Feb182026
Probate Q&A Series

Can the court undo asset changes made under a power of attorney after the person has passed away? – North Carolina

Short Answer

Yes—under North Carolina law, a court can sometimes unwind (or require repayment for) asset changes made by an agent acting under a power of attorney, even after the principal has died. The usual path is for the estate’s personal representative (or another legally authorized party) to demand records and then bring a claim that the agent exceeded authority, breached fiduciary duties, or caused an invalid transfer because the parent lacked capacity or was under undue influence. The remedy may be returning the property, tracing funds, or imposing a constructive trust, but the outcome depends heavily on the documents, timing, and where the assets went.

Understanding the Problem

In North Carolina probate disputes, the key question is whether a sibling, acting as an agent under a power of attorney, had legal authority to change ownership of a parent’s assets before death when the parent may have had dementia and lacked capacity. The issue often comes up after death because the asset change may have moved money or property outside the estate, changing what heirs receive. The decision point is whether the asset change was a valid act of the parent (through a valid power of attorney and within the agent’s authority) or an improper act that a court can correct.

Apply the Law

In North Carolina, an agent under a power of attorney is a fiduciary. That means the agent must act in the principal’s best interest, keep good records, and stay within the authority granted by the power of attorney document and state law. After the principal’s death, the power of attorney itself no longer authorizes new transactions, but the agent’s earlier actions can still be reviewed and challenged through the estate. Depending on the type of asset and transfer, the dispute may be handled as a contested estate proceeding before the Clerk of Superior Court, a civil action in Superior Court, or both.

Key Requirements

  • Standing (who can bring the challenge): Usually the estate’s personal representative brings claims to recover property for the estate; in some situations, other “successors in interest” may have rights to request information or seek relief.
  • Invalidity or wrongdoing tied to the transaction: Common theories include lack of capacity when the power of attorney was signed, undue influence, fraud, or that the agent exceeded the authority granted (for example, self-dealing or making gifts not authorized by the document).
  • Proof and tracing: The case often turns on records—bank statements, signature cards, deeds, beneficiary change forms, and a timeline showing when the parent’s cognition declined compared to when the changes were made.

What the Statutes Say

Analysis

Apply the Rule to the Facts: Here, the parent is deceased and a sibling acted under a power of attorney that may have been signed when the parent had dementia and lacked capacity. If the power of attorney was invalid when signed, transactions done under it may be attacked as unauthorized. Even if the document was valid, the estate can still challenge specific transactions if they look like self-dealing (for example, changing accounts into joint-with-survivorship form or moving assets to the agent) or if the agent cannot produce clear records showing the changes were for the parent’s benefit and within the authority granted.

In many cases, the practical first step is not “undoing” anything immediately—it is forcing transparency. Once records show what changed (titles, beneficiaries, withdrawals, deeds), the estate can target the specific transactions that were improper and seek return of the property or its value.

Process & Timing

  1. Who files: Typically the personal representative of the estate (executor/administrator). Where: Often begins in the Clerk of Superior Court in the county where the estate is administered (and may move to Superior Court depending on the claims and whether a jury-triable issue is raised). What: A demand for records/accounting from the former agent, followed by a petition or civil complaint seeking recovery of assets and appropriate court orders. When: As soon as the suspicious transactions are identified; deadlines can depend on the specific claim and when the wrongdoing was discovered, so prompt action matters.
  2. Information-gathering: The estate typically requests the power of attorney, transaction logs, bank statements, signature cards, beneficiary change forms, and closing documents for any real estate transfer. If the agent refuses, the estate may ask the court to compel production and an accounting.
  3. Recovery phase: If the court finds the agent exceeded authority or breached fiduciary duties, the court can order relief aimed at restoring the estate—this may include returning property, tracing and repaying funds, or imposing a constructive trust on property in the agent’s hands (or sometimes in the hands of others, depending on how the asset was transferred).

Exceptions & Pitfalls

  • Not every “change” is controlled by probate: Some assets pass by contract (beneficiary designations, joint accounts with survivorship). Those can still be challenged, but the lawsuit and proof may look different than a simple probate accounting dispute.
  • Good-faith third parties: If property was transferred onward to an innocent purchaser or a financial institution acted without knowledge of death, different rules may limit what can be undone and may shift the focus to recovering from the agent instead.
  • Authority in the document matters: Many disputes turn on whether the power of attorney specifically allowed gifting, changing survivorship ownership, or changing beneficiary designations. If the document did not authorize it, the transaction is more vulnerable.
  • Proof problems: Capacity and undue influence cases depend on medical records, witness testimony, and a clear timeline. Waiting too long can mean key witnesses and records are no longer available.
  • Real estate recording details: If the dispute involves a deed signed by an agent, the recording and reference rules in N.C. Gen. Stat. § 47-28 often become part of the fact investigation, even if they do not automatically decide whether the transfer was proper.

Conclusion

In North Carolina, a court can sometimes undo or financially remedy asset changes made under a power of attorney after the person has died, especially when the power of attorney was signed without capacity or the agent exceeded authority or breached fiduciary duties. The usual next step is for the estate’s personal representative to demand the agent’s records and then file a court proceeding to recover specific assets or their value. Because delay can make proof and recovery harder, the key practical deadline is to act promptly after death.

Talk to a Probate Attorney

If a parent has passed away and there are concerns that a sibling used a power of attorney to change accounts, beneficiaries, or property ownership, our firm has experienced attorneys who can help clarify what can be challenged, what records to demand, and what timelines may apply. 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: Pierce Law

Pierce Law Group is a North Carolina law firm focused on probate administration, real estate partition matters, and surplus funds claims across North Carolina. We know these situations often come with stress, family dynamics, and time-sensitive decisions—so we prioritize clear communication, steady guidance, and a practical plan from day one. Our goal is to make a complicated process feel manageable, while protecting what matters most to you.