How to Choose a Lawyer for a Trust or Will Dispute

What Should You Weigh When Choosing a Lawyer for a Trust or Will Dispute?

You should weigh courtroom experience with trust and probate disputes, who does the work, the fee and who pays it, conflicts, and which parts of the work another professional can handle. Drafting wills and trusts and litigating over them are different kinds of work. A trust dispute in Minnesota can run as a petition to the district court, and “the court shall, by order, fix a time and place for a hearing” (Minn. Stat. § 501C.0203, subd. 1). A lawyer who has handled those petitions knows the notice, hearing, and evidence steps before your matter starts.

A family business in the trust or estate adds a second body of law. In Lund v. Lund, 924 N.W.2d 274 (Minn. App. 2019), siblings’ trusts held interests in “three privately held Lund family business entities.” The same appeal reviewed a court-ordered buy-out of one sibling’s interests, holding “The district court did not abuse its discretion in granting a buy-out,” and also decided how the trustees’ legal fees are judged. When a company is at stake, I suggest asking whether the lawyer handles business disputes as well as trust and estate disputes.

I also suggest asking who will draft the filings, take depositions, and answer your calls, because the person you meet may not be the person doing the work.

Why Can the Lawyer Who Drafted the Will or Trust Be a Problem?

The lawyer who drafted the documents may be a witness, and may have a conflict. Under Minn. R. Prof. Conduct 3.7(a), “A lawyer shall not act as an advocate at a trial in which the lawyer is likely to be a necessary witness unless” the testimony is on an uncontested issue, “relates to the nature and value of legal services rendered in the case,” or disqualification “would work substantial hardship on the client.”

The drafting lawyer may have met with your parent, taken the instructions, and supervised the signing. In a dispute over capacity, undue influence, or what a document was meant to say, either side may want that testimony. A comment to Rule 3.7 adds that “the dual role may give rise to a conflict of interest that will require compliance with Rule 1.7 or 1.9,” and that this conflict “can arise whether the lawyer is called as a witness on behalf of the client or is called by the opposing party.” Under Rule 3.7(b), another lawyer in the drafter’s firm may try the case “unless precluded from doing so by Rule 1.7 or Rule 1.9.”

Conflict rules can also apply. When the drafting lawyer represented your parent, Minn. R. Prof. Conduct 1.9(a) bars representing another person “in the same or a substantially related matter in which that person’s interests are materially adverse to the interests of the former client unless the former client gives informed consent, confirmed in writing.” The rule’s comment gives a parallel example: “a lawyer could not properly seek to rescind on behalf of a new client a contract drafted on behalf of the former client.” A lawyer whose own drafting is under attack may also have “a personal interest of the lawyer” that limits the representation (Minn. R. Prof. Conduct 1.7(a)(2)).

The drafting lawyer’s file and memory may still help you, whoever you hire. That lawyer’s duties to your parent continue: Rule 1.9(c)(2) bars a lawyer who formerly represented a client from revealing “information relating to the representation except as these rules would permit or require with respect to a client,” and under Minn. Stat. § 595.02, subd. 1(b), “An attorney cannot, without the consent of the attorney’s client, be examined as to any communication made by the client to the attorney or the attorney’s advice given thereon in the course of professional duty.” If you plan to challenge a trust amendment, I suggest asking the lawyer you hire how to request that file.

When Can Trust Money Pay the Trustee’s Legal Fees?

Under Minn. Stat. § 501C.0709(a), “A trustee is entitled to be reimbursed out of the trust property, with interest as appropriate,” for legal fees and other “expenses that were properly incurred in the administration of the trust” ((a)(1)). Under (a)(2), the trustee may also be reimbursed for “expenses that were not properly incurred in the administration of the trust, to the extent necessary to prevent unjust enrichment of the trust.”

In Lund, trustees asked to be paid “nearly $800,000 in attorney fees and costs” from a beneficiary’s trusts. The Court of Appeals held that “the correct legal standard for ruling on a motion for trustees’ attorney fees and costs is provided in Minn. Stat. § 501C.0709, as supplemented by the common law.” The court observed that the statute “echoes the common law, which . . . focuses on whether the fees are reasonable and incurred in good faith.” It sent the request back to the district court and expressed “no opinion on the trustees’ entitlement to fees and costs under the correct standard.”

A beneficiary of an irrevocable trust can ask the trustee for information about the trust’s administration, including its spending. Minn. Stat. § 501C.0813(a) provides that “Unless unreasonable under the circumstances, a trustee shall promptly respond to a beneficiary’s request for information related to the administration of an irrevocable trust.” A settlor may provide in the trust instrument “that paragraph (a) shall not apply” while the trust’s terms require the trustee to keep the settlor or another person reasonably informed, and the trustee then responds to “such person’s requests for information related to the administration of the trust” (§ 501C.0813(b)). Under paragraph (c), “A beneficiary may waive the right to information otherwise required to be furnished under paragraph (a).” The same paragraph provides that “A beneficiary may withdraw any such waiver previously given,” and a withdrawal “must be made by notice delivered to the trustee.” If the bills look wrong, the court can address them in a petition, including one to remove a trustee.

The trustee’s lawyer does not represent you unless that lawyer agrees to. When you have no lawyer, Minn. R. Prof. Conduct 4.3(a) provides that “a lawyer shall not state or imply that the lawyer is disinterested.”

How Are a Personal Representative’s Legal Fees Paid and Reviewed?

A personal representative, the person who administers an estate, may hire a lawyer and pay reasonable fees from the estate, and an interested person may ask the court to review them. Unless the will or a court order restricts it, a personal representative, “acting reasonably for the benefit of the interested persons,” may “employ persons, including attorneys” (Minn. Stat. § 524.3-715(21)).

Litigation fees follow a good-faith rule. Under Minn. Stat. § 524.3-720, “Any personal representative or person nominated as personal representative who defends or prosecutes any proceeding in good faith, whether successful or not,” is entitled to “necessary expenses and disbursements including reasonable attorneys’ fees incurred” from the estate.

The fee must be “just and reasonable” (Minn. Stat. § 525.515(a)). “In determining what is a fair and reasonable attorney’s fee effect shall be given to a prior agreement in writing by a testator concerning attorney fees.” Without one, the factors are “(1) the time and labor required; (2) the experience and knowledge of the attorney; (3) the complexity and novelty of problems involved; (4) the extent of the responsibilities assumed and the results obtained; and (5) the sufficiency of assets properly available to pay for the services” (§ 525.515(b)). The statute adds that “the value of the estate shall not be the controlling factor.”

To challenge the fees, an interested person may petition under Minn. Stat. § 524.3-721, which lets the court review “the reasonableness of the compensation of any person so employed.” Under § 525.515(c), an interested person “shall seek review of attorney fees in the manner provided in section 524.3-721.” The court may also order refunds under § 524.3-721, because “Any person who has received excessive compensation from an estate for services rendered may be ordered to make appropriate refunds.” My page on executor misconduct covers problems beyond fees.

How Should a Lawyer Quote the Fee in a Trust or Estate Dispute?

A lawyer must tell you what the work covers and how you will be charged. Minn. R. Prof. Conduct 1.5(b) requires that the scope and “the basis or rate of the fee and expenses for which the client will be responsible shall be communicated to the client, preferably in writing, before or within a reasonable time after commencing the representation,” except for a regularly represented client billed on the same basis.

Three structures can fit a trust or estate dispute:

1. Flat fee. “A lawyer may charge a flat fee for specified legal services, which constitutes complete payment for those services” (Rule 1.5(b)(1)). It fits a defined step, such as a records request to the trustee or an analysis of the documents.
2. Hourly. You pay for the time spent, so you carry the risk that the dispute runs long. I suggest asking for an estimate by stage: the first letter, the petition and hearing, mediation, and trial.
3. Contingent fee. “A fee may be contingent on the outcome of the matter for which the service is rendered, except in a matter in which a contingent fee is prohibited by paragraph (d) or other law” (Rule 1.5(c)). The agreement “shall be in a writing signed by the client.”

A court can order your own fees paid from the trust or estate in some cases. Under Minn. Stat. § 501C.1004, “In a judicial proceeding involving the administration of a trust, the court, as justice and equity may require, may award costs and expenses, including reasonable attorney fees, to any party from the trust that is the subject of the judicial proceeding.” Lund wrote: “As amicus probate and trust law section of the Minnesota State Bar Association advises, section 501C.1004 governs a beneficiary or third party’s ability to recover attorney fees from trust assets.” In an estate, § 524.3-720 entitles “any interested person who successfully opposes the allowance of a will” to “necessary expenses and disbursements including reasonable attorneys’ fees incurred.” The same section covers two more situations. One is “When after demand the personal representative refuses to prosecute or pursue a claim or asset of the estate or a claim is made against the personal representative on behalf of the estate and any interested person shall then by a separate attorney prosecute or pursue and recover such fund or asset for the benefit of the estate.” The other is “when, and to the extent that, the services of an attorney for any interested person contribute to the benefit of the estate, as such, as distinguished from the personal benefit of such person.” In either situation, “such attorney shall be paid such compensation from the estate as the court shall deem just and reasonable and commensurate with the benefit to the estate from the recovery so made or from such services.”

When Is a Mediator or a CPA the Better Fit for Part of the Work?

A mediator fits when the family wants a negotiated result, and a CPA fits for accountings and tax returns. Both can cost less than having a lawyer do that part. Neither replaces your own lawyer’s advice on your rights.

A mediator helps the parties settle and represents none of them. Under Minn. R. Prof. Conduct 2.4(b), “A lawyer serving as a third-party neutral shall inform unrepresented parties that the lawyer is not representing them.” Under the Minnesota Civil Mediation Act, a “Mediated settlement agreement” means “a written agreement setting out the terms of a partial or complete settlement of a controversy identified in an agreement to mediate, signed by the parties, and dated” (Minn. Stat. § 572.33, subd. 4). It is not binding unless it states that it is binding and that the parties were advised in writing that “(a) the mediator has no duty to protect their interests or provide them with information about their legal rights; (b) signing a mediated settlement agreement may adversely affect their legal rights; and (c) they should consult an attorney before signing a mediated settlement agreement if they are uncertain of their rights” (Minn. Stat. § 572.35, subd. 1). The statute’s other route is that the parties were otherwise advised of those conditions. These rules reach a settlement of a controversy identified in an “Agreement to mediate,” which the Act defines as a written agreement that, among other terms, “is signed by the parties and mediator and is dated” (§ 572.33, subd. 3). The statute also provides that “The effect of a mediated settlement agreement shall be determined under principles of law applicable to contract” (§ 572.35, subd. 1). My page on what to expect during a mediation walks through the day.

A trust settlement can be recorded without a court case. “Except as otherwise provided in paragraph (c), interested persons may enter into a binding nonjudicial settlement agreement with respect to any matter involving a trust” (Minn. Stat. § 501C.0111(b)). Here “interested persons” means “persons whose consent would be required in order to achieve a binding settlement were the settlement to be approved by the court” (paragraph (a)). The agreement “is valid only to the extent it does not violate a material purpose of the trust and includes terms and conditions that could be properly approved by the court” (paragraph (c)), and any interested person may ask the court to approve it (paragraph (d)).

A CPA can review the trustee’s reports and prepare the fiduciary tax returns. Federal law requires a return from “Every estate the gross income of which for the taxable year is $600 or more” and from “Every trust having for the taxable year any taxable income, or having gross income of $600 or over, regardless of the amount of taxable income” (26 U.S.C. § 6012(a)(3), (a)(4)). A return is also required from “Every estate or trust of which any beneficiary is a nonresident alien” (§ 6012(a)(5)). Those returns “shall be made by the fiduciary thereof” (§ 6012(b)(4)). The decedent’s own return is covered too: “If an individual is deceased, the return of such individual required under subsection (a) shall be made by his executor, administrator, or other person charged with the property of such decedent” (§ 6012(b)(1)). A beneficiary can hire a CPA to test a trustee’s accounting before deciding whether a legal claim is worth its cost.

What Questions Should You Ask Before Hiring a Lawyer for a Trust Dispute?

The useful questions test the five factors and the drafting-lawyer issue. I suggest asking:

1. How many contested trust or probate matters have you handled, and how many went to a hearing or trial?
2. Did you or your firm draft any of the documents, or represent anyone involved, including the person who signed them?
3. Who will draft, take depositions, and answer my calls?
4. How will you charge, what does the quote cover, and what costs are extra?
5. Can the trust or estate be asked to pay any of my fees, and what would the court weigh?
6. Which parts of this could a mediator or a CPA handle at lower cost?
7. Besides a petition, what are my options, and what does each cost and risk?

At the first contact, I suggest giving each candidate the names of the person who signed the documents, the trustee or personal representative, the other beneficiaries, and any family company. A conflict found after hours of work costs you that time. What you tell a candidate in that consultation is protected even if you hire someone else. Under Minn. R. Prof. Conduct 1.18(b), “Even when no client-lawyer relationship ensues, a lawyer who has consulted with a prospective client shall not use or reveal information obtained in the consultation, except as Rule 1.9 would permit with respect to information of a former client.”

What Can a First Engagement Cover?

A first engagement can be the whole dispute or a defined first step, with the scope written down. “A lawyer may limit the scope of the representation if the limitation is reasonable under the circumstances and the client gives informed consent” (Minn. R. Prof. Conduct 1.2(c)).

First steps in a trust or estate dispute can include:

1. A records request. A written request to the trustee of an irrevocable trust, who must respond promptly unless that is unreasonable under the circumstances (§ 501C.0813(a)). The trust’s terms or a beneficiary’s waiver can make that duty not apply, and a waiver can be withdrawn, as the section on trustee fees explains.
2. A document analysis. An analysis of the will, the trust and every amendment, and any company agreements, so you can choose a course before acting.
3. A letter to the trustee or personal representative. A letter stating the problem and what would resolve it.
4. A petition. A court filing, such as a petition to interpret a trust or to review fees.

A good first engagement also lays out options beyond the courtroom. Under Minn. R. Prof. Conduct 2.1, “In rendering advice, a lawyer may refer not only to the law but to other considerations such as moral, economic, social, and political factors, that may be relevant to the client’s situation.” In a family dispute, those options can include a direct conversation among siblings, a mediation, or a buy-out of a family member’s share of a business.

Minnesota sets separate time limits for contesting a will, contesting a living trust after the person who made it dies, and suing a trustee. Claims against a personal representative have their own limit. Under Minn. Stat. § 524.3-1005, “Unless previously barred by adjudication and except as provided in the closing statement, the rights of successors and of creditors whose claims have not otherwise been barred against the personal representative for breach of fiduciary duty are barred unless a proceeding to assert the same is commenced within six months after the filing of the closing statement.” The section adds: “The rights thus barred do not include rights to recover from a personal representative for fraud, misrepresentation, or inadequate disclosure related to the settlement of the decedent’s estate.” My page on deadlines to contest a will or trust quotes the others. I suggest checking those limits at the first meeting, because a missed limit can end a claim whatever its merits. Check the current text of the statute before relying on these periods.

Choosing a Lawyer for a Trust or Will Dispute

The right lawyer for a Minnesota trust or will dispute has litigated trust and probate matters and tells you who will do the work and how it will be billed. That lawyer also has no conflict, which can rule out the lawyer who drafted the documents. Before hiring, I suggest asking what the trust or estate is paying its own lawyers and whether a mediator or CPA can handle part of the work. My page on trust and estate litigation describes how I represent beneficiaries, trustees, and personal representatives. If you are in a Minnesota trust or estate dispute, email [email protected] with a brief description, and I can start an intake and conflict check before you send any confidential documents.