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Seldom is a will drafted, signed and executed and then left unaltered. In most cases, wills undergo multiple amendments, with provisions being changed or removed altogether, new provisions being added, or even an entirely new set of terms taking the place of the old set of terms. In some instances, the testator (i.e. the person who initially establishes the will) gives an instruction to the attorney drafting the will which isn’t followed correctly. When that happens, the attorney has failed to uphold the terms of the attorney-client agreement reached between himself or herself and the testator; in technical contract terminology, the attorney has breached his or her contractual obligation and may face consequences.
What happens when an attorney’s breach or failure has a negative impact on a third party who is not actually a party within the contract itself? Let’s put that question into an estate planning context specifically: what if a third party beneficiary of a will is injured when an attorney failed to update the will properly prior to the death of the decedent? This issue was raised recently by the case of Bennett v. Gentile (2024).
Let’s explore this case in a bit of detail.
Facts of the Case
The testator in this case was the mother of the plaintiff. In 2015, the testator hired an attorney to draft a will, and this will included a trust which held a piece of real property. In this 2015 version of the will, the real property held by this trust would go to the plaintiff’s sister in the event that the testator passed away. In 2017, the will attorney drafted a new will to replace the 2015 will. The 2017 will had several alterations, but the real property in question still remained untouched.
Then, in 2019, the testator hired the attorney again to make some additional amendments. The testator instructed the attorney to cut out the plaintiff’s sister with respect to the real property held by the trust, and to redirect the property or its sale proceeds to the plaintiff. Apparently, this particular amendment was not made, although some other amendments were made. The testator passed away about one month after this 2019 version was finished, and the plaintiff brought multiple claims shortly thereafter.
The plaintiff’s first claim was that the real property should go directly to her because of the fact that the testator clearly intended for the plaintiff’s sister to be cut out and the property be redirected to her. The plaintiff’s secondary claim was that, if the property should not be redirected to her, she should have standing to sue the attorney for damages given that she was a “third party beneficiary” to the will. The case ultimately went before the Maryland Supreme Court.
Ruling & Discussion
Upon careful scrutiny, the Maryland Supreme Court upheld the determinations made the trial court, and affirmed the judgment in favor of the respondent attorney. This case might be an excellent example of a situation in which a certain party was harmed by another party’s behavior, but the harm is too “distant” to guarantee a remedy. After all, there was evidence to show that the testator wanted to cut out the plaintiff’s sister, and wanted to benefit the plaintiff directly; but, the “primary” goal of the testator with respect to the 2019 revisions was actually to ensure that she herself had sufficient funds to satisfy her nursing home bills.
The Supreme Court concluded that the privity of contract rule prohibited the plaintiff from recovering from the attorney, because the third party beneficiary exception didn’t apply. In the past, Maryland law has supported the notion that a third party beneficiary to a contract may have a valid claim under certain exceptional circumstances, but the Supreme Court didn’t find those circumstances in this case. Essentially, to have the exception apply, the plaintiff needs to show that benefitting him or her was the sole purpose of the contractual relationship between the testator and the attorney. In other words, if the plaintiff can show that the whole purpose of the testator engaging the attorney was to benefit him or her, then the exception might apply. As a rule, mere testamentary beneficiary status isn’t enough to overcome the strict privity rule, but other circumstantial facts might trigger the exception. In this case, the Supreme Court didn’t find sufficient evidence to trigger the exception.
Contact the Murphy Law Firm for Additional Resources
If people want to know more about the strict privity rule, the third party beneficiary exception in estate planning, avoiding mistakes in trust document drafting, or any other related estate planning matter, contact one of the estate planning attorneys at the Murphy Law Firm today by calling 240-219-1187.
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