Michigan Supreme Court Upholds Attorney as Beneficiary Under Client’s Will
In re Mardigian Estate, No. 152655, 2018 WL 3077084 (Mich. June 21, 2018).
The Michigan Supreme Court affirmed the appellate divisions ruling that an attorney was not automatically prohibited from being the beneficiary of a will he drafted for his client, even though such action may violate the rules of professional conduct. Attorney Mark Papazian prepared a will for his friend and client Robert Mardigian. Id. at *2. The will left Papazian and his two children a large portion of Mardigian’s estate. Id. Decedent’s family and girlfriend contested the validity of the will, arguing that it should be void as contrary to public policy because it violated Rule 1.8(c) of Michigan’s rules of professional conduct. Id. Specifically, MRPC 1.8(c) prohibits a lawyer from drafting an instrument that gives the lawyer or a person related to them a substantial gift from a client. Id. at *9.
The probate court granted summary disposition in favor of Mardigian’s family, explaining that it was disinclined to enforce documents that were contrary to the MRPC. Id. at *2. Relying on In re Powers’ Estate, 375 Mich. 150 (1965), the court of appeals reversed, and held that it was “required to remand for further proceedings, in which [Papazian] will be required to overcome the presumption of undue influence arising from the attorney-client relationship…” In re Mardigian Estate, 312 Mich. App. 553, 559 (2015).
The Supreme Court of Michigan granted leave to appeal. In re Mardigian Estate, 2018 WL 3077084 at *3. The appellants argued for a per se rule, prohibiting a testamentary gift to a drafting attorney when a violation of MRPC 1.8(c) occurs. Id. at *7. An evenly divided court declined to adopt a pro se rule, and affirmed the ruling of the appellate division. It reasoned that a per se rule would ignore any genuine consideration of the decedent’s intentions. Id. The per se approach is also contrary to Michigan “Estates and Protected Individuals Code Act” (“EPIC”), sections MCL 700.3407(1)(c) and MCL 700.3407(1)(d), which provide that a will contestant bears the burden of establishing undue influence, and the ultimate burden of persuasion remains with the contestant. Id. at *7. Ultimately the court held that an attorney’s breach of MRPC 1.8(c) does not establish per se undue influence over the decedent, and therefore does not invalidate a will. Id. at *11. Rather, it only shows that there has been a breach of professional conduct unrelated to the legal proceedings. Id. Although the court referenced EPIC, which places the burden on the contestant of a will, it affirmed the appellate court’s instruction on remand that the attorney had the burden of proving he did not unduly influence Mardigian. Id. at *12.
Justice McCormack’s dissent favored a “per se rule of undue influence that voids substantial testamentary gifts to attorney-drafters.” Id. at *12. She acknowledged that a lawyer is required to show they did not apply undue influence to their client, however reasoned that this showing is disingenuous because the client is dead, giving the lawyer an evidentiary advantage. Id.
Unlike the Michigan Supreme Court’s ruling in In re Mardigian Estate, New Jersey takes a more stringent approach. New Jersey has adopted RPC 1.8(c), which states “a lawyer shall not solicit any substantial gift from a client, including a testamentary gift, or prepare on behalf of a client an instrument giving the lawyer or a person related to the lawyer any substantial gift unless the lawyer or other recipient of the gift is related to the client.” The New Jersey Supreme Court has held that reprimand was warranted by an attorney’s conduct in participating in nonrelative’s estate when he had drafted the will and served as executor of the estate. See In the Matter of Edward J. Mangold, an attorney at law, 148 N.J. 76 (1997).