How to prove inheritance theft would depend on the cause of action, considering what and when it was stolen and who committed the inheritance theft. Most inheritance thefts are committed by either a relative, the estate’s personal representative, or a third person. Inheritance theft can also be committed before or after the decedent died. It can involve bank or brokerage accounts, personal property, or real property. Proving inheritance theft will depend on all of these factors.
What was stolen
Inheritance theft in bank accounts can be committed in several ways. Money can be stolen by abusing a financial power of attorney, either before or after the account holder’s death. There is inheritance theft when undue influence is exerted upon the account holder to change the designated beneficiary prior to death. An executor can also commit inheritance theft by skimming off estate funds and charging to the estate his personal expenses.
Real estate and vehicles, on the other hand, can be stolen through the execution of deeds. The real estate owner could have been unduly influenced into deeding the property to someone else.
Personal property can be physically stolen before or after the owner’s death. This is particularly more difficult to prove since stolen personal property can easily and immediately be sold so the thief would not be caught with possession of it.
When was it stolen
Inheritance theft can be done before or after the death of the decedent. In most cases in most states, it is the appointed personal representative of the estate who has the legal standing to file a proceeding to have such stolen property discovered and turned over to the estate. The personal representative is the person appointed by the court to administer the estate. It can be the executor or administrator.
Who stole it
Inheritance theft can be committed by the beneficiary/heir, the personal representative, or a third person. When inheritance theft is committed by the executor, an interested person, such as a beneficiary/heir or creditor, can file a petition removing the personal representative from office and naming a successor personal representative. If it is the beneficiary/heir or a third person who committed inheritance theft, the personal representative has the legal standing to request the court to discover information relating to the property and to request the turn-over of the property from the person with possession of it.
Proving inheritance theft
Proving inheritance theft really depends on the cause of action, which then depends on what, who, when, and where the theft was committed.
Proving inheritance theft of deeds
Generally, if the property, such as real estate, is transferable by deed, most deeds are invalidated by proving a combination of undue influence and fraud or misrepresentation. Undue influence occurs when the owner was coerced into executing the deed by the beneficiary. It normally happens when the owner is in a weakened state or physically reliant on the beneficiary for his daily activities. This is proven through the owner’s medical records, showing the medication the owner was taking and the owner’s health status at the time the deed was executed. When the owner is suffering from a mind-debilitating disease, is taking mind-altering medication, or is physically reliant on the beneficiary for his activities, this can bolster the allegation that the owner was unduly influenced into executing the deed of transfer.
Proving inheritance theft in bank accounts
If the property subject of inheritance theft is a bank or brokerage account, state laws will provide the applicable rule.
Financial power of attorney
For example, if inheritance theft is committed by a person holding a financial power of attorney and committed such abuse either before or after the death of the account owner, the personal representative can file a discovery or turn over (or a similar or equivalent) proceeding, requesting the court to direct the person with possession to turn over the funds. Money in the bank account is easily traceable for as long as it is not laundered.
Proving abuse of the financial power of attorney after the account owner’s death is easy. It is simply showing the transaction done through a financial power of attorney and the death certificate proving the date of death of the account owner. Any transaction conducted after the death of the principal using the financial power of attorney is considered illegal.
Proving abuse of the financial power of attorney before the account owner’s death is a little bit more complex. You must show that the withdrawals made in the bank account were not made for the benefit of the principal or given as a gift by the principal to the agent.
Unduly influenced designation of beneficiary
When the allegation of inheritance theft involves the account owner being unduly influenced into changing the beneficiary designation, proving inheritance theft is similar to proving the invalidation of deeds: a combination of undue influence and fraud or misrepresentation, precipitated by the owner’s weakened mental state. This is usually proven by the discovery of the account owner’s medical records.
Designation as joint account owner
In some states such as New York, if the allegation of inheritance theft involves the account owner designating someone as a joint account owner, you can invalidate this designation by showing that the joint account owner was included in the bank account for the original account owner’s convenience only. This is proven by showing that all withdrawals in the bank account during the lifetime of the account owner were made for the benefit only of the original account owner.
Inheritance theft committed by a personal representative
If the personal representative commits inheritance theft (i.e., charging personal expenses to estate funds), any interested person such as a beneficiary or creditor can file a petition requesting the removal of the personal representative and the nomination of a successor. You can also request that the personal representative be restrained from committing further acts, pending resolution of your petition. If found guilty, you can file a surcharge action, holding the personal representative liable for damages caused to the estate due to the inheritance theft. Depending on the state, the personal representative’s violation of fiduciary duty may be penalized with punitive damages.
Because of the many ways inheritance theft can be committed, how to prove inheritance theft requires a careful evaluation by the estate litigation attorney. Should you need assistance in the evaluation of your case, we at the law offices of Albert Goodwin are here for you. We have offices in New York, NY, Brooklyn, NY and Queens, NY. You can call us at 718-509-9774 or send us an email at firstname.lastname@example.org.