1. Attorney Liability: Estate Planning and the
Strict Privity Rule
INSIGHT
WEALTHCOUNSEL INSIGHT BRIEF | 2016
Jennifer L. Villier, JD
The strict privity rule has long protected estate planning attorneys from lawsuits brought against them
by disappointed beneficiaries. While some states have crafted broader exceptions to strict privity in
the estate planning context, a recent decision by the Colorado Supreme Court indicates that strict
privity, with a narrow exception, is here to stay in Colorado. What does this mean for Colorado estate
planning attorneys? Generally, they can rest assured that absent fraud, or a malicious or tortious act,
they will not be sued by non-clients in an estate planning matter. Citing a litany of case law from other
jurisdictions, the decision is instructive for any estate planning attorney concerned about the potential
for non-client, third-party liability.
In Baker v. Wood, Ris & Hames, 2016 CO 5, No. 13SC554 (January 19, 2016), Merridy Kay Baker
(“Baker”) and Sue Carol Kunda (“Kunda”) sued the attorneys retained by their father, Floyd Baker, to
prepare his estate plan.
Facts
The facts and circumstances leading to the dispute are not uncommon in today’s society of
remarriages and blended families. In addition to Baker and Kunda, Floyd had two stepchildren, Paula
Roosa (“Roosa”) and Robert Brown (“Brown”), who were his wife, Betty Baker’s, children from a prior
marriage. Floyd retained Wood, Ris & Hames, PC,1
Donald Cook and Barbara Brundin (the “Attorneys”),
who prepared a will and testamentary trusts to govern the dispositive terms of his estate plan. Floyd’s
will provided for the following distributions on his death:
• Each of the four children would receive $10,000;
• Betty would receive Floyd’s condominium;
• The residue of Floyd’s estate would be divided between a marital testamentary trust and a
family testamentary trust, with Betty designated as trustee and beneficiary of both trusts; and
• Betty had the right to principal and income from the trusts’ assets, and on her death, the
remaining trust assets would be divided equally among the four children.
Floyd died in 2003, survived by Betty and all four children. Upon his death, his assets that had been
held in joint tenancy with Betty passed directly to her as the surviving joint tenant. Each of the four
children received a $10,000 distribution, the family trust was funded with assets worth $929,000, and
the marital trust was funded with assets worth $64,000. Shortly after their father’s death, Baker and
1 Incidentally, a Google search for this firm returned a notice that Wood, Ris & Hames, PC has, after decades
of providing legal services, “closed its doors.” We can only speculate whether this prolonged, and potentially
frivolous litigation, had anything to do with the firm’s demise.

2. INSIGHTWEALTHCOUNSEL INSIGHT BRIEF | 2016
Kunda contacted the Attorneys to assure them that the trusts were properly funded and administered.
Brundin responded on behalf of the firm, attached a copy of Floyd’s will, described the mechanics of the
family trust, and instructed Baker and Kunda to retain their own attorney to review the will if necessary.
In the letter, Brundin clearly stated that she represented Betty Baker only, as Personal Representative of
Floyd’s estate, and that she could not represent either Baker or Kunda individually.
In the following year, Betty retained one of the Attorneys, Donald Cook, to prepare her own estate plan.
The terms of Betty’s will stipulated that the condominium would pass to Roosa, and the residue of Betty’s
estate would be divided among the three surviving children, Roosa, Baker and Kunda. Betty died in 2009.
Beneficiaries’ Claims
Baker and Kunda allege that the distribution of assets following Betty’s death resulted in Roosa receiving
70% of Betty’s assets, while Baker and Kunda received only 15% each. By their estimation, Roosa stood to
receive $3.2 million in assets from Floyd’s and Betty’s wills, while they would each receive $962,000.
Baker and Kunda sued the Attorneys, asserting claims including: (i) breach of contract-third party
beneficiary, (ii) professional negligence, and (iii) fraudulent concealment and negligent misrepresentation.
To support their claims, Baker and Kunda alleged that the Attorneys had failed to advise Floyd that titling
his assets in joint tenancy with Betty would frustrate his intent to treat the children equally. Additionally,
they alleged that the Attorneys’ negligence allowed Betty to override Floyd’s estate plan after his death
through the terms of her conflicting estate plan. Baker and Kunda claimed that, as intended beneficiaries
of Floyd’s will, they suffered damages as a result of the Attorneys’ actions and inactions.
Issue
The issue can be summarized in one word: standing. As non-clients of the Attorneys, do Baker and Kunda
have standing to sue? Finding the petitioners lacked standing, the lower courts dismissed the claims and
Baker and Kunda appealed to the Colorado Supreme Court.
Analysis
Baker and Kunda argued that the Court should recognize an exception to the strict privity rule that would
allow them to sue the Attorneys despite the absence of privity. They urged the Court to adopt exceptions
to strict privity that have been utilized in other jurisdictions, namely, the “California Test” and the “Florida-
Iowa Rule.”
Strict Privity Rule
In Colorado, the strict privity rule provides that, with respect to non-clients, an attorney can be held
liable only in the narrow set of circumstances in which the attorney has committed fraud, or a malicious

3. INSIGHTWEALTHCOUNSEL INSIGHT BRIEF | 2016
or tortious act, including negligent misrepresentation.2
Colorado courts and other jurisdictions have
identified numerous policy reasons for this limitation on attorney liability, including the fact that:
• Limiting an attorney’s liability protects the attorney’s duty of loyalty to and effective advocacy for
the client, since the attorney may otherwise be preoccupied with the fear of potential third party
claims.3
• Allowing a non-client beneficiary to maintain a cause of action against an attorney may require the
attorney to reveal confidences the testator would never want revealed.4
• If an attorney’s duty of care were extended to third parties, then the attorney could be liable to an
unforeseeable and unlimited number of people.5
• Expansion of attorney liability could deter attorneys from certain legal engagements, making it
more difficult for potential clients to obtain legal services.6
• Extending attorney liability risks suits by disappointed beneficiaries that would cast doubt on the
testator’s intentions after the testator is unavailable to speak for himself.7
California Test
One of the exceptions to strict privity that Baker and Kunda asked the Court to adopt is known as the
“California Test.” The California Test, as articulated by the California Supreme Court, provides that, in
determining whether a beneficiary of an estate can bring an action against a testator’s attorney for
negligence in drafting a will, various factors must be considered. These include: (i) the extent to which
the transaction was intended to affect the plaintiff, (ii) the foreseeability of harm to the plaintiff, (iii) the
degree of certainty that the plaintiff suffered injury, (iv) the closeness of the connection between the
defendant’s conduct and the injury, and (v) the policy of preventing future harm.8
The Court declined to adopt the California Test, finding it inconsistent with the policies favoring strict
privity. Furthermore, the out-of-state cases Baker and Kunda relied upon were distinguishable because
they involved situations in which a beneficiary did not receive what the testator expressly intended
because of the attorney’s poor drafting or failure to follow through to achieve the testator’s desired
2 Allen v. Steele, 252 P.3d 476, 482 (Colo. 2011).
3 See, e.g., Accident & Injury Med. Specialists, P.C. v. Mintz, 2012 CO 50, 279 P.3d 658, 663-64; Shoemaker v.
Gindlesberger, 887 N.E.2d 1167, 1171 (Ohio 2008); Barcelo v. Elliott, 923 S.W.2d 575, 578 (Tex. 1996); Noble v. Bruce, 709
A.2d 1264, 1270 (Md. 1998).
4 Noble, 709 A.2d at 1278.
5 Mintz, 279 P.3d at 663; Allen, 252 P.3d at 482.
6 Chem-Age Indus., Inc. v. Glover, 652 N.W.2d 756, 770 (S.D. 2002); Noble, 709 A.2d at 1270.
7 Blair v. Ing, 21 P.3d 452, 459 (Haw. 2001); In re Estate of McCreath, 240 P.3d 413 (Colo. App. 2009) (allowing
disappointed beneficiaries to question a deceased testator’s intentions contradicts the policy underlying Colorado’s
dead man’s statute, § 13-90-102, C.R.S. (2015)).
8 Lucas v. Hamm, 364 P.2d 685 (Cal. 1961).

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result.9
The Court determined that Baker and Kunda received precisely what Floyd’s will said they should
get.
Notwithstanding the willingness of other jurisdictions to permit lawsuits by disappointed non-client, third-
party beneficiaries, the Court held that the “strict privity rule (with its limited exceptions) better protects
the sanctity of and duties and protections inherent in the attorney-client relationship.”10
The Court noted
that disappointed beneficiaries have recourse in the Colorado Probate Code, which permits them to
litigate what they perceive to be the testator’s true intent.11
Florida-Iowa Rule
The other exception to strict privity that Baker and Kunda urged the Court to adopt is the so-called
“Florida-Iowa Rule,” which extends the third-party beneficiary theory of contract liability to allow them
to bring a malpractice claim against the Attorneys. The Court declined to adopt this exception, finding it
contrary to the policies underlying the strict privity rule. Under Colorado law, a non-party to a contract
can sue only if the parties to the contract intended to benefit the non-party, and the benefit is a direct
(not incidental) benefit of the contract.12
The Florida-Iowa Rule requires that the testator’s intent be expressed in the will. It does not apply to
disappointed beneficiaries seeking to introduce extrinsic evidence to prove that the testator’s intent was
other than what was expressed in the will.13
Since Baker and Kunda received what was expressly provided
for in Floyd’s will, the Florida-Iowa Rule, even if it was the law in Colorado, would not apply to their claim.
Fraudulent Concealment
Baker and Kunda further alleged that the lower court erred in treating their fraudulent concealment
claims as if they were based on overt misrepresentations, and improperly applying a heightened pleading
standard to those claims. The Court disagreed, holding that Colorado courts have consistently required
all claims based on fraud to be pleaded with particularity. Baker and Kunda failed to do so. Rather,
they alleged that the Attorneys concealed from them “numerous material facts that in equity and good
conscience should have been disclosed,” including the facts that (i) the majority of Floyd’s estate was held
in joint tenancy with Betty, and (ii) Betty could change her own estate plan to reduce the shares Baker
and Kunda would receive. Baker and Kunda argued that Cook represented Betty in drafting her estate
plan that was designed to foil Floyd’s testamentary intent.14
9 Shriners Hospital for Crippled Children, Inc. v. Southard, 892 P.2d 417 (Colo. App. 1994).
10 Baker, at 17.
11 Id.; C.R.S. § 15-11-806 (2015).
12 Baker, at 21; E.B. Roberts Constr. Co. v. Concrete Contractors, Inc., 704 P.2d 859, 865 (Colo. 1985).
13 Baker, at 22-23; Mieras v. DeBona, 550 N.W.2d 202, 208 (Mich. 1996); Calvert v. Scharf, 619 S.E.2d 197, 208 (W. Va.
2005).
14 Baker, at 26-27.

5. INSIGHTWEALTHCOUNSEL INSIGHT BRIEF | 2016
The Court dismissed their claims. Baker and Kunda cited no applicable law to support their argument
that equity and good conscience required the Attorneys to disclose to them information pertaining to
their father’s joint tenancy property. Additionally, there is no evidence the Attorneys intended for Baker
and Kunda to act on any purported concealment. To the contrary, Brundin encouraged them to seek
independent counsel to represent them.
Conclusion
Although the Court’s opinion offers nothing novel with respect to estate planning attorney liability,
Colorado attorneys can surely sleep better at night knowing the state’s Supreme Court has put a rubber
stamp on the applicability of the strict privity rule in Colorado. The opinion is helpful to practitioners
in other jurisdictions as well, as it cites to numerous courts’ applications of the exceptions to strict
privity. Those cases almost uniformly involved situations in which, as a result of negligent legal drafting
or the failure to follow through, (i) the testator’s intent was not clearly expressed in the will, or (ii) the
beneficiaries did not receive what the will expressly provided for. In other words, even in jurisdictions
with broader exceptions to strict privity than that found in Colorado, the courthouse door is far from wide
open to disappointed beneficiaries looking to sue estate planning attorneys.
In light of Baker and its progeny, it would be prudent for estate planning attorneys concerned about
non-client, third-party liability to (i) establish boundaries with non-clients; (ii) provide written notice of
the lack of an attorney-client relationship and suggest that non-clients seek independent representation
to ascertain their rights with respect to an estate plan; and (iii) while it goes without saying, avoid acting
or failing to act in a manner that could be construed as fraudulent, malicious, or tortious (including
negligent misrepresentation). In addition, proper funding and consistent, written communication with
clients about the status of their estate plan can help set client expectations, as well as create a paper
trail for disappointed beneficiaries to follow after the estate plan “matures.” By communicating clearly,
consistently, and in writing, the attorney can often cutoff claims by disappointed heirs before they reach
the point of litigation.
WealthDocx’s revocable living trust includes a provision to address contests brought by beneficiaries and
heirs of an estate. The language, which is customizable by jurisdiction, generally provides that:
If any person attempts to contest or oppose the validity of this trust or any amendment to
this trust, or commences, continues, or prosecutes any legal proceedings to set this trust
aside, then that person will forfeit his or her share, cease to have any right or interest in
the trust property, and will be considered to have predeceased me for purposes of this
instrument.
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