• September 3, 2015
Photo by Jonathan Rotondo-McCord

Photo by Jonathan Rotondo-McCord

Update (September 3, 2015): This post started as a “land mine” warning for Minnesota trust and estate lawyers: a cautionary tale emphasizing the importance of giving sound legal advice to clients, not just forwarding them legal forms to sign without giving them any legal advice.

The post ends by being a “land mine” warning for plaintiff’s-side legal malpractice lawyers…

 The Minnesota Supreme Court has revived the trial court’s decision in favor of a trusts and estates lawyer who appears to have processed a client’s power-of-attorney (“POA”) form without any consultation at any time with the client. The beneficiary of that POA form (the “attorney-in-fact”) then took all of the client’s money. The trial court threw the plaintiff’s legal malpractice claim case out.

The Minnesota Supreme Court, like the trial court, found that plaintiff’s expert failed to give any detailed opinion as to how the lawyer’s sloppiness caused the plaintiff’s loss. In other words, maybe if the trust/estate lawyer defendant had walked his client through all of the implications of the POA and all of the risks of the POA as drafted, maybe the decedent would still have executed it? The plaintiff’s expert failed to address or eliminate that possibility.

Of greatest interest in this week’s opinion is Justice Lillehaug’s concurrence (joined by Justice Page). In a nutshell, I would describe the concurrence as saying that the majority’s opinion is correctly decided based on current Minnesota law but current Minnesota law in cases of professional malpractice is deeply flawed and needs to be fixed. I agree. The law, as it stands, places fatal land mines around a procedural rule (a requirement of an “expert disclosure”) by imposing a distinction between “minor deficiencies,” which a plaintiff is allowed to address and correct and “major deficiencies,” which a plaintiff is foreclosed from addressing.

As a practical matter, this means that professional malpractice defense lawyers (who are almost always retained by insurance companies, who have a great deal more specific subject matter expertise than most plaintiffs’ professional malpractice lawyers) can exploit their edge to get meritorious plaintiffs’ cases thrown out of court before anyone has a chance to evaluate the merit of the plaintiffs’ cases. It’s sad and unfortunate in my opinion. On the brighter side, it sure keeps our professional malpractice insurance premiums low.

Update (January 2, 2015) (under the headline: Legal Malpractice Claim Survives After Appeal and Serves as Caution for Trust & Estates Lawyers): The Minnesota Supreme Court has granted the petition for review in the legal malpractice case, described below.

The law often struggles with the notion of whether Party A should be held liable for intentional and wrongful acts of Party B. I think that is at the root of the merits in the case described below. Do Minnesota trust and estate lawyers have a professional obligation to warn their clients that a particular inheritance plan exposes the client’s assets and estate to abuse or wrong-doing by a family member?

Original post, October 9, 2014:

We begin our analysis by quoting the late, great Tallulah Bankhead ‘There is less in this than meets the eye.’…. An attorney is asked to draft a power of attorney for his elderly client. The document is drafted by a secretary. The lawyer never meets the client. Neither the lawyer nor the secretary ever discusses the ramifications of signing the document with the client. The document allows the attorney-in-fact to transfer all of the client’s assets to himself. Days after the client signs the document, that is precisely what happens. (citation omitted)

Minnesota Court of Appeals Judge Francis Connolly reversed a trial court decision throwing out a legal malpractice claim. Minnesota Court of Appeals Chief Judge Matthew Johnson dissented from Judge Connolly’s decision, which had been joined by Minnesota Court of Appeals Judge Carol Hooten.

As a lawyer who takes on legal malpractice claims for plaintiffs, I found the decision interesting and, by and large, a positive development. On the other hand, Judge Johnson raises strong points in his dissent. (Also, the case is unpublished so you could say that my calling the decision “a positive development” is little more than wishful thinking.)

The gist of the malpractice claim is the allegation that Larry Kimball, a Walker, Minnesota lawyer, handled an estate planning matter rather carelessly and without properly advising an individual, George Nyberg, about the risks and benefits of granting extremely broad rights as attorney-in-fact. Tony Nyberg, his son, in turn, is alleged to have misappropriated his dad’s money (in excess of $225,000). The estate brings the lawsuit against Kimball.

I read Judge Connolly’s opinion to be a welcome and reasonable relaxation of what are sometimes extremely strictly enforced rules for legal malpractice cases and, in particular, the required disclosures under Minn. Stat. 544.42.

I read Judge Johnson’s dissent, however, to question whether the plaintiff in the case really had proof that “but for” the attorney’s failure to advise George of the full implications of the broad grant of power in the power-of-attorney form, George (who has since died) would not have executed the form.

Regardless of how readers feel about whether the case was rightly decided, Minnesota lawyers would be wise to take in the big picture.

When you are playing a role in estate planning, you are walking into a mine field. You are playing a role in the distribution of a person’s entire material gains over the span of that person’s life.

Don’t “phone it in.”


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