BREACH OF FIDUCIARY DUTY
As a beneficiary of a Will or Trust, you have the right to ensure that the Personal Representative or Trustee is acting in your best interest. Oftentimes the individual in charge of an estate or trust does not understand what his or her responsibilities or improperly takes advantage of trust and estate assets. Under Michigan law, these individuals have a fiduciary duty to protect the creditors and beneficiaries of the estate or trust.
Beneficiaries should be vigilant to ensure that fiduciaries appointed over an estate or trust do not engage in unlawful breaches of their fiduciary duty. Examples of a breach of fiduciary duty can include:
- Self-dealing. This is when a personal representative, trustee, or other fiduciary uses money or property belonging to the estate or trust for their own self interest and not to the benefit of the estate or trust.
- Excessive compensation. Fiduciaries are entitled to reasonable compensation for their services. However, some personal representatives and trustees treat the estate as their own piggy bank. Paying an excessive rate or paying for services that aren’t necessary is a breach of fiduciary duty.
- Embezzlement. Improperly converting money from the estate to personal use is not only a breach of fiduciary duty but could also constitute a crime for which the fiduciary is required to reimburse the estate and pay treble (triple) damages. A fiduciary who improperly transfers money from an estate to his or herself without justification is in breach of their fiduciary duty.
If you believe that a personal representative, trustee, guardian, or conservator over an estate you are interested in has breached their fiduciary duty, it is your right to petition the probate court for redress. The team at Kirk Huth is experienced in litigating breach of fiduciary duty claims both in defense of fiduciaries and in defense of beneficiaries.
To contact an attorney for assistance in a breach of fiduciary duty claim, click here.
UNDUE INFLUENCE
The most common way in which a beneficiary is cheated out of an inheritance is when a loved one has been unduly influenced. Undue Influence claims have increased in recent years as communities grow older and people live longer. As senior populations become more dependent on assistance from loved ones, the incidents of undue influence increase. An undue influence claim is a challenge to the validity of a will, trust, or other testamentary device (i.e. life insurance policy, retirement account, etc.) Undue influence can also apply to gifts or transfers that occurred during an individual’s lifetime.
Under Michigan Law, undue influence is influence that is so severe that it causes a person to change a beneficiary designation in a manner that they would not have done but for the influence. Undue influence is difficult to prove because it happens in secret and almost always must be proven through circumstantial evidence. Although difficult to prove, a claim of undue influence is a powerful tool to be used to protect your rights as a beneficiary. Undue influence is established by proving a pattern of threats, misrepresentations, coercion, fraud, or other actions that overpower an individual’s agency and destroys their free will.
Simple flattery and acts of kindness are generally not enough to rise to the level of undue influence. And it is difficult to know exactly where the line is between benign influence and undue influence. Pursuing or defending against a claim of undue influence requires an attorney who has experience in this nuanced area of the law. The team at Kirk Huth has represented clients both pursuing and defending against undue influence claims for decades.
If you believe that your interest in an estate, trust, or life insurance policy was changed due to someone’s undue influence, the team at Kirk Huth is here to help.
To contact an attorney for assistance in a breach of fiduciary duty claim, click here.
LACK OF TESTAMENTARY CAPACITY
It’s no secret that there is an unsettling rise in cases involving abuse of the elderly. With the baby-boomer generation increasing in age there is an increase in cases involving dementia, Alzheimer’s, and litigation over abuse of vulnerable seniors. Although the threshold for having sufficient testamentary capacity is low, challenges to a will, trust, or other device based on testamentary capacity are on the rise. Pursuing or defending against a claim of mental capacity is a fact-intensive inquiry that requires an attorney who is attentive to every detail.
In Michigan, an individual has sufficient capacity to execute a will if the individual:
- Understands that he or she is signing a will that provides for distribution of assets after death;
- Understands the basic nature and extent of the assets and property that he or she owns at the time of executing the will; and
- Knows the “natural objects of their bounty” – i.e. knows who his or her heirs are; and
Mental capacity is presumed in Michigan and the burden of proof rests on the party challenging the individual’s mental capacity. Mental capacity claims can be brought both during and after an individual’s life. If the challenger provides enough evidence to overwhelm the presumption the burden of proof shifts. A challenge to mental capacity can be brought to contest the validity of a will, trust, power of attorney, deed, life insurance beneficiary designation, retirement beneficiary designation, or other device.
If you believe that your interest in an estate, trust, or life insurance policy was changed due to someone’s lack of testamentary capacity, the team at Kirk Huth is here to help.
To contact an attorney for assistance in a lack of testamentary capacity claim, click here.