Guardianship Bonds – to post or not to post?
A property guardian of an incapable adult may be required by a court to post security “in the manner and amount that it considers appropriate”: see section 25 of the Substitute Decisions Act (the “SDA”). This discretion impressed upon a court can result in a wide variation in outcomes depending on the facts of the case under consideration.
Guardians residing outside of Ontario appear to have a higher hurdle to jump in order to avoid having to post a bond, given the requirement in section 24 of the SDA that a person residing outside of the province “shall not be appointed as a guardian of property unless the person provides security, in a manner approved by the court, for the value of the property”. That said, the legislation goes on to allow the court to dispense with the requirement or reduce the amount required to be posted, and make its order subject to conditions. In so doing, the court is to consider the best interests of the incapable person. The size and complexity of the assets under guardianship will likely play a factor in the court’s decision. If there is more than one guardian and one of them resides in Ontario, this could be a particularly helpful reason to excuse the requirement to post a bond.
There is considerably less leeway when it comes to property guardianships over minors, with section 55 of the Children’s Law Reform Act (the “CLRA”) requiring a bond to be posted and payable to the child “in such amount as the court considers appropriate in respect of the care and management of the property of the child”, save and except where the guardian is the child’s parent and the court holds the opinion that the parent not be required to post a bond. Accordingly, if you are not the child’s parent the posting of a bond is mandatory.
With the court’s duty being to ensure that the incapable person and/or child and his/her property is protected, we can expect a fairly cautious approach being taken by judges considering requests to dispense with the bond requirement in guardianship situations, particularly in guardianships of minors.
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