Does the lawyer for an estate administrator have to tell a creditor's lawyer that the estate has assets so the creditor can file a claim?

Plain-English summary

A lawyer for an estate administrator learned that the decedent had defaulted in a litigated matter, leading to a default judgment with a damages hearing still pending. The lawyer promptly notified the plaintiff's attorney that the decedent had died and the matter was stayed, but received no response. About a year later, preparing to distribute the estate's assets, the lawyer discovered that the plaintiff's attorney had earlier written the court to close the file, stating (wrongly) that there was no estate proceeding pending, even though the Surrogate's Court records showed the petition, the estate's value, and the issued letters of administration. The committee was asked whether the administrator's lawyer had to tell the creditor's attorney that the estate had assets and that the creditor should file a claim.

The committee answers no. Assuming the law imposes no affirmative duty to notify potential creditors, and where no misrepresentation was made about the estate's assets and the information was properly on file with the Surrogate's Court, the lawyer has no ethical obligation to alert the creditor's attorney. The only ethical constraint the committee identifies is DR 7-102(A)(5), which bars knowingly making a false statement of law or fact, and the lawyer's conduct does not approach a violation. The lawyer never indicated, directly or by implication, that the estate was insolvent; if anything, insisting the lawsuit be stayed pending letters of administration implied the estate had assets. The creditor's attorney did not inquire further or check the public record, which would have disclosed the assets, and did not file a claim. The committee does not opine on whether the administrator's lawyer could choose to reveal the information.

In practice

The opinion holds, under the former Code as it stood at the time, that the lawyer for an estate administrator has no ethical duty to tell a creditor (or the creditor's attorney) that the estate has assets and that a claim should be filed, where the lawyer made no misrepresentation about the assets and the relevant facts were on file with the Surrogate's Court. The committee grounds the limit in DR 7-102(A)(5)'s bar on knowingly false statements, finds no such statement here, and expressly does not decide whether the lawyer could voluntarily reveal the information.

Common questions

Q: Must an estate administrator's lawyer tell a creditor the estate has assets?

A: No. The committee concludes that absent a misrepresentation, the lawyer has no ethical duty to advise a creditor who failed to file a claim that the estate has assets and that the creditor should file.

Q: What ethical limit applies to the lawyer's silence?

A: Only the bar on knowingly false statements in DR 7-102(A)(5). The committee finds the lawyer made no false statement; insisting the suit be stayed pending letters of administration if anything implied the estate had assets.

Q: Does it matter that the creditor's lawyer was mistaken about the assets?

A: Not to the lawyer's duty. The committee notes the creditor's attorney did not inquire further or check the public Surrogate's Court record, which would have disclosed the assets, and did not file a claim.

Background and rules framework

The opinion interprets the former Code's bar on knowingly making a false statement of law or fact, DR 7-102(A)(5) (which corresponds to the truthfulness duties of ABA Model Rule 4.1 and the honesty principle in Model Rule 8.4(c)). The holding turns on the absence of any affirmative ethical duty to disclose to a non-client third party where no misrepresentation was made.

Citations and references

Rules of Professional Conduct:

• MR 4.1 (truthfulness in statements to others)
• MR 8.4(c) (dishonesty, fraud, deceit, misrepresentation)
• Former Code DR 7-102(A)(5)

See also

• NY State Bar Op. 797: Correcting a client's false court affidavit
• NY State Bar Op. 1034: Lawyer for an executor suspecting fiduciary misconduct

Source

• Landing page: https://nysba.org/ethics-opinion-796/