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SCV: Attorney-in-fact not liable for wife’s withdrawal of funds

An attorney-in-fact was not liable for his wife’s improper withdrawal from an account she shared with the decedent, but he was still liable to the decedent’s estate for money damages in the amount of funds he wrongfully deposited into his own account.


In May 2010, Bobbie Wynder appointed Defendant Leroy Mangrum Jr. to be her attorney-in-fact. Wynder died in June 2013.

In July 2014, Wynder’s four stepchildren, beneficiaries of her will, filed a suit against Mangrum seeking disclosure of all transactions and financial records from his service as attorney-in-fact. The transactions included: (1) a withdrawal by Mangrum’s wife, Doris, of $36,000 from a savings account held jointly with survivorship by Wynder, Doris, and Plaintiff Brenda Chavis; (2) Mangrum’s surrender of an annuity Wynder owned, valued at $116,330, the proceeds from which he deposited initially in Wynder’s checking account but which he subsequently withdrew and deposited into his own account.

The circuit court found that Doris’s withdrawal and Mangrum’s surrender of the annuity had been improper. It awarded judgment to the Plaintiffs, ordering Mangrum to restore $152,330 to Wynder’s estate and to pay $19,284 in attorneys’ fees. Mangrum appealed.

Wife’s withdrawal

The circuit court erred by requiring Mangrum to restore the $36,000 to the estate. The agency relationship between Wynder and Doris is separate from, and forecloses Mangrum’s liability under, the agency relationship between Wynder and him. Here, the trial court found that only Doris withdrew the $36,000. There is no finding that Mangrum directed or participated in the withdrawal, even if he benefited from it. Because his agency relationship was established by the power of attorney, and Doris’s agency relationship was established separately by her status as joint account holder, they didn’t owe their fiduciary duties to Wynder jointly. Consequently, as a separate agent, Mangrum cannot be liable for Doris’s acts unless he had a duty to supervise her. Code § 64.2-1612(B) imposes no such duties and does not make an attorney-in-fact liable for the alleged misuse of his principal’s property solely by a third party or for failure to affirmatively act to recover such property if stolen.

Restoration to estate

When Mangrum surrendered the annuity, he deposited the proceeds into a checking account owned by Wynder and payable upon her death to Plaintiff Gregory Wynder. Nine days later, Mangrum withdrew the proceeds from that account and deposited it into one only he owned. Consequently, at the time Mangrum placed the annuity proceeds beyond Wynder’s control, Gregory was the sole beneficiary and her successor-in-interest to those proceeds for the purposes of Code § 64.2-1615(1). However, this cause of action to seek restoration of the proceeds is assignable.

Under these specific facts, where Gregory is a Plaintiff but the prayer for relief seeks restoration only to the estate, rather than to Gregory in his personal capacity, the court may infer that there was such an assignment here. Accordingly, the circuit court did not err by ordering Mangrum to restore the $116,330 proceeds to the estate.

Nature of award

Code § 64.2-1615(1) provides that attorneys-in-fact are liable to the principal or her successors-in-interest for the amount required to restore the value of the principal’s property to what it would have been had the violation not occurred. This language permits the circuit court to award a judgment for money damages against the attorney-on-fact to his or her principal, or to the principal’s successors-in-interest, not to enjoin or to decree specific performance that a res be returned. Although the circuit court’s final order contains ambiguity that could be interpreted to impose an equitable remedy, under this court’s statutory interpretation, the circuit court merely awarded a money judgment against Mangrum to the Plaintiffs, rather than decreeing equitable relief.

Attorneys’ fees

The plain language of Code § 64.2-1615(1) is clear: An attorney-in-fact is liable to the principal or the principal’s successors-in-interest for the attorneys’ fees and costs “paid on the agent’s behalf.” Here, neither Wynder nor the Plaintiffs have paid any attorneys’ fees or costs on Mangrum’s behalf, nor is there any evidence that Mangrum paid any attorneys’ fees from Wynder’s property. If the General Assembly had intended to authorize courts to award fees to principals or their successors-in-interest to reimburse their own expenditures in actions against attorneys-in-fact against whom they alleged violations of the Act, it could have included language in the statute to that effect. It did not do so. Therefore, the circuit court abused its discretion by awarding attorneys’ fees to the Plaintiffs in this case.

Accordingly, the court reverses the portions of the circuit court’s judgment awarding the Plaintiffs $36,000 based on Doris’s withdrawal of that amount from the joint savings account and awarding them $19,284 in attorneys’ fees. But the court affirms the judgment awarding them $116,330. The court therefore enters final judgment against Mangrum and awards money damages to the Plaintiffs in the amount of $116,330.

Mangrum v. Chavis, Record No. 160782, Mar. 1, 2018. SCV (per curiam), from Hampton Cir. Ct. VLW No. 018-6-017, 7 pp.

VLW 018-6-017

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