Morrison Mahoney Partners Jim Brawley, Mike Keller, and Cristin Sheehan obtained a decision from the Connecticut Supreme Court affirming summary judgment in favor of our attorney-client in a legal malpractice case involving an alleged $1.5 million overpayment in federal estate taxes. This is the first decision of any Connecticut court interpreting Conn. Gen. Stat. § 45a-234(19), of the Fiduciary Powers Act, which provides immunity for fiduciaries to avoid liability for the conduct of professionals retained to perform services for an estate so long as the professional was selected with due care.
The plaintiff claimed that our client, while acting as an executor of an estate, committed malpractice in relying on an appraisal that over-valued the estate’s closely held stock despite the fact that one of the leading appraisal firms in the country performed the appraisal. The plaintiff argued that the report contained obvious errors or "red flags" that should have been obvious to our lawyer. We argued that the alleged deficiencies in the report involved highly technical arguments about how discount rates and other valuation principles should be applied when valuing closely held stock. Plaintiff argued that the immunity provision did not apply because plaintiff was not seeking to hold our client liable for the negligence of the appraiser, but rather was seeking to hold our client liable for his alleged failure to recognize deficiencies in the report prepared by the appraiser. The trial court granted summary judgment.
The Connecticut Supreme Court affirmed summary judgment, holding that our client exercised due care in selecting and retaining the third party appraiser such that the immunity provision applied. This decision is significant because it provides the first judicial interpretation of § 45a-234(19) and upholds the principle that lawyers acting has executors will not be liable for the alleged negligence of other professionals they retain to work on the estate so long as the lawyer exercises due care in selecting the expert.