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Financial exploitation through undue influence
WRITTEN BY :   STEVE LOPEZ, LAW OFFICE OF STEVE LOPEZ

Taking advantage of the elderly has become a serious problem in our society. As our health care system allows more people to live well into their 80′s and 90′s, this same prolonged longevity can lead older persons to become dependent on others to manage their physical needs as well as their banking, investments, and other financial affairs. With this dependency comes the risk that caregivers or family members will exploit the older person’s trust for their own advantage. When this occurs, the law states that if the individual has coerced the elderly person or unduly influenced them into gifting over their property, then the gift is not valid.
Claims of undue influence can be difficult to understand and prove, both because of the lack of a definition in the Probate Code, and because it occurs behind closed doors without witnesses. Increasingly, though, probate courts have retained staff members such as investigators or visitors who go out and interview proposed conservatees and determine their circumstances, including the presence of apparent undue influence. Probate courts are also receiving more information from community practitioners such as Adult Protective Services social workers, physicians, and hospital discharge planners.
In California, the definition of undue influence is contained in California Civil Code §1575. This statute was enacted in 1872, a date which calls into question its application in the 21st century. Thus, probate judges in California lack probate statutory support when they must consider imposing a conservatorship on an elder who is allegedly being victimized by someone using undue influence. Additionally, we see that cases are not always handled consistently due to the lack of understanding of the problems by the court system.
Complicating the picture is the traditional thinking that mental capacity and undue influence are one and the same. In other words, undue influence occurs only if there is mental incapacity. Even though California law is clear that soundness of mind and body does not imply immunity from undue influence, the perception that undue influence cannot exist without mental deficits persists. Thus, if your loved one does not have a mental deficiency, some courts are hesitant to find undue influence has occurred.
The first and most commonly invoked statute regarding undue influence is California Civil Code §1575, which was enacted in 1872 and is commonly cited as a definition of undue influence. The elements are: 1. The use, by one in whom a confidence is reposed by another, or who holds real or apparent authority over him, of such confidence or authority for the purpose of obtaining an unfair advantage over him 2. In taking an unfair advantage of another’s weakness of mind; and 3. In taking a grossly oppressive and unfair advantage of another’s necessities or distress.
Complicating this matter even further is that research has also found that even when the older person is aware that they have been a victim of undue influence, they will not report this to the authorities or others. This silence can be based on the fear of abandonment, being overwhelmed at the prospect of involving the courts and law enforcement in their personal affairs, and/or a fear of being forced to go into a nursing home if they do report the abuse.
What should you do with this information regarding undue influence? If you or your loved ones are looking to draft a will or other testamentary instruments, it may be wise to take steps to avoid such allegations against you in the future by involving an experienced attorney to guide you through the estate planning process. If you suspect undue influence, consult an attorney before jumping to any conclusions, so that you are able to make an objective assessment of whether you can prove your case. Probation litigation can be costly and these matters should be evaluated by an objective attorney before you decide on an appropriate course of action. As our population ages, we can expect to see an increase in undue influence allegations in probate courts.
The purpose of this column is to provide general information on the law, which is subject to change. It is not legal advice. Consult a lawyer if you have a specific legal problem.

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Published: October 11, 2012 – Volume 11 – Issue 26



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