Expanded Lawyer Liability in Estate Planning: What the Wisniewski v. Palermino Case Means for Connecticut Attorneys

A recent Connecticut Supreme Court decision in Wisniewski v. Palermino is poised to significantly reshape the scope of lawyer liability in estate planning. The case addresses whether an attorney can be held liable to third-party beneficiaries of a will for failing to advise a client on the impact of beneficiary designations on estate plans. This ruling expands the potential exposure of estate planning attorneys and sets a new precedent for professional responsibility in Connecticut. Let’s break down what happened, what the court ruled, and what this means for lawyers going forward.

The case centers on Edward Wisniewski, who hired attorney Anthony Palermino in April 2018 to draft an estate plan. Wisniewski’s estate included a TD Ameritrade account valued at $845,367.57. He instructed Palermino to draft a will that would distribute the assets from this account equally among five individuals: his daughter, Joanna Cooper, his three grandchildren, and his friend, Barbara Saccardo. Palermino drafted the will according to these instructions, and Wisniewski signed it. However, Palermino advised Wisniewski that no further action was needed to ensure the account’s assets would be distributed according to the will.

Here’s where the problem arose: Wisniewski had previously designated Joanna Cooper as the sole beneficiary of the TD Ameritrade account. When he died the following month, the assets in the account passed directly to Cooper under the beneficiary designation—bypassing the terms of the will entirely. As a result, the other intended beneficiaries received nothing from the account.

The plaintiffs—two of Wisniewski’s grandchildren and his friend Saccardo—filed a lawsuit against Palermino and his law firm. They alleged that Palermino committed professional negligence by failing to properly advise Wisniewski about the need to change the account’s beneficiary designation to align with his estate plan. They also claimed breach of contract, arguing that Palermino failed to draft the will in accordance with Wisniewski’s wishes.

Initial Rulings and the Appeal

The trial court initially dismissed both the professional negligence and breach of contract claims. It ruled that under Connecticut law, an attorney’s liability to third-party beneficiaries is limited to errors in the drafting or execution of a will—not to advice or failure to follow up on beneficiary designations. The court also found that the breach of contract claim was essentially a restatement of the professional negligence claim and dismissed it as well.

The plaintiffs appealed the decision, and the Connecticut Supreme Court agreed to hear the case.

The Supreme Court’s Ruling

The Connecticut Supreme Court issued a mixed ruling that significantly expands lawyer liability in estate planning but within defined limits:

1. Professional Negligence Claim: The court ruled that the trial court improperly dismissed the plaintiffs’ professional negligence claim. It held that public policy supports holding an attorney liable for failing to advise a client about the effect of beneficiary designations on the client’s estate plan. The court reasoned that when a client informs an attorney of their intention to transfer assets through a will, the attorney has a duty to advise the client that a beneficiary designation on a security account will override the terms of the will. Failing to provide this advice constitutes a breach of the standard of care, making the attorney liable to the intended beneficiaries.
2. No Duty to Ensure Changes: The court stopped short of imposing a broader duty to ensure that a client actually makes the required changes to a beneficiary designation. The court reasoned that doing so would create a conflict of interest and improperly shift responsibility for the client’s personal decisions onto the attorney. The attorney’s duty is limited to providing accurate advice—not to enforcing the client’s estate plan intentions.
3. Breach of Contract Claim: The court upheld the dismissal of the breach of contract claim. It concluded that the plaintiffs’ breach of contract allegations were essentially identical to the negligence claim and did not involve a failure to follow specific contractual instructions. Therefore, the claim sounded in tort (negligence), not contract law.

What This Means for Estate Planning Attorneys

The decision in Wisniewski v. Palermino marks a significant expansion of attorney liability in estate planning. Before this ruling, Connecticut attorneys were only liable to third-party beneficiaries for drafting or execution errors. Now, attorneys can be held liable for failing to provide proper advice about the effect of beneficiary designations on estate plans.

This creates several important implications for estate planning attorneys:

• Increased Duty to Advise: Attorneys must now go beyond simply drafting a will and advising clients on its contents. If an attorney knows that assets have a beneficiary designation that conflicts with the terms of the will, the attorney is obligated to inform the client and recommend corrective action.
• Documentation of Advice: To protect themselves from liability, attorneys will need to carefully document the advice they provide regarding beneficiary designations and estate planning conflicts. Written records of this advice could be critical in defending against future claims.
• Managing Client Expectations: Attorneys must set clear expectations with clients about what a will can and cannot accomplish concerning assets with direct beneficiary designations. Clients must understand that beneficiary designations override will provisions unless they are updated.
• No Duty to Act Beyond Advice: Importantly, attorneys are not required to ensure that a client follows through with changing a beneficiary designation. The court recognized that such a duty would improperly interfere with the attorney-client relationship and create conflicts of interest.

Potential for Increased Litigation

This ruling will likely lead to an increase in malpractice claims against estate planning attorneys in Connecticut. When intended beneficiaries are left out of an estate due to uncorrected beneficiary designations, they now have a clearer path to pursue claims against the drafting attorney.

The court’s decision reflects a broader trend toward expanding attorney liability in estate planning. Other states, such as California and Illinois, have already recognized similar duties. Connecticut’s ruling brings the state into alignment with this modern approach to estate planning liability.

Conclusion

The Wisniewski v. Palermino decision establishes that estate planning attorneys in Connecticut have a legal duty to advise clients about the effect of beneficiary designations on estate plans. While attorneys are not required to ensure that clients take corrective action, they must provide accurate advice about the potential consequences of failing to update beneficiary designations. This ruling increases the stakes for estate planning attorneys and highlights the importance of careful, thorough client counseling.

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