Jan12026
Probate Q&A Series

Can I challenge transactions an agent made under a power of attorney before death if they closed accounts, changed beneficiaries, or retitled property? – North Carolina

Short Answer

Yes. In North Carolina, transactions an agent made under a power of attorney (POA) before the principal’s death can be challenged if the agent exceeded the POA’s authority, acted for personal benefit instead of the principal’s best interest, or used undue influence, fraud, or similar misconduct. Challenges often focus on beneficiary changes, adding the agent to joint accounts with survivorship, and retitling property. The right claim and the right court depend on what was changed (bank account, beneficiary designation, deed, or vehicle title) and who has legal authority to sue (often the estate’s personal representative).

Understanding the Problem

In North Carolina probate, can a spouse or heir challenge actions an agent took under a power of attorney before the principal died, when the agent closed accounts, changed beneficiaries, or retitled property? The decision point is whether those pre-death transactions were valid acts within the agent’s authority and consistent with the agent’s fiduciary duty, or whether they were improper self-dealing that can be unwound or repaid. Timing often matters because some changes move assets outside the estate (like survivorship accounts or beneficiary designations), while other changes affect what the administrator must list on the estate inventory.

Apply the Law

Under North Carolina law, a POA agent is a fiduciary. That means the agent must act in the principal’s best interest, keep appropriate records, and avoid conflicts of interest and self-dealing unless the POA clearly authorizes the conduct. When an agent uses the POA to move assets to the agent (or to someone the agent favors) by changing beneficiaries, creating joint accounts with survivorship, or retitling property, those transactions may be challenged as unauthorized gifts, breach of fiduciary duty, conversion, constructive fraud, undue influence, or fraud. The usual forum is North Carolina Superior Court (often alongside or coordinated with the estate proceeding), and the estate’s personal representative commonly has standing to pursue recovery for harm to the decedent.

Key Requirements

  • Authority under the POA: The agent must have power under the written POA to do the specific act (for example, making gifts, changing beneficiary designations, or creating survivorship interests). If the POA does not authorize it, the transaction is vulnerable.
  • Fiduciary “best interest” conduct: Even if the POA grants broad powers, the agent must still act loyally and for the principal’s benefit, keep records, and avoid self-dealing that creates a conflict between the agent’s interests and the principal’s needs.
  • Proof of wrongdoing and traceable loss: A challenge usually needs evidence of what changed, when it changed, and how it harmed the principal or shifted assets away from the estate or intended recipients (for example, signature cards, beneficiary change forms, deeds, account statements, and medical records showing capacity concerns).

What the Statutes Say

Analysis

Apply the Rule to the Facts: The facts raise concerns about pre-death account changes under a POA, including possible beneficiary changes, account closures, and retitling. Those are common “red flag” transactions because they can shift assets outside the estate and into the agent’s control or ownership. If the POA did not clearly authorize gifts or beneficiary changes, or if the changes benefited the agent and occurred when the principal was vulnerable, the transactions may be challenged as unauthorized and inconsistent with fiduciary duties. Delays in filing the estate inventory can also make it harder to identify what assets existed at death and what may have been diverted shortly before death.

Process & Timing

  1. Who files: Often the estate’s personal representative (administrator) brings the main recovery claims; in some situations, an affected spouse or heir may need to seek court involvement to force action or to pursue a claim tied to a non-estate asset transfer. Where: North Carolina Superior Court (and, when appropriate, coordinated with the Clerk of Superior Court handling the estate). What: A civil complaint seeking relief such as an accounting, return of property, and related remedies; and targeted discovery requests for account records, signature cards, and beneficiary change forms. When: As soon as the questionable transactions are identified, because documents and funds can disappear and financial institutions’ records retention policies vary.
  2. Information-gathering step: Obtain the POA document, bank and brokerage statements before and during the agency period, signature cards, beneficiary designation and change forms, and any deeds or title paperwork. Capacity and undue influence issues often require medical records and a clear timeline of health changes compared to the transaction dates.
  3. Resolution step: If evidence shows the agent exceeded authority or breached fiduciary duties, the court can order remedies that may include repayment, return of assets, or other equitable relief. If the dispute involves survivorship or beneficiary designations, the case may focus on whether the change was valid or was the product of undue influence, fraud, or an unauthorized act by the agent.

Exceptions & Pitfalls

  • Bank “discharge” is not the same as agent immunity: North Carolina statutes can protect a financial institution that honored a POA before it received notice of death or revocation, but that does not automatically make the agent’s conduct proper. A claim may still exist against the agent even if the bank is protected.
  • Joint accounts with survivorship and beneficiary changes require careful proof: Adding an agent to a joint-with-right-of-survivorship account or changing beneficiaries can look “valid” on paper. Successful challenges usually depend on proving lack of authority, lack of capacity, undue influence, fraud, or that the agent treated the principal’s funds as the agent’s own without a true gift intent.
  • Standing problems: If the administrator will not act, the case can stall. In many situations, the estate’s personal representative is the party expected to pursue recovery for harm to the decedent, so delays in inventory and administration can become a practical barrier that needs to be addressed early.
  • Record gaps and tracing issues: Closing accounts and moving funds can create a paper trail that is hard to follow unless statements, canceled checks, and transfer confirmations are obtained quickly. Waiting can make it harder to trace where money went and to prove what belonged to the principal.
  • Overlooking the POA’s “gift” limits: Many POAs do not allow self-gifting or beneficiary changes without clear authorization. A common mistake is focusing only on whether the agent had access, rather than whether the agent had authority to make that kind of transfer.

Conclusion

In North Carolina, pre-death transactions an agent made under a power of attorney can be challenged when the agent lacked authority for the specific act (like gifting, changing beneficiaries, or creating survivorship ownership) or when the agent breached fiduciary duties by acting for personal benefit. These disputes often require quick document collection and a clear timeline of transactions and capacity. A practical next step is to have the estate’s personal representative file a civil action in Superior Court seeking an accounting and recovery once the questionable transactions are identified.

Talk to a Probate Attorney

If you’re dealing with questionable pre-death transfers made under a power of attorney—like closed accounts, beneficiary changes, or property retitling—our firm has experienced attorneys who can help explain options and timelines under North Carolina law. Call us today at (919) 341-7055.

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.

Category: Probate Q&A Series

Author: jpierce

Attorney Jared Pierce is the founder of Pierce Law Group in Raleigh, North Carolina, a firm he established with a dedicated focus on probate administration and estate planning across North Carolina. Born and raised in the Republic of South Africa, Jared moved to Durham with his family in 2001, bringing with him a rich cultural background and a distinctive accent that often serves as a conversation starter.