Background
Janie B. Sanders appointed her niece, Cynthia M. Fox, as attorney-in-fact under a durable power of attorney that authorized Fox to manage Sanders’s property and accounts but prohibited gifts, joint accounts with Fox, and compensation for Fox’s services. After Sanders entered a nursing home and later died, her daughter and estate representative, Barbara Manney, challenged Fox’s handling of Sanders’s money and credit cards.
Following a four-day bench trial, the Wayne Circuit Court found that Fox breached her fiduciary duties and converted Sanders’s property. The court awarded the estate $41,026.50 in damages, plus attorney fees and costs. Fox appealed, disputing the findings and raising several procedural and evidentiary issues.
The Court’s Holding
The Michigan Court of Appeals affirmed. It held that the trial court did not clearly err in finding fiduciary breaches based on evidence that Fox transferred Sanders’s money into an account held in Fox’s name with Sanders as beneficiary, received a Social Security check payable to Sanders and Manney, permitted expenditures benefiting Sanders’s grandson, and misused Sanders’s funds in connection with credit-card purchases, including two Louis Vuitton handbags delivered to Fox’s post-office-box address.
The court also upheld the conversion ruling, deferring to the trial court’s determination that Fox’s testimony was not credible. The record supported findings that Fox wrongfully exercised control over Sanders’s account funds and credit-card assets inconsistently with her authority under the power of attorney. The court deemed other challenges moot, waived, abandoned, or meritless, including Fox’s speedy-trial claim, evidentiary arguments, and contention that the circuit-court action improperly relitigated a probate matter.
Key Takeaways
- An attorney-in-fact owes fiduciary duties to the principal and may not use that position for personal interests at the principal’s expense.
- Authority to manage or withdraw funds does not permit conduct expressly forbidden by the power of attorney, such as creating an account benefiting the attorney-in-fact or making unauthorized gifts.
- Appellate courts defer to a trial judge’s witness-credibility findings after a bench trial, while inadequately briefed or unpreserved appellate arguments may be abandoned or waived.
Why It Matters
The decision illustrates that broad financial authority under a durable power of attorney remains constrained by the document’s express terms and the attorney-in-fact’s fiduciary obligations. Transactions that redirect the principal’s assets, confer unauthorized benefits, or lack reliable documentation can support liability for both fiduciary breach and conversion.
It also underscores the importance of preserving objections and presenting developed arguments on appeal. A voluminous filing does not preserve issues that are omitted from the appellate brief, inadequately analyzed, or supported only by material outside the trial-court record.