Undue Influence

Undue influence is a key element in financial abuse cases.  Almost always, the elderly victim was taken advantage of through coercion, manipulation or trickery and thus lost their property and money to the perpetrator.

California Civil Code Section 1575 describes undue influence as:

“The use, by one in whom a confidence is reposed by another, or who holds a real or apparent authority over him or her, of such confidence or authority for the purpose of obtaining an unfair advantage over him or her;

Taking an unfair advantage of another’s weaker state of mind; or

Taking a grossly oppressive and unfair advantage of another’s necessities or distress.”

As you can see, “taking advantage” of an elder is the key theme in financial abuse cases.

There are numerous ways that the elderly are taken advantage of.  One of the most prolific is the improper use of financial powers of attorney.  Placed into the hands of a greedy son or daughter, this powerful document can become a license to steal.   Here’s a quick example:  

Mom had always lived independently and always handled her own finances.  She would never relinquish control over her investments or bank accounts.  However, over the years she began to develop symptoms of dementia – short and long term memory loss.  Although she had some friends, none of them felt it was their place to step in and assist her with her financial matters. 

Because of the current economic situation, her son recently lost his job and his bank was threatening to foreclose on his home.  He now sees an easy way out.  He relentlessly badgers mom until he overpowers her deep-rooted need for independence, and unduly influences her into signing a financial power of attorney by convincing her that she needs help in paying her bills.   Son now takes the power of attorney to mom’s bank and adds his name on both her checking and savings accounts.

It isn’t long until her accounts are depleted and she never saw it coming because of her diminished mental capacity. 

Under California law, undue influence can be presumed to have occured whenever a “special relationship” exists between the elder and the perpetrator.  Determining whether a special relationship exists involves questions of fact and depends on the circumstances of each case. Such a relationship can be established by the close proximity of the perpetrator to the elderly victim. Caregivers, nurses, friends or relatives can all, potentially, be so involved in the elder’s life that such a special relationship exists to trigger the presumption that undue influence occurred.

The importance of this presumption, once established, is that it shifts the burden to the defendant (the son – in the above example) to prove that undue influence did not occur.

Another factor in determining whether undue influence occurred, it is a determination as to the adequacy of consideration that was given to the elder by the defendant. In making such a determination, the Court will consider the degree of isolation, failing health, and mental capacity of the elder and what benefit, if any, the defendant provided to the elder.

One more factor is whether or not the elder obtained independent legal advice before executing a power of attorney or completing a conveyance of real or personal property. In most cases of elder financial abuse, the perpetrator did not take steps to have the transaction reviewed by an attorney.

One of these factors, by themselves, is probably insufficient to show that the elder was subjected to undue influence and that the conveyance of real or personal property should be undone. However, a combination of these factors can be enough to prove undue influence and to convince the court that the power of attorney be declared void, or that the transaction, conveyance or contract should be rescinded and the property wrongfully taken must be returned to the elder.

Many remedies exist when undue influence has been used to obtain property. California’s Elder Abuse and Dependent Adult Civil Protection Act provides nearly every remedy under the sun, and a civil action can request that the defendant be liable for attorney fees, costs, and punitive damages, as well as all special and general damages.

If you or a loved one have been the victim of undue influence, then pick up the phone and give us a call.  We’re here to help.  The initial telephone consultation is always free.

Copyright.  2007 – 2012.  Law Office of George F. Dickerman.  All rights reserved.