Case Study: Power of Attorney – When an Accounting is Requested
Updated: Feb 18, 2019
Indiana statute requires that the attorney-in-fact must keep complete records of all transactions entered into by the attorney-in-fact on behalf of the principal for six years or until the records are delivered to the successor attorney-in-fact.
The attorney-in-fact must present an accounting to the Court if it is ordered. He/she must also render an accounting to the following persons if they request it: the principal, guardian of the principal, child of the principal, personal representative of the principal’s estate (if the principal has died), or an heir or legatee of the principal. A recent Court case has clarified this statute when it comes to a child requesting an accounting.
In the case, Natalie had four sons. Her son, William, was serving as attorney-in-fact for Natalie since 2011. In November 2012, Natalie was diagnosed with early Alzheimer’s, a type of dementia. One of her sons, Jeffrey, requested an accounting of Natalie’s finances from William. William refused to deliver a copy of the accounting to Jeffery. Therefore, Jeffery filed a Mandamus Action to compel the attorney-in-fact to render the accounting.
The trial court denied Jeffrey’s Mandamus action. It found that although Jeffrey was the child of the principal and requested an accounting, he did not qualify to receive an accounting because the Power of Attorney was created prior to July 1, 2012. The Court of Appeals reversed and remanded. The Court found that the statute allows a child of the principal to receive an accounting if he/she requests it. It also found that the effective date of the Power of Attorney is not relevant to who may receive an accounting.
In all future situations then, the attorney-in-fact must provide an accounting to the person who requests it (if the person is from the list mentioned in the statute). The date of the Power of Attorney does not affect a person’s request for an accounting. If you are serving as attorney-in-fact for someone, you must keep complete and accurate records of all transactions you take on behalf of the principal.