Under Ontario law, a Continuing Power of Attorney for Property gives a donor the ability to appoint another individual, an Attorney for Property (“AFP”), to manage financial affairs in the event of incapacity. That authority is fiduciary in nature: the appointed attorney must act honestly, in good faith, and in the incapable person’s best interests. When these obligations are questioned, courts have tools to intervene, including: interim restrictions, removal, and appointment of the Public Guardian and Trustee (“PGT”). Recent Ontario caselaw illustrate how these mechanisms are applied where conflict or misconduct is alleged.
In Sullivan v. Culic et al. 2026 ONSC 23, the Ontario Superior Court of Justice dealt with a situation involving a lawyer serving as AFP for an 84-year-old man (“Mr. Owers”) diagnosed with dementia. Mr. Owers had executed powers of attorney in 2018 appointing his longtime lawyer and family friend, the Respondent, as the AFP, with Mr. Owers’ daughter (the “Applicant”) as alternate. After the sale of the donor’s home, approximately $405,000 was held in the lawyer’s firm trust account. The Respondent arranged a private loan secured by a second mortgage on commercial property at a 12 percent interest rate with substantial equity as an investment opportunity for Mr. Owers’ funds. The Respondent did not disclose to the Applicant that he was the borrower, the first draw on the loan was made from the proceeds of the sales of Mr. Owers’ real property his law firm was holding in trust.
The Court paid particular attention to the Respondent’s communications in attempting to access Mr. Owers’ investment accounts with RBC. When RBC refused the Respondent to withdraw funds from Mr. Owers’ investment accounts, the Respondent threatened the bank. The Respondent then urged the Applicant to make sure that the bank paid out the funds he tried to get from RBC to him in trust “ASAP”. The Applicant repeatedly requested a complete accounting of all trust funds and expenses, including transfers to the lawyer and his firm amounting to around $118,000. The Respondent advised the applicant that he used those funds advanced to him personally as a line of credit to finance renovations.
The court “reluctantly” approved a consent interim order restricting the lawyer’s access to the RBC investment accounts and transferring remaining trust funds to the daughter’s counsel’s firm but expressed serious reservations about not removing him outright. It questioned whether, given the serious concerns raised, the alternate attorney, the Applicant, should have been appointed in his stead.
This decision underscores an important principle: that even at interim stages, the Court will scrutinize attorney conduct for signs of conflict and disregard for the donor’s best interests. Lastly, this decision also highlights the proposition that interim relief can be tailored to protect assets while the substantive application is litigated.
A more definitive example of judicial intervention was rendered earlier last year in Public Guardian & Trustee v. Hara 2025 ONSC 145. In this case, a 91-year-old donor with severe dementia had appointed his brothers as attorneys for property. One brother, Gerald, acted alone and allegedly misappropriated funds and spent it on himself. These allegations include over $169,000 in unexplained withdrawals and the depletion of the donor’s retirement funds. He also failed to pay the donor’s long-term care fees and incurred unauthorized expenses; these financial expenditures drove the donor into unnecessary debt and financial strain.
The PGT applied for an order removing Gerald as attorney. The court found strong evidence of misconduct, noting that Gerald had breached his fiduciary obligations and failed to act in the donor’s best interests. With no suitable family member ready to assume the role, the court appointed the PGT as permanent guardian of the property.
This ruling reflects that where clear financial mismanagement or misappropriation is proven, and in this case, “brazen” actions of misconduct and neglect, the Court will not hesitate to remove an attorney for property and appoint a guardian to protect the incapable person’s interests.
The bottom line: Ontario courts are prepared to exercise their supervisory role robustly to ensure that attorneys for property act in good faith and in the best interests of the incapable.
Thanks for reading,
David Morgan Smith and John Tuy (student-at- law)