Creditors and assets

[kentw]

What is the name of your state (only U.S. law)? California
When my mother in law became ill she gave my wife power of attorney over her finances. Just before her death she wished to have her small savings account ($6000) divided among her 3 heirs. Now that we are about to deal with her creditors I am wondering if they will try to claim any of that $6000 or will they even be able to find out about it?What is the name of your state (only U.S. law)?

 

[Zigner]

What is the name of your state (only U.S. law)? California
When my mother in law became ill she gave my wife power of attorney over her finances. Just before her death she wished to have her small savings account ($6000) divided among her 3 heirs. Now that we are about to deal with her creditors I am wondering if they will try to claim any of that $6000 or will they even be able to find out about it?What is the name of your state (only U.S. law)?

Her creditors must be paid prior to the funds being distributed to "heirs"

 

[tranquility]

The POA may be guilty of fraud if the creditors are not paid. Will they find out? It depends. If the amount owed to each creditor is small, probably not as the searches required will not result in information on the distribution in anticipation of death. If the amount is large enough for a creditor to care, yes.

 

[latigo]

Contrary to what you were told - your wife as POA is NOT going to be guilty of fraud because her mother’s creditors are not paid!

And the simple reason is that your wife not longer holds a power of attorney.

Her authority to manage her mother’s assets automatically ended with her mother’s death.

A power of attorney creates an agency relationship and does not survive the death of the person granting the agency authority. Nor can a power of attorney serve as a will.

Next, concerning the mother’s verbal statements as to how she wanted the $6,000 split following her death -

Please understand that because her wishes in this respect were expressed orally they have no legal consequences whatsoever. In fact, no witnesses to those statements would be permitted to testify as to what she said.

You also need to be aware that upon the mother’s death the $6,000 and anything else owned by her became the sole property of her estate.

And it cannot be taken out her estate short of some form of a probate proceeding. And then must first be applied in payment of the legitimate debts owed at the time of death.

Should any of her heirs to appropriate the $6K for their own use, they'd become personally liable to her unpaid creditors and possibly subject themselves to criminal charges of theft. But it would not be because they were acting under an expired power of attorney.

You people need to talk to an attorney practicing probate law in California.

The mother’s estate may qualify as a Small Estate and thus avoid probate administration. (See: California Probate Code Division 8, Part 1, Sections 10400-10406)

Sax

 

[Kiawah]

Was the $6K distribution made already, and if so, was it made before or after her death.