Opinion ID: 886904
Heading Depth: 1
Heading Rank: 3

Heading: issues

Text: ¶17 Whether Appellants have standing to bring a legal malpractice action against Respondents. ¶18 Appellants contend that the District Court's orders should be reversed and remanded because the court's rationale on this issue is unclear. In their motion for summary judgment, Respondents did not raise any issues as to Appellants' standing to bring this action. Rather, the standing issue was raised by the District Court at the close of the hearing on the motion for summary judgment, based on an inquiry to Respondents' counsel regarding the existence of a fiduciary relationship between Lacosta and Appellants. ¶19 With regard to the Estate of Stanley L. Watkins (the Estate), Lacosta admits that Stanley was a client. Because the Estate stands in the shoes of the decedent, it is considered to be in privity with the attorney, and the personal representative has standing to prosecute a malpractice claim. Espinosa v. Sparber, Shevin, Shapo, Rosen & Heilbronner (Fla. 1993), 612 So.2d 1378, 1380. ¶20 A fact issue exists as to whether the Trust is a client or a nonclient beneficiary. The Trust may be considered a client based upon the legal services provided by Lacosta to the Trust and its Trustees, services which involved Trust assets and transactions. Because Lacosta did not raise the issue of standing in her motion for summary judgment, she presented no facts as to whether the Trust was or was not a client. And, in its order, the District Court failed to cite to any cases and made no conclusions as to whether a duty exists to nonclients, or the extent of that duty if it does exist. However, [t]he courts agree that the existence of the attorney-client relationship, the contractual scope of duty, the causation of damages and the extent of damages usually are issues for the trier of fact . . . . A common factual dispute is whether there was an attorney-client relationship. Ronald E. Mallen & Jeffrey M. Smith, Legal Malpractice, Vol. 5, § 33.11 (5th ed. 2000) (hereafter, Mallen ). ¶21 Steve claims standing as a nonclient beneficiary of the estate plan. The duty owed to a nonclient beneficiary is a matter of first impression in Montana. See Rhode v. Adams, 1998 MT 73, ¶¶ 12-13, 288 Mont. 278, ¶¶ 12-13, 957 P.2d 1124, ¶¶ 12-13. However, the majority rule in other jurisdictions supports standing in cases involving actions by named beneficiaries against drafting attorneys. Cf., Blair v. Ing (Haw. 2001), 21 P.3d 452; Mallen, Vol. 4, § 32.4 (Despite statements that strict privity is the prevailing or majority rule, just the opposite is true of actions brought by beneficiaries of wills. A duty to a third party is implied because that is the mutual intent of the attorney and client.) ¶22 Moreover, a finding of duty is consistent with existing Montana law. This Court has noted that a multi-factor balancing test adopted in other jurisdictions may be appropriate in deciding the duty owed by attorneys to nonclients in estate planning. Rhode, ¶ 17. Additionally, we have recognized liability to nonclients in other professional contexts. See, e.g., Thayer v. Hicks (1990), 243 Mont. 138, 793 P.2d 784 (accounting firm liable to nonclient); Jim's Excavating Serv. v. HKM Assoc. (1994), 265 Mont. 494, 878 P.2d 248 (professional engineer liable to nonclient); Turner v. Kerin & Assoc. (1997), 283 Mont. 117, 938 P.2d 1368 (professional engineer liable to nonclient). ¶23 Accordingly, we hold that the Estate does have standing to bring a legal malpractice action against Respondents. We further hold that whether the Trust and Steve have standing to bring a legal malpractice action against Respondents is a factual issue that must be determined at trial, thus precluding summary judgment.