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Beneficiaries Removed From Accounts Lacked Standing To Sue

July 2, 2012

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The issue of standing regularly arises in fiduciary litigation.   Generally, to establish standing to sue, a plaintiff must have suffered an injury in fact, the injury must be traceable to the conduct complained of, and it must be likely that the injury will be redressed by a decision in the plaintiff’s favor.

Lack of standing can be a good defense in fiduciary litigation cases because many estate planning documents are ambulatory and can be changed at any time.  How can a person have suffered harm – an injury in fact – if they could have been written out of a will, taken off an account, or removed as the beneficiary of an insurance policy at any time?

The issue of standing in a fiduciary litigation context was recently before the United States District Court for the Northern District of Georgia in Hill v. Clark (2012 WL 1903265). 

Attorney-In-Fact’s Lawsuit Against Her Co-Attorney-In-Fact Is Allowed To Proceed

December 19, 2011

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I understand why someone would want co-executors, co-trustees, co-attorneys-in-fact, etc.  Maybe it’s because they’re afraid of having too much power in one person’s hand.  Maybe it’s because they don’t want to offend a friend, child, or relative.  Maybe it’s because it may just be easier to have a few people with that power in case the other is indisposed.  I get it.  But, going in, they should also know it’s a recipe for litigation.

Co-fiduciaries often have to work unanimously – either by statute or by the underlying instrument.  Lack of unanimity leads to lawsuits.  Moreover, when, for example, one attorney-in-fact lives in the same state as the principal, the co-attorney-in-fact residing in another state may be cut out of the process.  Whether perceived or actual shenanigans exist, litigation may result.

In Rosenkrantz v. Feit, a Florida Court of Appeals considered whether one attorney-in-fact could pursue a lawsuit

Daughter Forged Power of Attorney And Exercised Undue Influence Over Father

October 28, 2011

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We’ll start and end the week here at BryanCaveFiduciaryLitigation.com with powers of attorney.  In order to abuse a power of attorney, there actually has to be one.   In Kubek v. Jones, the United States District Court for the Middle District of Alabama recently determined that a decedent’s daughter forged a power of attorney so she could convert her father’s retirement benefits and life insurance policy to the exclusion of her stepmother.  And, as if the forgery wasn’t enough, she also exercised undue influence over her father.

Kentucky Grantor Was Not Unduly Influenced In Conveying Home To ‘Grandson’

October 12, 2011

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Perception — or perhaps more precisely, misperception — fuels so much fiduciary litigation.  For example, an elderly grantor may have perfectly legitimate reasons for conveying property to someone outside the family.  Even if the grantor’s reasons aren’t good, she is within her rights to make a completely unreasonable transfer so long as nothing afoul is afoot (e.g., lack of capacity, undue influence, fraud, etc.).

But, when a blood relative learns of this transfer, a sense of entitlement kicks in, and we’re on our way to litigation.  The problem for these elderly grantors, who are under so much pressure to explain or change their decision, is that they oftentimes say or do anything to try to make everyone happy.  That never works.  And that was the sort of situation recently before the Kentucky Court of Appeals.

Enhanced Health Care Proxies

July 12, 2011

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Enhanced Health Care Proxies

July 12, 2011

Authored by: Luke Lantta

In a recent blog post, Paula Span examines the challenges of assisting elderly relatives with their health care when those relatives have not been declared incapacitated. The movement in a number of states to permit ‘enhanced’ health care proxies would allow designees to assist with or make health care decisions for the principal while the principal is still legally competent.