In our blog post entitled “Find A Good Ol’ Trustee Person to Act on Your Behalf,” we discussed the importance of appointing a power of attorney. Today we look at what to do if you find out that an attorney for property is abusing their power.
When clients come to us to discuss drafting their powers of attorney, we ask our clients to carefully consider the best person for the job. Most want to appoint those nearest and dearest to their hearts – they often can’t imagine their siblings, children, or friends abusing this position of trust. We’re here to tell you to think with your head and not your heart on this one.
We hear about it all the time – one sibling discovers a very generous transfer of funds from a parent’s account to another sibling; someone notices a series of bank transfers and debit transactions funneling out of a parent’s bank account; or even, a person discovers the unusual transfer of their parent’s foreign owned property to their sibling. While this sounds like an episode of a day-time soap opera, the unfortunate truth is this can happen to anyone. The good news is that there is something you can do about it.
If you or someone else discovers questionable actions being undertaken by an appointed power of attorney while the grantor (the person granting the power of attorney) is still alive, there are several options you can explore:
- Terminate the existing power of attorney
Termination of the existing power of attorney can be achieved if the grantor signs a new continuing power of attorney listing someone else as their attorney; this would revoke the existing power of attorney in place.
The power of attorney also terminates automatically upon the death of the grantor.
Lastly, the power of attorney is terminated if the appointed attorney resigns, becomes in capable, or dies.
- Request a passing of the accounts
An attorney for property is required to keep detailed accounts of their actions as an attorney and can be ordered by the court to “pass” their accounts. What this means is that the accounts are then filed with the court and transactions can be objected to by interested parties. The following is a list of those that can ask for a passing of accounts:
- The grantor’s attorney for personal care;
- A dependant of the grantor;
- The Public Guardian and Trustee;
- The Children’s Lawyer;
- A judgment creditor of the grantor; and
- Any other person, with leave of the Court.
A passing of the accounts would reveal all the transactions carried out by the attorney for property. So, if there are any inexplainable shopping sprees at Nordstrom, the attorney could be in hot water! This means potentially repaying all that money the attorney has misspent, not to mention their possible removal by the court as the attorney of the grantor.
- Court removal of an Attorney
While the court has the power to remove an attorney for an incapable grantor, it does not exercise this power liberally as it aims to respect a grantor’s appointment. The court will look at whether it is in the best interest of the grantor to remove the appointed attorney. The court will also see whether there is any evidence of negligence or misconduct on part of the attorney. If the court sees fit to remove the grantor’s appointed attorney, the court will then appoint a guardian of property. If you are considering a power of attorney for yourself (and we definitely think you should) heed our words carefully – with great power comes great responsibility! Okay, so maybe those aren’t our words per se, but Peter Parker’s uncle was right, nonetheless. This is a position of power, choose wisely! If you think someone is abusing this power – do something about it!
Robin K. Mann, JD