PBCBA BAR BULLETINS pbcba_bulletin_February 2019 | Page 16

PROBATE C o r n e r
Verification Based On “To The Best Of My Knowledge And
Belief” May Be No Verification At All (Part III of III)
DAVID M. GARTEN
The term “to the best of my knowledge
and belief” is used in affidavits and court
documents to indicate that statements
being made are not knowingly false.
Assuming your client signs a document
under “knowledge and belief”, is your
knowledge and belief of the facts and law
imputed to your client? Can a fiduciary
avoid liability by signing under “knowledge
and belief”?
IMPUTED/CONSTRUCTIVE KNOWLEDGE:
Black’s Law Dictionary (10th Ed. 2014)
defines “constructive knowledge” as “[k]
nowledge that one using reasonable care
or diligence should have, and therefore
that is attributed by law to a given person.”
“Imputed knowledge” means knowledge of
one person attributed to another person.
Knowledge may be imputed from one person
to another based on their legal relationship.
I hate imputed
knowledge!
You know every-
thing that I know
even if you don’t.
The knowledge of an employee or officer
in an organization may be imputed to
the person making a representation or
rendering an opinion on behalf of the
organization. For example, in Specialized
Tours, Inc. v. Hagen, 392 N.W.2d 520 (Minn.
1986), the sole shareholder of a corporation
warranted “[t]hat to the best of Seller’s
knowledge, the Corporation has complied
with all applicable laws, rules, and
regulations of the city, county, state, and
federal governments,” the Supreme Court
of Minnesota held that the warranty was
not breached even though the corporation
was in violation of Civil Aeronautics Board
regulations regarding escrow accounts
and the office manager of the corporation
knew of this.
The court reached this conclusion because
the “best knowledge” warranty only
extended to the shareholder’s personal
knowledge, and although the knowledge of
the agent may be imputed to the corporation,
it may not be imputed to the individual
shareholder.
It is well established that the attorney-
client relationship is an agent-principal
relationship. Accordingly, information an
attorney receives during the scope of his
representation of a client will be imputed
onto his client even if the client does not
have actual knowledge of that information.
See Gordon C. Brydger, P.A. v. Wolfe, 847
So. 2d 1074 (Fla. 4th DCA 2003), citing In re
Brugh’s Estate, 306 So. 2d 599, 600 (Fla. 2d
DCA 1975); Applefield, supra; State v. C.R.S.,
584 So. 2d 172 (Fla. 3rd DCA 1991); State v.
White, 794 So. 2d 682 (Fla. 2nd DCA 2001);
Starling v. State, 799 So. 2d 425 (Fla. 5th
DCA 2001); State v. Martinez, 790 So. 2d 520
(Fla. 2nd DCA 2001). But see Stueve Bros.
Farms, LLC v. Berger Kahn, 166 Cal. Rptr. 3d
116, 222 Cal.App.4th 303 (Cal. App. 2013) (a
client’s imputed knowledge may not apply
where the standard is “knew or should have
known”).
FIDUCIARY LIABILITY: A fiduciary may not
be able to absolve himself from liability
based on reliance on a professional
irrespective of whether the document
at issue was signed on “knowledge and
belief”. See Harrell v. Badger, 171 So. 3d 764
(Fla. 5th DCA 2015) (Reliance on counsel
did not absolve a trustee from liability as
his misconduct resulted from his failure
to comply with clear and unambiguous
statutory requirements); Laramore et al. v.
Laramore et al., 64 So. 2d 662 (Fla. 1953) (A
trustee may not surrender or delegate to
the attorney all the functions and duties
of the trust, or acquiesce in the complete
management and control of the trust by the
attorney without becoming liable for losses
sustained thereby.)
In Gurdschinsky v. Hartill, 815 P.2d 851
(Alaska 1991), the personal representative
was surcharged for penalties and interest
incurred by the estate for filing the estate
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tax return late. On appeal, the personal
representative defended on the basis that
she reasonably relied on the advice of her
accountant who, she claims, informed
her that the returns had been timely filed.
The Alaska Supreme Court, in affirming
the judgment of surcharge against the PR,
reasoned in part: “Gudschinsky makes
several arguments to escape all or part of
this surcharge.
First, she argues that she reasonably relied
on the advice of her accountant who, she
claims, informed her that the returns had
been timely filed. We have found no cases
which absolve from liability a personal
representative who took no steps to assure
that the estate’s tax return had been
filed on time…. In Gudschinsky’s case,
she apparently left all tax matters to the
accountant. Gudschinsky does not point
to any evidence in the record which shows
that she tried to find out when the taxes were
due. She merely claims that she interpreted
a conversation with her accountant to mean
that the estate’s tax returns had been filed
on time. We find that Gudschinsky’s mere
passive acceptance of an interpretation of
a conversation with her accountant does
not relieve her of liability for penalties and
interest.”