Court Opinion

ID: 9566657
Source: CourtListenerOpinion
Date Created: 2023-08-21 19:41:48.644483+00
Date Added: 2024-06-11T09:38:53.077132
License: Public Domain

Durham, J. —
The beneficiaries of a will brought this action for damages against two attorneys and their law firm, alleging that as a result of the attorneys' negligence, *677they were unable to take assets originally devised to them. The trial court granted the defendants' CR 12(b)(6) motion to dismiss the action for failure to state a claim upon which relief could be granted. We affirm.
An action may be dismissed under CR 12(b)(6) only if "'it appears beyond doubt that the plaintiff can prove no set of facts, consistent with the complaint, which would entitle the plaintiff to relief.'" Bowman v. John Doe, 104 Wn.2d 181, 183, 704 P.2d 140 (1985) (quoting Orwick v. Seattle, 103 Wn.2d 249, 254, 692 P.2d 793 (1984); Corrigal v. Ball & Dodd Funeral Home, Inc., 89 Wn.2d 959, 961, 577 P.2d 580 (1978)). For purposes of this motion, the plaintiffs' factual allegations are presumed to be true. Bowman, at 183.
Respondents Norman Brock and Kenneth Carpenter are attorneys practicing in the Davenport office of the law firm of respondent Underwood, Campbell, Brock & Cerutti, P.S. Appellants Alvin Stangland and Bruce Kintschi were designated as beneficiaries in the will of Ralph Schalock, now deceased.
Brock prepared the will and Schalock signed it in April 1979. Before the execution of the will, Brock had been the exclusive personal attorney for Schalock in all of his business and personal affairs. Schalock had been a client of the Underwood, Campbell, Brock & Cerutti firm and its predecessor for many years.
Schalock asked Brock to draft the will to leave all of his real property to appellants. At the time, Schalock's only real property of substantial value was a farm in Lincoln County. In their amended complaint, appellants alleged that Brock knew that Schalock's intent was "to pass the principal asset of his estate, his farm land," to them.
The will drafted by Brock provides as follows in paragraph 4:
I hereby give, devise and bequeath any and all real property owned by me at the time of my death unto Alvin Stangland and Bruce Kintschi equally, share and share alike, as their sole and separate property.
*678Paragraph 5 of the will left the residue of Schalock's property of every kind to Troy Rux and Joseph Kintschi, in equal shares.
On or about February 1, 1982, Carpenter prepared a real estate contract for the purpose of selling Schalock's farm to Frank and Janet Titchenal. Before the contract was executed, Carpenter did not discuss it with Brock and did not review Schalock's will or file. Appellants assert that although the firm circulated to its attorneys a memo reporting on new matters being handled in the firm, Brock did not notice that the real estate contract was being prepared and was not aware that the property was being sold. Appellants also assert that neither Brock nor Carpenter conferred with the other regarding Schalock's property or estate plan, and neither informed Schalock that the sale of the property on a real estate contract would affect the disposition of his estate.
On May 7, 1982, Schalock died. His will was admitted to probate. A dispute arose as to whether the vendor's interest in the real estate contract would pass to appellants, or to Troy Rux and Joseph Kintschi, the residuary beneficiaries. Litigation ensued between appellants and the residuary beneficiaries, ultimately resulting in a settlement by which appellants received 60 percent of the balance owing under the real estate contract.
Subsequently, appellants brought this action against respondents Brock, Carpenter and their law firm, seeking damages for professional negligence. Appellants alleged that in preparing Schalock's will, Brock neglected to provide for the effectuation of Schalock's intent to pass the principal asset of his estate, the farm, to them. They further alleged that by causing the farm to be conveyed by real estate contract to the Titchenals, respondents negligently disregarded the intent manifested by Schalock in his will. Appellants asserted that respondents did not advise Schalock that the effect of the sale on the real estate contract would be contrary to the intent expressed in his will. Appellants alleged that as a result of respondents' negli*679gence and breach of duty to Schalock, appellants were unable to take the real estate originally devised to them.
Respondents brought a CR 12(b)(6) motion to dismiss the complaint for failure to state a claim upon which relief could be granted. The trial court entered an order granting the motion to dismiss. Appellants appealed to the Court of Appeals, which certified the case to this court.
This court has long held that for purposes of administration of an estate, a vendor's interest in an executory real estate contract should be treated as personal property rather than real property. In re Estate of Fields, 141 Wash. 526, 528, 252 P. 534 (1927). See also Freeborn v. Seattle Trust & Sav. Bank, 94 Wn.2d 336, 340, 617 P.2d 424 (1980); Cascade Sec. Bank v. Butler, 88 Wn.2d 777, 782, 567 P.2d 631 (1977); In re Estate of Eilermann, 179 Wash. 15, 18, 35 P.2d 763 (1934). Under this rule, Schalock's interest in the real estate contract for the sale of his farm would be personal property for purposes of the administration of his estate. Schalock's will provided that only his real property would pass to appellants, and the remainder of his property would pass to the residuary beneficiaries. Hence, if Schalock's interest in the real estate contract was personal property for administration purposes, it would pass not to appellants, but to the residuary beneficiaries pursuant to the terms of the will. The question we must decide is if, under these circumstances, appellants have a cause of action against respondents for professional negligence with respect to their handling of Schalock's affairs.
In an action for legal malpractice sounding in negligence, the plaintiff must establish initially the existence of an attorney-client relationship. Bowman v. John Doe, 104 Wn.2d 181, 185, 704 P.2d 140 (1985). Once such a relationship is shown, the elements of such a legal malpractice action are the same as those of an action for negligence. These elements are: (1) the existence of a duty owed to the plaintiff; (2) a breach of that duty; (3) a resulting injury; and (4) a proximate cause between the breach of duty and the resulting injury. Bowman, at 185-86.
*680Traditionally, privity of contract between the parties has been required as a basis for establishing a duty in a legal malpractice action. Hence, attorneys' exposure to liability for malpractice has been confined to their clients. See R. Mallen & V. Levit, Legal Malpractice §§ 71, 72 (2d ed. 1981). However, as we recognized in Bowman, at 186-87, the modern trend is to relax the privity requirement, allowing legal malpractice actions to be brought by persons other than the clients of attorneys in some factual situations. In the absence of privity, there must be some other basis for a duty between the attorney and the plaintiff. Bowman, at 187; see also R. Mallen & V. Levit § 80.
In the present case, an attorney-client relationship existed between respondents and Schalock. However, there was no privity of contract between appellants and respondents. Therefore, in order for appellants to have a cause of action for legal malpractice, they must show that there is some other basis upon which respondents owed them a duty.
In Bowman, we observed that a duty between an attorney and a plaintiff who is not the client may be found under two theories. Bowman, at 187. Under one theory, first adopted in California, a multi-factor balancing test is applied to determine if an attorney owed a duty to a plaintiff. The factors in the test are: the extent to which the transaction was intended to affect the plaintiff; the foreseeability of harm to the plaintiff; the degree of certainty that the plaintiff suffered injury; the closeness of the connection between the defendant's conduct and the injury; the policy of preventing future harm; and the extent to which the profession would be unduly burdened by a finding of liability. See, e.g., Heyer v. Flaig, 70 Cal. 2d 223, 227, 449 P.2d 161, 74 Cal. Rptr. 225 (1969); Lucas v. Hamm, 56 Cal. 2d 583, 588, 364 P.2d 685, 15 Cal. Rptr. 821 (1961), cert. denied, 368 U.S. 987 (1962). See also R. Mallen & V. Levit § 80. The inquiry under this multi-factor test has generally focused on whether the attorney's services were intended to affect the plaintiff. See Bowman, at 188; R. Mallen & V. *681Levit § 81.
The second theory for finding a duty between the attorney and the plaintiff in the absence of privity is based on the concept of a third party beneficiary contract. The plaintiff must prove that he or she was intended to benefit from the established attorney-client relationship. See, e.g., Guy v. Liederbach, 501 Pa. 47, 459 A.2d 744 (1983); Pelham v. Griesheimer, 92 Ill. 2d 13, 20, 440 N.E.2d 96 (1982); Stowe v. Smith, 184 Conn. 194, 441 A.2d 81 (1981). See also Bowman, at 188; R. Mallen & V. Levit § 80 (2d ed. 1981 & 2d ed. Supp. 1985).
In most other jurisdictions where the issue has been considered, courts have held that an attorney who agrees to draft a will for his client owes some duty to the intended beneficiaries of the will, either under the multi-factor balancing test or the third party beneficiary theory. See, e.g., Heyer v. Flaig, supra; Lucas v. Hamm, supra; Needham v. Hamilton, 459 A.2d 1060 (D.C. 1983); Guy v. Liederbach, supra; Stowe v. Smith, supra; McAbee v. Edwards, 340 So. 2d 1167 (Fla. Dist. Ct. App. 1976). See also R. Mallen & V. Levit § 80. Those courts that have applied the multi-factor test have reasoned that the drafting of the will is intended to affect the beneficiaries, it is foreseeable that the beneficiaries may be harmed if the will is drafted improperly, the intended beneficiaries would have received benefits but for the attorney's alleged negligence, and if the beneficiaries could not recover for the attorney's alleged negligence, no one could. See Lucas, at 589. Under the third party beneficiary theory, courts reason that the beneficiaries of the will are intended to benefit from the relationship between the testator and the attorney drafting the will, because an integral purpose of drafting the will is to provide for the beneficiaries. See Lucas, at 590; Stowe, at 197-98.
Nevertheless, even if a duty is owed, the law will give it recognition and effect only as it is defined by a particular standard of conduct. In Lucas v. Hamm, supra, an attorney drafted a will so that it violated the rules relating to perpe-tuities and restraints on alienation. The court held that, *682while an attorney who drafted a will owed a duty to the intended beneficiaries of the will, the beneficiaries in that particular case had no cause of action because the attorney's errors in drafting the will were not so extraordinary as to violate the standard of care applicable to attorneys. Lucas, at 591-93.
In Heyer v. Flaig, supra, the testatrix retained an attorney to prepare her will, telling him that she wished all of her estate to pass to her daughters, and that she intended to marry. The attorney drafted a will which purported to leave the entire estate to the testatrix's daughters, but did not mention her future husband, except for naming him executor. After executing the will, the testatrix married. Following her death, her husband claimed a portion of the estate as a post-testamentary spouse. The daughters brought an action against the attorney, alleging that he negligently failed to advise their mother of the consequences of a post-testamentary marriage, to include in the will any provision as to the intended marriage, and to advise her after the marriage of the legal consequences of omitting from the will any provision regarding her husband's claim to a share of her estate. The court reiterated its holding in Lucas that an attorney who agrees to draft a will for his client has a duty to the intended beneficiary. Heyer, at 228. It further stated that the attorney's duty is "to act with due care as to the interests of the intended beneficiary." Heyer, at 229. It concluded that the attorney's conduct in that particular case did not meet the standard of care of a reasonably prudent attorney, and, therefore, plaintiff's had a cause of action. Heyer, at 229.
In Washington, the standard of care to which a lawyer is held in performing professional services is "'that degree of care, skill, diligence and knowledge commonly possessed and exercised by a reasonable, careful and prudent lawyer in the practice of law in this jurisdiction."' Walker v. Bangs, 92 Wn.2d 854, 859, 601 P.2d 1279 (1979) (quoting Cook, Flanagan & Berst v. Clausing, 73 Wn.2d 393, 395, 438 P.2d 865 (1968)). In the present case, in order *683to be entitled to relief for respondents' conduct, appellants would have to show a failure to conform to this standard of care. This they cannot do.
Brock's Conduct When the Will Was Drafted
First, appellants contend that they are entitled to relief for Brock's conduct when he initially drafted the will. They argue that, considering that Brock knew that Schalock intended to leave his farm to them, Brock drafted the will too narrowly when he used the term "real property" to describe the bequest to them. Appellants contend that Brock owed them a duty to draft the will more broadly so that, in case Schalock sold the farm on a real estate contract and the nature of his interest thus changed to personal property, his interest in the contract would pass to them. They further contend that Brock was negligent in failing to advise Schalock of the effect of a change in the nature of the property at the time he executed the will.
We do not believe Brock failed to exercise the care, skill, diligence and knowledge of a reasonable, prudent lawyer practicing in Washington when he drafted the will. Schalock asked Brock to prepare his will so as to leave all of his real property to appellants, and that is precisely what Brock did. Assuming that appellants could prove their allegation that Brock knew that Schalock intended to pass the principal asset of his estate, the Lincoln County farm, to them, Brock still acted reasonably in drafting the will as he did. Given all the circumstances, it is inconceivable that, at the time Schalock asked Brock to draft the will, he informed Brock that he intended to sell the farm after executing his will. Thus, unlike the attorney in Heyer v. Flaig, 70 Cal. 2d 223, 449 P.2d 161, 74 Cal. Rptr. 225 (1969), Brock had no notice when he drafted the will that Schalock planned to take any action after executing the will that might affect the testamentary distribution of his property. In the absence of such an indication, no reasonable lawyer would be expected to foresee at the time the will was drafted that Schalock might sell the farm on a real estate *684contract, and that such a sale might affect his testamentary distribution. Given that Brock could not be expected to anticipate these events, it would be unreasonable to require him either to draft the will to provide for them, or to advise Schalock of their possible effects. Therefore, appellants have not stated a claim for which relief could be granted with regard to Brock's conduct at the time the will was drafted.
Brock's Conduct When the Real Estate Contract Was Drafted
Appellants further contend that, at the time Carpenter was drafting the real estate contract for Schalock, Brock was negligent in failing to advise Schalock that the sale on the contract could change the nature of the property and affect his estate plan. According to appellants' own assertions, Brock did not notice that Carpenter was preparing the real estate contract and was not aware that the property was being sold. Appellants suggest, however, that because the firm's lawyers received memos on new matters being handled in the firm, Brock should have known that the farm was being sold on a real estate contract and, therefore, he had a duty to advise Schalock of the contract's possible effect on his testamentary distribution.
If we held that Brock had such a duty, we would be expanding the obligation of a lawyer who drafts a will beyond reasonable limits. When an individual retains an attorney to draft his will, the attorney's obligation is to use the care, skill, diligence and knowledge that a reasonable, prudent lawyer would exercise in order to draft the will according to the testator's wishes. Once that duty is accomplished, the attorney has no continuing obligation to monitor the testator's management of his property to ensure that the scheme originally established in the will is maintained. The time and expense that would be required for the attorney to follow all of the testator's activities with respect to his property would prevent the attorney from being able to provide reliable and economical services to *685that client, and would constitute an overwhelming burden on the attorney's practice as a whole. We conclude, therefore, that Brock had no duty to advise Schalock when the real estate contract was drafted of its effect on his testamentary distribution.
Carpenter's Conduct
Finally, we must consider appellants' allegations as to Carpenter's conduct. Appellants contend that when Carpenter drafted the real estate contract, he was negligent in failing to inform Schalock that the sale of the property on a contract could change the nature of the property and affect his plans for the disposition of his estate.
Appellants acknowledge that in order for Carpenter to have such a duty, he would have to he imputed with knowledge of the contents of Schalock's will. We believe that it would be unreasonable to impute such knowledge to Carpenter. To so hold would impose potentially staggering responsibilities on attorneys. An attorney would have to research every matter that attorney's firm had previously handled for the client, no matter how large the firm or how extensive the firm's prior work for the client. This would place an unreasonable burden on the attorney and would markedly increase the cost of providing legal services.
If Carpenter had no knowledge of the contents of Scha-lock's will, then it follows that Carpenter had no duty to advise Schalock that the sale of his property on the real estate contract could affect the disposition of his estate. Because he did not know the terms of the will, Carpenter cannot be expected to have recognized the possibility that the sale could have any impact on Schalock's estate plan.
If Carpenter had no such duty to Schalock, he certainly could not have owed a similar duty to appellants. There cannot be a greater duty between an attorney and third persons affected by the attorney-client agreement than there is between the attorney and the client.
Furthermore, no such duty to appellants could arise under the multi-factor balancing test or the third party *686beneficiary theory. Because Carpenter had no reason to know the contents of Schalock's will, he could not have foreseen that the sale on the real estate contract might harm appellants. In addition, appellants could not have been intended to benefit from the attorney-client relationship between Carpenter and Schalock, because the sale on the real estate contract had no conceivable benefit to them.
We conclude that Carpenter had no duty to appellants to inform Schalock that the sale of his farm on the real estate contract could affect his testamentary distribution. Therefore, appellants are not entitled to relief for their claims regarding Carpenter's conduct.
In summary, we hold that appellants are unable to prove any facts which would entitle them to relief for any of respondents' conduct in handling the testator's affairs. We affirm the trial court's dismissal of this action for failure to state a claim upon which relief may be granted.
Utter, Brachtenbach, Dolliver, Dore, Andersen, and Callow, JJ., concur.
Pearson, C.J., concurs in the result.