San Antonio Express-News
March 25, 2003

Agent's Duty to Account to Family after Death of Principal

copyright 2003, Paul Premack

It depends on how much time, effort and money you want to put into a battle with your brother. There are a few ways that you could approach this problem, each with varying degrees of difficulty.

First, consider getting him into a meeting with all the heirs. There, you can ask him questions and he can provide copies of bank statements and explain how the funds were used. That may satisfy everyone without engendering much conflict.

Second, you may be able to use the fiduciary accounting provisions in the power of attorney act. That law gave your mother the right to demand a full accounting from him even without accusing him of wrongdoing, and extended that right to any person she designated (or to her personal representative). If you become court appointed administrator of her estate, then you will have the legal authority you need to demand an accounting.

In that light, you would file an administration of her estate in probate court as though no Will exists. Your brother might then come forward with the Will and offer it for probate. If he does, you can challenge his nomination as Executor by alleging he has a conflict of interest. In the process of developing that claim, you could use the rules of civil procedure to obtain information about his alleged misuse of her funds. If the Judge agrees to make you Administrator, then you would have authority to obtain a full accounting.

Your third option, severe thought it is, would be to make a report to the fraud division of your local police force. In San Antonio, you would call the Financial Crimes Unit of the Special Property Crimes section. Talk to them about "Misapplication of Fiduciary Funds."

Be careful before doing so. Your speculation needs to be backed up by some facts. The police need to establish that your brother intentionally, knowingly, or recklessly misapplied your mother’s money, while acting as her agent, in a manner that involved substantial risk of loss to her. They garner the evidence, and the DA decides if it is strong enough to prosecute. Depending on the amount of money involved, he could face misdemeanor or felony charges.

One last thought: you said that the Will has not been probated. That means your brother is not court-appointed Executor (he was just nominated in the Will) so he is not entitled to 5% of the mutual fund as a fee. Even if he later becomes court-appointed Executor, Texas law does not grant an Executor a fee for collecting funds held in such an account. He should return the 5% for distribution among the heirs.