafted a will and an inter vivos trust agreement for Barcelo.
- The trust agreement stipulated that upon Barcelo's death, the remainder of the trust assets would pass to her six grandchildren.
- Barcelo signed the will and trust agreement in September 1990 and died on January 22, 1991.
- After Barcelo's death, two of her children contested the trust's validity.
- A probate court declared the trust invalid and unenforceable for reasons not specified in the record.
- As a result of the trust's invalidity, the grandchildren settled for a substantially smaller share of the estate than they were designated to receive under the trust.
Procedural Posture:
- Frances Barcelo's grandchildren filed a legal malpractice action against attorney David Elliott and his law firm in a Texas trial court.
- Elliott moved for summary judgment, arguing he owed no professional duty to the grandchildren as they were not his clients.
- The trial court granted Elliott's motion for summary judgment.
- The grandchildren, as appellants, appealed to the Texas court of appeals.
- The court of appeals affirmed the trial court's judgment.
- The grandchildren then appealed to the Supreme Court of Texas.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does an attorney who drafts a will or trust owe a professional duty of care to the intended beneficiaries of that will or trust, with whom the attorney is not in privity?
Opinions:
Majority - Chief Justice Phillips
No, an attorney who drafts an estate plan does not owe a professional duty of care to the intended beneficiaries. The court holds that the traditional privity rule, which limits an attorney's duty to his or her client, should be maintained as a bright-line rule in the estate planning context. The court reasoned that abrogating the privity rule would create conflicts of interest for the attorney, dividing their loyalty between the client and the beneficiaries. It would also subject attorneys to limitless liability from disappointed heirs and create evidentiary problems, as courts would have to rely on extrinsic evidence to determine the testator's true intent. Preserving the privity barrier ensures attorneys can zealously represent their clients without the threat of compromising that representation through suits from third parties.
Dissenting - Justice Cornyn
Yes, an attorney who drafts an estate plan owes a professional duty of care to the intended beneficiaries. The majority's decision insulates negligent lawyers from liability and follows a minority of jurisdictions, departing from the modern trend. The harm to intended beneficiaries from a negligently drafted will is plainly foreseeable, a key factor in establishing a duty. Under the majority's rule, there is effectively no accountability for malpractice because the client is deceased and their estate typically suffers no damage, leaving the innocent beneficiaries to bear the entire loss. Concerns about divided loyalty are misplaced, as the beneficiary's claim would require proving the attorney breached the duty owed to the client to effectuate the client's intent.
Dissenting - Justice Spector
Yes, an attorney owes a duty, but only to a limited class of beneficiaries. This dissent argues against the majority's absolute privity bar, but also against an unlimited cause of action for any potential beneficiary. Instead, a cause of action for legal malpractice should be recognized only for beneficiaries who are specifically identified on the face of the invalid will or trust. This approach would hold attorneys accountable for negligence and further the public policy of ensuring testators' plans are carried out, without opening the door to speculative claims from individuals not explicitly named in the testamentary documents.
Analysis:
This decision solidifies Texas's adherence to the strict privity rule in legal malpractice cases involving estate planning, placing it in a minority of states. The court prioritizes the sanctity of the attorney-client relationship and the attorney's duty of undivided loyalty over providing a remedy to foreseeably harmed third-party beneficiaries. This bright-line rule provides certainty for attorneys but leaves intended beneficiaries who lose their inheritance due to an attorney's negligence without legal recourse against that attorney. The ruling effectively immunizes Texas estate planning attorneys from liability to non-clients, creating what the dissent calls an accountability gap.
Unlock the full brief for Barcelo v. Elliott