Does SCPA 2110 Authorize Payment of a Beneficiary’s Legal Fees from the Estate?

“Under the general rule, attorneys’ fees and disbursements are incidents of litigation and the prevailing party may not collect them from the loser unless an award is authorized by agreement between the parties or by statute or court rule” (A. G. Ship Maintenance Corp. v Lezak, 69 NY2d 1, 5 [1986]).  This rule limits this court’s discretion and authority to award fees to a beneficiary payable from an estate (see Matter of Urbach, 252 AD2d 318, 321 [3d Dept 1999] [“all parties to a controversy, the victors and the vanquished, [must] pay their own counsel fees”]; see also Matter of Rodken, 2 AD3d 1008, 1009 [3d Dept 2003] [“An attorney may be compensated from estate funds only for services that benefit the estate”]; Matter of Baxter [Gaynor], 196 AD2d 186, 190 [4th Dept 1994]).  

To be compensated for legal fees from an estate, the “legal services [must] have been rendered for the benefit of the estate as a whole, resulting in the enlargement of all the shares of all the estate beneficiaries” (Matter of Burns, 126 AD2d 809, 812 [3d Dept 1987]; Matter of Wallace, 68 AD3d 679, 680 [1st Dept 2009]; Matter of Baxter [Gaynor], 196 AD2d at 190; see also Matter of Kinzler, 195 AD2d 464, 465 [1st Dept 1993]; Matter of Carver, 19 Misc 3d 1110[A], 1110A, 2008 NY Slip Op 50632[U], *3 [Sur Ct, Essex County 2008] [citing cases]).

On the other hand, “where the legal services rendered did not benefit the estate but benefitted only the individuals whom the attorney represented, the attorney must seek compensation from the clients individually” (Matter of Wallace, 68 AD3d at 680; see also Matter of Rodken, 2 AD3d at 1008; Matter of Baxter [Gaynor], 196 AD2d at 190).

An Interview with an Estate Litigation Attorney (Part 2)

Q. What skills should an Estate Litigation Attorney possess?

A. An estate litigation attorney is required to know the law in several critical areas. First, it is mandatory that the attorney fully understand the law pertaining to the making of a valid will or trust, as that is often the heart of the contest. An estate litigation attorney must know and understand how estate planning attorneys operate and how they develop and achieve a client’s estate plan.

An estate litigation attorney must also know the state and federal procedural rules of the court cold. The attorney is equally required to know how to prove the client’s case. For example, it must be second nature for the estate litigation attorney to prove that a will was properly prepared and signed under the statute that prescribes how to make a valid will or that a person making a will lacked legal capacity or was subjected to undue influence. An estate litigation attorney must not only know the four basic objections to a will, but also know how to either prove a valid objection or successfully defend against objections lacking merit in to obtain a dismissal.

Q. Are there other skills that come in handy?

A. Strong litigation and in particular, trial skills are a tremendous advantage. Many lawyers who draw a lot of wills and trusts and plan estates, try to handle the estate litigation. These well-intentioned but misplaced efforts often result in case failures or settlements too generous to the other side due to a lack of significant estate litigation and negotiation experience. Lawyers with a lot of experience in lawsuits are better suited to taking the deposition testimony of witnesses under oath as they are accustomed to dealing with non-cooperative and evasive witnesses, shades of truth and confrontations with documentary evidence.

Q. Do you need to understand medical proof?

A. It is mandatory. The estate litigation attorney must have significant professional experience with medical/legal matters. It is impossible to handle a case where the decedent’s capacity is an issue if you do not fully understand the medical details of the decedent’s condition. In order to properly handle the case, the lawyer must be fully versed in all medical issues involving the decedent, fully understand all of the medical records and charts, diagnostic tests and results and ultimately, know how to legally prove the decedent’s condition in court. There are countless dismissals of objections that allege only that the decedent was old, of advanced age, senile, demented, weak or sick. Without more and strong medical and lay person evidence, these claims are properly dismissed for failures of proof.

It is a recipe for disaster in a case where a lawyer is unfamiliar with the medical terminology, practices and procedures. Not only can it be embarrassing but the medical witnesses become frustrated with what they perceive to be a lack of preparation and skills.

Q. Why does the Estate Litigation Attorney need to know how lawyers work?

A. Inevitably estate and trust litigation often is an intense study and critique of the drafting attorney’s work and conduct. An objectant’s attorney ordinarily is critical of the work, seeking to attack it to cause the instrument to fail in court. The attacks range from the basics pertaining to the paperwork to the leveling of allegations of attorney misconduct and negligence. In these cases, a strong attorney defending the estate knows the standard of care required to be upheld by the drafting attorney and brings out the drafting attorney’s good work and fine product.

Q. Is invalidating a will or trust in New York courts easy?

A. No. The law favors validity of wills and trusts that are properly prepared and signed. The law makes it difficult to upset valid planning put in place by a decedent. This makes sense for a number of good reasons. First, the law favors and encourages people to plan their estates. The law is deferential to decedent’s lawful intentions rather than imposing generic dispositions. In New York, the law takes it a step further to add a presumption of validity to wills that are signed under the supervision of an attorney. Further, in New York the level of capacity required to make a valid will is quite low. The law sends a strong message to residents who take the time and often incur substantial expenses to plan their estates, that the law will make the success of the estate plan more likely than challenges attempting to destroy it.