## Facts

- Gerald E. Stockton created a living trust in 1979 that did not name Mary Donahue or Sundy McClung as beneficiaries.
- In May 1988, anticipating surgery, Stockton delivered $150,000 in checks drawn on his trust account to his lawyer, J. Harlan Stamper, payable to Donahue and McClung, and instructed Stamper to ensure they received the proceeds upon Stockton’s death.
- Stockton directed Stamper to prepare a deed conveying a 50% interest in Stockton’s home to Donahue, intended to be effective upon Stockton’s death.
- In September 1988, Stockton gave Stamper another $100,000 trust check payable to multiple payees (including Donahue and Stamper as trustee), which Stamper allegedly understood was intended to benefit Donahue upon Stockton’s death.
- Stockton died in November 1988, and the alleged intended transfers failed.
- Donahue and McClung, who were not Stamper’s clients, sued Stamper and his firm for legal malpractice and related theories, alleging they were the intended beneficiaries of Stamper’s services.

## Issues

1. Whether non-client intended beneficiaries of an attorney’s services to implement a client’s donative intent may sue the attorney for malpractice when the intended transfers fail.
2. Whether the petition’s allegations, taken as true at the dismissal stage, stated a cognizable claim that the attorney owed a duty of care to the alleged intended beneficiaries.
3. What limits apply to non-client malpractice claims to prevent liability to merely incidental or unforeseeable third parties.

## Decision

- The Supreme Court of Missouri affirmed in part, reversed in part, and remanded.
- The court held that, in limited circumstances, an attorney may owe a duty to non-client intended beneficiaries when the primary purpose of the attorney’s undertaking is to benefit those identifiable beneficiaries.
- Applying the motion-to-dismiss standard, the court concluded that at least some claims were sufficiently pleaded to proceed.
- The court also held that certain aspects of the plaintiffs’ theories were not viable on the pleaded facts and were properly dismissed.

## Legal Principles

- On a motion to dismiss for failure to state a claim, pleaded facts and reasonable inferences are taken as true and construed liberally in favor of the plaintiff; dismissal is proper only if no substantive legal theory supports relief.
- Missouri’s general privity rule for attorney malpractice has a limited exception where the attorney’s services are undertaken for the direct benefit of a clearly identified third party, particularly in testamentary or estate-transfer settings.
- Foreseeability alone is insufficient; the third party must be an intended (not incidental) beneficiary of the attorney’s performance, and the attorney’s purpose must include conferring the alleged benefit.
- The client’s death may support recognizing the exception because the client cannot sue, and the intended beneficiary may be the party directly harmed by negligent failure to implement the client’s donative instructions.

## Conclusion

The court permitted a narrowed path for intended non-client beneficiaries to pursue malpractice claims arising from failed death-related transfers where the attorney’s work was allegedly undertaken to deliver a direct benefit to them, while preserving limits that bar suits by merely incidental third parties; the dismissal was therefore affirmed in part, reversed in part, and the case remanded.


Donahue v. Shughart, Thomson & Kilroy, P.C., 900 S.W.2d 624 (Mo. 1995)