Smith v. O’Donnell, 288 S.W.3d 417 (Tex. 2009).
Executor sued Decedent’s former Attorneys for malpractice in advising
Decedent in his capacity as the executor of his wife’s estate. The lower
court ruled in favor of Attorneys basing its judgment on the fact that
Decedent’s executor and the estate lacked privity of contract with
Attorneys. The Supreme Court of Texas granted a petition for review
without reference to the merits, vacated the lower court’s judgment, and
remanded so the lower court could take into account the holding in Belt
v. Oppenheimer, Blend, Harrison & Tate, Inc., 192 S.W.3d 780 (Tex.
2006).
On remand, the Court of Appeals began its analysis by holding that Belt
was not limited to estate planning malpractice actions. Accordingly, the
court explained that Executor stepped into Decedent’s shoes and could
bring whatever malpractice action Decedent could have brought while
alive, even if it did not involve the planning of Decedent’s estate. The
court relied on language in the Belt decision which provided that “legal
malpractice claims alleging pure economic loss survive in favor of a
deceased client’s estate.” The court then examined the evidence and
concluded that although there was no evidence that Attorneys acted with
malice or breached fiduciary duties, there was a triable issue as to
what damages were attributable to Attorneys’ acts. The court remanded
the case to the trial court to determine whether Attorneys’ acts amount
to malpractice. O’Donnell v. Smith, 234 S.W.3d 135 (Tex. App.—San
Antonio 2007). Attorneys appealed.
The Texas Supreme Court affirmed. The court agreed with the Court of
Appeals that Executor is in the same position as Decedent. If Decedent
had not died, Decedent could have brought the malpractice action and
thus Executor may bring the action on Decedent’s behalf. The court
explained that the concerns about third-party malpractice suits (e.g.,
by disgruntled beneficiaries) do not apply in this type of case as the
estate’s suit is the same as the one the client would have brought; the
attorney-client relationship is not jeopardized by the attorney
considering the impact on a third party.
Note: The court does not address whether Attorneys’ actions constituted
malpractice.
Dissent: A two-judge dissent asserted that this case falls under the
Barcelo v. Elliott, 923 S.W.2d 575 (Tex. 1996), rule which precludes a
malpractice action by a non-client (e.g., an unhappy beneficiary)
against the decedent’s attorney for malpractice because of lack of
privity.
Moral: A decedent’s claim for legal malpractice, regardless of whether
it involves the planning of the decedent’s estate or some other legal
matter, survives and thus may be brought by the decedent’s personal
representative.