Misbehaving Agents Under a Power of Attorney

Individuals often question the actions of agents acting under another family member’s power of attorney. Complaints can arise during the course of the family member’s life, but more often the questions seem to arise after a parent passes, when the heirs wonder where the estate went and suspicion automatically falls on the agent under the power of attorney.

The method of obtaining information on the agent’s actions and determining whether the agent has breached a duty to the parent (in legal terms the “principal”) is to compel that agent to file an “accounting”. The accounting is a detailed report describing what assets the principal had when the agent first took over the principal’s financial affairs, what assets were left over at the end of the accounting period, and what happened in between. An interested party can file objections to the accounting, often with the ultimate aims of undoing a transaction, having the agent reimburse the principal for bad decisions, or returning money to the estate that the agent took without permission.

The accounting process can be protracted, and because these disputes often happen among family members, they can be acrimonious. However it is an effective method of getting answers and can lead to substantial recoveries in the case of an agent who has acted negligently or worse.

— Rod Fluck

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