Eighty-five-year-old Francis Gagnon and his wife lived on a farm in Shelburne, Massachusetts. They also owned land in Hillsborough, New Hampshire. They had two children: Joan Coombs, who lived 20 miles from Shelburne, and Frank Gagnon who lived in a trailer on a far corner of the farm. Joan suggested that her parents sign powers of attorney appointing her as their agent so that she could take care of them and their property.
Frank found out about the power of attorney when he checked his mother into a nursing home. Frank then moved his trailer in to the main house and convinced his father to revoke the power. Francis did so, but never told Joan explicitly. Two months later, Mrs. Gagnon died and Mr. Gagnon signed a purchase and sale [P&S] agreement for the Shelburne farm. He gave the property in Hillsborough to Frank.
When Mr. Gagnon told Joan about the sale of the land and his intention to move to Hillsborough to live with Frank, she crafted her own plan. Not realizing that her power of attorney had been revoked, she used it to transfer the Shelburne property to a trust that she had created and that she controlled. Francis’s lawyer wrote to Joan demanding that she return the Shelburne property to him. She refused.
The trial court found that Joan had the authority under the power of attorney to convey the Shelburne property to the trust. Francis appealed.
You Be The Judge: Did Joan have the right to convey the Shelburne farm to a trust that she had established? Does the property belong to the trust or to Francis?
Holding: Judgment for Joan reversed. The court ruled that Joan had violated her fiduciary duties to Francis by acting in her interest, not his. Also, he had “lost” the property when he signed a P&S on it and, therefore, her power of attorney did not permit her to transfer it.
a. What is a power of attorney?
b. When does it expire?
c. Francis never told Joan that he revoked her power of attorney. If Joan did not know, how could her authority be revoked?
d. But even after Francis signed the P&S, he still owned the property. Couldn’t Joan transfer it to the trust?