A lawyer's duty of care to willmaking clients

The NSW Court of Appeal decision in Howe v Fischer [2014] NSWCA 286 reversed a negligence finding against a lawyer who failed to have a Will signed for an elderly client.  The decision is important because it deals with the scope of a lawyer’s duty of care to a willmaking client.

Facts

Marie Fischer wanted to make a new Will.  She was aged 94 years.  Her general practitioner arranged for a lawyer Graham Howe to see Mrs Fischer.  He attended on Mrs Fischer at her home on 25 March 2010 to obtain her instructions for the Will.  Mr Howe said he would draft the Will and see her again in the week after Easter.  Mrs Fischer agreed with that timeframe and also indicated she wanted other people to be present at the next meeting.  However, Mrs Fischer died on 6 April 2010 before any new Will had been signed.

Mrs Fischer’s son brought professional negligence proceedings against the lawyer, Mr Howe, seeking damages for breach of duty of care owed to him as a disappointed beneficiary under the proposed new Will.  The son’s entitlement under the proposed new Will would have increased from 25 percent to 50 percent of the residuary estate.

The first instance judgment of Adamson J found the lawyer negligent and damages of $800,000 and interest of $145,715 were awarded to the son.  The judge found that the retainer was to give legal effect to the testamentary intentions of the deceased and not merely to prepare a Will and arrange for it to be signed.  The lawyer was held to be negligent because he had not procured an informal Will for Mrs Fischer when he first saw her on 25 March 2010 given her particular circumstances.  Lawcover appealed on behalf of the lawyer.

The appeal sought to challenge some of the factual findings of the primary judge.  It also challenged the judge’s finding about the scope of the lawyer’s retainer.

Court of Appeal decision

The Court found in favour of the appellant in relation to the factual findings of the primary judge.  The Court also made some important comments about a lawyer’s duty of care and the scope of a lawyer’s retainer to a willmaking client.  The Court held that:

• The lawyer’s retainer was to prepare a formal Will and to arrange for it to be signed according to the agreed timeframe.  There was an implied obligation on the lawyer to avoid any reasonably foreseeable frustration of this objective.  However, the lawyer was not obliged to procure the signing of an informal Will (as an interim measure) in Mrs Fisher’s circumstances.
• The lawyer’s duty was to bring to bear the reasonable care and skill of the ordinary lawyer exercising and professing to have the special skill relevant to the field of professional practice.
• A lawyer’s duty to a disappointed beneficiary under a Will must be considered in the context of the terms of the lawyer’s retainer and the instructions of their client.  The lawyer’s primary duty is owed to the client.

Special leave to appeal to the High Court

An application for special leave to appeal to the High Court was filed on 23 September 2014.  The application was ready for hearing as of 20 March 2015.  If special leave is granted, it will be helpful for the legal profession to hear what the High Court has to say about the scope of the duty owed by lawyers to willmaking clients.

Implications and risk management

The real challenge for lawyers is to be aware that the terms of every retainer for willmaking clients will be different because of the particular circumstances and instructions of the client.  Lawyers need to respond appropriately to different retainers and need to be careful when dealing with circumstances such as seriously ill clients, elderly clients or clients about to travel overseas.

The Court of Appeal decision does not alleviate the need for lawyers to advise clients to have instructions immediately signed as an interim Will until a formal Will is prepared, if the particular circumstances of the client require that advice to be given.  It is the writer’s practice to give that advice to every willmaking client.  In almost every case, the client makes the decision not to proceed with an interim Will because of their particular circumstances (for example, uncertain testamentary intentions, complex affairs or being happy to rely on prior Will until the new Will is prepared).  The client’s instructions not to proceed with an interim Will are confirmed in writing as part of the retainer.  Taking this proactive step may protect lawyers (and may have protected Mr Howe) from a claim by a disappointed beneficiary.

This publication is intended as a source of information only. No reader should act on any matter without first obtaining professional advice.

Author: Gerard Basha