Background
Janie B. Sanders appointed her niece, Cynthia M. Fox, as 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. After Sanders entered a nursing home and later died in June 2014, her daughter, Barbara Manney, discovered disputed withdrawals, account transfers, Social Security funds, credit-card charges, and other expenditures.
Manney, acting as personal representative of Sanders’s estate, sued Fox for claims including breach of fiduciary duty and conversion. Following a four-day bench trial, the Wayne Circuit Court found that Fox breached her fiduciary duties and converted Sanders’s property. It entered judgment for the estate awarding $41,026.50 in damages plus attorney fees and costs. Fox appealed as of right.
The Court’s Holding
The Court of Appeals affirmed. It held that the trial court did not clearly err in finding that Fox breached her fiduciary duty. The evidence supported findings that Fox placed Sanders’s money into an account under Fox’s own name with Sanders as beneficiary despite the power of attorney’s restrictions, received a Social Security check payable to Sanders and Manney, facilitated prohibited gifts benefiting Sanders’s grandson, and misused Sanders’s funds in connection with credit-card purchases, including two luxury handbags delivered using Fox’s post-office-box address.
The court also upheld the conversion ruling, deferring to the trial court’s assessment that Fox’s testimony lacked credibility. Fox wrongfully exercised control over Sanders’s funds by transferring money into the new account and through unauthorized credit-card activity. The appellate 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, a civil “speedy trial” right, evidentiary rulings, and alleged relitigation of a probate dispute.
Key Takeaways
- An attorney-in-fact owes the principal fiduciary duties and may be liable when acting for personal benefit or contrary to express restrictions in the power of attorney.
- Opening an account under the attorney-in-fact’s own name with the principal’s funds supported both breach-of-fiduciary-duty and conversion findings.
- Michigan’s constitutional speedy-trial protections apply to criminal prosecutions, not civil litigation, and appellate issues may be lost through waiver or inadequate briefing.
Why It Matters
The decision illustrates the scrutiny courts apply to an attorney-in-fact’s handling of a vulnerable principal’s assets. Authority to manage accounts does not permit self-dealing, unauthorized gifts, or transactions that violate the power of attorney’s specific limitations.
It also underscores the importance of preserving and adequately briefing appellate issues. The Court of Appeals would not reconstruct undeveloped arguments, consider material outside the trial-court record, or revisit matters on which the trial court had not ruled adversely to the appellant.