California Court Reversed Malpractice Award in Estate Planning Case

Legal malpractice claims reversed due to insufficient evidence of intent

Jeffrey Grossman, Alexis Grossman, and Nicholas Grossman filed a legal malpractice lawsuit against attorney John Peter Wakeman, Jr. and Wakeman Law Group, Inc. following the death of Dr. A. Richard Grossman. The lawsuit alleged that Wakeman’s estate planning services negligently excluded them from Richard’s 2012 estate documents, which disinherited them and left the estate to his fourth wife, Elizabeth Grossman.

Dr. Grossman had been a prominent burn surgeon and founder of the Grossman Burn Centers. He had two sons, Jeffrey and Peter Grossman. Peter was the father of Alexis and Nicholas. A 2003 version of Dr. Grossman’s revocable trust divided his estate equally between his two sons. In meetings with Wakeman in 2011, Dr. Grossman expressed a desire to disinherit Peter while providing for Jeffrey and the grandchildren through irrevocable trusts.

In late 2011 and early 2012, Wakeman prepared updated estate documents. Though Richard signed trusts for Jeffrey and the grandchildren, he ultimately directed that the bulk of his estate, including Brookfield Farms, go outright to Elizabeth. Wakeman testified that Richard explicitly said he wanted Elizabeth to have everything and trusted her to distribute assets as she saw fit.

Despite this, witnesses for the respondents testified that Richard had always expressed his intent to provide for Jeffrey and the grandchildren, and that the estate plan contradicted this longstanding intent. Respondents brought a malpractice suit as alleged intended beneficiaries. The jury found in their favor and awarded $9.5 million in total damages. The trial court denied a motion for judgment notwithstanding the verdict.

California Court of Appeal reversed jury’s award

On appeal, the California Court of Appeal analyzed whether Wakeman owed a duty of care to respondents, who were not his clients. The court explained that such a duty exists only where the client’s intent to benefit the nonclient is clear, certain, and undisputed. Relying on the standard articulated in Gordon v. Ervin Cohen & Jessup LLP, the court concluded that the evidence of Richard’s intent failed to meet this threshold.

While respondents offered testimony from friends and family suggesting that Richard loved and intended to support Jeffrey and the grandchildren, the court found this evidence insufficient to establish a duty. The court emphasized that the relevant inquiry was not what Richard may have told others, but what he clearly instructed his attorney to do. Wakeman and other witnesses testified that Richard intended to leave his estate to Elizabeth, trusting her to make discretionary decisions afterward.

The court reasoned that imposing malpractice liability in such cases would undermine the attorney’s duty of loyalty to the client and create a risk of conflicting obligations to nonclients. It concluded that attorneys should not be held liable for malpractice absent unequivocal instructions from the client to benefit a specific third party.

Final outcome

The Court of Appeal reversed the malpractice judgments against Wakeman and his law firm and directed the trial court to enter judgment in their favor. It also dismissed the appeal regarding the denial of the motion for judgment notwithstanding the verdict as moot.

Help with estate planning and succession disputes

If you’re involved in a dispute over estate planning or believe an attorney’s drafting decisions have impacted a succession plan, Whitcomb, Selinsky PC handles trust and estate controversies, duty-to-beneficiary issues, and legal malpractice defenses. Reach out to schedule a consultation and learn how our team can assist with your case.