(Formerly Standard 04)
PGTS Standard
5. All trusts, wills, charitable gift annuities, and all other legal documents are prepared by, or under the supervision of, legal counsel licensed to practice in the applicable jurisdiction in such a manner that the attorney accepts responsibility for the documents. (NADWP S 40 05, S 40 40) [PGP, PGTS]
It is a common practice for legal documents such as wills, trusts, powers of attorney, advanced directives, and charitable gift annuities to be prepared by a paralegal or legal office assistant under the supervision of a licensed attorney. The attorney will usually review the documents and accept responsibility for the content of each document.
Most gift planners are not attorneys. Even if a gift planner is an attorney, they most likely would not want to accept responsibility for creating documents they did not prepare or had no part in creating. So, what does it mean the preparing attorney accepts responsibility for the document? The preparing attorney acknowledges they have created the documents per the client’s wishes and in compliance with all laws and statutes of the governing jurisdiction, therefore taking responsibility for their validity.
Acceptance of Responsibility
How is acceptance of responsibility for the documents typically demonstrated? The preparing attorney may write a letter stating they take full responsibility for the documents, and the letter is stored in the donor file. Or, the documents themselves may have the name and contact information for the attorney on each page of the document. Either option provides evidence the document was prepared by the listed attorney, who takes responsibility for them.
This standard aims to avoid the unauthorized practice of law and reduce the liability exposure of the gift planner’s organization. If the documents contain a mistake and the donor is harmed, the liability of faulty documents remains with the attorney who prepared them. All documents containing present or future fiduciary responsibilities for your organization; must have evidence an attorney prepared and accepts responsibility for the documents.
Your organization does not want to be a fiduciary working with defective documents that could reduce the distribution to the beneficiaries. In other words, if you do not have documentary evidence that the preparing attorney has taken responsibility for the content of the documents, your organization is on its own in resolving any issues that arise. Suppose you have an attorney who has accepted responsibility for the content of the documents. In that case, problems could still occur, but you have an attorney to lean on and help resolve the issues.
Suppose your organization has a storage agreement detailing that it has no fiduciary responsibility contained in the documents. They are filed only for safekeeping at the donor’s request. In that case, the “preparation responsibility” is not required to be obtained by the storage organization but is undoubtedly still a best practice for the benefit of your donors.
Conclusion
Not just any attorney may take responsibility for the preparation of documents as required by this standard. In many of the revised standards, you will see the phrase “legal counsel licensed to practice in the applicable jurisdiction.” This phrase requires each organization to verify that the attorneys they are using are currently and actively licensed in the states that they service. Only attorneys who qualify as stated above may take responsibility for documents that have been prepared in the states where they are licensed.