Power of Attorney / Attorney in Fact Responsibilities and Rights – Slides 3, 4 and 5

I seldom see discussions about power of attorney, principal, and attorney-in-fact responsibilities and rights. In this post and in subsequent posts I will be providing some of my power of attorney presentation slides. Below in this post I have provided screenshots of my slide numbers 3, 4 and 5.

You should note, obviously these slides are a summary of what can be a complicated area of law and specific facts, they are not a solicitation for services inside or outside of California, and they do not pertain to any particular situation or to you and your situation. You need to consult with an appropriate professional for your specific situation.

Best to you, Dave Tate, Esq.

 

Conservatee right to live in personal residence, and sale of personal residence – new 2020 law changes – forwarding from Weintraub Tobin

The following is a link to a discussion by attorney Carlena Tapella at Weintraub Tobin about two new conservatee personal residence rights beginning in 2020. https://www.weintraub.com/blogs/theres-no-place-like-home-heightened-evidentiary-standard-for-moving-conservatees-from-their-personal-residence

As discussed by Ms. Tapella, under present law it is presumed that the personal residence of the conservatee is the least restrictive and most appropriate residence where the conservatee should live. But beginning in 2020 that presumption can only be overcome by clear and convincing evidence, which is a significantly higher standard. Amended Probate Code Section 2352.5 will in part read: “In any hearing to determine if removal of the conservatee from the conservatee’s personal residence is appropriate, that presumption may be overcome by clear and convincing evidence.” And the petitioner or conservator also will be required to determine and establish the appropriate level of care, including the most appropriate residence. Amended Section 2352.5 will also in part read that: If the conservatee is living at a location other than the conservatee’s personal residence at the commencement of the proceeding, that determination shall either include a plan to return the conservatee to their personal residence or an explanation of the limitations or restrictions on a return of the conservatee to their personal residence in the foreseeable future.”

In recent years several California Court decisions have significantly increased the rights of conservatees and prospective conservatees, including, for example, the right to a jury trial on at least some of the conservatorship issues. You should also be aware that a conservatee and a prospective conservatee also have the right to oppose the conservatorship and the conditions of the conservatorship, and also the right to be represented by an attorney – and in appropriate circumstances the Court will appoint an attorney to represent the conservatee or prospective conservatee. The Courts have recognized that a conservatorship proceeding is an action in which the person who has filed the petition is requesting the Court (the State or government) to limit or to take away or to restrict some of the prospective conservatee’s constitutional rights and rights to personal freedom and freedom of choice and decision making. You will see in some of my prior blog posts discussions about certain aspects of conservatorships.

At the link above Ms. Tapella also discusses 2020 changes that put restrictions on the sale of the conservatee’s residence. Amended Probate Code Section 2540 will in part read: “In seeking authorization to sell a conservatee’s present or former personal residence, the conservator shall notify the court that the present or former personal residence is proposed to be sold and that the conservator has discussed the proposed sale with the conservatee . . . . and whether the conservatee supports or is opposed to the proposed sale and shall describe the circumstances that necessitate the proposed sale, including whether the conservatee has the ability to live in the personal residence and why other alternatives, including, but not limited to, in-home care services, are not available. The court, in its discretion, may require the court investigator to discuss the proposed sale with the conservatee.”

The law of conservatorships, and conservatorship proceedings and administrations, including the responsibilities and rights of conservatees and conservators, continue to become more specialized and complicated, and conservatee rights continue to increase and be recognized by the California Legislature and by the Courts.

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Remember, every case and situation is different. It is important to obtain and evaluate all of the evidence that is available, and to apply that evidence to the applicable standards and laws. You do need to consult with an attorney and other professionals about your particular situation. This post is not a solicitation for legal or other services inside of or outside of California, and, of course, this post only is a summary of information that changes from time to time, and does not apply to any particular situation or to your specific situation. So . . . you cannot rely on this post for your situation or as legal or other professional advice or representation.

Thank you for reading this post. I ask that you also pass it along to other people who would be interested as it is through collaboration that great things and success occur more quickly. And please also subscribe to this blog and my other blog (see below), and connect with me on LinkedIn and Twitter.

Best to you, David Tate, Esq. (and inactive California CPA) – practicing in California only.

I am also the Chair of the Business Law Section of the Bar Association of San Francisco.

Blogs: Trust, estate/probate, power of attorney, conservatorship, elder and dependent adult abuse, nursing home and care, disability, discrimination, personal injury, responsibilities and rights, and other related litigation, and contentious administrations http://californiaestatetrust.com; Business, D&O, board, director, audit committee, shareholder, founder, owner, and investor litigation, governance, responsibilities and rights, compliance, investigations, and risk management  http://auditcommitteeupdate.com

My law practice primarily involves the following areas and issues:

Probate Court Disputes and Litigation

  • Trust and estate disputes and litigation, and contentious administrations representing fiduciaries and beneficiaries; elder abuse; power of attorney disputes; elder care and nursing home abuse; conservatorships; claims to real and personal property; and other related disputes and litigation.

Business and Business-Related Disputes and Litigation: Private, Closely Held, and Family Businesses; Public Companies; and Nonprofit Entities

  • Business v. business disputes including breach of contract; unlawful, unfair and fraudulent business practices; fraud, deceit and misrepresentation; unfair competition; licensing agreements, breach of the covenant of good faith and fair dealing; etc.
  • Misappropriation of trade secrets
  • M&A disputes
  • Founder, officer, director and board, investor, shareholder, creditor, VC, control, governance, decision making, fiduciary duty, conflict of interest, independence, voting, etc., disputes
  • Buy-sell disputes
  • Funding and share dilution disputes
  • Accounting, lost profits, and royalty disputes and damages
  • Access to corporate and business records disputes
  • Employee, employer and workplace disputes and processes, discrimination, whistleblower and retaliation, harassment, defamation, etc.

Investigations and Governance

  • Corporate and business internal investigations
  • Board, audit committee and special committee governance and processes, disputes, conflicts of interest, independence, culture, ethics, etc.

The following are copies of the tables of contents of three of the more formal materials that I have written over the years about accounting/auditing, audit committees, and related legal topics – Accounting and Its Legal Implications was my first formal effort, which resulted in a published book that had more of an accounting and auditing focus; Chapter 5A, Audit Committee Functions and Responsibilities, for the California Continuing Education of the Bar has a more legal focus; and the most recent Tate’s Excellent Audit Committee Guide (February 2017) also has a more legal focus:

Accounting and Its Legal Implications

Chapter 5A, Audit Committee Functions and Responsibilities, CEB Advising and Defending Corporate Directors and Officers

Tate’s Excellent Audit Committee Guide

The following are other summary materials that you might find useful:

OVERVIEW OF A RISK MANAGEMENT PROCESS THAT YOU CAN USE 03162018

Audit Committee 5 Lines of Success, Diligence, and Defense - David Tate, Esq, 05052018

COSO Enterprise Risk Management Framework ERM Components and Principles

From a prior blog post which you can find at https://wp.me/p75iWX-dk if the below scan is too difficult to read:

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Who Can File A Petition Relating To A Power Of Attorney – Almost Anyone, Including Any Interested Person Or Friend

If you have a question or dispute about how a power of attorney operates, or how it should be or is being used, the California Probate Code allows almost anyone to file a petition with the Court for instructions or other remedies. See the provisions of Probate Code Sections 4540 and 4541 below.

Also note, there are powers of attorney for financial and asset management, and powers of attorney for health care and daily living – although some of the provisions are similar, there are important differences. And, perhaps outside of common knowledge, it is not always clear when, for how long, and for what decision making a person can become and becomes an attorney in fact, what decisions can be made, what decisions are legally prudent, and what people and resources, including the principal, might be or in circumstances should be or must be consulted about the matter at hand and possible options for decision making. 

California Probate Code Section 4540 provides as follows:

Subject to Section 4503, a petition may be filed under this part by any of the following persons:

(a) The attorney-in-fact.

(b) The principal.

(c) The spouse of the principal.

(d) A relative of the principal.

(e) The conservator of the person or estate of the principal.

(f) The court investigator, described in Section 1454, of the county where the power of attorney was executed or where the principal resides.

(g) The public guardian of the county where the power of attorney was executed or where the principal resides.

(h) The personal representative or trustee of the principal’s estate.

(i) The principal’s successor in interest.

(j) A person who is requested in writing by an attorney-in-fact to take action.

(k) Any other interested person or friend of the principal.

California Probate Code Section 4541 provides as follows:

A petition may be filed under this part for any one or more of the following purposes:

(a) Determining whether the power of attorney is in effect or has terminated.

(b) Passing on the acts or proposed acts of the attorney-in-fact, including approval of authority to disobey the principal’s instructions pursuant to subdivision (b) of Section 4234.

(c) Compelling the attorney-in-fact to submit the attorney-in-fact’s accounts or report the attorney-in-fact’s acts as attorney-in-fact to the principal, the spouse of the principal, the conservator of the person or the estate of the principal, or to any other person required by the court in its discretion, if the attorney-in-fact has failed to submit an accounting or report within 60 days after written request from the person filing the petition.

(d) Declaring that the authority of the attorney-in-fact is revoked on a determination by the court of all of the following:

(1) The attorney-in-fact has violated or is unfit to perform the fiduciary duties under the power of attorney.

(2) At the time of the determination by the court, the principal lacks the capacity to give or to revoke a power of attorney.

(3) The revocation of the attorney-in-fact’s authority is in the best interest of the principal or the principal’s estate.

(e) Approving the resignation of the attorney-in-fact:

(1) If the attorney-in-fact is subject to a duty to act under Section 4230, the court may approve the resignation, subject to any orders the court determines are necessary to protect the principal’s interests.

(2) If the attorney-in-fact is not subject to a duty to act under Section 4230, the court shall approve the resignation, subject to the court’s discretion to require the attorney-in-fact to give notice to other interested persons.

(f) Compelling a third person to honor the authority of an attorney-in-fact.

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Remember, every case and situation is different. It is important to obtain and evaluate all of the evidence that is available, and to apply that evidence to the applicable standards and laws. You do need to consult with an attorney and other professionals about your particular situation. This post is not a solicitation for legal or other services inside of or outside of California, and, of course, this post only is a summary of information that changes from time to time, and does not apply to any particular situation or to your specific situation. So . . . you cannot rely on this post for your situation or as legal or other professional advice or representation.

Thank you for reading this post. I ask that you also pass it along to other people who would be interested as it is through collaboration that great things and success occur more quickly. And please also subscribe to this blog and my other blog (see below), and connect with me on LinkedIn and Twitter.

Best to you, David Tate, Esq. (and inactive California CPA) – practicing in California only.

I am also the Chair of the Business Law Section of the Bar Association of San Francisco.

Blogs: Trust, estate/probate, power of attorney, conservatorship, elder and dependent adult abuse, nursing home and care, disability, discrimination, personal injury, responsibilities and rights, and other related litigation, and contentious administrations http://californiaestatetrust.com; Business, D&O, board, director, audit committee, shareholder, founder, owner, and investor litigation, governance, responsibilities and rights, compliance, investigations, and risk management  http://auditcommitteeupdate.com

My law practice primarily involves the following areas and issues:

Probate Court Disputes and Litigation

  • Trust and estate disputes and litigation, and contentious administrations representing fiduciaries and beneficiaries; elder abuse; power of attorney disputes; elder care and nursing home abuse; conservatorships; claims to real and personal property; and other related disputes and litigation.

Business and Business-Related Disputes and Litigation: Private, Closely Held, and Family Businesses; Public Companies; and Nonprofit Entities

  • Business v. business disputes including breach of contract; unlawful, unfair and fraudulent business practices; fraud, deceit and misrepresentation; unfair competition; breach of the covenant of good faith and fair dealing; etc.
  • Misappropriation of trade secrets
  • M&A disputes
  • Founder, officer, director and board, investor, shareholder, creditor, VC, control, governance, decision making, fiduciary duty, conflict of interest, voting, etc., disputes
  • Buy-sell disputes
  • Funding and share dilution disputes
  • Accounting, lost profits, and royalty disputes
  • Access to corporate and business records disputes
  • Employee, employer and workplace disputes, discrimination, whistleblower and retaliation, harassment, defamation, etc.

Investigations and Governance

  • Corporate and business internal investigations
  • Board, audit committee and special committee governance and processes, disputes, conflicts of interest, independence, etc.

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New California Case, Levin v. Winston-Levin: Probate Code §859 Undue Influence Also Requires A Finding Of Bad Faith, And Depending On The Circumstances A Finding Of Undue Influence Could Invalidate The Entire Document, Or Only A Part Thereof

In Levin v. Winston-Levin (California Court of Appeal, Fourth Appellate District, Case No. G056353, filed September 13, 2019), the court made two noteworthy holdings:

1.  To recover double damages under the Cal. Probate Code §859 prong pertaining to undue influence, in addition to a finding of undue influence there must also be a finding that the undue influence was in bad faith. While one might presume that undue influence is in bad faith, as the court noted, Cal. Welfare & Institutions Code §15610.70 which defines undue influence as excessive persuasion that causes another person to act or refrain from acting by overcoming that person’s free will and results in inequity, directs a court to consider four primary factors which are then further broken down: the vulnerability of the victim, the influencer’s apparent authority, the actions or tactics used by the influencer, and the equity of the results – thus, it is entirely possible that a court might find that there was undue influence but no bad faith by the influencer.

I also note that there are very few appellate decisions pertaining to Cal. Probate Code §850, et al., which is surprising in light of the somewhat frequency that §850 is pleaded. It is my view that §850, §859, and the other sections relating thereto, are not particularly well drafted which can lead to confusion about applicability in situations that are on the fringe.

2.  It is the general rule that if the whole document (in this case a will) is the result of the presence of undue influence, the will is totally invalidated, but that if only a part of the will was procured by undue influence, that part may be rejected as void, but the remainder which is the outcome of the testator’s free will remains valid if it is not inconsistent with and can be separated from the part that is invalid. In Levin the court also compared the result if the entire will was invalidated or with the result if only a part of the will was invalidated, and compared those results with what was established about the decedent’s overall historical estate planning wishes and intentions.

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Remember, every case and situation is different. It is important to obtain and evaluate all of the evidence that is available, and to apply that evidence to the applicable standards and laws. You do need to consult with an attorney and other professionals about your particular situation. This post is not a solicitation for legal or other services inside of or outside of California, and, of course, this post only is a summary of information that changes from time to time, and does not apply to any particular situation or to your specific situation. So . . . you cannot rely on this post for your situation or as legal or other professional advice or representation.

Thank you for reading this website. I ask that you also pass it along to other people who would be interested as it is through collaboration that great things and success occur more quickly.

Best to you, David Tate, Esq. (and inactive California CPA) – practicing in California only.

I am also the Chair of the Business Law Section of the Bar Association of San Francisco.

Blogs: Trust, estate/probate, power of attorney, conservatorship, elder and dependent adult abuse, nursing home and care, disability, discrimination, personal injury, responsibilities and rights, and other related litigation, and contentious administrations http://californiaestatetrust.com; Business, D&O, board, director, audit committee, shareholder, founder, owner, and investor litigation, governance, responsibilities and rights, compliance, investigations, and risk management  http://auditcommitteeupdate.com

 

Discussions About Powers of Attorney – Responsibilities and Rights (Part 1)

I am writing a couple of posts discussing powers of attorney under the California Probate Code. One of my current cases involves responsibilities and rights under financial and healthcare powers of attorney. A prior case in litigation involved whether or not to disconnect mom from medical equipment that was believed to be keeping her alive. Some of the discussion in these posts will be from a talk that I presented for the Professional Fiduciary Association of California.

Responsibilities and rights under a power of attorney are determined by the wording of the power of attorney itself, statutes, case law, and the facts and circumstances of the situation. These can be complicated issues. Although the wording of the power of attorney is extremely important, and that wording should be where the determination of responsibilities and rights starts, as you will see in these posts, the wording of the power of attorney does not give the complete answer. There are lengthy chapters and books written on these topics – in this and a couple of following posts I will be discussing some of the statutory provisions that govern responsibilities and rights under powers of attorneys under the California Probate Code.

Under the California Probate Code powers of attorney are discussed at Probate Code §§4000-4545.

Thus, for example, California Probate Code §§4050 and 4051 provide as follows:

Probate Section 4050:

(a) This division applies to the following:

(1) Durable powers of attorney, other than powers of attorney for health care governed by Division 4.7 (commencing with Section 4600).

(2) Statutory form powers of attorney under Part 3 (commencing with Section 4400).

(3) Any other power of attorney that incorporates or refers to this division or the provisions of this division.

(b) This division does not apply to the following:

(1) A power of attorney to the extent that the authority of the attorney-in-fact is coupled with an interest in the subject of the power of attorney.

(2) Reciprocal or interinsurance exchanges and their contracts, subscribers, attorneys-in-fact, agents, and representatives.

(3) A proxy given by an attorney-in-fact to another person to exercise voting rights.

(c) This division is not intended to affect the validity of any instrument or arrangement that is not described in subdivision (a).

Probate Section 4051:

Except where this division provides a specific rule, the general law of agency, including Article 2 (commencing with Section 2019) of Chapter 2 of Title 6 of, and Title 9 (commencing with Section 2295) of, Part 4 of Division 3 of the Civil Code, applies to powers of attorney.

In relevant part, California Civil Code Sections 2019, 2020 and 2022 provide:

Civil Code Section 2019 – an agent must not exceed the limits of his actual authority.

Civil Code Section 2020 – an agent must use ordinary diligence and keep his or her principal informed of his or her acts.

Civil Code Section 2022 – a mere agent of an agent is not responsible as such to the principal of the latter.

Thus, whereas the power of attorney might appear to say or suggest that the attorney-in-fact has absolute authority at least in the circumstances that are listed, you can see that, nevertheless, the attorney-in-fact cannot exceed his or her actual authority, he or she has to use at least ordinary diligence unless the power of attorney states otherwise, and the attorney-in-fact must keep his or her principal informed of his or her acts. And these are themes and requirements that run throughout the statutes that more specifically discuss responsibilities and rights, and that will be discussed in future posts.

Every case and situation is different. You do need to consult with an attorney and other professionals about your particular situation. This post is not a solicitation for legal or other services inside of or outside of California, and, of course, this post only is a summary of information that changes from time to time, and does not apply to any particular situation or to your specific situation. So . . . you cannot rely on this post for your situation or as legal or other professional advice or representation.

Thank you for reading this website. I ask that you also pass it along to other people who would be interested as it is through collaboration that great things and success occur more quickly.

Best to you, David Tate, Esq. (and inactive California CPA) – practicing in California only. I am also the new Chair of the Business Law Section of the Bar Association of San Francisco.

Blogs: Trust, estate/probate, power of attorney, conservatorship, elder and dependent adult abuse, nursing home and care, disability, discrimination, personal injury, responsibilities and rights, and other related litigation, and contentious administrations http://californiaestatetrust.com; Business, D&O, board, director, audit committee, shareholder, founder, owner, and investor litigation, governance, responsibilities and rights, compliance, investigations, and risk management  http://auditcommitteeupdate.com

 

OVERVIEW OF A RISK MANAGEMENT PROCESS THAT YOU CAN USE 03162018

Audit Committee 5 Lines of Success, Diligence, and Defense - David Tate, Esq, 05052018

COSO Enterprise Risk Management Framework ERM Components and Principles

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New California case – California lacks personal jurisdiction over a Utah resident on a cross-complaint against her individually as a third party for intentional interference with prospective economic advantage, although the real property was located in California, and the Utah resident was appointed guardian ad litem for her mother in California

Keri Jensen v. Trine Jensen (Court of Appeal, Second Appellate District, B2896111, January 24, 2019), is very fact specific, so its value is mostly in the court’s legal evaluation as applied to this specific case. Frankly, I am a bit surprised by the court’s holding. Daughter Trine came to California and moved her mother back to Utah to stay with Trine. Trine was also appointed as guardian ad litem for her mother in California. Mother sued other daughter Keri in California relating to a parcel of real property that had been co-owned by mother and daughter Keri. In that lawsuit Keri then cross-complained against Trine personally and individually, not as guardian ad litem, for intentional interference with prospective economic advantage claiming that Trine took advantage of mom’s advancing dementia and coerced mom to sever the joint tenancy in the California real property.

Trine filed a motion to quash for lack of personal jurisdiction which the trial court granted and the court of appeal upheld. Since the parties apparently agreed that Trine was not subject to general jurisdiction in California, the court evaluated whether Trine purposefully availed herself of the California forum benefits, whether the controversy is related to or arises out of the Trine’s contacts in California, and whether California’s assertion of personal jurisdiction over Trine would comport with fair play and substantial justice.

It seems to me that this case is a close call as the real property is located in California. The court in dicta also made the point that Trine was not sued in California as guardian ad litem. I also note that there would be jurisdiction over Trine in Utah. The case also has other less relevant facts and is interesting reading relating to possible undue influence.

Thanks for reading this post. If you have found value in this post, I ask that you also pass it along to other people who would be interested as it is through collaboration that great things and success occur more quickly. And please also subscribe to this blog and my other blog (see below), and connect with me on LinkedIn and Twitter.

Every case situation is different. You do need to consult with professionals about your particular situation. This post is not a solicitation for services inside of or outside of California, and, of course, this post only is a summary of information that changes from time to time, and does not apply to any particular situation or to your specific situation. So . . . you cannot rely on this post for your situation.

Best to you, David Tate, Esq. (and inactive California CPA) – practicing in California only

Blogs: California trust, estate, and elder abuse litigation and contentious administrations http://californiaestatetrust.com; D&O, audit committee, governance and risk management http://auditcommitteeupdate.com

New California case upholds the substantial benefit doctrine for payment and recovery of attorneys’ fees and expert witness fees from the entire trust and the shares of all of the beneficiaries

In Smith v. Szeyller (Court of Appeal, Second Appellate District, B281758, January 16, 2019), the court held that the probate court’s award approving payment of attorneys’ fees and expert witness fees from the trust to the beneficiary who challenged the trustees’ accounting and management of the trust was appropriate under the substantial benefit doctrine. The beneficiary who challenged the trustees’ accounting and management of the trust prevailed, thus benefiting the trust and all beneficiaries of the trust although only the one beneficiary challenged the accounting and management. As the trust and all of its beneficiaries benefited from the successful challenge, it was appropriate that the attorneys’ fees and expert witness fees be paid and reimbursed from the assets of the entire trust and the shares of each of the beneficiaries thereof.

Note: I used this doctrine after a successful week-long trial in one of my cases.

Thanks for reading this post. If you have found value in this post, I ask that you also pass it along to other people who would be interested as it is through collaboration that great things and success occur more quickly. And please also subscribe to this blog and my other blog (see below), and connect with me on LinkedIn and Twitter.

Every trust situation is different. You do need to consult with professionals about your particular situation. This post is not a solicitation for services inside of or outside of California, and, of course, this post only is a summary of information that changes from time to time, and does not apply to any particular situation or to your specific situation. So . . . you cannot rely on this post for your situation.

Best to you, David Tate, Esq. (and inactive California CPA) – practicing in California only

Blogs: California trust, estate, and elder abuse litigation and contentious administrations http://californiaestatetrust.com; D&O, audit committee, governance and risk management http://auditcommitteeupdate.com