By: Justin M. Smigelsky, Esq.
In addition to the traditional will contest, estate litigation includes, among numerous other potential claims, claims related to non-probate assets (assets passing outside of the Last Will and Testament), claims by and against a fiduciary, and claims in regards to pre-death transfers of assets. Unfortunately, disputes regarding powers of attorney are also becoming more prevalent in New Jersey estate litigation.
A power of attorney is a writing by which one person, the principal, appoints another as his agent, and confers upon that agent the authority to act in the principal’s place for the purposes set forth in the document. In New Jersey estate litigation, a power of attorney dispute will ordinarily arise when either the agent uses the power of attorney document for his or her own benefit or other improper purpose, or when the authority itself is attacked based upon allegations of undue influence, duress, or lack of capacity.
Ordinarily, unless the power of attorney document contains very clear enabling language, the agent is not permitted to give the principal’s assets to himself or to others. In fact, the principal, his heirs, or his representative, may compel the agent to provide an accounting of all financial transactions conducted by the agent during his tenure – as is often the case, this obligation to account may be enforced by the executor or administrator of the principal’s estate after the principal has passed away.
Generally, a power of attorney may be revoked by the principal at any time, with or without reason. Unfortunately, a dispute will often arise where one party persuades the principal to revoke the power of attorney granted to another and execute a subsequent power of attorney naming himself as agent –where allegations of duress, undue influence, or lack of capacity exist, such a scenario is commonplace. In addition, the power of attorney is no longer effective upon the principal’s death, which can result in a dispute where an agent claims that he or she was unaware of the death of the principal and continues to act.
Because estate and trust administration and litigation requires specialized knowledge, you may wish to consult with an experienced attorney if you are either a fiduciary or beneficiary of an estate or trust. Specifically, you may wish to contact an attorney if you have questions regarding powers of attorney, the probate process, administration of an estate or trust, fiduciary obligations, preparation of a formal or informal accounting, refunding bonds and releases, and the procedures for filing a formal accounting or exceptions thereto. This article is for information purposes only, and is neither legal advice nor the creation of an attorney client relationship.
Justin M. Smigelsky, Esq. / Timothy J. Little, P.C., 2016, All Rights Reserved