Background
Janie B. Sanders appointed her niece, Cynthia M. Fox, as her attorney-in-fact under a durable power of attorney in October 2013. The instrument authorized Fox to manage Sanders’s property and bank accounts but prohibited gifts, joint accounts between Sanders and Fox, and compensation for Fox’s services. Sanders later entered a nursing home and died in June 2014.
Sanders’s estate alleged that Fox mishandled Sanders’s assets, including by transferring money into an account in Fox’s name, receiving a Social Security payment, paying expenses that did not benefit Sanders, and permitting charges for luxury handbags and other purchases. After a four-day bench trial, the circuit court found that Fox breached her fiduciary duties and converted Sanders’s property. It awarded the estate $41,026.50 in damages, plus attorney fees and costs.
The Court’s Holding
The Michigan Court of Appeals affirmed. It held that the circuit court did not clearly err in finding fiduciary breaches based on evidence that Fox opened an account in her own name using Sanders’s funds despite the power of attorney’s restrictions, received a $1,666 Social Security payment, made or permitted gifts benefiting Sanders’s grandson, and misused Sanders’s credit cards. The appellate court deferred to the trial judge’s determination that Fox’s explanations were not credible.
The court also upheld the conversion ruling. The evidence supported findings that Fox wrongfully exercised control over Sanders’s money and credit accounts, including funds placed in the new account and purchases linked to Fox’s post-office box. The court rejected or declined to consider Fox’s remaining arguments because they were moot, waived, abandoned through inadequate briefing, unsupported by the record, or meritless. Those arguments included challenges concerning the power of attorney’s validity, an asserted civil right to a speedy trial, evidentiary rulings, and alleged relitigation of a property dispute previously addressed in probate court.
Key Takeaways
- An attorney-in-fact owes fiduciary duties to the principal and may be liable for using the principal’s assets contrary to the power of attorney’s express restrictions.
- A conversion finding may rest on circumstantial evidence and credibility determinations showing that the fiduciary exercised wrongful control over the principal’s funds for personal purposes.
- Civil appellants must preserve issues in the trial court and adequately brief them on appeal; undeveloped, waived, moot, or extra-record arguments ordinarily will not obtain appellate relief.
Why It Matters
The decision illustrates the financial and litigation risks facing an attorney-in-fact who cannot document that expenditures served the principal’s interests. Authority to manage accounts does not permit self-dealing, prohibited gifts, or transfers that place the principal’s property under the agent’s personal control.
It also underscores the importance of appellate discipline. Even a lengthy pro se filing will not preserve claims that lack developed legal analysis, record support, or a timely objection below.