WHY AND WHEN SHOULD A GUARDIANSHIP OR CONSERVATORSHIP ACTION BE TAKEN, ESPECIALLY WHEN UNDUE INFLUENCE AND DOMINATION EXIST OR IS SUSPECTED?
When someone has personally misappropriated the assets of another, either directly as a power of attorney, or through the misuse of jointly titled accounts, etc., a guardianship proceeding can provide a legal means to recover the wrongfully converted property/assets. In addition, a guardianship action can reestablish legal ownership and title to the rightful owner as well as restore the original beneficiary designations to the victim’s financial accounts.
In cases where a person has caused an incapacitated person’s estate plan to be altered, a guardianship proceeding can be used to gather evidence of undue influence and other legal causes of action to prosecute the wrongdoer and restore the person’s estate plan to its original goals and objectives.
Besides the economic considerations involved when filing for guardianship, it may be equally necessary (on an emergent basis) to take protective action where there exists substantial elder abuse involving physical or psychological harm. In these types of cases, the alleged incapacitated person may or may not be able to acknowledge the abuse, or is unable to stop the abuse without outside assistance.
How a Guardianship Can Help Protect Against Elder Financial Abuse
Warning Signs of Elder Abuse or Undue Influence Justifying a Guardianship
Most often, there are warning signs that virtually all of us can recognize that alert us to the fact “something isn’t right”. When something isn’t right with an elderly person, it often means deteriorating health and/or vulnerability to the influence of others. The outcomes are tragic, heartbreaking, and in most cases, avoidable. So, let’s look at the warning signs of elder abuse. If you recognize any of these, consider calling me today. Time is not your friend, nor is it the elderly victim’s.
- A spouse (often in a second marriage and with the assistance of his/her children by the first marriage) dumps the spouse in a nursing home and begins to withdraw large sum(s) of money or sells property and assets in secret and fails to keep the children of the institutional spouse (generally the children of the first marriage) informed in advance of decisions and actions being taken or about to be taken.
- The elderly person is frail and in need of care. A well-meaning “outsider,” such as a neighbor, friend, or health aide, intervenes, leading to a power struggle between the outsiders and family members. Often, no family members live close to the elderly person, leaving them vulnerable to the nice neighbor down the street.
- The elderly person manipulates family members or others by threatening to cut them out of his or her will or promises to leave certain family members or others a larger share of the estate if they agree to the desires of the alleged incapacitated person.
- A vulnerable elderly person is the subject of repeated calls to Adult Protective Services and/or is brought to the hospital emergency room on several or more occasions due to a lapse in care, a fall, or for other reasons.
- The person who is assisting the vulnerable adult with his or her finances refuses to disclose information to others based upon the alleged incapacitated person’s instructions not to disclose such information to anyone.
- The vulnerable adult has been making frequent and/or substantial gifts to one or more persons, and the recipient(s) of the gift(s) state that the elderly person intended them to receive the gift (s).
- Telephone scammers repeatedly call the home, claiming the elderly person is the winner of a contest that requires a donation in return for a substantial prize.
If you recognize any of the examples listed above, then you likely have elder financial abuse right in front of you. It’s time to act!
Assessing Whether or Not to File for Guardianship or a “Protective Proceeding”
Read the questions I have listed for you below. What are your answers?
- Has someone received any significant lifetime gifts from the alleged incapacitated person? If so, who are they and what is their relationship to the alleged incapacitated person?
- Is the beneficiary of the gift a fiduciary for the alleged incapacitated person, meaning is he or she a trustee, power of attorney, guardian, or agent?
- Did the Power of Attorney, acting as attorney-in-fact, make any gifts on behalf of the declining person? If so, was he or she specifically authorized by the written Power of Attorney to do so?
Did you know that a power of attorney drafted after January 28, 2004, cannot be interpreted to authorize the attorney-in-fact to make a gift(s) unless the power of attorney document expressly authorizes such gifts? Moreover, a power of attorney that authorizes the agent to generally perform all acts the principal could perform does not authorize the agent to make gifts or gratuitous transfers. If so, a claim that the attorney-in-fact breached a fiduciary duty to the principal in making such gifts is a legal claim that can be made against the offending power of attorney.
- Is the person a caregiver for the alleged incapacitated person?
- Will another person receive a larger inheritance than the others in the same degree of kinship?
Legal Remedies Available to a Person Who Wants to Assert a Claim(s) of Abuse or Undue Influence Against Another and Obtain Guardianship: You Can
- File a “Protective Action” complaint with the Superior Court. It’s a potentially powerful option. See the page “Protective Action You Can Take Now” to learn more.
- Seek an injunction against the abusive conduct and/or exploitation
- Request the appointment of a temporary guardian.
- Request the appointment of a geriatric care manager.
- Request an accounting. New Jersey court rules provide that a court “may, upon application of any heir or other next friend of the principal, require an attorney-in-fact acting within the powers delegated by the power-of-attorney, or is acting solely for the benefit of the principal to file an accounting.”
- Contact the County Prosecutor’s office.
- Call Adult Protective Services if the circumstances warrant the call.
- Apply for guardianship.
GIFTS BETWEEN A GUARDIAN AND HIS OR HER WARD
A very strong presumption exists against the validity of a gift(s) made between an incapacitated person and his or her guardian or the holder of a power of attorney. The law places a heavy burden on the fiduciary to show the absence of undue influence, diminished capacity, and other factors that may adversely impact the gift being made voluntarily. If a gift is contemplated, it is strongly suggested that careful planning and proof of the ward’s independent and voluntary decision-making be established. If “gifts” have already been made and you consider yourself to be the victim of a predatory guardian who has deprived you of the value of your property, you should immediately contact us. Chances are, we can successfully challenge it.
Fredrick P. Niemann Esq.
Have questions or a case involving elder financial abuse in New Jersey by a guardian, power of attorney, or an abusive person, contact Fredrick P. Niemann, an NJ elder abuse and financial abuse law attorney at (732) 863-9900 or email him at fniemann@hnlawfirm.com.
He will sit and discuss your case and help you evaluate whether an actionable case of elder abuse exists.
Written by Fredrick P. Niemann, Esq. of Hanlon Niemann & Wright, a New Jersey Elder Abuse Attorney