We all know that when attorneys represent fiduciaries of any kind (be it guardians, personal representatives or trustees) much of the work we do is intended to benefit not just our clients, but the third parties they’re charged with serving (for example, a guardian’s ward or the beneficiaries of estates and trusts).

The general trend in Florida (especially in the trusts and estates context) is that a third-party beneficiary of your legal services can sue you for malpractice. Examples of this trend include cases in which the beneficiaries of a deceased ward’s estate had standing to sue a guardian’s lawyers for malpractice (see here, here), estate beneficiaries had standing to sue a decedent’s estate planning attorneys for malpractice (see here), and a successor personal representative had standing to sue his predecessor’s attorney for malpractice (see here).

The common-law “fiduciary exception” rule:

A corollary to the line of cases entitling third-party beneficiaries to sue a fiduciary’s attorney for malpractice is the common-law “fiduciary exception” to the attorney-client privilege, which allows third-party beneficiaries to demand access to privileged communications. The basic rule is that if the attorney-client communication has to do with normal administration issues the beneficiaries of the trust or guardianship/probate estate are the intended third-party beneficiaries of that work, so they’re entitled to the information. If the communication has to do with the fiduciary’s own  self interest, for example, if he or she is being sued for malfeasance, then he’s the sole intended beneficiary of that work, and the communications are privileged. In 2006 I wrote here about the application of this rule in the context of a contested Florida guardianship proceeding.

The fiduciary exception is an inherently ambiguous rule that creates huge uncertainties for fiduciaries and their attorneys, inhibiting the free flow of information between clients and their attorneys, which is bad news for all concerned. In 2011 we fixed that problem in Florida by legislatively abolishing the fiduciary-exception rule by adopting new F.S. 90.5021 (see here).

So here’s the question addressed in the linked-to order: Can we have it both ways? Can we allow third-party beneficiaries to sue attorneys working for their fiduciaries while simultaneously blocking those same plaintiffs from getting their hands on privilege attorney-client communications?

Bivins v. Rogers, — F.Supp.3d —-, 2016 WL 4702682 (S.D.Fla. Sept. 07, 2016):

This case involves a contested guardianship proceeding that bled over into a contested probate proceeding when the ward passed away. After the ward died his son was appointed personal representative of his estate, and in that capacity he sued the guardian’s attorneys for malpractice, alleging that they “did not properly administer the guardianship to maximize its assets.”

Plaintiff demanded access to the confidential files of the guardian’s attorneys. They refused, asserting the attorney-client privilege. Plaintiff then challenged the privilege assertion on several grounds, two of which should be of interest to every trusts and estates attorney in Florida.

First, plaintiff argued that the Florida Supreme Court’s refusal to adopt F.S. 90.5021 for procedural purposes meant the statute wasn’t valid. I’ve heard this concern from other lawyers, but never thought it really made sense. And I was right. Court said NO to this argument:

While the Florida Supreme Court did decline to follow the Committee’s recommendation to adopt the new provision of the Evidence Code, it did so because the Court “question[ed] the need for the privilege to the extent that it is procedural” and not because the statute was unconstitutional or otherwise unlawful. [See In re Amendments to Florida Evidence Code, 144 So.3d 536, 536–537 (Mem) (Fla.2014).] The Florida Supreme Court’s decision not to adopt Section 90.5021 because it questioned the need for the privilege “to the extent that it is procedural” did not vitiate or overturn the statute. Therefore, contrary to Plaintiff’s argument, the statute remains the law in Florida.

Second, plaintiff argued it was crazy to allow him to sue the guardian’s attorneys for malpractice and at the same time allow these same attorneys to block his discovery requests on privilege grounds:

Plaintiff asserts that it would be nonsensical to allow beneficiaries and estates to sue the attorneys who represent the guardians for malpractice (which Defendants concede beneficiaries and estates are permitted to do by law), but then prevent the beneficiaries and estates from obtaining discovery necessary from the attorneys to prove their malpractice cases.

I don’t buy this argument. There’s nothing stopping a plaintiff from prosecuting a valid malpractice claim without ever getting bogged down in a privilege fight with the defendant attorney. And if anyone’s going to waive the privilege shield, it’s likely going to be the defendant attorney who will want to point to his work product as evidence of due care. Anyway, plaintiff struck out here as well, although the trial court’s reasoning isn’t exactly comforting to those of us who think getting rid of the fiduciary-exception rule was a good idea.

Plaintiff asserts that, since wards and their estates are permitted to sue the guardians’ attorneys for malpractice, it would only make sense for the wards and their estates to be able to obtain the documents necessary to prove their malpractice cases. While Plaintiff’s argument is arguably logical, the Court cannot simply ignore the applicable existing law. This Court will not make policy decisions as that is the job of the legislature. Whether it was prudent or not for the Florida legislature to enact Section 90.5021 is not within the purview of this Court. The fact of the matter is that Section 90.5021 is clear and unambiguous, and the statute supersedes the pre-2011 case law.

Does the common-law “fiduciary exception” to the attorney-client privilege still matter in Florida? NO

The last thing anyone wants is for guardians, personal representatives or trustees to NOT talk to their attorneys. We want these fiduciaries to be fully aware of all of their legal obligations and get the best advice possible on how to comply with those duties. This is especially true in cases where there’s family conflict. Getting rid of the fiduciary-exception rule helps make sure those conversations take place. And cases like this one make sure the right message gets out: it’s safe to talk to your lawyer!