The Law Society’s Ethics Committee recently released the following Professional Conduct Ruling as guidance for the profession. For your convenience, I’ve listed the ruling below but it can also be found in our Professional Conduct Rulings Database.
If you have any questions or concerns regarding this post, please contact the Law Society at (306) 569-8242 or 1-833-733-0133.
Date: April 26, 2018
Cite as: 2018 SKLSPC 4
Classification: Quality of Service, Rule 3.2-1 & Conflict of Interest, Rule 3.4
Practice Area: Wills and Estates
Ethics Committee Ruling
Lawyer X represented Client A in the drafting of two wills, several years apart. Client A was referred to Lawyer X by Client A’s financial institution (the “Financial Institution”), as Client A did not have a lawyer of their own. The Financial Institution referred individuals needing estate planning to Lawyer X in the event they did not have their own lawyer. The Financial Institution, with the assistance of Client A’s child (“Child 1”), and Child B’s uncle (“Uncle D”), took will instructions from Client A. Lawyer X received the instructions from the Financial Institution and proceeded to draft a will for Client A (the “New Will”). Lawyer X reviewed the New Will with Client A. The New Will was executed by Client A and witnessed by Lawyer X and Uncle D. The New Will was a significant departure from Client A’s previous will (the “Old Will”), which Lawyer X was not involved in. When compared to the Old Will, the New Will reduced the inheritance entitlement of another one of Client A’s children, Child 2 (“Child 2”), from 100% to 20% and increased the entitlement of Child 1 from 0% to 40%. Unbeknownst to Lawyer X was that Child 1 and Uncle D had an informal arrangement that would see some of Client A’s estate proceeds go to repay money owed to Uncle D (a board member of the Financial Institution) in respect of a failed business of Child 2.
Prior to the New Will, Client A had added Child 2 as a joint owner on some real estate, and a bank account at the Financial Institution. Several years later it was discovered that the Financial Institution added Child 1’s name to Client A and Child 2’s joint bank account, without Child 2’s consent, and possibly without Client A’s consent. Upon learning Child 1’s name had been added to the joint account, Child 2 withdrew the entire balance from the account. Thereafter, Child 1 and Uncle D approached Lawyer X, separately, and claimed that Child 2 had withdrawn all the money from Client A’s bank account, and that the account balance was intended by Client A to be part of the estate rather than Child 2’s property. In a phone call with Uncle D, Lawyer X ran through different scenarios for how to proceed and suggested revisions to Client A’s New Will to account for the property Child 2 had in their possession. Lawyer X then drafted another will (the “Third Will”) in such a way that Child 2’s gift in the Third Will would be nullified unless Child 2 returned the money taken from the joint bank account. Once the Third Will was drafted, Lawyer X attended upon Client A; Client A was in the hospital and was over the age of 90. Lawyer X proceeded to review the content of the Third Will with Client A and obtained Client A’s agreement with its terms and contents. Lawyer X reviewed the Third Will with Client A three times during that visit. Lawyer X assessed Client A’s competence while completing one of the reviews of the Third Will, during which another of Client A’s children (“Child 3”) was present. Lawyer X and a hospital nurse witnessed Client A sign the Third Will after a final review. Client A died less than two months after signing the Third Will. After Client A’s death, Child 2 claimed that both Client A’s New Will and Third Will were not reflective of Client A’s wishes. In addition, Child 2 alleged that Lawyer X was in a conflict of interest in preparing both the New Will and the Third Will for Client A as Lawyer X also worked for the Financial Institution, and that Lawyer X acted for Uncle D and not Client A.
The Ethics Committee determined that Lawyer X represented Client A and no other party. The Committee further found that Lawyer X was not in a conflict of interest in accepting instructions from third partiesp, but in that situation the member needed to take steps to ensure the instructions were in accordance with the testator’s wishes. The Committee found that Lawyer X confirmed Client A’s instructions in a sufficient manner.
The Ethics Committee further indicated generally that the prior guidance from this committee requires modernization, in that members often receive instructions from third parties on wills, i.e. accountants, estate planners and financial advisors. Still, when lawyers receive will instructions from independent third parties, they need to ensure that they are doing their due diligence and are having the necessary conversations with clients to ensure that their clients have capacity, an understanding of the property, potential beneficiaries, and that the will(s) they are drafting are in accordance with their client’s instructions. Best practices include ensuring that the information received from the third party is sent to the client to confirm that these reflect their instructions. If no confirmation is received, the instructions are not acted upon. If confirmation is received, then the will is prepared in the normal course. Members should be cautious preparing wills for clients who are aged, potentially medicated, in hospital, etc. Another critical component of will-drafting is the size of the estate and whether other professionals need to be included. (It goes without saying that extreme caution is warranted where there are substantial changes with previous wills without specific reasons being reviewed with the testator).