Fiduciary Conflicts
North Dakota has amended its Rule 1.8 (prohibited transactions) to add a provision governing lawyers who act as a fiduciary of an estate, trust or conservatorship . The pertinent addition reads as follows:
(l) Neither a lawyer serving as a fiduciary of an estate, trust,or conservatorship nor the lawyer’sfirm may serve as legal counsel for the fiduciary. This paragraph does not apply to matters inwhichthe decedent, trustor, beneficiary, or protected person is a spouse, child, grandchild, parent,grandparent, or sibling of the lawyer.
The new provision has the following explanatory comment:
[22] Paragraph (l) addresses situations in which a lawyer may be asked to serve as botha fiduciaryfor an estate, trust, or conservatorship and as legal counsel for the requesting party. Situations inwhich a lawyer serves in both capacities represent a conflict of interest and present, whether bydesign or default, opportunities for overreaching, misappropriation, or other exploitation of thedualcapacity relationship. The relationship of trust and confidence between lawyer and client andwithrespect to the lawyer as fiduciary generally requires that a lawyer not serve in both capacities. Theprohibition in paragraph (l) would not apply to those situations in which there is a familialrelationship between the lawyer and the decedent, trustor, beneficiary, or protected person.
The full amended rule is linked here. (Mike Frisch)
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