Today on Hull on Estates, Natalia Angelini and Doreen So discuss life insurance policies, separation agreements, and the limits to section 72 of the Succession Law Reform Act in Birnie v Birnie, 2019 ONSC 2152.
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This week on Hull on Estates, Natalia Angelini and Nick Esterbauer discuss security bonds within the context of estate administration and guardianship of property, as well as certain situations in which security is typically required and applicants may request to dispense with the requirement to provide security.
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The Substitute Decisions Act directs that, when a person who does not reside in Ontario is appointed as a guardian of property, that person must provide security, as approved by the Court, for the value of the property to be administered. However, the Court also has discretion to waive the requirement that security be provided by a non-resident guardian of property. Under what circumstances the Court will exercise its discretion to waive the requirement to post security when appointing a non-resident guardian of property is unclear within the legislation and little guidance is provided by the sparse case law that deals with this issue.
In a paper presented by Dermot Moore of the Office of the Public Guardian and Trustee (the “PGT“) at this year’s Six-Minute Estates Lawyer, Mr. Moore outlined the policy of the PGT on recommending security when a non-resident guardian of property is being appointed. The PGT will typically recommend that security be required in the following circumstances:
- If the proposed guardian is not a parent or spouse of the incapable person and the value of property is greater than $100,000.00;
- If the proposed guardian is a parent or spouse, the incapable person does not own real property, and the value of the property is greater than $250,000.00; and
- If the proposed guardian is a parent or spouse, the incapable person owns real property, and the value of the property is greater than $500,000.00.
It may be worth noting that in a jurisdiction such as Toronto, where property values are so high, a guardianship application by a non-resident of Ontario in respect of the average person who own real property will result in a recommendation by the PGT that security be posted.
In his paper, Mr. Moore notes that it is not infrequent for the Court to dispense with the requirement that security be provided if there is some argument in support of waiving the requirement. One of the few decisions in which the issue of security in the appointment of non-resident guardians has been considered is Salzman v. Salzman, 2011 ONSC 3555, 2011 CarswellOnt 15786. In this case, a resident of Quebec was appointed as guardian of property for his mother and was not required to post security upon his appointment. In dispensing with the requirement to post security, Justice Hoy made note of the proposed guardian’s close relationship with his incapable mother, his historical assistance in managing her affairs, and the consent of his siblings, the only other beneficiaries of his mother’s estate, to the non-resident’s appointment and the dispensing of the requirement to post security.
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