Detailed Answer — How to challenge transfers made under a power of attorney in South Dakota

Yes — you can challenge transfers made under a power of attorney (POA) if you reasonably suspect the principal (in your example, a grandfather) lacked capacity when he signed the POA or when transfers were made. South Dakota courts can undo transfers, remove or limit an agent’s authority, order return of assets, and take other remedial steps when a POA was invalidly executed or misused.

What “lack of capacity” means

To validly sign a POA the principal must have had sufficient mental capacity at the time of signing. In plain terms, capacity usually means the person understood:

• the nature and effect of the POA document,
• the kinds of property and transactions the agent would control, and
• the fact that signing lets the agent act on the principal’s behalf.

If the principal could not understand these things because of dementia, confusion, intoxication, or other impairment, a court may find the POA invalid.

Common legal grounds to challenge transfers

• Lack of capacity when the POA was signed or when a particular transfer occurred.
• Undue influence — the agent or someone else pressured or manipulated the principal into signing or transferring assets.
• Forgery or fraud — signatures or documents were forged or the POA was obtained by false statements.
• Agent exceeded authority — the agent acted beyond powers granted by the POA.
• Revocation — the principal revoked the POA before the transfer but the agent or third parties ignored the revocation.

What evidence helps prove lack of capacity or wrongdoing

Successful challenges usually rely on multiple kinds of evidence, including:

• Medical records and treating physicians’ or neuropsychologists’ reports documenting cognitive impairment around the time the POA was signed or transfers occurred.
• Testimony from family members, caregivers, or friends about the principal’s abilities and behavior when the document was executed.
• The POA document itself (look for notarization, witness signatures, and wording that matches statutory formalities).
• Bank records and cancelled checks showing unusual or out‑of‑pattern transfers.
• Communications (emails, texts) that show pressure, confusion, or conflicting instructions from the principal.
• Expert testimony about whether the principal met the legal standard for capacity at the relevant time.

Immediate steps to protect assets and preserve evidence

1. Preserve documents. Make copies of the POA, bank statements, transfer records, and any correspondence.
2. Get medical records. Ask the principal’s doctors for records or notes from the time near execution or transfers. These are often critical.
3. Notify financial institutions. If transfers are ongoing, tell the bank in writing you suspect lack of capacity and request records. Ask whether the institution will freeze suspicious transactions while the matter is investigated.
4. Don’t confront aggressively. Avoid escalating family conflict in ways that could harm the principal or spoil evidence.
5. Talk to an attorney right away. Time can be important to stop dissipation of assets and to meet filing deadlines.

Who can bring a challenge in South Dakota

Typically, an “interested person” may petition the court. That category commonly includes family members, heirs, beneficiaries, or others with an ownership or financial interest in the principal’s estate. If the principal already has a guardian or conservator, that guardian may also act for the principal’s interests.

Possible court outcomes and remedies

• Declaring the POA (or specific transfers) void or voidable because of lack of capacity or fraud.
• Ordering the agent to return funds or property taken improperly.
• Freezing accounts, placing constructive trusts, or granting other equitable relief to protect assets.
• Removing or limiting the agent’s authority and possibly appointing a guardian or conservator.
• In some cases, criminal referral for theft, fraud, or exploitation of a vulnerable adult.

How long do you have to act?

Deadlines vary by claim type (contract, tort, fiduciary breach, fraud). Because statutes of limitations and equitable tolling rules differ, act promptly. If you wait too long, a court may refuse to undo transfers even if the POA was flawed.

How a lawyer can help

An attorney experienced in elder/estate litigation can:

• Evaluate the strength of your claim and the evidence you need.
• Send preservation and demand letters to banks and potential wrongdoers.
• File a petition in probate or civil court to challenge the POA or transfers and ask for temporary relief (asset freeze, temporary guardian) if needed.
• Work with medical experts to document capacity or its lack at the relevant time.
• Negotiate recovery or litigate to undo transfers and obtain compensation.

For statutory language and the formal text of South Dakota law, see the South Dakota Codified Laws index: https://sdlegislature.gov/Statutes/Codified_Laws/. The South Dakota Unified Judicial System also provides resources on guardianship and probate matters: https://ujs.sd.gov/.

If you believe a vulnerable adult is being abused or financially exploited, contact local authorities and consider contacting Adult Protective Services in South Dakota or law enforcement.

Helpful Hints

• Act quickly. Suspected asset depletion is time sensitive.
• Collect and back up documents immediately: POA copies, bank statements, and medical notes are the most important evidence.
• Look for red flags: sudden changes to beneficiaries, large unexplained transfers, or an agent living with or isolated with the principal.
• Don’t destroy evidence. Preserve emails, texts, and voicemail messages.
• Ask a doctor for contemporaneous notes or evaluations that address the principal’s decision‑making ability at the relevant time.
• Consider temporary, short‑term court relief (injunction, asset freeze) while you gather evidence.
• Use a lawyer for formal filings. Courts expect claims to be properly framed and supported by admissible evidence.
• Keep communications calm and documented — hostile confrontations can complicate court proceedings.