Case Summary: The Fiduciary Exception to Attorney-Client Privilege in Pennsylvania

In Re: Trust Established under Agreement of Sarah Mellon Scaife, Deceased dated May 9, 1963, No. J-A06008-22, 2022 WL 1617129, (Pa. Super. May 23, 2022)

In the context of litigation regarding objections to a trustees’ account, the estate of a deceased beneficiary sought production of unredacted versions of previously produced documents on the basis of a fiduciary exemption to attorney client privilege and the attorney work product doctrine. Following the issuance of the Pennsylvania Supreme Court’s plurality decision in In Re Estate of McAleer, 248 A.3d 416 (Pa. 2021) (“McAleer II”) the orphans’ court required the production of the unredacted documents.

In affirming the orphans’ court decision, the Pennsylvania Superior Court concluded that “a fiduciary exception to the attorney-client privilege is consistent with Pennsylvania law.” Scaife, 2022 WL 1617129, at *14.  In support of this conclusion, the court relied on Follansbee v. Gerlach, 56 Pa. D. & C.4th 483 (C.C.P. Allegheny 2002), McAleer II, and In Re Estate of McAleer, 194 A.3d 587 (Pa. Super. 2018)(“McAleer I”).  The conclusion was based upon the court’s balancing the interests of protecting communications between attorneys and their clients, and the obligation of a trustee to inform beneficiaries regarding the administration of the trust.

Of particular interest is that, unlike in the previous cases, the court found no support for conditioning the fiduciary exception on whether the trust paid counsel fees.  It did, however, determine that “a trustee is privileged from disclosing to beneficiaries or co-trustees’ (sic) opinions obtained from, and other communications with, counsel retained for the trustees’ personal protection in the course, or in anticipation, of litigation,” finding that “the balancing of interests affords the greatest protection to beneficiaries, trustees and counsel.”  Scaife, 2022 WL 1617129, at *15. (emphasis in original).