Fletcher v. Mathew

Blanche Fletcher Petersen was in her 80s when Paul Mathew (defendant), an attorney who was much younger than Petersen, began assisting in her affairs. Petersen, who only had an eleventh-grade education, lived in a hospital for the 10 years before her death after suffering a stroke. Petersen heavily depended on Mathew, who would visit her daily, oversaw her medical attention, bought her flowers and gifts with her money, and managed her business affairs. Petersen would not eat unless Mathew visited. In 1981, four years before Petersen’s death, Petersen executed a power of attorney making Mathew her attorney-in-fact. The instrument granted Mathew the power to manage Petersen’s affairs but did not expressly permit Mathew to make gifts. Mathew began borrowing against certificates of deposit (CDs) in Petersen’s name and then used the money to buy new CDs in both Mathew’s and Petersen’s names. Mathew told Petersen that if the CDs were not in his name too, then he would stop visiting. Between the CDs and other transfers to himself from Petersen, Mathew was able to use the power of attorney to gift himself over $500,000 of Petersen’s money. Following Petersen’s death, the personal representative of Petersen’s estate, Francis Fletcher (plaintiff), filed suit against Mathew. Francis alleged that Mathew committed fraud and that he did not have the power to make the gifts. The trial court found in favor of Fletcher, and Mathew appealed.