Tips for Joint Representation of Spouses: Part 2 of 2
“Tips for Joint Representation of Spouses after the Engagement Letter,” that’s the subject of today’s ACTEC Trust and Estate Talk.
This is Margaret Van Houten, ACTEC Fellow from Des Moines, Iowa. Once a joint representation of spouses is underway, what are the best practices for ensuring both spouses are appropriately represented and engaged in the decision-making process? What red flags should estate planners watch out for? Representing an unhappily married couple who may be headed for divorce tests estate planners in practical and ethical ways. ACTEC Fellow, Professor Elizabeth R. Carter, of New Orleans, Louisiana, joins us today to discuss this topic. Welcome, Elizabeth.
Thanks, Margaret. Before I dive in, I want to remind all of our listeners of two wonderful free resources available on the website: The ACTEC Commentaries on the Model Rules of Professional Conduct and the ACTEC Engagement Letters. They both get revised periodically, and they are wonderful resources, particularly for these joint representation issues.
So, with that in mind, I have four tips to consider when you are representing spouses jointly in their estate planning. I will generally refer to spouses in this podcast, but most of this also applies to unmarried romantic partners.
Watch Out for Red Flags
Tip Number One: Keep an eye out for red flags. You want to keep an eye out for any red flags that might preclude joint representation, or that might be a reason that you need to terminate a joint representation. Remember, joint representation is not always possible or advisable. If red flags are obvious at the outset, then you should avoid joint representation in the first place. Sometimes, however, the red flags were not obvious at the outset, and sometimes they do not pop up until after the representation has started. So, what are those red flags?
Well, to have a successful joint representation, spouses should have similar goals and expectations. Their interests should be reasonably aligned, and they should be able to communicate openly and freely with the attorney and with each other. So, anything that runs afoul of those basic principles can present a red flag that might preclude joint representation. Some red flags are obvious. If your clients decide to divorce, then their interests are usually no longer sufficiently aligned for a joint representation. Similarly, spouses with serious marital problems who appear to be on the verge of divorce are not ideal candidates for joint representation.
Other red flags may be less obvious. If the clients have very different ideas about their estate planning goals and expectations, then joint representation may not be possible. Blended family structures and divided loyalties to various family members can cause problems for joint representation. You always want to keep an eye out for power imbalances between the spouses. These might be financial, social, or personality driven. Sometimes, conflicts can arise over thorny classification issues such as when there’s a disagreement about whether or not a significant asset is community property or separate property.
Declining or diminished capacity on the part of one of the spouses may make it difficult to continue a joint representation. If you suspect that one spouse is being harmed financially, emotionally, or physically by the other spouse or even by some other third party, then joint representation may be inappropriate. If you discover that one spouse is hiding assets or keeping major secrets from the other spouse, then the joint representation will have to terminate. Remember, just because you did not see any red flags at the outset of the representation does not mean that you can let your guard down. You have to keep an eye out for these things throughout the representation.
Actively Involve Both Spouses in The Joint Representation
Tip Number Two: Keep both spouses actively involved in the joint representation. In a joint representation, you want to make sure that you really are representing the interests of both spouses. To do this, you have to keep both spouses actively involved in the conversation. Doing this can also alert you to some of those red flags that I just mentioned. Sometimes, one spouse will try to dominate the decision-making or steer the course of the representation. Try not to let this happen. You want to ensure that both spouses are as involved as possible in the decision-making process.
One fairly easy way to help keep both spouses involved is to include both spouses in all of your communications. Copy both of them on emails. Get both of them on the phone with you. Get both spouses to come to the meetings. Make it clear to the more domineering spouse that you’re not going to take that spouse’s direction without consulting with the other spouse. Make sure both spouses are responding to the questions that you ask. If one spouse is quieter, be sure to ask that spouse directly if they have any specific questions or concerns. Sometimes, people will need you to prompt them like that in order to voice their thoughts.
Advise Clients of the Risks Associated with Various Planning Options
Tip Number Three: Advise your clients about the risk associated with various planning options, including the unpleasant risk. Often, the burden is going to be on you, as the attorney, to bring up the unpleasant “what-if” conversation. Don’t just assume that your clients will remain married. Don’t assume that one will not have an affair resulting in extramarital children. Don’t assume that one spouse will not remarry if the other one dies first. Rather, the better practice is to tell the clients about the risk associated with various planning options, including the types of risks that I just mentioned.
You should not ignore the possibility of unpleasant scenarios just because the marriage seems happy or because the clients don’t bring those questions up themselves. For example, suppose the spouses plan to leave everything to each other with the expectation that the survivor will leave property to their children in equal shares. This is a pretty common estate plan, of course. But you want to at least point out to your clients that there is some risk that the surviving spouse will change their mind.
The surviving spouse might favor one child over the others. The surviving spouse might remarry and favor that new spouse. The surviving spouse might have a new romantic partner. The surviving spouse might have children with someone else. Sometimes, clients will ask questions about those risks directly. But often, spouses do not raise these issues on their own, in part because they can be a bit awkward. In my opinion, it’s good practice for attorneys to raise these unpleasant possibilities in a tactical, but straightforward manner.
You don’t want to make the clients more worried about these possibilities than they need to be. But also, clients are often in a better position to know just how worried they should be about these possibilities than the attorney is. So, you at least want to point out these possibilities so that the spouses can make informed decisions. Personally, if I sense any hesitancy at all on the part of either spouse, then I like to give them some time to think things over before I ask them to make a specific decision. Give them some space to process their thoughts and feelings before asking them to lock down a position.
Remind Clients of Independent Representation Options
Tip Number Four: When appropriate, remind the spouses that they can seek independent representation. Whenever the spouses seem as though they might be at an impasse, or if a particular plan presents some real risk to one of the spouses, then you should remind the spouses that they can seek outside independent representation. In doing this, you may want to remind them that your role and advice are somewhat limited by the fact that you have a joint representation. Obviously, you want to go about this in a friendly way, in a way that really normalizes the idea of seeking outside representation.
If you sense a major conflict on the horizon, or a major risk to one spouse, or some major hesitation on the part of one of the spouses, then you might even insist that the spouse seeks separate representation. You can always point out to the spouses that you’re happy to work collaboratively with another lawyer if a spouse does seek that outside representation. This can help normalize their feelings. To normalize the idea of seeking outside representation.
To summarize, my four tips for joint representations are:
- One, keep an eye out for red flags that might preclude a joint representation or cause it to terminate.
- Two, keep both spouses actively involved in the joint representation.
- Three, advise your clients about the risk associated with various planning options, including the unpleasant risk.
- And finally, number four, when appropriate, remind the spouses that they can seek independent representation.
Thank you, Elizabeth, for that very helpful and informative presentation.
You may also be interested in:
- Tips for Joint Representation of Spouses: Engagement Letters (Pt. 1 of 2) (May 2023)
- 3rd Edition of ACTEC Engagement Letters (sample engagement letters available for download)
- What should attorneys have in their Engagement Letters? (Feb 2018)
- Ethical Considerations in Representing Clients in Connection With Family Businesses (Sep 2018)
- Family Law podcasts
If you have ideas for a future ACTEC Trust & Estate Talk topic, please contact us at ACTECpodcast@ACTEC.org.
© 2018 – 2023 The American College of Trust and Estate Counsel. All rights reserved.
Latest ACTEC Trust and Estate Talk Podcasts
Patagonia Purpose Trusts
The founder of Patagonia clothing transferred $3B of stock to a Purpose Trust. What is a Purpose Trust and how does it meet Patagonia’s corporate objectives?
Tips for Joint Representation of Spouses: Engagement Letters (Pt. 1 of 2)
Four tips practitioners need to keep in mind when providing joint representation to spouses and where to find sample attorney engagement letters.
Non-Grantor Irrevocable Complex Discretionary Spendthrift Trusts
Don’t get fooled by non-grantor irrevocable complex discretionary trust scams. An expert explains warns about questionable trust structures marketed online.