Ethical Issues for Trusts and Estates Lawyers

Frank W. Streng, Surrogate’s Court Lawyers
by Frank W. Streng on 05/08/2009

Frank W. Streng, Esq.

McCarthy Fingar LLP

11 Martine Avenue

White Plains, NY 10606-1934

914-946-0134 (fax)

914-385-1022 (voice)



New York State Bar Association

Trusts and Estates Section

Everything You Wanted to Know About Estate Planning

for the Middle Class Client

(But Were Afraid To Ask)

Spring, 2009

Ethical Issues for Trusts and Estates Lawyers

Introduction – Source Materials


Our goal: raise issues for Surrogate’s Court practitioners so we are better able to work with the ethics rules and to become effective lawyers for our clients

What is professionalism? How does a lawyer maintain professionalism and a successful business?

What are lawyers selling? Knowledge, competence and experience in solving a client’s problem?

In the wake of the internet, how can you, the lawyer, compete in this market place? How do you compete in a market in which, following a community based seminar on estate planning, someone asks you if you could recommend (1) books or periodicals on estate planning or (2) good web sites

Have you ever talked to anyone who attended a “lawyer bashing” revocable trust seminar?

“Old” Canons of Ethics: Code of Professional Responsibility

Canons (Topical Headings)

Ethical Considerations (ECs) (aspirational standards)

Disciplinary Rules (DRs) (black letter rules)

American Bar Association’s Model Rules of Professional Conduct, adopted, in part, in New York, effective April 1, 2009, called the New York Rules Of Professional Conduct

Bar Association Opinions

New York State Bar Association Committee on Professional Ethics

Association of the Bar of the City of New York

New York County Lawyers Association

Court decisions

New York Rules Of Professional Conduct

ABA Rules v. “Old” New York Code

ABA: Restatement-type structure

Black letter rules took the place of the DRs

Explanatory comments (not aspirational) provided additional guidance to lawyers seeking answers to their ethical questions

However, in New York many of the provisions of the “Old” Code have simply carried over from the old Code. It is anticipated that, sometime in the future NY will be ready to join adopt much of the substantive change, but not in the foreseeable future

We are awaiting for “Comments” for the new Code, and it is expected that we shall see them soon.

However, the new rules will makes it easier for NY lawyers to research the nationwide body of law that has developed under the Model Rules since 1983

Canons of Ethics; Ethical Considerations and Disciplinary Rules

Introduction: Take us through the Canons of Ethics and focus on particular ECs and DRs relevant to Surrogate’s Court practice

Canon 1: A Lawyer Should Assist in Maintaining the Integrity and Competence of the Legal Profession.

Canon 2: Lawyer Should Assist the Legal Profession in Fulfilling its Duty to Make Legal Counsel Available.

Attorney Fee Issues

Factors for the Fixation of Fees

DR 2-106(a) prohibits entering into an agreement to charge or collect an excessive fee

DR 2-106(b) lists the factors to be considered in determining prohibits entering into an agreement to charge or collect an excessive fee

The time, labor, difficulty and skill involved;

The likelihood that the employment will preclude other employment;

The customary fee charged in the locality;

The amount involved and the results;

The time limitations imposed;

The length and nature of the relationship with the client;

The experience, reputation and ability of the lawyer

Matter of Freeman, 34 N.Y.2d 1 (1974)

Matter of Potts, 213 A.D. 59, 62 (4th Dep’t 1925), aff’d, 241 N.Y. 593, where the Appellate Division said:

In general the court, in determining the justice and reasonableness of an attorney’s claim for services, should consider the time spent, the difficulties involved in the matters to which the services were rendered, the nature of the services, the amounts involved, the professional standing of the counsel, and the results obtained.

Application for Attorney Fees under SCPA 2110

Rule 207.45:


Affidavit of services;


when by and by whom the attorney was retained;

terms of retainer;

amount requested;

whether the client has been consulted as to fee requested;

whether client has consented to fee requested; if not, the extent of disagreement and nature of controversy;

period in which services rendered;

services rendered;

the time spent;

method or basis of compensation;

whether fee includes services to be rendered through decree and distribution; and

whether hearing is waived;

Attorney/Fiduciary Issues

SCPA 2111 (an attorney who is also a fiduciary must obtain court approval to received advance legal fees).

See balance of outline under Canon 5, including SCPA 2307-a

Written Letters Of Engagement In Civil And Criminal Matters With Fees Of $3,000 Or More

Part 1215 to Title 22 of the Official Compilations of Codes, Rules and Regulations of the State of New York

Effective March 4, 2002, all attorneys must have a written letter of engagement before commencing representation OR within a reasonable time after commencing representation of a client if it is impracticable at the time of commencement or if the scope of services cannot be determined at the time of the commencement of representation.

For purposes of Part 1215, where an entity (such as an insurance carrier) engages an attorney to represent a third party, the term “client” shall mean the entity that engages the attorney.

Where there is a significant change in the scope of services or the fee to be charged, an “updated letter of engagement” must be given to the client.

Part 1215 does not apply:

if legal fees are expected to be less than $3,000

where the attorney’s services “are of the same general kind as previously rendered to and paid for by the client” [i.e., regularly existing clients]; or

to domestic relations matters which are still subject to Part 1400 of the Joint Rules of the Appellate Division.

Contents of Letters of Engagement

Letters of Engagement Must Include:

scope of legal services;

attorney’s fees to be charged, expenses and billing practices; and

where applicable, notice of the client’s right to arbitration of fee disputes under Part 137.

Letters of Engagement May Include:

Under §137.1(b)(2), an attorney may make fee arbitration apply to disputed amounts less than $1,000 or more than $50,000 “if the parties have consented. …” Without the client’s consent, fee arbitration does not apply to sums less than $1,000 or more than $50,000.

Under §137.2(b), an attorney may make fee arbitration mandatory for the client by obtaining the client’s written consent in “a retainer agreement or other writing…” If not included in the retainer agreement, fee dispute arbitration commenced by a client is mandatory for the attorney but is not mandatory for the client if commenced by the attorney.

Under §137.2(c), an attorney can make the arbitration award final, instead of subject to a de novo review, by obtaining the client’s written consent.

Under §137.2(d), an attorney can select a different arbitral forum for fee dispute arbitration, by obtaining the client’s written consent.

What if there is no retainer agreement? Trend of cases, especially in Matrimonial Law arena, to disallow fees

Fee Dispute Arbitration v. Determination of Fees by Surrogate’s Court

Attorney Advertising – Highlights of New Rules effective 2/1/2007

Caution: Partially struck down in Northern District of New York in Alexander v. Cahill by Judge Scullin. Thumb sketch of decision, on appeal to Second Circuit

Most rules not challenged

Some upheld

rules found unconstitutional as protected free speech

“Advertisement” defined:

communication aimed primarily at securing business.

(k) “Advertisement” means any public or private communication made by or on behalf of a lawyer or law firm about that lawyer or law firm’s services, the primary purpose of which is for the retention of the lawyer or law firm. It does not include communications to existing clients or other lawyers. (emphasis added). (22 NYCRR 1200.1)

“Computer-accessed communication” defined

(l) “Computer-accessed communication” means any communication made by or on behalf of a lawyer or law firm that is disseminated through the use of a computer or related electronic device, including, but not limited to, web sites, weblogs, search engines, electronic mail, banner advertisements, pop-up and pop-under advertisements, chat rooms, list servers, instant messaging, or other internet presences, and any attachments or links related thereto. (22 NYCRR 1200.1)

Some Dos and Don’ts: See generally DR 2-101(22 NYCRR 1200.6).

client testimonials are permitted if the client does not have a pending legal matter involving the attorney.

Words or statements required by new rule to appear in an advertisement must be “clearly legible and capable of being read by the average person, if written, and intelligible if spoken aloud.”

the use of celebrities, voice-overs and depictions of fictionalized events is permitted so long as the attorney makes a full disclosure.

monikers, nicknames and mottoes are banned — such as “heavy hitter” or “dream team” — that imply an ability to obtain results.

advertising “techniques to obtain attention banned that demonstrate a clear and intentional lack of relevance to the selection of counsel, including the portrayal of lawyers exhibiting characteristics clearly unrelated to legal competence.”

E.g., advertisements run by a Long Island, N.Y., attorney who permitted herself to be filmed in provocative poses to tout her real estate practice. Cleavage has nothing to do with legal abilities.

“factually supported” descriptions in advertising and web sites are okay, so long as they are accompanied by the following disclaimer: “Prior results do not guarantee a similar outcome.”

Email advertising is okay, provided the subject line contains the notation “ATTORNEY ADVERTISING.”

Complex Solicitation Rules, with many dos and don’ts

names of clients “regularly represented” are okay, provided that the client has given “prior written consent”

banned: “portrayal of a judge, the portrayal of a fictitious law firm, the use of a fictitious name to refer to lawyers not associated together in a law firm, or otherwise imply that lawyers are associated in a law firm if that is not the case”

complex rules regarding advertising on attorney fees and rates

business cards and announcements okay

“1) legal and nonlegal education, degrees and other scholastic distinctions, dates of admission to any bar; areas of the law in which the lawyer or law firm practices, as authorized by the code of professional responsibility this Part; public offices and teaching positions held; publications of law related matters authored by the lawyer; memberships in bar associations or other professional societies or organizations, including offices and committee assignments therein; foreign language fluency; and bona fide professional ratings”

Specific Web Site Rules

“Attorney Advertising”: You need to have the words “Attorney Advertising” on your home page.

No description of size or type of font

Pop-Up Ads/MetaTags: (g) A lawyer or law firm shall not utilize: (1) a pop-up or pop-under advertisement in connection with computer-accessed communications, other than on the lawyer or law firm’s own web site or other internet presence; or (2) meta tags or other hidden computer codes that, if displayed, would violate a disciplinary rule. Section 1200.6 [DR 2-101]

Domain Names: (e) A lawyer or law firm may utilize a domain name for an internet web site that does not include the name of the lawyer or law firm provided: (1) all pages of the web site clearly and conspicuously include the actual name of the lawyer or law firm; (2) the lawyer or law firm in no way attempts to engage in the practice of law using the domain name; (3) the domain name does not imply an ability to obtain results in a matter; and (4) the domain name does not otherwise violate a disciplinary rule. (f) A lawyer or law firm may utilize a telephone number which contains a domain name, nickname, moniker or motto that does not otherwise violate a disciplinary rule. Section 1200.7 [DR 2-102]

Address of Lawyer or Law Firm. Lawyer websites must include the street address of the office of the advertising lawyer or law firm

Description of Cases/Results Obtained. A factually-supported description of a lawyer’s or law firm’s accomplishment is okay, so long as it is accompanied by the following disclaimer: “Prior results do not guarantee a similar outcome.”

Disclaimer on web site

Home page?

Practice pages?

Filing requirements and Record Retention

Must be “open to public inspection”

Retain print advertisements for three years

Filing with Departmental Disciplinary Committee of the appropriate judicial department.

“All advertisements of legal services that are mailed, or are distributed other than by radio, television, directory, newspaper, magazine or other periodical, by a lawyer or law firm that practices law in this State”

Retain e-mail and Web Site solicitations for only one year.

Initial version or edits of web site

Initial: “preserved upon the initial publication of the web site”

Changes: “any major web site redesign, or a meaningful and extensive content change

Omnibus: retain no “less frequently than once every 90 days.”

Canon 3: A Lawyer Should Assist in Preventing the Unauthorized Practice of Law.

Canon 4: Lawyer Should Preserve the Confidences and Secrets of a Client.

EC 4-1: Both the fiduciary relationship existing between lawyer and client and the proper functioning of the legal system require the preservation by the lawyer of confidences and secrets of one who has employed or sought to employ the lawyer. A client must feel free to discuss anything with his or her lawyer and a lawyer must be equally free to obtain information beyond that volunteered by the client. * * * *

DR 4-101: Preservation of Confidences and Secrets of a Client

* * *

B. Except when permitted under DR 4-101(C), a lawyer shall not knowingly:

1. Reveal a confidence or secret of a client.

* * *

A lawyer may reveal:

* * *

Confidences or secrets necessary to establish or collect the lawyer’s fee or to defend the lawyer or his or her employees or associates against an accusation or wrongful conduct.

CPLR 4503(a) “[U]nless the client waives the privilege, an attorney . . . shall not disclose, or be allowed to disclose such communication . . . .”

CPLR 4503(b) “in any action involving the probate, validity or construction of a will, an attorney or his employee shall be required to disclose information as to the preparation, execution or revocation of any will or other relevant instrument, but he shall not be allowed to disclose any communication privileged under subdivision (a) which would tend to disgrace the memory of the decedent.”

Clients under Disability

Attorney client privilege

ABA Model Rule 1.6(a)

Do not reveal client confidence, unless you will:

Prevent death/harm

Prevent financial injury

secure legal advice

establish lawyer claim

Reconciling the traditional attorney-client privilege rules with the attorney-client relationship between a lawyer and a fiduciary of an estate. What is different about trusts and estates clients? In theory, estate planning clients are no different than any other client whose confidence we must uphold. But see CPLR 4503(b) (will exception) (“tend to disgrace” the decedent’s memory; concerned about how the decedent will be seen)

CPLR 4503 (as amended): there is an attorney-client privilege for communications with an executor or trustee in an estate or trust. Prior to the amendment of 4503, there was a fiduciary exception for the attorney-client privilege. That exception was derived from case law

In Hoopes v. Carota, 74 N.Y.2d 716 (1989), the Court of Appeals held that, since the trustees of a trust were acting in a fiduciary capacity, the privilege is not absolute and may be set aside on a showing of “good cause” by the beneficiaries. The Court also noted that “some courts have held that the privilege does not attach at all.” Id. at 717. The Court upheld the Appellate Division’s finding of “good cause” and concluded that “the communications are not privileged in any event.” Id. But see AMBAC Indemnity Corp. v. Bankers Trust Co., 151 Misc. 2d 204 (Sup. Ct., N.Y. Co. 1991) (good cause not shown for indentured trustee)

What does it mean to “act in a fiduciary capacity” Is it different to “act in a representative capacity”? No; you are acting “in behalf” of someone else – the beneficiaries.

In Matter of Baker, 139 Misc. 2d 573 (Surr. Ct., Nassau Co. 1988), Surrogate Radigan, after analyzing the various cases and issues as to whether a privilege can be asserted by a fiduciary of an estate, compelled the fiduciary to turn over a sensitive document in the estate that pertained to distributions from the estate. Surrogate Radigan held as follows:

This court is of the opinion that a fiduciary has an obligation to disclose the advice of counsel with respect to matters affecting the administration of the estate (2A Scott, Trusts § 173 [4th ed]). This is subject to the limitation that the fiduciary should have the protection of the privilege when litigation has commenced or is anticipated (2A Scott, Trusts § 173 [4th ed]); see, In re LTV Sec. Litig., 89 FRD 595). Certainly, the fiduciary is entitled to the benefit of counsel in the preparation of his defense in a contested accounting or other proceeding.

Id. at 577 (Emphasis Supplied)

When does a lawyer advise the fiduciary that “litigation . . . is anticipated”? For purposes of privilege, should we be identifying areas where litigation might be “anticipated”?

The answer, prior to the amendment to CPLR 4503, tell executors and trustees that, with few exceptions, they cannot be expected to have a true privilege. As in the case of Justice Stewart’s famous definition of pornography – you’ll know that the subject is “privileged” when you see it

How about:

Conflicts between beneficiaries of estate and fiduciary/beneficiary of nonprobate assets

Estate tax penalty issues

Noninterest bearing funds and possibility of surcharges

A “blown deal” for the sale of estate assets on the part of the executor, with clear fault/imprudence on the executor’s part; communications with executor before and after the blown deal

Retention by client to represent executor in contested estate accounting proceeding, and objectant seeks surcharges against the executor

Waiver of attorney-client privilege in fee disputes. But is there a risk in asserting privilege for trusts and estates lawyers whose fee applications may need to be determined by the Court; and the lawyer is considered, more than in other areas, to be “officers of the Court”?

Incestuous nature of trusts and estates practice, with an attorney often representing multiple interests. After the client’s death, who does the lawyer represent:

the estate?

the executor(s)?

specific legatees of tangible personal property

cash or pecuniary legatees

the independent trustee of residuary trust?

permissible lifetime beneficiaries of residuary trust?

remainderman of residuary trust?

the outright residuary beneficiaries?

all of the above?

Canon 5: A Lawyer Should Exercise Independent Professional Judgment on Behalf of a Client.

Can you take a case if you will be a witness?

DR 5-102: Lawyers as witness

A lawyer shall not act, or accept employment that contemplates the lawyer’s acting, as an advocate on issues of fact before any tribunal if the lawyer knows or it is obvious the lawyer ought to be called as a witness on a significant issue on behalf of the client, except that lawyer may act as an advocate and also testify:

If the testimony will relate solely to an uncontested issue.

If the testimony will relate solely to a matter of formality and there is no reason to believe that substantial evidence will be offered in opposition to the testimony.

If the testimony will relate solely to the nature and value of legal services rendered in the case by the lawyer or the lawyer’s firm to the client.

Neither a lawyer nor the lawyer’s firm shall accept employment in contemplated or pending litigation if the lawyer knows or it is obvious that the lawyer or another lawyer in the lawyer’s firm may be called as a witness on a significant issue other than on behalf of the client, and it is apparent that the testimony would or might be prejudicial to the client.

* * * *

Witness Advocacy Rule. When can a lawyer:

Act as the sole advocate?

Act as “co-counsel” and use a trial counsel?


Will contest on your Will. Answer: Get trial counsel for probate proceeding; and represent the fiduciary of the estate on administration issues. In many instances, it might be advisable to have a different lawyer acting as counsel of record; and not simply as a trial counsel.

Estate Litigation seeking surcharges. Likelihood that your fiduciary is the person in control. However, when there is estate litigation, you may have estate counsel giving testimony; and it may be helpful or harmful to fiduciary

Estate Litigation dealing with nonprobate assets payable to fiduciary. Keep in mind who you represent.

DR 5-105: Conflict of Interest; simultaneous representation

A lawyer shall decline proffered employment if the exercise of independent judgment in behalf of a client will be or likely to be adversely affected by the acceptance of the proffered employment, or if it would be likely to involve the lawyer in representing differing interests, except to the extent permitted under DR 5-105(C).

A lawyer shall not continue multiple employment if the exercise of independent professional judgment in behalf of a client will be or is likely to be adversely affected by the lawyer’s representation of another client, or if it would be likely to involve the lawyer in representing differing interests, except to the extent permitted under DR 5-105(C).

In the situations covered by DR-105(A) and (B), a lawyer may represent multiple clients if a disinterested lawyer would believe that the lawyer can competently represent the interest of each and if each consents to the representation after full disclosure of the implications of the simultaneous representation and the advantages and risks involved.

Conflict Rules. Existence of Conflict: Under DR 5-105, you first determine whether a conflict exists. A conflict exists if either (1) the attorney’s “exercise of independent professional judgment” on behalf of one client “will be or is likely to be adversely affected” by representing the other client, or (2) the simultaneous representation of both clients “would be likely to involve the lawyer in representing differing interests. DR 5-105(A) and (B).

Possible Waiver of Conflict by Clients: If there is a conflict, the attorney must determine whether the conflict may be waived by both clients. Specifically, both clients can waive the conflict, provided “it is obvious that the lawyer can adequately represent the interests of each” client. DR 5-105(C). DR 5-108 makes clear that a lawyer shall not represent another party in a manner adverse to that client.

Disclosure before Obtaining Waivers: If the attorney concludes that, upon waiver, he or she can still adequately represent client, the attorney can obtain waiver from both clients only “after full disclosure of the possible effect of [the joint] representation on the exercise of the lawyer’s independent professional judgment on behalf of each.” DR 5-105(C).

Representing multiple clients with potential conflicts of interest is a common theme for many trusts and estates lawyers, particularly since a substantial part of trusts and estates practice is considered to be “nonadversarial.” Examples of some problems follow.

Medicaid Eligibility for Institutionalized Spouse f/b/o Community Spouse. Is all fair in love and Medicaid eligibility?

Spousal Refusal Technique: A natural conflict with a married person’s duty of support [Domestic Relations Law § 32; Family Court Act § 412.

Can we ethically represent the community spouse on spousal refusal matters even though, as part of the assignment process, the “refusing” spouse is subject to a lawsuit by “your client” – albeit, with the local Department of Social Services acting as “your client’s agent?

Consider financial benefits that community spouse may get and why, as matter of substituted judgment, the institutionalize spouse (a) consents or (b) would consent as a matter of substituted judgment. But . . . how do you protect yourself. What if institutionalized spouse unable to consent because of mental disability?

Lifetime Planning: Can you represent both clients in these scenarios? Does it matter whether husband and/or wife are on second or third marriages and have children of prior marriages?

Husband and Wife in preparation of Wills and Trust Agreements and Related Estate Planning.

Husband and Wife in Execution of Spousal Waivers of Elective Share. Bad Idea

Husband and Wife in Husband’s or Wife’s creation of Irrevocable Life Insurance Trust.

Husband and Wife in Husband’s or Wife’s execution of spousal waiver of Qualified Plan accounts.

Husband and Wife who cannot agree on who the “ultimate” beneficiaries of estate will be.

Both fiancées in prospective marriage in the preparation and execution of prenuptial agreements.

Multiple Fiduciaries. Inform fiduciaries of the consequences of representing all of them. In the event of a conflict, you may continue to represent one of them, with the consent of the other fiduciary. See discussion below on representing fiduciaries and beneficiaries.

Fiduciary and Surviving Spouse in Will with Q-Tip trust with issues as to Whether Spouse Files Elective Share. Husband and Wife make reciprocal wills creating Credit Shelter outright bequests and Q-Tip trusts. Husband predeceases and an issue exists as to whether the wife will get “more money” by an elective share. Must there be independent representation for the wife?

Communications with Beneficiaries. Can a lawyer represent one or more of the beneficiaries of the estate and the fiduciary of the estate? No, not in the proper sense, and the beneficiaries would need to engage separate counsel to represent their interest. But, to the extent that the fiduciary of the estate is considered to be acting in a representative capacity (as the representative of the residuary beneficiaries of the estate), then the lawyer for the fiduciary arguably has a duty to such beneficiaries (see Matter of Clarke, 12 N.Y.2d 183, 187 (1962) (“An attorney for the fiduciary has the same duty of undivided loyalty to the cestui as the fiduciary himself”). That duty is sometimes discharged by the lawyer having necessary communications with such beneficiaries in the proper representation of the fiduciary as the client. See discussion above for issues arising out of attorney-client privilege. Indeed, pursuant to SCPA 2102(1), a fiduciary has a duty to respond to written requests for information concerning an estate, and the attorney for the fiduciary will frequently provide to such beneficiaries copies of important documents in the estate, such as Federal and New York estate tax returns and related papers, even prior to an accounting.

Representing Fiduciary in Individual and Representative Capacities. Can a lawyer represent a fiduciary both in his or her capacity as a fiduciary and his or her capacity as a beneficiary. Yes, and it happens all the time. But, what if the fiduciary/beneficiary has offered a will for probate and substantial litigation and/or controversies take place in the estate, such as a will contest and other similar problems for which your client is the target? The answer is still yes, but the lawyer needs to evaluate all of the consequences in these difficult scenarios.

Consider: Retainer agreement. Who do you represent and who pays the bill?

Representing Multiple Objectants in Will Contest with Different Interests. Can you represent multiple objectants in will contest even though their interest are different? Examples:

multiple classes of distributees/beneficiaries (distributees, with no interest in prior will; distributees with interest in prior will;

clients with differing goals in will contest (distributees with interest in challenging will; distributees with interest in sustaining a claim against the estate for debt.

The Putnam rule:

Almost needs no introduction: It started with an attorney, in which, in 1931, the Court of Appeals held that, in the absence of an acceptable explanation, a jury would be justified in drawing an inference of undue influence as to a bequest drafted by the drafting attorney to the drafting attorney. Court advised: have someone else draw the Will under these circumstances.

Hearing v. Affidavit

Even when attorney did not draft, court can hold hearing

Bare minimum Court will require an affidavit explaining circumstances of the bequest to attorney

Usually Court renders decision

Putnam rule has been widely expanded to apply to just about anyone with a confidential relationship able to exercise influence.

Examples: doctors, dentists, nurses, clergyman, accountants, secretary and relatives of attorney, charity created by attorney

Ethical derivation of Putnam rule:

Canon 5: must exercise independent judgment; and by accepting a gift, attorney is susceptible to charge that he or she unduly influenced or overreached the client

Proposed ABA rule bars lawyer from preparing an instrument providing for gift, unless attorney is related to donee

Ethical Considerations

EC 5-6: Do not influence a client to name you as fiduciary; avoid the appearance of impropriety.

See NYSBA Opinion #481 (3/28/78): Opinion holds that a lawyer offering to serve as executor is not improper, per se, but you must exercise great caution. Initially, the opinion stresses the propriety of the drafter using his or her influence in being named as an executor. However, the opinion found a substantial exception as follows:

There may be circumstances which can justify a lawyer’s conduct in offering his services as executor. Principally, those circumstances must be such as support a firm conviction that the client would request his lawyer to serve in that capacity if he were aware of the lawyer’s willingness to accept the responsibility. Not only should the lawyer have enjoyed a long-standing relationship with the client, but it must also appear that the client is experiencing difficulty in selecting other persons qualified and competent to serve as executor.

(Emphasis Supplied)

What if your don’t have the relationship? Can you still accept an appointment? Yes, in my judgment, if the client wants you, an independent lawyer (who was well recommended to him/her) to handle the estate

Sanctions can be applied if you are not careful and follow the letter and spirit of the ethical considerations

Weinstock case: attorney fiduciary is denied letters in probate proceeding

Harris permits Weinstock objection in accounting proceeding

Courts take action

Denial of letters

Denial of commissions

Limitation to one commission where multiple fiduciaries

Possible disciplinary ruling

Relationship between attorney fees and commissions

SCPA 2307-a: Absence compliance with the statute’s disclosure forms to be executed by client – client agrees that you are entitled to full commissions and full fees – then commission is one-half of statutory commission

If, however, will is made prior to statute – 12/31/95, Court will examine on a case-by-case basis. However, as time passes, the window is virtually completely shut by the Court.

Consider attorney-trustee: Advice: broaden disclosure form for trustee, whether attorney serves as primary or ultimate alternate fiduciary

New amendment: 2307-a

form language in Will does not do the trick; need separate form.

Language in form that makes clear that, absent disclosure, attorney gets “one-half” of commissions

Query: whose will is it?!?!

Attorney fiduciary can act as witness to will, but beware: if there is will contest, perhaps the attorney fiduciary appointment may prove to be fodder for objectant

Attorney Drafter/Beneficiary

(The paragraphs below are reprinted with permission from McQuaid, Streng and LaPiana, NEW YORK WILLS AND TRUSTS (3rd Ed. Lexis, 1998))

Persons who are in a confidential relationship to a testator, and who receive legacies or other benefits under a will, have a special burden to explain the circumstances leading to such benefit. The principle leading to this rule was enunciated by the Court of Appeals in 1931 in Matter of Putnam,21 in which the Court said: “Attorneys for clients who intend to leave them or their families a bequest would do well to have the will drawn by some other lawyer. Any suspicion which may arise of improper influence used under the cover of the confidential relationship may thus be avoided.”22

Under the Putnam Rule, a legacy in favor of a person who is in a confidential relationship to the testator may be excised from a will if the Surrogate finds that the legacy was the product of undue influence. While the Putnam Rule is an offspring of the objection of undue influence,23 the Surrogate can allow the probate of the will but expunge the legacy.24 In applying the rule, the court either requires the submission of an affidavit or schedules a hearing to explore the circumstances that led to the legacy.

The Putnam Rule has its most obvious application to an attorney- drafter, but it has been applied to individuals who share different confidential relationships with the testator, including, but not limited to, relatives of the attorney-drafter,25 doctors,26 nurses,27 nursing home personnel,28 accountants and financial advisors,29 and clergy.30 If another attorney is selected to prepare a will in which the testator’s primary attorney, or a member of his or her family, is a beneficiary, the attorney who is selected must be independent of the control or interest of the initial attorney.31

In a developing area of the law, the Putnam Rule has been used by Surrogates to review the propriety of the designation of an attorney- drafter as an executor or trustee under the will. In Matter of Weinstock,32 the Court of Appeals reinstated a Surrogate’s decree in which letters testamentary had been denied to attorneys, a father and a son, who were named as executors in a will prepared by the father, but who had had no previous professional relationship with the testator. Noting that the attorneys were aware of the testator’s intention to avoid executor’s commissions, the Court held that the testator’s confidential relationship with the attorneys required that the attorneys disclose the effect of a joint designation to the testator.33

The designation of attorneys as fiduciaries, which is illustrated by Weinstock , has led to close supervision by Surrogate’s Courts over compensation to the attorney-fiduciary for both legal services and statutory commissions. In Matter of Laflin ,34 the Appellate Division, Second Department, held that objections to multiple executors’ commissions may be made by the beneficiaries in the final accounting proceeding. And in view of the “fact that an attorney draftsman of a will is uniquely situated to selfishly gain additional employment”35 as counsel for a testator’s estate, Surrogates generally are giving strict scrutiny to attorney fees for the attorney-fiduciary.36

Canon 6: A Lawyer Should Represent a Client Competently.

EC 6-4: Having undertaken representation, a lawyer should use proper care to safeguard the interests of the client. If a lawyer has accepted employment in a matter beyond the lawyer’s competence but in which the lawyer expected to become competent, the lawyer should diligently undertake the work and study necessary to qualify. In addition to being qualified to handle a particular matter, the lawyer’s obligation to the client requires adequate preparation for and appropriate attention to the legal work, as well as promptly responding to inquiries from the client.

DR 6-101: A. A lawyer shall not:

Handle a legal matter which the lawyer knows or should know that he or she is not competent to handle, without associating with a lawyer who is competent to handle it.

Handle a legal matter without preparation adequate in the circumstances.

Neglect a legal matter entrusted to the lawyer.

If a lawyer does not have prior experience in a particular legal matter, he or she can still be engaged. For example, a lawyer who has no experience even in litigation in the Surrogate’s Court involving sophisticated tax issues can be engaged, provided that lawyer commits himself or herself in becoming competent or associates with a lawyer who is competent on the tax issues.

For lawyers with insufficient experience in this area, consult and pay out of your own pocket someone who is. Ethically, professionally and economically required. The alternative: your very sophisticated client sees your lack of experience in working on the tax aspect of the litigation; and your client either gets bum work or fires you.

Before mandatory CLE, maintaining your skills and ability, through CLE, permitted us lawyers to satisfying our ethical obligations.

The use of legal assistants by trusts and estates lawyers brings on ethical obligations. Assuring proper oversight and training is necessary to assure that competent legal work is carried out in behalf of a client.

Performing legal work effectively, and expeditiously, is an important component of carrying out competent legal work.

Communicate, Communicate, Communicate!!!! The single biggest criticism of lawyers is their failure to return phone calls or otherwise communicate with their clients.

Ethics Rules and Malpractice Claims

Privity v. nonprivity

NY matters

Non NY matters

What exactly is a non NY matter?

How to protect yourself:

Refer matters to a specialist

Be careful on out of state law – e.g., Florida or CT

Consider there is no privity problem in these 2 states

Keep current on law

establish routines

print and proofread documents

document the file

ask about unusual assets or a relationship

consider problems with multiple estate planning documents

Canon 7: A Lawyer Should Represent a Client Zealously Within the Bounds of the Law.

Representing the incapacitated client.

EC 7-11:

The responsibilities of a lawyer may vary according to the intelligence, experience, mental condition or age of a client, the obligations of a public officer, or the nature of a political proceeding. Examples include the representation of an illiterate or an incompetent, service as a public prosecutor or other government lawyer, and appearances before administrative and legislative bodies.

EC 7-12

Any mental or physical condition of a client that renders him incapable of making a considered judgment on his own behalf casts additional responsibilities upon his lawyer. Where an incompetent is acting through a guardian or other legal representative, a lawyer must look to such representative, for those decisions which are normally the prerogative of the client to make. If a client under disability has no legal representative, his lawyer may be compelled in court proceedings to make decisions on behalf of the client. If the client is capable of understanding the matter in question or of contributing to the advancement of his interests, regardless of whether he is legally disqualified from performing certain acts, the lawyer should obtain from him all possible aid. If the disability of a client and the lack of a legal representative compel the lawyer to make decisions for his client, the lawyer should consider all circumstances then prevailing and act with care to safeguard and advance the interests of his client. But obviously a lawyer cannot perform any act or make any decisions which the law requires his client to perform or make, either for himself if competent, or by a duly constituted representative if legally incompetent.

Preparing Wills for a potentially incapacitated client or dying client

Be Very Careful!!!

Engagement by client

What if referred by

potential beneficiary

current client

consider built-in claim of undue influence

cannot reverse undue influence problem once you have permitted it to happen

engagement letter

Initial client interview

Attorney-client privilege

Preserving confidentiality of communications

Obtaining information/documents from client

Transmittal of drafts of wills with explanations

Communication with client alone concerning draft

Your role: “scrivener” v. “estate planner”

Execution of documents

Can you represent a third party in bringing a guardianship proceeding to appoint a guardian for your client?

Probably not, but there appears to be very little precedent:

As a general rule, I agree that an attorney who has previously represented an “alleged incapacitated person” should not participate in a guardianship proceeding, either by petitioning the Court or representing a petitioner

Consider duty of advocacy to AIP

Consider attorney-client privilege

Nassau County Bar Association 1990 opinion [can’t disclose information to third parties regarding client’s lack of decision-making capacity]

Ass. of Bar of City of NY [1987-7] (can disclose confidential information if necessary to protect client’s interest, and disclosure made in camera

But, what if client “consents” to appointment

And what if there a consensual joint representation

Consider ABA Model Rule 1.14

(a) when a client’s ability to make adequately considered decisions in connection with the representation is impaired, whether because of minority, mental disability or for some other reason, the lawyer shall, as fair as reasonably possible, maintain a normal client-lawyer relationship with the client.

(b) A lawyer may seek the appointment of a guardian or take other protective action with respect to a client, only when the lawyer reasonably believes that the client cannot adequately act in the client’s own interest.

NYS Bar Opinion 746:

“A lawyer serving as a client’s attorney-in-fact may not petition for the appointment of a guardian without the client’s consent unless the lawyer determines that the client is incapacitated; there is not practical alternative, through the use of the power of attorney or otherwise, to protect the client’s best interests; and there is no one else available to serve as petitioner. Subject to conflict of interest restrictions, if the lawyer petitions for the appointment of a guardian, the client does not oppose the petition, and the lawyer will not be a witness in a contested hearing, the lawyer may represent him-or herself in the proceeding.”

Ethical dilemmas for advocates: When does your duty of advocacy end and your relationship to the Surrogate’s Court and its personnel begin?

Canon 8: A Lawyer Should Assist in Improving the Legal System.

Canon 9: A Lawyer Should Avoid Even the Appearance of Professional Impropriety.

EC 9-5: Separation of the funds of a client from those of his lawyer not only serves to protect the client but also avoids even the appearance of impropriety, and therefore commingling of such funds should be avoided.

DR 9-102: Preserving Identity of Funds and Property of Others; Fiduciary Responsibility; Commingling and Misappropriation of Client Funds or Property; Maintenance of Bank Accounts; Record keeping; Examination of Records

Prohibition Against Commingling and Misappropriation of Client Funds or Property. A lawyer in possession of any funds or other property belonging to another person, where such possession is incident to his or her practice of law, is a fiduciary, and must not misappropriate such funds or property or commingle such funds or property with his or her own.

Separate Accounts. * * * *

Notification of Receipt of Property; Safekeeping; Rendering Accounts; Payment or Delivery of Property. * * * *

Required Bookkeeping Records. * * * *

Authorized Signatures. * * * *

F. Missing Clients. * * * *

G. Designation of Successor Signatories. * * * *

H. Dissolution of a Firm. * * * *

I. Availability of Bookkeeping Records; Records Subject to Production in Disciplinary Investigations and Proceeding. * * * *

J. Disciplinary Action. * * * *

Full compliance with DR 9-102 in dealing with client escrow accounts is essential to assure that a lawyer maintains his or her license to practice.

Proper record keeping is the key.

Should you use escrow accounts in the management of estates and trusts?

DR 9-102 goes beyond the management of escrow accounts; it goes to the core of the lawyer’s business records. DR 9-102(D.) requires retention for 7 years many business records, including, but not limited to, all escrow account records, special account records, retainer and compensation agreements, client disbursement records and bills.

What are the stakes in proper management of escrow accounts: Tarrytown lawyers, Robert J. Ponzini, Robert W. Spencer and Thomas W. Maroney know that the stakes were very high, when their license were suspended (later modified by the Second Department).

Balances fell below 0, through inadvertence

Obligation of bank to inform Central Registry at the Lawyers’ Fund for Client Protection within 5 days when negative balance takes place

Bookkeeping errors

Failed efforts in curing bookkeeping problem


Control your bookkeeper

Instruct your bookkeeper

Exercise control over your bookkeeper

Develop strict procedures to assure that, under no circumstances, are escrow accounts over drafted

What about check fees, for example, certified check fees? Either know, with certainty, what they are if you permit them to be charged against the escrow account. Or, do what my firm does, and have such charges assessed against our firm’s business account.

21 257 NY 140, 177 NE 399 (1931).

22 Id at 143, 177 NE at 400. See also New York State Bar Association Code of Professional Responsibility EC 5-5 (1975). See generally Groppe, Putnam/Weinstock Revisited: Problems Facing the Attorney/Legatee/ Fiduciary, 7 Newsletter of General Practice Section NYSBA (1986).

23 See generally Children’s Aid Socy v Loveridge, 70 NY 387 (1877).

24 Matter of Lawson, 75 AD2d 20, 428 NYS2d 106 (4th Dept 1980); Matter of Eckert, 93 Misc 2d 677, 403 NYS2d 633 (1978).

25 Matter of Hayes, 49 Misc 2d 152, 267 NYS2d 452 (1966).

26 Matter of Satterlee, 281 AD 251, 119 NYS2d 309 (1st Dept 1953).

27 Matter of McCarthy, 269 AD 145 54 NYS2d 591 (1st Dept 1945), affd , 296 NY 987, 73 NE2d 566 (1947).

28 Gordon v Bialystoker Center, 45 NY2d 692, 385 NE2d 285, 412 NYS2d 593 (1978); Matter of Burke, 82 AD2d 260, 441 NYS2d 542 (2d Dept 1981).

29 Matter of Collins, 124 AD2d 48, 510 NYS2d 940 (9th Dept 1987).

30 Marx v McGlynn, 88 NY 357 (1882) (a precursor to Putnam , in which it is cited, Matter of Putman, 257 NY 140, 144, 146, 177 NE 399, 400-01 (1931)).

31 Matter of Guidi, 259 AD 652, 20 NYS2d 240 (1940).

32 40 NY2d 1, 351 NE2d 647, 386 NYS2d 1 (1976).

33 Id at 5, 351 NE2d at 648, 386 NYS2d at 3.

34 111 AD2d 924, 491 NYS2d 35 (2d Dept 1985).

35 Matter of Stalbe, 130 Misc 2d 725, 727, 497 NYS2d 237, 240 (1985).

36 See, e.g., Matter of Harris, 123 Misc 2d 247, 473 NYS2d 125 (1984). Some Surrogate’s Courts require the probate petition to disclose whether an attorney-fiduciary or a member of the firm is a drafter of the will, and if so the drafter is required to prepare and file an affirmation setting forth the facts and circumstances surrounding the testator’s selection of the drafter as a fiduciary of the estate. These affirmations, which are sometimes required to be filed in probate and accounting proceedings, are apparently being used to determine the reasonableness of commissions and attorney fees for an attorney-fiduciary.

Contact Me

If you think you may require the assistance of Frank Streng in any matter, email ( or phone him (914-385-1022) with any question you may have.