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How to Challenge a Power of Attorney in order to prevent abuse

how to challenge a power of attorney

If you are suspecting that someone is financially abusing your loved one through a power of attorney, your first instinct is to lear how to challenge the power of attorney, in order to minimize the damage and to have the property returned to your loved one.

If you are suspecting power of attorney abuse:

Abuses of powers of attorney can be financially and emotionally devastating to a person’s estate and their heirs and beneficiaries. If you are alleging power of attorney abuse, your goals are to

  • challenge the power of attorney
  • have the power of attorney agent return the money and property
  • have the court revoke, set aside or cancel out the power of attorney
  • punish the agent in a criminal proceeding
  • find other ways of assisting your loved one

If your loved one is suffering from power of attorney abuse, it can mean serious financial consequences for their well-being and diminishes your future inheritance. Power of attorney abuse occurs frequently in connection with elder care or the care of a person who is physically disabled or mentally incapacitated.

If you are looking into how to challenge a power of attorney, you are likely to need representation from an attorney who has experience with power of attorney abuse litigation, settlements and mediation. We at the Law Offices of Albert Goodwin are here for you. You can send us an email at attorneyalbertgoodwin@gmail.com or call us at 718-509-9774.

What is considered power of attorney abuse

There are plenty of ways in which a person can abuse a power of attorney. Here are some examples:

  • Opening joint bank accounts and naming the power of attorney Agent as a beneficiary
  • Purchasing life insurance policies and naming the Agent as a beneficiary
  • changing existing life insurance account beneficiaries
  • Purchasing real estate with the principal’s money and transferring title of real estate for the benefit of the Agent
  • Unauthorized gifting to self
  • Unauthorized gifting to individuals and charities
  • Theft of property
  • Self-dealing
  • Unauthorized use of credit cards
  • Establishing credit under the principal’s name

A person perpetrating power of attorney abuse can leave a person’s estate and their heirs without any assets or inheritance. Power of attorney abuse such as the conduct described above typically involves one or more of the following potentially criminal conduct:

  • Embezzlement
  • Theft
  • Identity theft
  • Fraud
  • Forgery

What can I do if I suspect power of attorney abuse?

Ask your loved one to revoke the power of attorney

The simples thing to do would be to explain to your loved one that they are possibly being defrauded, and ask them to revoke the power of attorney in writing (hopefully with a copy to you). You may or may not choose to follow up and make sure that the person suspected of abusing the power of attorney is no longer in any power of authority over any of your loved one’s assets.

Ask the power of attorney agent to return the money or property

This may or may not work, but you can always just ask the power of attorney agent to return the money or property. It could be that their plan was to only abuse the power of attorney if they could get away with it. Now that they are discovered, they may decide to cut their losses and not have to deal with a civil lawsuit or even criminal prosecution, and they might just return the money or property in question.

Bring a lawsuit to challenge the power of attorney

The maker or their potential heirs can contest the power of attorney in court by suing the representative directly on grounds that a fiduciary duty was broken, tortuous interference or other causes of action to get the embezzled funds or property returned to the estate and beneficiaries. These matters are complex, time-consuming and most people require the assistance of an experienced New York litigation attorney to help resolve matters for them in court.

Although your loved one can revoke the power of attorney that and can sue the power of attorney agent to get the money back, they are often too old and frail and don’t have the will power or sometimes even the mental capacity to bring a lawsuit. They also feel bad for the person who took the money from them, thinking that they don’t want them to get into any kind of trouble with the law.

The best way to challenge a power of attorney might be to place a guardianship over your loved one

You will not be able to challenge the power of attorney on your own, as you don’t have what we call the legal standing. You cannot sue on behalf of your loved one. And they are not likely to sue on their own, because it’s a difficult process and the person abusing the power of attorney is someone they care about. If you want to challenge the power of attorney, the way to do that is through obtaining a guardianship over your loved one. Once you are a guardian, you can bring a lawsuit against the person abusing the power of attorney on grounds that a fiduciary duty was broken, tortuous interference or other causes of action to get the embezzled funds or property returned to the loved one, and ultimately to benefit the estate and beneficiaries.

There are some downsides to the guardianship proceeding, the most common downside being that your loved one can resent you for bringing a proceeding which compromises their independence. These matters are complex, time-consuming and most people require the assistance of an experienced New York litigation attorney to help resolve matters for them in court.

Is abusing a power of attorney criminal, can I get the police involved and can a person go to jail for it?

Power of attorney abuse can involve state and federal crimes of embezzlement, theft, identity theft, fraud or forgery, but it is unlikely that the power of attorney agent will face jail time, as the victim is unlikely to press charges against them and the police tends to view power of attorney abuse as a civil matter. So the only way you can challenge a power of attorney is likely to be in civil court, a criminal proceeding would not be the way to go.

Can I report the abuse to adult protective services?

Reporting power of attorney abuse to the adult protective services is not a way to challenge a power of attorney. It likely to not yield a result, as those government agencies typically view this issue as a civil matter. Your best opportunity to resolve the situation is to retainer the services of an attorney who has experience in these kind of matters. However, if other types of abuse are present, then you do want to report the abuse to adult protective services.

How can I prove power of attorney abuse

In order to challenge a power of attorney, you would need to prove power of attorney abuse. You can prove power of attorney abuse by looking at the financial statements and property records of the person who made the power of attorney. If power of attorney abuse took place, then you will see transfers of money or property to the power of attorney principal or unexplained cash withdrawals. You can ask your loved one to show those documents to you or to give you access to those documents. If that is not possible, then your attorney would know how to get those documents.

A power of attorney has a lot of potential for abuse

If your loved one gave someone a power of attorney, it may make sense for you to look closely into the arrangement and for possible ways of how to challenge the power of attorney. Perhaps ask for some financial records just to be on the safe side. You can never be too careful when it comes to power of attorney, due to the potential for abuse. A power of attorney gives a person the authority to make legal and financial decisions for someone else regarding such matters as

  • bank accounts, including withdrawals and transfers
  • the purchase and sale of real estate
  • management of assets
  • stock and bond transactions
  • retirement plans
  • investments
  • buying and selling assets

By creating a power of attorney and giving someone such important powers, there is a potential for fraud, self-interest and embezzlement by a the power of attorney agent, especially where large sums of money and substantial assets are involved and readily accessible. A situation where large sums of money and substantial assets are involved and readily accessible can create a temptation that is hard to resist for some people.

A power of attorney is in effect until

  • The person who made it dies
  • It expires (if it has an expiration date)
  • It’s revoked by the principal, who can revoke it by giving written notice to the power of attorney agent
  • It is successfully challenged and is revoked by the court

How much does it cost to hire a lawyer to challenge a power of attorney

Attorneys generally charge by the hour. In our firm, we charge $400 per hour and require a retainer deposit of $4,000 to work on a case. No one likes to spend money on lawyers, but if the alternative is your relative continuing to suffer power of attorney abuse and your future inheritance to keep getting diminished, or having power of attorney abuse accusations being undefended, it seems like an easy choice to make.

Where can I find an attorney near me who knows how to challenge a power of attorney?

We at the Law Offices of Albert Goodwin are here for you. If you are looking for an attorney who knows how to challenge a power of attorney, get in touch with our firm. We have offices in Brooklyn, NY, Manhattan and Queens. You can send us an email at attorneyalbertgoodwin@gmail.com or call us at 718-509-9774.

Uncle Inheritance Laws: an Overview and Frequently Asked Questions

Uncle inheritance laws endow you with certain rights to your uncle’s inheritance. However, your rights are lower priority than those of your uncle’s more immediate family members. As set forth in the laws of the state of New York, you have no rights to your uncle’s inheritance if your uncle had a living spouse, descendants or parents at the time of his death. Even if you are the closest living relative, you may also have very limited rights if your uncle left you out of his will.

Will I inherit if my uncle did not have a will? If your uncle did not have a will, then you will inherit only if you are “the closest living relative” – only if your uncle died with no living spouse, descendants (children, grandchildren, great-grandchildren etc.) and parents.

Do I have to be notified if my uncle died? If your uncle had a will, then uncle inheritance laws state that you will have the right to be notified of the will and the hearing date when the will is presented before the court.

What can I do if I am not named in my uncle’s will? If you were not named in your uncle’s will, then you have the right to contest the will. You can win a will contest if you can prove that your uncle either did not have the mental capacity to make a will, was unduly influenced into making the will or the will was not made correctly.

Can I inherit from step-uncle? You cannot inherit from a step-uncle. Only if you were adopted by the uncle’s sibling, in which case they would be considered an uncle.

Do all nieces and nephews inherit equally? According to uncle inheritance laws, nieces and nephews inherit by sharing the inheritance share of the uncle’s siblings.

Will I be in charge of my uncle’s estate? If you are the closest living relative (your uncle does not have a living spouse, descendants or parents) or you are named as the executor in your uncle’s will, then you can be named the executor or administrator of his estate.

Can I inherit from my uncle if his marriage was invalid? A legal marriage is assumed to be valid unless you can prove otherwise, even your uncle was separate from his spouse or was in the process of divorce. But if you can prove to the court that your uncle’s spouse abandoned them, then you will be able to set aside the spouse’s share and will be able to inherit from your uncle. To be valid for inheritance purposes, the marriage has to be a legal marriage. Common-law marriage is not valid in New York, but may be valid in a different state.

What should I do if I need an estate and probate lawyer for my uncle’s estate? You can contact the Law Offices of Albert Goodwin, an attorney familiar with uncle inheritance laws, at 718-509-9774 or (718) 509-9774.

Aunt Inheritance Laws: An Overview and Frequently Asked Questions

Aunt inheritance laws endow you with certain rights to your aunt’s inheritance. However, your rights are lower priority than those of your aunt’s more immediate family members. As set forth in the laws of the state of New York, you have no rights to your aunt’s inheritance if your aunt had a living spouse, descendants or parents at the time of her death. Even if you are the closest living relative, you may also have very limited rights if your aunt left you out of her will.

Will I inherit if my aunt did not have a will? If your aunt did not have a will, then you will inherit only if you are “the closest living relative” – only if your aunt died with no living spouse, descendants (children, grandchildren, great-grandchildren etc.) and parents.

Do I have to be notified if my aunt died? If your aunt had a will, then aunt inheritance laws state that you will have the right to be notified of the will and the hearing date when the will is presented before the court.

What can I do if I am not named in my aunt’s will? If you were not named in your aunt’s will, then you have the right to contest the will. You can win a will contest if you can prove that your aunt either did not have the mental capacity to make a will, was unduly influenced into making the will or the will was not made correctly.

Can I inherit from step-aunt? You cannot inherit from a step-aunt. Only if you were adopted by the aunt’s sibling, in which case they would be considered an aunt.

Do all nieces and nephews inherit equally? According to aunt inheritance laws, nieces and nephews inherit by sharing the inheritance share of the aunt’s siblings.

Will I be in charge of my aunt’s estate? If you are the closest living relative (your aunt does not have a living spouse, descendants or parents) or you are named as the executor in your aunt’s will, then you can be named the executor or administrator of her estate.

Can I inherit from my aunt if her marriage was invalid? A legal marriage is assumed to be valid unless you can prove otherwise, even your aunt was separate from her spouse or was in the process of divorce. But if you can prove to the court that your aunt’s spouse abandoned them, then you will be able to set aside the spouse’s share and will be able to inherit from your aunt. To be valid for inheritance purposes, the marriage has to be a legal marriage. Common-law marriage is not valid in New York, but may be valid in a different state.

What should I do if I need an estate and probate lawyer for my aunt’s estate? You can contact the Law Offices of Albert Goodwin, an attorney familiar with aunt inheritance laws, at 718-509-9774 or (718) 509-9774.

Inheritance Rights of Siblings

inheritance rights of siblings
Inheritance rights of siblings endow you with certain rights to your brother’s or sister’s inheritance. However,  your rights are lower priority than those of your sibling’s more immediate family members. As set forth in the laws of the state of New York, you have no rights to your sibling’s inheritance if they had a living spouse, descendants or parents at the time of their death. Even if you are the closest living relative, you may also have very limited rights if your sibling left you out of their will.

Do I have the right to inherit if my sibling did not have a will? If your sibling did not have a will, then you will inherit only if you are “the closest living relative” – only if your sibling died with no living spouse, descendants (children, grandchildren, great-grandchildren etc.) and parents.

Do I have the right to be notified if my sibling died? If your sibling had a will, then you will have the right to be notified of the will and the hearing date when the will is presented before the court.

What rights do I have if I am not named in my sibling’s will? If you were not named in your sibling’s will, then you have the right to contest the will. You can win a will contest if you can prove that your sibling either did not have the mental capacity to make a will, was unduly influenced into making the will or the will was not made correctly.

Do half-siblings have the right to inherit? Half-siblings have the right to inherit equally with full siblings. This is only true in some states, New York being one of them.

Do step-siblings have the right to inherit? Step-siblings do not have the right to inherit. Only if they were adopted by the sibling’s parents, in which case they would be considered siblings.

Do all siblings have the right to inherit equally? All siblings have the right inherit equally unless stated otherwise in the will of the sibling who died.

Do I have the right to be in charge of my sibling’s estate? If you are the closest living relative (your sibling does not have a living spouse, descendants or parents) or you are named as the executor in your sibling’s will, then you can have the right to be named the executor or administrator of their estate.

Do I have the right to inherit from my sibling if they were not married and the children are not theirs? Children are presumed to be biological children if they were born during the marriage or have your sibling’s name on their birth certificate. Adopted children of your sibling are considered their children. Step-children or foster children are not considered their children.

Do I have the right to inherit from my sibling if their marriage was invalid? A legal marriage is assumed to be valid unless you can prove otherwise, even your sibling was separate from their spouse or was in the process of divorce. But if you can prove to the court that your sibling’s spouse abandoned them, then you will have the right to set aside the spouse’s share and will be able to inherit from your sibling. To be valid for inheritance purposes, the marriage has to be a legal marriage. Common-law marriage is not valid in New York, but may be valid in a different state.

What should I do if I need an estate and probate lawyer for my sibling’s estate? You can contact the Law Offices of Albert Goodwin, an attorney familiar with inheritance rights of siblings, at 718-509-9774 or (718) 509-9774.

Sister Inheritance Laws: an Overview

sister inheritance laws
Sister inheritance laws endow you with certain rights to your sister’s inheritance. However, your rights are lower priority than those of your sister’s more immediate family members. As set forth in the laws of the state of New York, you have no rights to your sister’s inheritance if your sister had a living spouse, descendants or parents at the time of her death. Even if you are the closest living relative, you may also have very limited rights if your sister left you out of her will.

Will I inherit if my sister did not have a will? If your sister did not have a will, then you will inherit only if you are “the closest living relative” – only if your sister died with no living spouse, descendants (children, grandchildren, great-grandchildren etc.) and parents.

Do I have to be notified if my sister died? If your sister had a will, then sister inheritance laws state that you will have the right to be notified of the will and the hearing date when the will is presented before the court.

What can I do if I am not named in my sister’s will? If you were not named in your sister’s will, then you have the right to contest the will. You can win a will contest if you can prove that your sister either did not have the mental capacity to make a will, was unduly influenced into making the will or the will was not made correctly.

Can half-sisters inherit? According to the laws of the state of New York, half-sisters inherit equally with full sisters. This is only true in some states, New York being one of them.

Can step-sisters inherit? Step-sisters do not inherit. Only if they were adopted by the sister’s parents, in which case they would be considered sisters.

Do all sisters inherit equally? According to sister inheritance laws, all sisters inherit equally unless stated otherwise in the will of the sister who died.

Will I be in charge of my sister’s estate? If you are the closest living relative (your sister does not have a living spouse, descendants or parents) or you are named as the executor in your sister’s will, then you can be named the executor or administrator of her estate.

Can I inherit from my sister if her marriage was invalid? A legal marriage is assumed to be valid unless you can prove otherwise, even your sister was separate from her spouse or was in the process of divorce. But if you can prove to the court that your sister’s spouse abandoned them, then you will be able to set aside the spouse’s share and will be able to inherit from your sister. To be valid for inheritance purposes, the marriage has to be a legal marriage. Common-law marriage is not valid in New York, but may be valid in a different state.

What should I do if I need an estate and probate lawyer for my sister’s estate? You can contact the Law Offices of Albert Goodwin, an attorney familiar with sister inheritance laws, at 718-509-9774 or (718) 509-9774.

Brother Inheritance Laws: An Overview

brother inheritance laws

Brother inheritance laws endow you with certain rights to your brother’s inheritance. However, your rights are lower priority than those of your brother’s more immediate family members. As set forth in the laws of the state of New York, you have no rights to your brother’s inheritance if your brother had a living spouse, descendants or parents at the time of his death. Even if you are the closest living relative, you may also have very limited rights if your brother left you out of his will.

Will I inherit if my brother did not have a will? If your brother did not have a will, then you will inherit only if you are “the closest living relative” – only if your brother died with no living spouse, descendants (children, grandchildren, great-grandchildren etc.) and parents.

Do I have to be notified if my brother died? If your brother had a will, then brother inheritance laws state that you will have the right to be notified of the will and the hearing date when the will is presented before the court.

What can I do if I am not named in my brother’s will? If you were not named in your brother’s will, then you have the right to contest the will. You can win a will contest if you can prove that your brother either did not have the mental capacity to make a will, was unduly influenced into making the will or the will was not made correctly.

Can half-brothers inherit? According to the laws of the state of New York, half-brothers inherit equally with full brothers. This is only true in some states, New York being one of them.

Can step-brothers inherit? Step-brothers do not inherit. Only if they were adopted by the brother’s parents, in which case they would be considered brothers.

Do all brothers inherit equally? According to brother inheritance laws, all brothers inherit equally unless stated otherwise in the will of the brother who died.

Will I be in charge of my brother’s estate? If you are the closest living relative (your brother does not have a living spouse, descendants or parents) or you are named as the executor in your brother’s will, then you can be named the executor or administrator of his estate.

Can I inherit from my brother if they were not married and the children are not his? Children are presumed to be biological children if they were born during the marriage or have your brother’s name on their birth certificate. Adopted children of your brother are considered his children. Step-children or foster children are not considered his children.

Can I inherit from my brother if his marriage was invalid? A legal marriage is assumed to be valid unless you can prove otherwise, even your brother was separate from his spouse or was in the process of divorce. But if you can prove to the court that your brother’s spouse abandoned them, then you will be able to set aside the spouse’s share and will be able to inherit from your brother. To be valid for inheritance purposes, the marriage has to be a legal marriage. Common-law marriage is not valid in New York, but may be valid in a different state.

What should I do if I need an estate and probate lawyer for my brother’s estate? You can contact the Law Offices of Albert Goodwin, an attorney familiar with brother inheritance laws, at 718-509-9774 or (718) 509-9774.

Sibling Inheritance Laws: An Overview

sibling inheritance laws
Sibling inheritance laws endow you with certain rights to your sibling’s inheritance. However,  your rights are lower priority than those of your sibling’s more immediate family members. As set forth in the laws of the state of New York, you have no rights to your sibling’s inheritance if your sibling had a living spouse, descendants or parents at the time of their death. Even if you are the closest living relative, you may also have very limited rights if your sibling left you out of their will.

If you are concerned with sibling inheritance laws and need to consult an attorney, you can send us an email at attorneyalbertgoodwin@gmail.com.

Will I inherit if my sibling did not have a will? If your sibling did not have a will, then you will inherit only if you are “the closest living relative” – only if your sibling died with no living spouse, descendants (children, grandchildren, great-grandchildren etc.) and parents.

Do I have to be notified if my sibling died? If your sibling had a will, then sibling inheritance laws state that you will have the right to be notified of the will and the hearing date when the will is presented before the court.

What can I do if I am not named in my sibling’s will? If you were not named in your sibling’s will, then you have the right to contest the will. You can win a will contest if you can prove that your sibling either did not have the mental capacity to make a will, was unduly influenced into making the will or the will was not made correctly.

Can half-siblings inherit? According to the laws of the state of New York, half-siblings inherit equally with full siblings. This is only true in some states, New York being one of them.

Can step-siblings inherit? Step-siblings do not inherit. Only if they were adopted by the sibling’s parents, in which case they would be considered siblings.

Do all siblings inherit equally? According to sibling inheritance laws, all siblings inherit equally unless stated otherwise in the will of the sibling who died.

Will I be in charge of my sibling’s estate? If you are the closest living relative (your sibling does not have a living spouse, descendants or parents) or you are named as the executor in your sibling’s will, then you can be named the executor or administrator of their estate.

Can I inherit from my sibling if they were not married and the children are not theirs? Children are presumed to be biological children if they were born during the marriage or have your sibling’s name on their birth certificate. Adopted children of your sibling are considered their children. Step-children or foster children are not considered their children.

Can I inherit from my sibling if their marriage was invalid? A legal marriage is assumed to be valid unless you can prove otherwise, even your sibling was separate from their spouse or was in the process of divorce. But if you can prove to the court that your sibling’s spouse abandoned them, then you will be able to set aside the spouse’s share and will be able to inherit from your sibling. To be valid for inheritance purposes, the marriage has to be a legal marriage. Common-law marriage is not valid in New York, but may be valid in a different state.

What should I do if I need an estate and probate lawyer for my sibling’s estate? You can contact the Law Offices of Albert Goodwin, an attorney familiar with sibling inheritance laws, at 718-509-9774 or (718) 509-9774.

Can One Heir Sell Property

Can one heir sell property of the estate

For those wondering “can one heir sell property of an estate,” the short answer is Yes, if they are the executor, unless there are restrictions in his Letters Testamentary which require court approval before selling the property or there is a restriction that limits the administration of the estate to a certain amount. The sale has to be for market value and for benefit of all of the heirs.

Once one heir is appointed by the court as the executor, the one heir may act on the authority of New York State law to marshal the assets of the estate, pay debts and expenses and disburse the remainder of the estate to the rightful beneficiaries. That can include a house, bank account, stock portfolio, automobiles, and any other assets of an estate.

However, even though the one heir who is the executor does not legally have to have the beneficiaries’ approval, it may still be a good idea for them to communicate with the beneficiaries in a way that can be later proven in court (such as email) to confirm in writing that they agree with one heir’s decision.

For example, if one heir is selling a property of an estate, such as a house or a business, they will do well to advise beneficiaries of the price for which the asset is being sold and confirm in writing that the beneficiaries are comfortable with that price, so as to avoid being sued in the future for “selling it under market value. Is it a good idea for one heir to sell the property without all beneficiaries approving? Not really. Putting himself in such a risky position is what one heir cannot do.

Having your New York estate lawyer get a release form beneficiaries is especially crucial when the transaction in question involves the one heir personally, such as when the transaction is between the estate and the one heir or the one heir derives some sort of benefit from the transaction. For example, if the one heir is transferring a share of the decedent’s business, house, or other property to themselves, they should obtain a written release from the beneficiaries, or at least get them to approve it in writing, in order to avoid the possibility of being sued. Transferring assets to yourself often triggers feelings of inequity in beneficiaries, so it is important to communicate with them, explain that they are still getting a fair share of the estate, and that they are actually getting more money than they would have if not for you buying them out because of cost savings on transaction costs such as paying a broker. It is important that there is a feeling that one heir fulfilled his responsibilities to the beneficiaries.

The most crucial release that the one heir can get from the beneficiaries is at the end of the estate. Once the assets are collected or sold and the debts are paid out, and it’s time for them to disburse the funds to the beneficiaries. But before that’s done, it is important to get the release from the beneficiaries that states that they are satisfied with what they are getting and are never going to sue one heir. The best release comes with an informal accounting, which provides a summary of what property went into the estates, what the expenses were, and what is the share of inheritance for each beneficiary.

Assets that were held in the sole name of a New York City decedent at the time of the decedent’s death are subject to probate under New York laws. Assets may include cash in bank accounts, real estate, stocks, bonds, motor vehicles and vessels, a family business, royalties and copyrights and other assets. One heir who is in charge, together with the assistance of a New York City estate attorney, must compile a list of the decedent’s assets and prepare an inventory. A New York probate attorney can also recommend other professionals that one heir may need to hire to determine the value of the assets such as an appraiser, real estate broker and CPA or accountant.

An estate inventory is required to be submitted to the Surrogate’s Court within 6 months after one heir of the estate is appointed. Compiling the estate inventory also gives you a chance to determine the total value of the estate and the amount of any estate taxes that are due. Your estate attorney will review the inventory to make sure that everything is in order before it is submitted to the Surrogate’s Court for review and approval.

Assets That May Need to Be Sold

The One heir in charge is obligated to review creditors’ claims and other claims submitted by the decedent’s creditors and interested parties to the estate. Creditors and other claimants must submit their claims within the prescribed statutory period in order to get paid. Sometimes, one heir must sell some of the estate assets to pay off creditors.

Assets that may need to be sold are as follows:

• Decedent’s primary residence, vacation property or retirement property or any commercial real estate
• Family business including business equipment and business assets
• Stocks, bonds and other investments
• Collectible items including artwork, classic cars, etc. and memorabilia
• Furniture and household furnishings
• Jewelry

Many times the one heir will discuss the sale of the decedent’s assets with the other heirs, to make sure that everyone is in agreement so as to avoid any estate litigation accounting challenges later on by one or more of the beneficiaries. One heir may also decide to sell assets even if they are not needed to pay off creditors. For example, many times the decedent’s family members and beneficiaries decide that they would rather receive the cash proceeds from the sale of the decedent’s house than keep the property and have to become landlords.

Large estates, especially celebrity estates, often have estate sales where items are auctioned off at public auctions. Smaller estates may simply decide to sell assets in an informal sale.

If you are an heir who is involved in the sale of estate assets, or you are a heir or interested party who would like to expedite the closing of an estate, contact a New York City probate and estate attorney to assist you with the matter. An attorney can help with locating and selling estate assets, preparing and reviewing accountings, attending court hearings and making sure court and tax deadlines are met on time.

Can one heir sell property of the estate below market value? No. Selling the property of the estate for less than market value for entities controlled by one heir, or getting money “under the table” is embezzlement, or more simply, stealing.

New York Consolidated Laws, Estates, Powers and Trusts Law – EPT § 11-1.6 states that “Every fiduciary shall keep property received as fiduciary separate from his individual property. He shall not invest or deposit such property with any corporation or other person doing business under the banking law, or with any other person or institution, in his own name, but all transactions by him affecting such property shall be in his name as fiduciary.” [3]

New York’s Penal Law (the Criminal Law) states that “A person steals property and commits larceny when, with intent to deprive another of property or to appropriate the same to himself or to a third person, he wrongfully takes, obtains or withholds such property from an owner thereof.” [4]

The estate owns the house. If one heir uses the house to benefit himself at the expense of the beneficiaries, he would be committing embezzlement, which is larceny.

New York Penal Law continues to say that “Larceny includes a wrongful taking, obtaining or withholding of another’s property, with the intent prescribed in subdivision one of this section, committed … by conduct heretofore defined or known as common law larceny by trespassory taking, common law larceny by trick, embezzlement, or obtaining property by false pretenses.” [5]

Someone who is a heir but not an administrator or an executor, and even an heir who is the executor nominated by the will but has not been appointed by the court to act as the executor does not have the power to sell a house. The law states that “an executor named in a will has no power to dispose of any part of the estate of the testator before letters testamentary or preliminary letters testamentary are granted, except to pay reasonable funeral expenses, nor to interfere with such estate in any manner other than to take such action as is necessary to preserve it. [6]

To sum up, can one heir sell property of the estate? Yes, if they are the executor or administrator of the estate. The executor does not have to seek the beneficiaries’ approval, but in many cases, it is better to do so before the transaction rather than to be sued by the beneficiaries later.

Albert Goodwin, Esq. is a New York estate, guardianship, wills, trust, Medicaid and probate lawyer, and make an appointment to discuss spousal claims and rights to the estate. He is in practice since 2008. He can be reached at 718-509-9774.

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[1] NY EPTL § 11-1.1

[2] In re Estate of Naumoff, 301 A.D.2d 802, 803, 754 N.Y.S.2d 70 (3d Dep’t 2003)

[3] NY EPTL § 11-1.6

[4] NY PEN § 155.05

[5] NY PEN § 155.05

[6] NY EPTL § 11-1.3

A Trustee is Not Allowed to Borrow Funds From a Trust Account

Can a Trustee borrow money from the trust account? No. Why not? Because he is the one managing the money. So if he takes money from the account, it’s presumed to be embezzlement, which is simply known as stealing.

But how about if a trustee is also a beneficiary? Don’t some of the money in the trust also belong to him? For example, a man left a trust for his four children, and one of the children is a trustee. Can the trustee-child borrow money from the trust and say that he is just borrowing his own money? The answer to that is absolutely not. Even though the trustee is one of the beneficiaries of the trust, at the end of the day the trust is not his. The trust belongs to all the beneficiaries. So if a trustee borrows money, he is considered by the law to be taking everyone’s money, not just his own. As an example, if he borrows four thousand dollars, he is not borrowing four thousand dollars of his own money. He is stealing a thousand dollars from each of his siblings. If he takes a penny, most of that penny belongs to the other beneficiaries of the trust.

What can happen if a trustee neglects good advice and does borrow money from the trust account? Nothing good. The trustee can be removed by the court. The court will force the trustee to return the money. The court might order the trustee to pay for his own attorneys’ fees as opposed to using trust funds to pay for his attorney’s fees. The judge may even order the trustee to pay the beneficiaries’ attorneys’ fees. What is scarier is that the trustee can even be criminally prosecuted for stealing. That’s right, a criminal prosecution even if the trustee is one of the beneficiaries of the trust and even if the amount he took is less than his stake in the trust account and intended to return the funds. The judge can refer the case to the District Attorney’s office, which has the power to prosecute the case in criminal court.

Above, we’ve referred to the trustee as a manager. The legal term for someone managing money, including a trustee is “fiduciary.” [2] New York’s Estates, Powers and Trusts Law governs the conduct of a trust fiduciary.

New York Consolidated Laws, Estates, Powers and Trusts Law – EPT § 11-1.6 states that “Every fiduciary shall keep property received as fiduciary separate from his individual property.  He shall not invest or deposit such property with any corporation or other person doing business under the banking law, or with any other person or institution, in his own name, but all transactions by him affecting such property shall be in his name as fiduciary.” [3]

New York’s Penal Law (the Criminal Law) states that “A person steals property and commits larceny when, with intent to deprive another of property or to appropriate the same to himself or to a third person, he wrongfully takes, obtains or withholds such property from an owner thereof.” [4]

The trust as an entity is the owner of the funds. If a trustee borrows money from the trust, he commits larceny.

New York Penal Law continues to say that “Larceny includes a wrongful taking, obtaining or withholding of another’s property, with the intent prescribed in subdivision one of this section, committed … by conduct heretofore defined or known as common law larceny by trespassory taking, common-law larceny by trick, embezzlement, or obtaining property by false pretenses.” [5]

To sum up, trustees should keep the trust funds where they belong. In the trust account. Whenever they receive any funds relating to the trust in any way, those funds should be deposited into the trust account and not taken out for any reason without either signed consent from each and every beneficiary or an order of the court authorizing the executor to disburse the funds.

The trustee should place all trust funds into the trust account

Whether you are a beneficiary who thinks that the trustee is borrowing money from the trust, or if you are a trustee and you feel that you are being falsely accused of borrowing money from the trust and not returning it, you can speak with New York trust attorney Albert Goodwin, Esq. He can be reached at 718-509-9774.

[1] NY EPTL § 11-1.1

[2] NY EPTL § 11-1.1

[3] NY EPTL § 11-1.6

[4] NY PEN § 155.05

[5] NY PEN § 155.05

Trustee Refusing to Pay Tuition for a Child’s Education

If a trustee is refusing to pay tuition for a child’s education such as private school, college, university, graduate school, medical school or law school, you may have a recourse depending on how the trust was set up.

The first step is to have your attorney read the trust. Unlike wills that are admitted to probate, trusts are not part of public records. If you don’t have a copy of the trust, as the trustee for a copy. Or perhaps one of the other beneficiaries has a copy they can give you. If you don’t have a copy of the trust and the trustee refuses to provide a copy, we can file a proceeding with the court to compel the production of the trust.

If a trustee is specifically required by the trust to pay the tuition, then we can use the courts to compel the trustee to pay. When a trustee has the power to pay the child’s tuition as a discretionary power, there could be a situation where a trustee and beneficiary are not in agreement, leading to legal conflict.

The clearest and best-written trusts make it easy to tell whether the trustee is required to pay for the child’s education such as private school, college, university, graduate school, medical school or law school. Unfortunately, only a small majority of trusts are clear and well-written. In some cases, language could be interpreted to mean that the trustee must distribute funds in a way to keep the beneficiary up to the standard of living that they used to enjoy, which may or may not mean paying for the tuition. Other trusts may only direct that the trustee uses the funds for things such as medical or emergency expenses.  There are other trusts that simply allow the trustee to use their discretion entirely, with no additional guidance as to how.  It all depends on the language that the attorney who drew up the trust document used and what was requested by the person who set up the trust.

Even if the trust is set up to leave distributions up to the discretion of the trustee, a trustee still does not have unlimited power when it comes to distributing funds.  A trustee cannot simply refuse to distribute discretionary funds for a bad reason or no reason.  A trustee still has to act reasonably and fairly when making distributions from the trust, meaning that they can’t simply refuse to pay tuition at either private school, college or graduate school without some sort of good cause.  For example, if the trust document says that funds from the trust should be used for educational expenses, it would most likely be found to be unreasonable on the part of the trustee to refuse to pay for the school.

When a trustee refuses to pay for a child’s education, there are a few things that the beneficiary may want to try in order to get the money they feel they deserve.  A first step could be as simple as having a New York trust litigation attorney write a demand letter on the beneficiary’s behalf making a demand for distribution of the estate.  This could be a simple solution to keep out of court.

If this does not work, then litigation may be the only option.  If this is the case, the beneficiary may have to file a suit against the trustee to have the court force them to release the funds.

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Call the Law Offices of Albert Goodwin at 718-509-9774, New York estate, guardianship, wills, trust, Medicaid and probate lawyer, and make an appointment to discuss your trust situation.