The exposures to financial loss and possible criminal prosecution far exceed the properties gained from committing undue influence or fraud against an elder.
The focus of many lawsuits is to recover what was lost, such as a real property, future earnings, or a business’ goodwill. In legal jargon, the recovery of actual loss is commonly known as actual damages. In addition to actual damages, certain legal claims allow additional recovery as penalty, which can be double or triple the actual damages. If the egregious conducts warrant punishment and deterrence of similar conducts, recovery is available as punitive damages, which can be many multiples of actual damages. Furthermore, attorney fees and costs may be awarded to make the prevailing party whole. All of these remedies can be recovered from the same claim.
Let’s assume that an elder’s caregiver manipulates the elder into changing the elder’s trust removing the elder’s children as beneficiaries and naming the caregiver as the sole beneficiary of all assets valued at $1,000,000.
The actual damages is $1,000,000 as the elder’s children lost $1,000,000 in inheritance as a result of the change in the trust.
If the elder’s children successfully set aside the changes to the trust, the elder’s children would receive their $1,000,000 inheritance under the original trust.
Doubling the amount of actual damages is permissible under Probate Code section 859 for conducts that constitute bad faith in the wrongful taking, concealing, or disposing of property by undue influence or committing financial elder abuse as defined under the Welfare and Institutions Code section 15610.30. The burden of proof for bad faith is lower than malice. The wrongdoer’s ability to pay is not a relevant factor in awarding double damages under Probate Code section 859.
If the caregiver is found to have committed financial elder abuse or in bad faith to have taken, disposed, or concealed the property by undue influence, the statutory penalty under Probate Code section 859 is $2,000,000, double the actual damages of $1,000,000.
An amount to punish the wrongdoer and deter the wrongdoer and others can be many multiples of the actual damages if the wrongful conducts were committed with oppression, fraud, or malice as defined in Civil Code section 3294. Contrary to the double damages provided in Probate Code section 859, the wrongdoer’s ability to pay is one of the factors to be considered in determining the punitive amount.
If the caregiver committed the wrongful conducts by malice, oppression or fraud against the elder, the elder’s children can recover from the caregiver any amount determined to be sufficient as punishment and deterrence. The punitive amount can be ten times or more of the actual damages.
AVOID INADVERTENT FINANCIAL ELDER ABUSE OR UNDUE INFLUENCE
As illustrated above, the caregiver’s exposures to liabilities outweigh the gain from the wrongful conducts.
The laws create strict presumptions of financial elder abuse and undue influence, regardless of an alleged wrongdoer’s intent. For example, in following the elder’s instructions, a non-family caregiver creates a document changing the elder’s trust for the benefit of the caregiver. Under Probate Code section 21380, the presumption is conclusive that the caregiver unduly influenced or committed fraud against the elder to obtain the changes in favor of the caregiver. As a result, the caregiver is exposed to the liabilities described above.
Attorneys knowledgeable in trust and estate laws understand the legal requirements and traps in creating and changing estate plans and gifting assets. Thus, consulting an experienced trust and estate attorney before taking actions that would affect an elder’s estate plan or properties is a must to ensure the elder’s wishes are honored and to protect the intended beneficiaries.
- Finding And Selecting An Attorney For Your Specific Legal Needs
- Liable for Attorney Fees if Inheritance is Result of Undue Influence
- Resources to Prevent and Stop Elder Neglect & Financial Abuse
- Beneficiaries Disinherited From Estate Plans Created by Undue Influence
- Use Collaborative Practice to Prevent Elder Care and Financial Abuse