Originally published in our May 2017 Newsletter

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This past March, the Law Commission of Ontario (LCO) released its Final Report On Legal Capacity, Decision-making and Guardianship.

Over four years, the LCO undertook its most extensive project to date: analysing how Ontario’s laws and policies regarding powers of attorney, guardianship and health care consent – which developed from the late 1980’s to early 1990’s – can be reformed to make the law more effective, responsive, and accessible.

The LCO considered the following in undertaking its analysis:

1. whether the system reflects contemporary law, values, and needs;
2. whether it works on the ground and achieves its objectives in practice; and
3. whether the legal protections are adequate and accessible.

The LCO identified a number of strengths of the current system and made 58 recommendations to address issues in the system’s operation. These recommendations were also in response to public concerns regarding misuse of powers of attorney, elder abuse, and barriers to access to justice.

Broadly, the LCO identified the following areas of concern:

• the system is confusing, complex, and lacks coordination;
• capacity assessments lack clarity and consistency and there are significant barriers to capacity assessments under the Substitute Decisions Act, 1992 (the “SDA”);
• the system must be more responsive to the range of needs of those directly affected and provide better support for individuals, families, and service providers;
• guardianships are insufficiently limited, tailored, and flexible;
• oversight and monitoring mechanisms for substitute decision-makers are deficient and the rights enforcement and dispute resolution mechanisms under the SDA are inaccessible to many Ontarians;
• statutory provisions regarding detention of persons lacking capacity are needed; and
• inadequate promotion of pilots, monitoring, research and evaluation.

For a fulsome review of the LCO’s analysis and its suggestions for short, medium, and long-term plans to implement its recommendations, see the following resources provided by the LCO at www.lco-cdo.org:

Analysis of the LCO’s Report

Legal capacity, decision-making, and guardianship laws affect tens of thousands of Ontarians every day. The broad scope of the report and its recommendations, therefore, will likely have a widespread influence on Ontarians, particularly those in vulnerable circumstances. This analysis reviews the LCO’s recommendations regarding Capacity Assessments under the SDA as well as reforms to the current legal processes for resolving power of attorney, capacity, and guardianship disputes.

Capacity Assessments under the SDA

A capacity assessment by a Capacity Assessor under the SDA may have profound consequences on the rights of the individual whose decisional capacity is being assessed. Existing concerns regarding the impact of Capacity Assessments under the SDA are amplified by the inconsistencies in the provision and quality of these assessments throughout Ontario. In this regard, the report provides a number of recommendations, including:

• Recommendation 11: Ontario government to
  • a) amend the SDA to provide a clear statement as to the appropriate purposes of Capacity Assessment; and
  • b) review forms under the SDA to ensure that the forms promote the use and conduct of Capacity Assessments in accordance with the purposes and principles underlying the statute.
• Recommendation 14: Ontario to develop and implement a strategy for improving access to Capacity Assessments under the SDA, which would consider how to remove informational, navigational, communication, and other barriers for persons including, but not limited to, those in remote and First Nation communities, those facing communications barriers, or persons identified as facing barriers.
• Recommendation 15: Government of Ontario to review the list of professionals eligible to conduct Capacity Assessments under the SDA.

In order to protect the rights of vulnerable persons, lawyers and Capacity Assessors must understand that there is no single legal definition of ‘capacity’ and that no blanket ‘test’ for capacity exists nor should one be applied. Instead, capacity is decision, time and situation-specific and there are factors/criteria to consider in assessing whether an individual possesses the requisite decisional capacity to make a certain decision at a particular time. The LCO’s recommendations reflects a nuanced understanding capacity, as it is fluctuating and must be determined on a case-by-case basis in relation to a particular task/decision, at a moment in time.

Putting the Vulnerable Person First in Dispute Resolution

For estate litigators involved in capacity, decision-making, and guardianship disputes, it is clear that the legal system is in desperate need of change. The court process is often unequipped to resolve these disputes, which necessitate navigating emotionally difficult waters and often leave family members feeling divided.

The LCO’s report highlights the obstacles individuals face in accessing justice in power of attorney, capacity, and guardianship matters, which are almost impossible to conclude during the lifetime of the often vulnerable person who is the subject matter of the dispute (the “Vulnerable Person”).

For example, the Vulnerable Person may be someone:

• who is elderly – which is often, but not always the case;
• whose capacity to make a certain decision may be at issue;
• who may be vulnerable to abuse by someone in a position of trust (i.e., a child, caregiver, or attorney under a power of attorney); and/or
• who may be the subject of a guardianship application.

These are only a few of the many situations where the Vulnerable Person may be in need of access to justice. However, those individuals who are trying to act in the best interests of the Vulnerable Person may be barred from fully accessing legal remedies if they do not have the financial resources to pursue a drawn out, exhausting and costly court process.

Guardianship applications are often considered the only option if an individual is unhappy with the Vulnerable Person’s attorney for property or where there is an allegation of breach of trust or breach of fiduciary duty. This application process, however, is lengthy and costly, as courts are backlogged and the Public Guardian and Trustee is overwritten with these applications. A guardianship application, therefore, often does not align with s. 66(9) of the SDA, which provides that “the guardian shall choose the least restrictive and intrusive course of action that is available and is appropriate in the particular case.”

Resolving power of attorney and decision-making disputes during the Vulnerable Person’s lifetime – without exacerbating tensions between those involved – necessitates the development of a more meaningful dispute resolution process. Recommendation 29 of the LCO’s report provides for the creation of a specialized, expert tribunal to strengthen dispute resolution and rights enforcement under the SDA, the Mental Health Act, and the Health Care Consent Act, 1996. This would bring these types of disputes out of the courtroom and into a setting with the following characteristics, amongst others:

• broad jurisdiction in areas of capacity, guardianship and decision-making;
• an approach that recognizes the fundamental rights affected by this area of law, the vulnerability of the persons at the centre of these disputes, and the ongoing relationships that are frequently involved;
• expertise in this area of the law; and
• the ability to provide flexible and holistic approaches to disputes.

However, while we wait to see whether the Ontario government will implement the LCO’s recommendation, lawyers in the estates bar should encourage their clients to utilize less adversarial dispute resolution processes. Most importantly, lawyers in these disputes should weigh the age, health, and individual circumstances of the Vulnerable Person and always keep in mind that the Vulnerable Person’s needs and circumstances should be placed and kept at the forefront of the dispute resolution process. If the Vulnerable Person appears to be capable of instructing counsel, he or she should be referred to a lawyer well-versed in these practice areas in order to facilitate a meaningful mediation of the dispute.

In the context of litigation proceedings where there is an impugned transaction or power of attorney granted by the Vulnerable Person, counsel should seriously consider bringing an application for the opinion, advice, and direction of the Court under rule 14.05(3) of the Rules of Civil Procedure to identify an issue that touches on the interests of the grantor and where available, submit that mandatory mediation is necessary to resolve that issue.

The LCO’s report and the recommendations therein provide a well-needed basis for initiating reform to Ontario’s laws and policies regarding powers of attorney, guardianship and health care consent. The LCO will continue their work in this area of the law with the project Improving the Last Stages of Life, which will be informed by the conclusions from the LCO’s report.