(Formerly Standard 05a)
PGTS Standard
4a. A written opinion has been obtained from the attorney licensed to practice in the applicable jurisdiction regarding the activities PGTS personnel may properly engage in and the risks that may be involved.
Opinion Letter’s Purpose
The purpose of the written attorney opinion letter is to inform the organization’s administration of the potential risks that certain Planned Giving & Trust Services (PGTS) activities may carry. The letter also provides guidance to the PGTS personnel in the organization about what they can do and what they should not do. Included in the letter are items to avoid, such as the unauthorized practice of law, undue influence, conflict of interest, self-dealing, and ways to avoid risk.
If an organization has never been accredited and seeks to become so, their legal counsel must write an opinion that complies with the laws of the state(s) in which they operate. This attorney’s opinion must conform to the level of service the organization has chosen and for which they wish to be accredited. There are three possible levels of service. Planned Giving Only (PGO), Planned Giving Plus (PGP), and Planned Giving & Trust Services (PGTS). A written opinion will be different for each of these levels of service.
Content of Opinion Letter
The written opinion should address all the items listed below, plus any additional items the attorney deems necessary to address based on your state(s) laws:
- Activities that personnel may properly engage in, considering the risk involved
- Tasks that a PGTS certified person may perform
- Tasks that personnel who are not PGTS certified may perform
- List of ethical guidelines to direct all personnel
- If the organization is involved with drafting documents, the opinion must include the circumstances and extent to which the organization may be involved.
- The opinion must address the issue of dual representation and if the organization may be involved in charging fees or reimbursing legal expenses to donors.
- The written opinion must consider NAD WP, NAD PGTS Standards and address any local laws that could hinder compliance.
Drafting the Letter
Any attorney drafting the opinion letter would be aided by describing the type of services your PGTS department is planning to provide. For example, the attorney will want to know if the organization intends to take on any fiduciary duties, be involved in drafting documents, or serve as trustee for charitable remainder trusts. By giving the attorney a description of your operations, they will give their opinion on whether what you plan to do is legal and what the risks are.
The written attorney opinion letter should be voted and recorded in the minutes of the appropriate committee(s) in your organization. This consideration informs the management of the organization and preserves the opinion letter for the future. The attorney opinion letter should be voted as its own agenda item and should not be placed on a consent agenda.
Required Review and Revisions
Review and revision of the written opinion is required every three to five years. Every organization that is currently accredited or accredited in the past, has had an attorney opinion letter addressing the activities in which their personnel may properly engage. If you are new to an organization and cannot find your attorney opinion letter (it may be very old), check with your current and past legal counsels to see if they have a copy. If your organization hasn’t changed the types of services, it provides it may not be necessary to completely change your attorney opinion letters. One letter that I am aware of was written in 1989 and is still used today. If you are able to find your opinion letter(s), all you need to do for the review is provide them to your legal counsel and have them review, revise or approve them for another five years.
Having a folder where opinion letters are stored on a shared digital storage drive for the office is an excellent way of ensuring future PGTS Directors can find these important documents.
Notice
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.