Estate Administration (Chapter 10 of Attorney Fee Agreements in Michigan)
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Chapter 10: Estate Administration
Nancy L. Little, Buhl Little Lynwood & Harris PLC
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CONTENTS
Requirements of the Fee Agreement Under MCR 5.313
Drafting the Fee Agreement

I.   Overview

§10.1   The Estates and Protected Individuals Code became effective on April 1, 2000. This legislation did not make any significant change in the law pertaining to the compensation of attorneys who represent personal representatives. However, it does clarify the nature of the services that an attorney may render on behalf of a personal representative. A personal representative of an estate may retain “an attorney to perform necessary legal services or to advise or assist the personal representative in the performance of the personal representative’s administrative duties.” No court order is necessary. The attorney may be associated with the personal representative. MCL 700.3715(w).

The court rule governing the compensation of attorneys, MCR 5.313 limits the application of the rule to decedent estates. All fee agreements involving decedent estates are governed by MCR 5.313.

In addition, if a personal representative enters into a contingent fee agreement with an attorney (e.g., in connection with claims for personal injury, wrongful death, or no-fault benefits), that fee agreement is also governed by MCR 8.121. If a case is to be tried in Michigan courts, a contingent fee in excess of one-third of the net recovery is a “clearly excessive fee” in violation of MRPC 1.5(a) unless the fee “is received as a result of an award of attorney fees payable pursuant to MCL 500.3148, or other award or sanction made pursuant to statute, court rule, or the common law.” MCR 8.121(A). See also RI-122 (Mar 10, 1992). This rule holds true even if the client resides in a state that allows a fee in excess of one-third. CI-548 (June 22, 1981), CI-933 (July 31, 1983).

The attorney who files an appearance on behalf of a personal representative represents the personal representative and not the estate or the beneficiaries. MCR 5.117(A). This is of particular significance for purposes of service. If the fiduciary dies, resigns, or is removed, the attorney-client relationship ends, and the attorney is no longer eligible to receive service on behalf of the fiduciary. Wright v Estate of Treichel, 36 Mich App 33, 193 NW2d 394 (1971).

Footnotes

1 The author wishes to extend her thanks and appreciation to Everett R. Zack for his previous contributions to this chapter.

Forms and Exhibits

Form 10.01 Engagement and Fee Letter for an Individual Personal Representative -- Hourly Billing
Form 10.02 Engagement and Fee Letter for a Corporate Personal Representative -- Hourly Billing
Form 10.03 Engagement and Fee Letter for a Personal Representative Also Acting as Trustee
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