Denying Compensation to a Guardian

October 4, 2012 Hull & Hull LLP Guardianship, Litigation Tags: , , , , , , 0 Comments

On Tuesday, I blogged on the recent Ontario Court of Appeal decision of Aragona v. Aragona, 2012 ONCA 639.

There, the application judge denied the guardian compensation. In so doing, the application judge noted the guardian’s failure to keep proper accounts. The Court of Appeal stated that a guardian has, by statute, a fiduciary obligation to carry out his or her obligations with honesty and due care and attention. “The core of these obligations includes the duty to be in a position at all times to prove the legitimacy of disbursements made on behalf of the estate.” 

Further, the application judge went on to find that “the conduct [of the guardian] has been shocking. He has literally helped himself to many thousands of dollars from his mother’s estate, at a time when his mother had Alzheimer’s and was unable to look after her own affairs.”

Together, these two factors led to a denial of compensation: a conclusion that was said to be clearly in the discretion of the application judge.

In denying compensation, both the Court of Appeal and the court below relied on the decision of Zimmerman v. McMichael Estate, 2010 ONSC 2947. This decision clearly sets out the obligations of a trustee, including the obligation to account. The application judge found that because significant funds disappeared from the estate without adequate explanation, it was appropriate to award no compensation. The application judge contrasted this with the situation in Re Assaf Estate, 2009 CanLII 11210.  There, there was wrongdoing found, but no harm was said to have resulted to the estate. In that situation, compensation was reduced by 50%, but not disallowed completely.

Thanks for reading,

Paul Trudelle – Click here for more information on Paul Trudelle

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