Contemplating templates? Seller beware…

Barry Ian Dillon was a prudent man who took the time to ensure that he had arranged for the disposal of his assets when he passed.

He had assets in both Australia and Malaysia, and so made a will in Malaysia to deal with Malaysian assets, and on his return to Australia determined to make an Australian will to deal with his Australian assets.

He did this by purchasing and completing a will kit, which contained a standard clause revoking all previous wills, and thus the Malaysian will; on his death an application to rectify the will was necessary.

The court rectified the will on the basis that Mr Dillon had failed to carry out the instructions he gave himself when completing the kit. The case (Dillon & Anor v Henderson1) is proof that will kits are usually a net negative for an estate, but it also sounds a warning for solicitors. Had the template been prepared by a lawyer, could Mr Dillon’s children have sought redress from that lawyer?

Some solicitors, in seeking to create new revenue streams, now offer templates, and not just for wills – powers of attorney, debt recovery documents, employment contracts, trust deeds and more can now be purchased from law firms.

Often the solicitor’s involvement ends with the sale, and the purchaser completes the form themselves; that does not mean, however, that the solicitor’s responsibilities end with the sale.

While the client may well use the template without further reference to the solicitor, it may well be that the duty to advise the client does not end with the provision of the template.

In Badenach v Calvert2 the High Court held that a solicitor did not owe a duty to advise an estate client of ways to defeat a potential claim by his estranged daughter, but it is worthy of note that the matter turned on the scope of the original retainer. The courts have taken a cautious approach on this issue3 and practitioners should be alive to the possibility that a court may not consider all duties discharged by the provision of a template.

Guidance can be taken from the decision in Bartier Perry Pty Ltd v Paltos.4 In that case Mr Paltos, a partner in a law firm, suffered a series of strokes which threatened his ability to continue to work, and his partner sought the dissolution of the partnership. Mr Paltos engaged Bartier Perry to act for him in the dispute.

Bartier advised Mr Paltos that an option in the partnership agreement – which allowed him, if he remained unable to work in the partnership after six months, to exercise the option to require his partner to purchase his 70% interest – did not apply ‘yet’ or ‘at this time’.

They did not, however, advise him that if he remained unable to work for six months, the option would be open for a short period.

The option expired to the detriment of Mr Paltos, who ultimately sued Bartier for breach of contract, negligence, and for misleading and deceptive conduct for failing to advise him fully of the operation of the option.

He was successful, with the court finding that Bartier simply noting that the option was not available ‘yet/at this time’ did not discharge their obligation to provide competent legal advice, and that a reasonably competent solicitor would have advised of the full operation of the option.

In the case of a solicitor simply selling a template to a client, it is unclear as to when the solicitor’s responsibility ceases; but the Bartier Perry case would indicate that it may not be enough to simply draft the template with skill and diligence. It may be that, should problems arise, a court could reasonably find that some instruction as to the operation of the template is necessary to discharge a solicitor’s duties.

If no such instruction or advice is to be provided, solicitors will need to ensure that the scope of their retainer is clear on this, and that clear and plain-language disclaimers are engaged. They will also need to factor in the possibility that a court may see such measures as insufficient, and that it is likely that the complexity of the template and the sophistication of the client will be relevant in this regard.

Solicitors provide expert services and advice to clients, only some of which can be reduced into templates; they will never be an adequate substitute for the full suite of services provided in a standard engagement.

Just how broad the responsibility of a solicitor who sells templates to laypeople is will be a grey area until decided by a court. The question for practitioners contemplating templates is, what will it cost to find out?

Shane Budden is a Special Counsel, Ethics, with the Queensland Law Society Ethics and Practice Centre.

Footnotes
1 [2018] QSC 236.
2 [2016] HCA 18 (11 May 2016).
3 See, for example, Justice Bowskill’s comments in Talbot v Boyd Legal (A Firm) & Ors [2021] QSC 157 (24 June 2021), at 67.
4 [2021] NSWCA 158 (3 August 2021).

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