Lucas v. Hamm - 56 Cal. 2d 583, 15 Cal. Rptr. 821, 364 P.2d 685 (1961)

Rule:

The determination whether in a specific case the defendant will be held liable to a third person not in privity is a matter of policy and involves the balancing of various factors, among which are the extent to which the transaction was intended to affect the plaintiff, the foreseeability of harm to him, the degree of certainty that the plaintiff suffered injury, the closeness of the connection between the defendant's conduct and the injury, and the policy of preventing future harm. The same general principle must be applied in determining whether a beneficiary is entitled to bring an action for negligence in the drafting of a will when the instrument is drafted by an attorney rather than by a person not authorized to practice law.

Facts:

Plaintiffs, beneficiaries under a will, brought this action for damages against defendant attorney, L. S. Hamm. Hamm prepared a will by which plaintiffs were designated as beneficiaries of a trust provided for in the will. Hamm prepared testamentary instruments containing phraseology that was invalid by virtue of Cal. Civ. Code § 715.2 and former §§ 715.1 and 716 relating to restraints on alienation and the rule against perpetuities. As a result, plaintiffs received a smaller share of the estate. They have appealed from a judgment of dismissal entered after an order sustaining a general demurrer to the second amended complaint without leave to amend.

Issue:

Does the lack of privity between plaintiffs and Hamm preclude plaintiffs from maintaining an action in tort against Hamm?

Answer:

No.

Conclusion:

The court held the lack of privity between plaintiffs and Hamm did not preclude an action in tort against Hamm. Intended beneficiaries of a will who lost their testamentary rights because of attorney's failure to properly prepare a will could recover as third-party beneficiaries. However, Hamm was not liable for the mistake in this case because he was in error as to a question of law on which well-informed lawyers could entertain reasonable doubt.