Non-Clients Cannot Sue Estate Attorneys for Failing to Create Trust to Avoid Estate Tax

Wisconsin's highest court rules that the children of a decedent do not have standing to sue the law firm that administered the decedent's estate for legal malpractice because there was no evidence that the firm negligently thwarted the decedent's intent in failing to create a trust to avoid estate taxes. Macleish v. Boardman & Clark LLP (Wis., No. 2016AP2491, March 26, 2019).

Charles Macleish drafted a will that gave all his property to his wife. When Mr. Macleish died, the Boardman & Clark law firm handled the administration. The firm advised Mr. Macleish's widow, Thelma Macleish, to claim the federal estate tax marital deduction so that his estate would not be subject to estate tax. When Ms. Macleish died, her estate included his estate assets and was subject to estate tax.

The Macleish's children sued the law firm for legal malpractice, arguing that Mr. Macleish's will should have been construed to create a trust for Ms. Macleish. The law firm argued that it did as the will instructed. The trial court granted summary judgment to the law firm, holding that under case precedent, a third-party beneficiary can sue for legal malpractice only if the beneficiary can show the attorney's actions thwarted the decedent's testamentary intent. The court of appeals affirmed, and the Macleish children appealed.

The Wisconsin Supreme Court affirms, holding that the Macleish children did not having standing to sue for legal malpractice. According to the court, "a non-client who is a named beneficiary in a will has standing to sue an attorney for malpractice if the beneficiary can demonstrate that the attorney's negligent administration of the estate thwarted the testator's clear intent." In this case, the court finds that the clear language of the will "cannot be construed to compel the creation of a trust either as a matter of administration or by its explicit text" so the law firm did not thwart Mr. Macleish's intent by not creating a trust.

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