Can attorneys representing trustees automatically represent the trust itself? In re Estate of Goldberg Explained

The Utah Supreme Court’s recent decision in In re Estate of Goldberg clarifies important boundaries regarding attorney-client relationships in trust litigation. The case arose when successor trustees sought to disqualify attorneys who had previously represented former trustees, arguing that the attorneys had also represented the trusts themselves.

Background and Facts

After C. Leon Nelson and Marilynn Tetrick became co-trustees of the Stanley and Sandra Goldberg Trusts, they retained legal counsel to assist with trust administration. The engagement letters specified that the attorneys represented the trustees “only” in their “capacity as trustees” and did not represent the beneficiaries. When beneficiaries later sued the trustees for breach of fiduciary duty, the same attorneys defended them. A jury found the trustees liable and entered a $1.8 million judgment, most payable to the trusts. The court then removed the trustees and appointed successors.

Key Legal Issues

The central issue was whether the attorneys’ representation of the former trustees created an attorney-client relationship with the trusts themselves under Snow, Christensen & Martineau v. Lindberg. The successor trustees argued that Rule 1.9(a) of the Utah Rules of Professional Conduct prohibited the attorneys from continuing to represent the former trustees because their interests had become materially adverse to the trusts’ interests when seeking to reduce the judgment.

Court’s Analysis and Holding

The Utah Supreme Court reversed, clarifying that Lindberg does not create a per se rule that attorneys representing trustees automatically represent the underlying trust. The court emphasized that context determines whether an attorney-client relationship exists with a trust. Here, the attorneys consistently defended the former trustees against claims that would benefit the trusts, never entered an appearance for the trusts, and the trusts were not parties to the litigation. The court found the engagement letters supported the conclusion that representation was limited to the trustees individually.

Practice Implications

This decision provides crucial guidance for trust practitioners. Attorneys should carefully draft engagement letters to specify whether they represent the trustee individually, the trust entity, or both. The court noted that Comment 27 to Rule 1.7 acknowledges this ambiguity and advises attorneys to “make clear the lawyer’s relationship to the parties involved.” Practitioners should also be mindful that payment from trust funds alone does not establish representation of the trust itself—the attorney’s role in the representation is the decisive factor.