The traditional protection from legal malpractice claims afforded Estate practitioners by the doctrine of Privity has been relaxed by a recent New York Court of Appeals decision.
In the Estate of Saul Schneider v Finmann[i], a unanimous Court of Appeals has ruled that a personal Estate representative “stands in the shoes of the decedent,” and therefore has “the capacity to maintain a malpractice claim on the Estate’s behalf[ii].”
On September 1, 2009, significant changes to the New York law of Durable Powers of Attorney will take effect.
The current statute in the General Obligations Law has a Durable Power of Attorney Statutory Short form, which has been in effect since January 1, 1997 and is a basic form in which you can add unlimited gift giving authority to the Power of Attorney within the form by initialing a box. In Salvation Army v. Ferrara, 2006 N.Y. Slip Op. 05156 (2006) the Court of Appeals restricted the statutory provisions and determined that the gift-giving authority including gift giving to the attorney-in-fact, had to be in the “best interests of the principal,” which was narrowly defined as gift giving authority to the attorney in fact which is allowed only if it is for gift, income, and estate tax purposes.
By: James L. Hyer, Esq.
On May, 2, 2007, a decision was rendered in Penny D. Taylor v. Joseph Rosa, No. 76026-04 (Bronx Sup. 2007), significantly changing the law of Paternity By Estoppel.
This noteworthy decision came less than a year after the New York State Court of Appeals holding In The Matter of Shondel J. v. Mark D., 7 N.Y.3d 320, 853 N.E.2d 610, 820 N.Y.S2d 199, 2006 N.Y. Slip Op. 05238 that ruled in favor of Paternity By Estoppel. In that case, the Court of Appeals upheld the lower court determinations that a man was required to pay child support for a child despite irrefutable DNA evidence that the child was not biologically his.
Over the past two years the New York Courts have taken increasingly nuanced positions in the interpretation, enforcement, and denial of In Terrorem clauses in a variety of contexts. A more expansive reading of Estates, Powers and Trusts Law (EPTL) § 3-3.5(b) advocated by the Court of Appeals in the 2009 case Matter of Singer[i], has lead to a broader discovery process, and arguably, a narrower interpretation of a testator’s intent. Alternatively, in 2010 the Appellate Division, First Department, declined to broaden the application of EPTL § 3-3.5(b), surprisingly yielding a more expansive interpretation of an In Terrorem clause in the Matter of Cohn[ii]. Each of these cases are instructive on how to better drat and use the In Terrorem clause when trying to preserve a client’s Estate plan, and offer insight into the Courts’ approach to determining a testator’s intent regarding its use.
Until quite recently, Estate practitioners were protected from Estate planning malpractice claims by Estate representatives by the often overlooked protections afforded by the doctrine of Privity. However, with their unanimous June 2010 decision in the Estate of Saul Schneider v Finmann[i], the New York Court of Appeals has relaxed this traditional safeguard and allowed for a new cause of action in the State against a negligent Estate planning attorney.
Although the Schneider decision represents a marked change from the prior bar on suits by personal representatives against a negligent Estate planning attorney, its rationale is far from revolutionary, and its rather narrow ruling endeavors to balance the interests of both Estate representatives and their legal counsel.
Marriage is the chief cause of divorce. – Groucho Marx
Perhaps second only to the issue of child custody, determining what assets are—or are not—subject to Equitable Distribution is the most important factor that shapes matrimonial litigation.
Since 1980, New York State has employed the Equitable Distribution methodology to dividing “Marital Property” in divorce proceedings. The Equitable Distribution approach, in stark contrast to the division used in common law property states, divides “Marital Property” equally regardless of individual ownership by taking a snapshot of the assets owned between husband and wife upon the commencement of the Divorce action.
Our office has a particular respect and appreciation for the nature of modern police and firefighting work which exposes police and firefighters to risk of physical injury on a daily basis, thereby increasing their vulnerability to physical injury or death. Our firm’s partner, Irving O. Farber, Esq., has a first-hand understanding of the dangers faced through his role as a Mount Kisco volunteer firefighter.
To fellow practitioners, past, and potential clients: Bashian & Farber, LLP, is pleased to announce that as part of our continued efforts to offer the highest quality legal services in the greater Hudson Valley, we are enthusiastically expanding in the area of Appellate Practice. We are currently litigating several matters in the Appellate Division, Second Department; the Appellate Term, Second Department; and have recently applied for leave to appeal to the Court of Appeals, the highest Court in New York State.
By: Gary E. Bashian & James G. Yastion
IN A CONSTRUCTION PROCEEDING, THE
COURT WILL GO ONLY SO FAR IN
INFERRING THE CREATION OF A TRUST
The petitioner in this proceeding sought a construction of the decedent’s Will as creating a trust for her benefit. Estate of Louis Arancia, NYLJ, April 9, 2003, p. 24 (Surr. Ct. Kings Co.). Her petition was denied.
The petitioner was the executrix of the decedent’s Will and his surviving spouse. She claimed that paragraph THIRD of the Will created a trust for her benefit. She cited paragraph THIRD which gave the decedent’s securities to the petitioner for her life and the remainder to their daughter, and further provided that the assets would be held “in trust during [the petitioner’s] lifetime.”
Bashian & Farber, LLP 