What happens if a power of attorney was used to move or spend my parent’s money before death—can I challenge that for undue influence or breach of duty? – North Carolina

Short Answer

Yes. In North Carolina, an agent acting under a power of attorney (often called an “attorney-in-fact”) owes fiduciary duties to the parent (the “principal”), and misuse of the parent’s money can be challenged as a breach of fiduciary duty. After death, the personal representative (and in some situations a “successor in interest” of the estate) can seek a court-ordered accounting of the agent’s transactions and, if misconduct is proven, pursue court remedies to restore misused assets.

Understanding the Problem

When a sibling had a North Carolina power of attorney and used it to access a parent’s accounts or transfer property before the parent died, the key decision point is whether those actions were authorized and done for the parent’s benefit, or whether the agent used the power and the parent’s dependence to benefit the agent or someone else. The question focuses on whether the pre-death money moves can be challenged after death based on undue influence or breach of duty, especially when family members report isolation, secrecy, and missing financial information.

Apply the Law

Under North Carolina’s Uniform Power of Attorney Act, an agent is a fiduciary. That means the agent must act for the principal’s benefit and stay within the authority granted in the power of attorney document. Even when a power of attorney is broad, disputes often turn on (1) whether the document actually allowed what the agent did (especially gifting or self-dealing), and (2) whether the power of attorney itself or the transactions were the product of undue influence, lack of capacity, fraud, or duress. For information-gathering, the Clerk of Superior Court can handle certain power-of-attorney proceedings such as compelling an accounting, but monetary-damages claims (like breach of fiduciary duty, fraud, or negligence) generally belong in Superior Court.

Key Requirements

Fiduciary relationship (agency): A valid power of attorney created an agent/principal relationship, which is treated as a fiduciary relationship in North Carolina.
Unauthorized or disloyal transaction: The agent’s spending, transfers, or “gifts” exceeded the power of attorney’s authority or were not done for the principal’s benefit (for example, transfers to the agent without clear gifting authority and a defensible purpose).
Proof and remedy path: A proper party (often the estate’s personal representative) uses the correct forum to (a) force disclosure/records and (b) pursue recovery remedies that restore the value of what was improperly taken.

What the Statutes Say

N.C. Gen. Stat. § 47-28 (Recording powers of attorney affecting real property) – Requires recording a power of attorney (or certified copy) in the Register of Deeds when the agent signs a real estate transfer, and sets rules for counties where property is located.
N.C. Gen. Stat. § 14-112.2 (Exploitation of an older adult or disabled adult) – Defines a criminal offense for certain deceptive or intimidating taking or use of an older/disabled adult’s property by someone in a position of trust.

Note: North Carolina has detailed statutes in Chapter 32C that address an agent’s recordkeeping, accountings, court proceedings about powers of attorney, and agent liability. Statute numbers and procedures can depend on the specific type of relief being requested (accounting vs. damages), so a lawyer typically reviews the actual power of attorney and the timeline of transfers before choosing the best filings.

Analysis

Apply the Rule to the Facts: The facts describe a sibling-agent who allegedly isolated the parent, controlled finances, and provided no accounting after death. Those facts line up with the two main legal pressure points in North Carolina: (1) compelling an accounting to force transparency about pre-death transactions, and (2) challenging transactions that look like self-dealing or gifts outside the power of attorney’s scope as a breach of fiduciary duty (and, in some cases, arguing that the power of attorney or the transfers resulted from undue influence). The lack of shared information after death also increases the importance of using court procedures that require records production rather than relying on voluntary disclosure.

Process & Timing

Who files: Commonly the estate’s personal representative; sometimes another legally recognized “interested person” may have standing depending on the relief sought. Where: For an order to compel an agent’s accounting under a power of attorney, filing often starts as a special proceeding before the Clerk of Superior Court in the county with proper venue under North Carolina’s power-of-attorney rules. What: A verified petition asking the Clerk to compel an accounting and require production of records supporting withdrawals, transfers, and payments. When: File as soon as concerns arise; delay can make it harder to trace funds and obtain records.
Information phase: The goal is to obtain bank statements, checks, receipts, transfer documents, deeds, and any written instructions from the parent. If the accounting shows questionable transfers (especially to the agent), the dispute often shifts from “what happened?” to “was it authorized and for the parent’s benefit?”
Recovery phase (if warranted): If evidence supports wrongdoing, a separate civil action is typically filed in Superior Court seeking remedies tied to fiduciary breach (for example, restoring property value or tracing and recovering property). Depending on what occurred, the case may also involve real property title issues (including recording history and deeds) and whether certain assets were non-probate transfers.

Exceptions & Pitfalls

“Broad POA” does not always mean “unlimited POA”: Many disputes turn on gifting/self-dealing. If the document did not clearly authorize gifts to the agent or transfers benefiting the agent, those transactions can be vulnerable.
Forum mismatch: In North Carolina, the Clerk of Superior Court can handle certain power-of-attorney proceedings (like compelling an accounting), but claims for monetary damages for breach of fiduciary duty or fraud generally need to be brought in Superior Court.
Undue influence proof issues: Isolation, secrecy, and dependence can support an undue influence theory, but these cases often require careful evidence of how the power of attorney was obtained or how a specific transaction was pushed through.
Non-probate assets: Life insurance usually pays a named beneficiary and may not be part of the probate estate. A financial-control dispute may still matter, but the recovery strategy can differ depending on the asset type and title/beneficiary designations.
Multi-state property: Real property is governed by the law of the state where it sits, and transfers may require coordinated filings across jurisdictions. The North Carolina estate case may still be the starting point for investigating the agent’s conduct.

Conclusion

In North Carolina, an agent under a power of attorney is a fiduciary, and misuse of a parent’s funds before death can be challenged after death through court procedures that force disclosure and allow recovery. A common first step is to seek a court-ordered accounting of the agent’s transactions so the record shows what money moved, where it went, and why. The next step is to file a petition with the Clerk of Superior Court to compel an accounting and production of supporting documents.

Talk to a Probate Attorney

If a sibling used a power of attorney to control a parent’s finances and then refused to share records after death, experienced attorneys can help sort out the correct forum, the best way to force an accounting, and the options to recover assets if wrongdoing is proven. 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.