In the recent decision Lacaria v. Lacaria, 2026 ONSC 591, the Ontario Superior Court of Justice considered whether, and to what extent, costs should be awarded in guardianship applications when the incapable person passed before final adjudication of the issues.
Background
In her Power of Attorney for Personal Care, Caterina Lacaria (the “Deceased”) named her four children as joint attorneys. After the Deceased was diagnosed with severe dementia, disagreements arose amongst her children regarding her care. One of the children commenced an application under the Substitute Decisions Act, 1992, SO 1992, c. 30, seeking appointment as sole Guardian of Personal Care. Unfortunately, Deceased passed about seven months after the Application was commenced and before a substantive hearing on the merits.
The Dispute Over Costs
After the Deceased had passed, the Applicant sought to recover costs from his Respondent siblings in their personal capacities and from the Deceased’s Estate. Two-thirds of the Applicant’s legal fees were incurred after the Deceased’s death, in the pursuit of recovering costs. The Respondents argued that all parties, including themselves, should bear their own costs.
Decision
The Court confirmed its discretionary jurisdiction to award costs even where no adjudication has occurred, but reviewed case law cautioning against conducting a “phantom trial” solely for the purpose of determining costs when the actual issues are no longer in dispute (paras. 15-17). Applying that same reasoning, the Court determined that costs should not be awarded against the Respondents personally because no findings had been made on the facts (para. 19).
The Court accepted that the Applicant had initiated the Application to benefit the Deceased, and that the parties had negotiated and implemented two detailed agreements (namely, an agreement governing the Deceased’s care and an agreement regarding employing a PSW) after the Application was commenced (para. 23). The Court determined that these agreements provided a direct benefit to the Deceased and likely would have never been established if the Applicant had not brought the matter to litigation. Accordingly, the Court awarded pre‑death costs to the Applicant from the Estate, though on a reduced basis after assessing the reasonableness of the fees incurred during that period (para. 24).
However, the Court found that the post-death legal fees incurred were both unreasonable and, for obvious reasons, did not benefit the Deceased. Given that the Deceased’s death rendered the issues of the Deceased’s capacity, care, and guardianship moot, the Court decided that the legal fees incurred post-death were not recoverable (paras. 18 & 26).
Overall, the decision in Lacaria demonstrates how courts can scrutinize costs in proceedings involving incapable persons. Litigants and lawyers ought to tread lightly when a proceeding shifts from substantive care to a dispute which does not center the incapable person in question.
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