Motion for Summary Judgment Granted for Our Client in $3.5M Premarital Agreement Legal Malpractice Case

Summary Judgment was entered in favor of our clients in a legal malpractice case alleging damages in excess of $3.5 million. Plaintiff served a 998 for $1.5 million shortly before the hearing on the motion. Plaintiff claimed that she retained our client to negotiate and draft an “enforceable” premarital agreement in 2004. The Agreement was negotiated and signed before she married her third husband – a wealthy television executive. Her husband agreed to use his separate property to buy a home and pay the debt on the home throughout the marriage and agreed to take title in the name of the husband and wife as community property. Upon the husband’s death, it was agreed that husband’s estate would pay for the wife to live in the home for 3 years and pay off any mortgage. Upon plaintiff’s death, the home, or proceeds from the sale of the home, would go to the husband’s four adult children.

During the 15-year marriage the husband executed multiple trust documents reiterating the terms of the Premarital Agreement relating to the home. The last amendment the husband signed before his death appointed the plaintiff as a co-trustee, changing who husband had identified as his sole trustee for over 20 years. The husband died with barely enough in the estate to pay the mortgage on the home. Plaintiff immediately sold the property for $10.2 million without notifying the husband’s children – she netted roughly $6.2 million. The children filed two petitions against her claiming elder abuse and undue influence over their dad. A well-known law firm defended plaintiff in the petitions and charged $500,000 in legal fees before settling with the children a year later. The settlement provided payment of one-third of all monetary bequests in the will and all attorney’s fees in the litigation and placed $2.0 million of the $6.2 million sale proceeds in an account held in the name of the wife’s irrevocable trust.

Plaintiff turned against our clients after the trust litigation was settled. She claimed that because there was no evidence her husband was represented by an attorney at the time of the 2004 Agreement, she was subjected to litigation by the children and had to give up that portion of the estate provided for in the settlement totaling more than $1.5 million and also lost the use of $2.0 million during her life. Plaintiff claimed that during the trust litigation it became clear that the Premarital Agreement was unenforceable and the children intended to make said claim, despite the fact that no pleading in the trust litigation asserted such a claim.

The Court agreed with the defense that even if there was negligence in connection with the Premarital Agreement, this was a classic “settle-and-sue” case and there was no causal connection to any damages as her husband ratified the terms of the Premarital Agreement through multiple trust documents.

July 2020