The Lawyer as Beneficiary

A Last Will being signed at Hammerle Finley Law Firm.

In 1991, Mr. Olson was a Texas licensed lawyer.  He and his wife met Hope while she was a resident in a nursing home.  They entered into an agreement that provided Olson and his wife would move into Hope’s house and make improvements in exchange for receiving her house when she died.   If Hope recovered enough, then she could move in with them.   Mr. Olson prepared an agreement and a will, both of which Hope signed.

Hope never recovered, and died soon after.   Her only child, Robert, challenged the will.  Robert won, and here is why.

It is against the law, and unethical, for a lawyer to write a will for a client that makes him a beneficiary.  Olson argued to the appeals court that he wasn’t acting as Hope’s attorney, but the court decided that was hogwash.   It said “no phase of law requires a more profound learning on the subject of trusts, powers, taxation law, legal and equitable estates and perpetuities than preparing a will.   Only licensed persons trained in such complex legal subjects can perform these duties for someone else.”    [Sidenote: think about that next time you are tempted to download an internet will]

Having decided that Olson was representing Hope when he wrote up the agreement and will, the court determined that Olson’s actions were unethical.     Ethics Rule 1.08(b), prohibited Olson from preparing an instrument [the will]  that gave him a substantial gift.

The court then determined that Olson’s actions also violated the probate code.  That meant the provision of the will giving Olson and his wife the property was void.

Mr. Olson and his wife took nothing under the will.

Additional information about exceptions:   The law and ethics code provisions do not apply to transactions where the lawyer is related to the donee/testator.  The ethics code prohibition doesn’t apply to mere tokens of appreciation or holiday gifts that meet the standard of fairness.  Neither the probate code nor the ethics code prohibit transactions where there is adequate consideration and full disclosure.