Tag: power of attorney
Over the Christmas break, a news story out of Winnipeg captured national headlines. Samuel Golubchuk is 84 years old and on life support in Winnipeg’s Grace Hospital. He apparently suffered a brain-injury from an earlier fall and part of his brain was removed at the time. Tragically, Mr. Golubchuk cannot walk, speak, eat or breathe on his own. His treating physicians say Mr. Golubchuk has no chance of recovery and that his quality of life is negligible. They want the right to remove him from life support. The news stories don’t indicate whether Mr. Golubchuk left a power of attorney or end-of-life instructions.
Mr. Golubchuk’s family has gone to court to resist any attempt by the hospital’s doctors to remove him from life support. Mr. Golubchuk’s family claims that removing life support would violate Mr. Golubchuk’s orthodox Jewish belief and amount to an assault as it would hasten his death.
In early December, the family was granted a temporary court injunction while a local judge considered the case. In January, the family returned to court and presented two opinions from New York doctors. According to the family’s doctors, Mr. Golubchuk was not beyond hope.
The family has maintained throughout that it is a matter of self-determination and the right to live in a free and democratic society without an outside party making decisions for you. The hospital, on the other hand, maintains that it is up to the treating physician to make a judgment call as to whether or not life support should be removed.
As far as I can tell, the judge hearing the case has still not decided what will happen to Mr. Golubchuk. However, it is clear that the courts struggle with life and death decisions as much as guardians or family members do. There are simply no easy answers. In the end, I think it is difficult to say how any one of us would act or react when confronted with the ultimate decision.
Keep thinking and thanks for reading.
In our rapidly aging society, powers of attorney for personal care and property are now widespread and their importance is recognized by the general public. A family member or friend can also apply to the court to be appointed guardian of the person or the person’s property if powers of attorney have not been executed. However, family members often find themselves in a situation where a loved one is being legally cared for by a family member, or friend of the incapable person, who they no longer like or trust.
A common complaint that I hear is from family members or friends who feel excluded from participating in or influencing decisions regarding the incapable person, particularly when it comes to personal care.
However, under the Substitute Decisions Act, 1992, which generally governs the rights of an incapable person, any person, with leave, can seek directions from the court on any question arising under a power of attorney (the same is true regarding a court appointed guardian). Pursuant to sections 39 and 68 of the Act, the court may give such directions as it considers to be for the benefit of the incapable person and consistent with the Act.
Section 66(1) of the Act sets out the duties of an attorney for personal care (section 32 is the corresponding section for an attorney for property). In general, the attorney is required to exercise his or her duties and powers with diligence and in good faith.
Section 66(6) also states that an attorney must foster regular personal contact between the incapable person and supportive family members and friends. Moreover, section 66(7) states that the attorney shall consult with supportive family members and friends who are in regular contact with the incapable person, as well as the incapable person’s caregivers.
The requirements of section 66, coupled with the ability to seek directions from the court, offer family members and friends the means to ensure that they remain involved with their loved ones and are not simply sidelined. Proceeding to court is always expensive. However, where there is genuine concern and frustration that the incapable person is not being properly cared for and/or his or her finances are being squandered, recourse can be had to the courts.
During Hull on Estate and Succession Planning Podcast #65, Ian Hull and Suzana Popovic-Montag discuss the importance of designating a Power of Attorney in your estate plan.
They cover topics such as why a Power of Attorney is essential and what can happen if an incapable individual does not have a Power of Attorney in place, focusing on the Court Order process to obtain a Power of Attorney for property and/or personal care.
Listen to "Powers of Attorney Defined"
Read the transcribed version of "Powers of Attorney Defined"
They define "Power of Attorney", and cover the responsibilities that accompany this role. The steps to take if you decide to revoke your Power of Attorney are also discussed, as well as the regulations of the Substitute Decisions Act which sets out some of the duties involved in Power of Attorney
In McMullen v. McMullen  B.C.J. No 2900, an 86 year old widower commenced an application against two of his three daughters, who held his power of attorney. The application was to set aside the transfer of a 99% interest in the father’s condominium property to the husbands of his two daughters. The daughters, in turn, brought an application for an order requiring their father to submit to a psychiatric assessment.
According to the medical evidence before the court, the father had some medical problems, but no documented cognitive problems. At worst, he suffered from depression. However, the two daughters alleged that their father’s spending habits had changed and his investments had been depleted. The daughters claimed that their father was sending money to a new female acquaintance in the United States. The family contacted medical professionals and legal authorities with concerns that their father was being financially abused, but to no avail.
When the daughters confronted their father with respect to his worsening financial situation, he became angry and denied he was being financially exploited. He asked his one daughter to stop monitoring his bank account though she did not accede to his request, as she considered it her duty under the power of attorney. The two daughters then transferred the father’s condominium property to preserve his only remaining asset and provide for his future care.
However, the daughters did not immediately register the transfer of the condominium property, as they thought it would cause emotional distress. It was not until a year later that the daughters finally registered the transfer of the condominium without telling their father or providing consideration. The father commenced the application when he ultimately discovered the transfer.
The court allowed the application by the father and the condominium transfer was declared null and void. While the daughters acted in what they considered to be in their father’s best interests, there was nevertheless no evidence to show that the father was incapable of managing his financial affairs. The daughters had therefore breached their duties as attorneys by acting contrary to their father’s intentions. The court dismissed the daughters’ application, as the father was not required to submit to a psychiatric assessment where his mental capacity was not an issue.
The case holds that even when a family fears that an elderly parent is being financially exploited, but mental incompetency is not an issue, a power of attorney does not give the family carte blanche to do what they think is in the best interests of that parent. A power of attorney for property has its limits even in the most egregious situations.
Justin de Vries
If a testator does not adequately shelter the bequests or insurance policy beneficiary designations to a disabled beneficiary, the disabled beneficiary may still have a way of sheltering the gift to him or her by taking advantage of what is known as a “disability expense trust”.
A disabled beneficiary, or member of a benefit unit, is entitled to put monies derived from an inheritance or the proceeds of a life insurance policy into a trust. These funds, up to a maximum value of $100,000, will not be considered assets for ODSP purposes.
This trust is distinct from a Henson Trust in that the funds may be received directly by the recipient and subsequently placed into the trust. Such a vehicle is available to shelter the funds were the testator failed to do so.
Any income earned on the funds and accrued will not be considered income to the disabled beneficiary if it the fund does not exceed $100,000.
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During Hull on Estates Episode #40, Sean and Paul discussed the importance of wills, naming a Power of Attorney and other elements of succession planning that should be considered in the New Year.
The final blog for this week wraps up our theme by considering an interesting instance of the interaction between power of attorney litigation and estate litigation.
In Wolfson Estate v. Wolfson, a recent reported decision of the Ontario Superior Court of Justice, a brother and sister were engaged in litigation relating to the estate of their late mother. The mother had jointly held her investment portfolio with her daughter. After the mother became increasingly physically and mentally frail after a stroke, the sister and brother had a falling out, the result being that the sister signed off of the joint account in place of her brother.
By will and by agreement, the mother and daughter had agreed that the jointly held portfolio would pass in accordance with the mother’s Will. However, on the mother’s death, the son, as new joint owner of the portfolio, took the position that the asset had passed to him by right of survivorship and, as he was not a party to the agreement, he was not to be bound to treat the jointly held asset as an estate asset. Moreover, he argued that the mother was upset with her daughter and that, rather than change her will, she sought to effect a change in her testamentary disposition by effecting a joint transfer to her son.
Perhaps the most difficult issue that arises in power of attorney litigation relates to a determination of the onset of incapacity and the varying degrees of incapacity. These issues have a direct bearing on the nature of the fiduciary obligation of the attorney.
Under the Substitute Decisions Act, an attorney has a higher duty of care (a) if the grantor is incapable of managing property; or (b) if the attorney has reasonable grounds to believe that the grantor is incapable of managing property.
The reality is that there is often no clear determination made that the grantor is incapable. All too often, the Court is left trying to make that determination a considerable period of time after the fact.
In Re Nesbitt Estates, an unreported 2005 decision of the Ontario Superior Court of Justice that is presently under appeal, the actions of an attorney under power of attorney were scrutinized by the Court in an unusual fact situation.
In this case, the attorney managed the property of his elderly aunt and uncle at their request and made a series of transfers of the aunt’s bank accounts into joint bank accounts held with her husband. The evidence suggested that the aunt was capable at all relevant times although there was admittedly sketchy evidence as to whether the aunt knew and approved of each and every transaction that placed her assets into joint ownership with her husband of sixty years. What was clear was that her testamentary intention throughout the period of the transfers was to benefit her husband with her entire estate. The wrinkle was that the aunt inexplicably changed her will shortly before her death to benefit, not her husband but, rather, a family friend.