Breach of fiduciary duty & Misuse of Power of Attorney

Breach of fiduciary duty & Misuse of Power of Attorney The New Jersey Supreme Court has described the elements of a claim for breach of fiduciary duty as follows: The essence of a fiduciary relationship is that one party places trust and confidence in another who is in a dominant or superior position. A fiduciary relationship arises between two persons when one person is under a duty to act for or give advice for the benefit of another on matters within the scope of their relationship. Restatement (Second) of Torts 874 cmt. a (1979) . . . . The fiduciarys obligations to the dependent party include a duty of loyalty and a duty to exercise reasonable skill and care. Restatement (Second) of Trusts 170, 174 (1959). Accordingly, the fiduciary is liable for harm resulting from a breach of the duties imposed by the existence of such a relationship. Restatement (Second) of Torts 874 (1979). [McKelvey v. Pierce, 173 N.J. 26, 57 (2002) (quoting F.G. v. MacDonell, 150 N.J. 550, 563-64 (1997)).] Financial exploitation of older persons, including the systematic depletion of bank accounts or other resources for the benefit of the abuser, has been tagged the crime of the 90s. The number of financial exploitation cases will only continue to rise as the population continues to age. Despite the increase in financial abuse cases, law enforcement officials remain reluctant to pursue perpetrators of abuse, traditionally viewing the situation as a family matter best resolved by civil litigation. Because an agent owes a fiduciary duty to his or her principal, a cause of action for breach of that fiduciary duty may redress a wide variety of aberrant conduct by an agent. An agent is required to act for the advancement of the interests of the principal. The agents may not serve or acquire any private interest of his or her own that is adverse to the interests of the principal without the principals consent. The duty of the agent to the principal is one of utmost good faith and loyalty. Furthermore, agents, as fiduciaries, are required to make full disclosure to their principals of all information material to a transaction. An agent that breaches his or her fiduciary duty may be liable in tort. All of the traditional tort damages are available, including punitive damages where conduct is wanton or willful. An agent who is dishonest may also forfeit his or her right to compensationfor those duties. Conversion Conversion is the wrongful or unauthorized exercise of dominion or control over a chattel. A conversion action is a tort. The tort of conversion is bottomed upon a tortious interference with possessory rights. Under the common law, an agent has a duty to account to his principal. An agent must keep and render accounts and, when called upon for an ac- counting, has the burden of proving that she or he properly disposed of funds that she or he is shown to have received for her or his principal. The relationship between a principal and an attorney-in-fact can be analogized to the relationship between a trust beneficiary and trustee. Thus, the agent bears the burden of proving that he or she has properly disposed of funds. The elements of a cause of action for breach of fiduciary duty are: (1) Plaintiff and Defendant share a relationship whereby: (a) Plaintiff reposes trust and confidence in Defendant, and (b) Defendant undertakes such trust and assumes a duty to advise, counsel and/or protect Plaintiff; (2) Defendant breaches its duties to Plaintiff; and (3) Plaintiff suffers damages. The elements of a claim for breach of fiduciary duty are not fixed as the claim may arise from virtually any case where one party accepts the trust and assumes the duty to protect a weaker party.