McLane v. Russell
137 Ill. Dec. 554, 546 N.E.2d 499, 131 Ill.2d 509 (1989)
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Rule of Law:
A non-client may maintain a negligence action against an attorney when the non-client can prove that the primary and direct purpose of the transaction or relationship between the attorney and the client was to benefit or influence the non-client.
Facts:
- Grace and Helen Shugart, two sisters, owned a 240-acre farm as joint tenants with a right of survivorship.
- Attorney Fred Russell began representing the sisters in 1958 and, at their request, placed their farm into joint tenancy.
- Cecil McLane and his son, Keith, were long-time tenant farmers on the Shugart property.
- In 1971, Helen Shugart was adjudicated incompetent, and Russell was appointed her conservator.
- After Helen's incompetence, Grace Shugart discussed with Russell methods of leaving her interest in the farm to the McLanes.
- In 1975, Russell drafted a new will for Grace that devised her interest in the farm to Cecil McLane for life, with the remainder interest to Keith McLane.
- The joint tenancy ownership of the farm between Grace and Helen was never severed.
- Upon Grace's death in 1977, her interest in the farm passed by operation of law to the surviving joint tenant, Helen, thereby defeating the bequest to the McLanes.
Procedural Posture:
- Keith McLane and Cecil McLane sued attorney Fred Russell and his law firm, Johnson, Martin & Russell, for legal malpractice in the circuit court of Peoria County.
- A jury returned a verdict in favor of the plaintiffs for $325,000.
- The trial court granted the defendants' motion for a setoff, reducing the damages award to $258,545.
- The defendants, Russell and his firm, appealed to the Illinois Appellate Court, and the plaintiffs cross-appealed the setoff.
- The appellate court affirmed the judgment of the circuit court.
- The defendants petitioned the Supreme Court of Illinois for leave to appeal, which the court granted.
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Issue:
Are the named beneficiaries of a will, who were not the attorney's clients, considered intended third-party beneficiaries with standing to sue the drafting attorney for malpractice when the testamentary gift fails due to the attorney's negligence?
Opinions:
Majority - Justice Ward
Yes. The named beneficiaries of a will are intended third-party beneficiaries of the attorney-client relationship and have standing to sue the drafting attorney for malpractice if the attorney's negligence defeats the testator's intent. The court, applying the 'intent to directly benefit' test from Pelham v. Griesheimer, found that the primary purpose of the specific transaction—drafting the 1975 will—was to confer a benefit upon the McLanes. The court rejected the defendant's argument that it must consider the entire 25-year attorney-client relationship, stating that the analysis can focus on a single transaction. Evidence, including the will's specific language devising Grace's 'interest' in the farm, demonstrated her intent to benefit the McLanes regardless of whether she survived her sister. Russell's failure to sever the joint tenancy, a necessary step to effectuate this intent, constituted a breach of a duty owed to the McLanes as the primary and direct beneficiaries of that transaction.
Analysis:
This decision solidifies an important exception to the privity requirement in legal malpractice cases, particularly in the context of estate planning. By allowing disappointed beneficiaries to sue the testator's attorney, the court ensures there is a remedy for negligence that would otherwise go unaddressed, as the testator's estate typically suffers no damage. The ruling clarifies that the 'intent to benefit' test can be applied to a single transaction, preventing attorneys from using a long-standing client relationship as a shield against liability for negligence in a specific matter. This case reinforces the duty of care an estate planning attorney owes to the intended recipients of the client's bounty, thereby enhancing accountability for professional competence in this area of law.
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