A durable power of attorney is a routine part of many people’s estate plan. Unfortunately, sometimes the person designated under the power of attorney–the agent–no longer deserves the principal’s special trust. My previous blog discussed steps involved in revoking a durable power of attorney. At that blog’s conclusion, I mentioned that a demand for an accounting of all actions the agent took under the power of attorney should be made. This blog takes a closer look at what goes into an accounting.
A principal is free to specify the exact elements of an accounting. If the principal doesn’t specify the elements, then the minimum elements are established in the Texas Estates Code Section 751.104, as follows:
- The property belonging to the principal that has come to the agent’s knowledge or into the agent’s possession;
- Each action taken or decision made by the agent;
- A complete account of receipts, disbursements, and other actions of the agent that includes the source and nature of each receipt, disbursement, or action, with receipts of principal and income shown separately;
- A list of all property over which the agent has exercised control that includes: (a) an adequate description of each asset; and (b) the asset’s current value, if the value is known to the agent;
- The cash balance on hand and the name and location of the depository at which the cash balance is kept;
- Each known liability; and,
- Any other information and facts known to the agent as necessary for a full and definite understanding of the exact condition of the property belonging to the principal.
The list above is a good start on a full and proper accounting. The principal can set the length of time the agent has to reply. Texas Estates Code Section 751.105 sets the deadline at 60 days unless the principal sets a shorter time, after which the principal can bring suit through the courts to compel the accounting, if necessary. The principal should carefully evaluate the complexities involved before shortening the agent’s time for response too much. A quality effort by the agent will take some time.
Author Jim Cramp is the founder and principal attorney at the Cramp Law Firm. The Cramp Law Firm provides a spectrum of family-related legal services in the greater San Antonio Region.