What is Undue Influence?

By: Suzanne R. Fanning

What Is Undue Influence?

Undue influence occurs when an often elderly or person with diminished capacity, is subjected to threats, misrepresentation, undue flattery, fraud or physical or moral coercion.  This overpowers the person's free agency and impels that person to act against his or her inclination and free will. 

Fred's Story.

Here is a good example of undue influence. My client's mother was a first generation immigrant and lived with her husband in a small Michigan town.  They had two sons, Fred (my client) and Jim.  Jim was never able to hold down a job and lived with his parents for most of his life.  While he was alive, the father maintained the family finances and kept accounts in his and his wife's name only.  Both parents had estate plans which divided everything equally between their children after their deaths. 

A pattern of isolation begins.

After their father died, Jim gradually restricted Fred's access to his mother.  Jim would always have an excuse for why their mother could not come to the phone to talk to Fred.  If Jim knew Fred planned to visit, he would schedule appointments for his mother so she would be away from the house.  Since their mother spoke little English, she did not have friends outside of the family. 

Reliance on the Influencer.

Jim and Fred's mother did not drive and so she relied on Jim to take her to the bank and other errands.  Accordingly, she did not leave the house unless she was accompanied by Jim. He also took her to doctor's visits and to the bank.  This meant that Jim's mother depended on him.  By accompanying his mother to important appointments, Jim also had the opportunity to influence his mother.

Changes to Bank Accounts.

When their mother died, Fred discovered that Jim was a joint owner on all of his mother's bank accounts.  In addition, Jim had written checks out to himself for varying amounts of money at regular intervals over the previous year which his mother signed.  This meant that there was very little in the will to divide between the brothers.  

What Jim did to acquire money and assets from his mother is perhaps a more obvious example of undue influence.   He manipulated an elderly parent who was grieving her husband's death and was unfamiliar with the family finances.  Jim isolated his mother from her family and ensured that she relied solely on him. These behaviors are hallmarks of a pattern of undue influence.  It was easy for Fred to convince his mother to add him onto her accounts.   In Fred's case, we brought an undue influence claim and were able to undo the changes that Jim made to his benefit.

What types of assets or documents are likely to be subject to undue influence?

1. Trust and Estate Plans. Usually, the first time someone becomes aware that undue influence might be at work is after a person dies.  It is then that one child might discover that his or her parent changed a will or trust to disproportionately benefit one child over other children. 
2. Power of Attorney.  An influencer might persuade the elder person to change his or her power of attorney to name the influencer as the agent.  
3. Deeds.  Another example might be a family member who is named in a will or trust as the beneficiary of a house.  The family member finds out that the decedent executed a deed shortly before his or her death that transferred the property to another person. 
4. Bank Accounts.  A person who is unduly influencing an elderly person might seek to be named as a joint owner on the elder's bank accounts.  After the elderly person's death, the undue influencer is the sole owner of those accounts.  Family members who think that the bank accounts are in the estate soon find out that they have no right to those assets.
5. Beneficiary designations. An elderly person subject to undue influence may change beneficiary designations on life insurance policies, IRAs and investment accounts to name the influencer as sole beneficiary.
6. Gifts.  It is not unusual to see an elderly person make gifts as a result of undue influence.  These can be cash gifts through checks or withdrawals from bank accounts.  However, a person might give the influencer a car, items of valuable personal property or jewelry.

Who is likely to be subject to undue influence?

A person who fits into one or more of the following criteria may be a vulnerable to undue influence:

1. Elderly 
2. Disabled
3. Diminished capacity or memory issues
4. Recently bereved
5. Lonely
6. Unfamiliar with finances
7. No close family

Who Might Have An Opportunity To Unduly Influence Another?

1. A child or family member 
2. A caregiver
3. A friend 
4. A neighbor
5. A new romantic interest
6. A professional such as a financial advisor
7. An online or telephone scammer
8. Anyone with access to an elderly person or person with diminished capacity

What Can You Do If You Suspect Undue Influence?

Talk to an attorney who is experienced with undue influence and elder financial exploitation.  There are steps that can be taken legally if undue influence can be established.  These include obtaining Guardianship and Conservatorship for the elderly individual, freezing bank accounts, removing the undue influencer from a fiduciary position.  You may also be able to filing a petition to set aside documents such as a will that has been changed to benefit the influencer.