What obligation does a POA/executor have to account for spent funds?

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What obligation does a POA/executor have to account for spent funds?

My mother passed away 6 months ago. At the time of her death my brother had power of attorney and was the executor of the Will. About 2 tears ago her house was sold for $400,000 (after she was placed in a nursing home). That money was deposited into a joint checking account (joint between my mother and brother). My brother claims that during the 2 years $200,000 was needed for my mother’s care. However, if $200,000 was needed, should my brother be required to show how the money was spent and the remaining $200,000 be part of the estate and not my brother’s personal property?

Asked on March 29, 2012 under Estate Planning, Massachusetts

Answers:

Steven Fromm / Steven J Fromm & Associates, P.C.

Answered 9 years ago | Contributor

You have a problem that requires that you meet with an estate litigation attorney to demand an immediate accounting of the POA and possible surcharge action for losses. In addition, there may be a possible action for removal for cause.  For removal for cause, please see my article entitled Pennsylvania Probate: Removal of Personal Representative Under PA Estates and Fiduciary Code at the following link: http://www.sjfpc.com/Probate_Removal_Executor_Trustee_PA_Probate_law.html. Even though this relates to PA law most states have similar rules.

 

 

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

I am so sorry for your loss and for the problems that have resulted.  First you need to know that an Attorney in Fact (POA) has the same fiduciary duty to account for funds as the executor.  A breach of the duty is a serious thing.  Also know that a POA dies with the person for whom it is executed (here your Mother) so what now governs in the fact that your brother is the executor of the estate.  The glitch here is that the funds were deposited in to a joint account.  Generally speaking, when one of the parties to a joint ccount passes away the other party inherits - for lack of a better word here - the money automatically.  So I would seek help here from an independent attorney(one not associated with the estate) to help you determine the next step.  Good luck.


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