Borges v Borge 2018 ONSC 3451 (CanLII) http://canlii.ca/t/hskbw

The application in Borges v Borges 2018 ONSC 3451 involved a dispute between siblings over the control of their older adult mother’s substantial property.

Background:

A mother of three adult sons was diagnosed with progressive dementia in 2011.  In July of 2013, she signed a power of attorney in favour of two of her sons (“the respondents”).  She also added one of their names to one of her bank accounts.

The mother’s third son (“the applicant”) was allegedly unaware of the existence of the power of attorney until December 8, 2017.  In November of 2017, he brought an application seeking a declaration that Maria lacked the capacity to manage her property, an order appointing him as guardian of her property, as well as costs on a substantial indemnity basis and all associated expenses payable from the estate.

The applicant also sought the following relief:

1. arrangement of independent representation for the mother;
2. invalidating the power of attorney for lack of capacity;
3. compelling the respondents to pass their accounts; and
4. production of the notes and records of the lawyer who prepared the power of attorney as well as the mother’s medical files dating back to 2011.

Analysis:

Independent Representation:

Given that the mother’s capacity was at issue and there was a dispute over the control of her property, the Public Guardian and Trustee (PGT) agreed that she would need independent representation.  The Court ordered the PGT to arrange for counsel with fees payable from the mother’s property if Legal Aid did not provide a Certificate.

Power of Attorney:

The respondents produced various medical reports all of which post-dated the signing of the power of attorney.  These reports chronicled the mother’s cognitive decline. One of the reports referenced a further report dated March 2013 which the respondents had chosen not to disclose.

The Court concluded that the reports produced did not support the applicant’s contention that the mother lacked capacity at the time that she executed the power of attorney. However, since the mother was diagnosed in 2011, her condition may have deteriorated by 2013. Therefore, the undisclosed March 2013 report would thus be relevant to the issue of capacity.  Despite the importance of privacy when it comes to medical records, there was no reason not to produce the report given the release of other medical records. The Court stated:

I am mindful of the Court’s admonition in Seepa, at para. 28, that “no information is more personal and is accorded a higher standing in discussion of privacy law than a person’s medical files.” However, the respondents have disclosed [the mother’s] medical files from 2013 to 2017. There is no reason why they should not disclose any medical record that may be relevant to the issue of [the mother’s] capacity.[1]

The applicant relied on Bishop et al. v. Bishop, arguing that even in a case involving a mild case of dementia, courts have not hesitated to set aside a power of attorney.[2]  However, in Bishop there was an independent medical report, concluding that Mrs. Bishop did not have the capacity to grant power of attorney.   There was no such report in this case.

As a result, the Court declined to set aside the power of attorney on the reports filed.  The applicant was free to bring a further motion after reviewing the March 2013 report.

Solicitor’s Records:

Citing the importance of solicitor/client confidentiality as referenced in Seepa v. Seepa[3], the Court declined to make an order for the lawyer’s file.

Passing Accounts:

The applicant sought to compel the respondents to pass their accounts, on the basis that one of them was in a fiduciary relationship with the mother given that he had been made signatory to her account and had withdrawn sums of money from that account.  The applicant also argued that the son had been paying his wife $1,400 a month from the mother’s account.  This monthly payment was reportedly for the care provided to the mother while she still lived at home.

The Court declined to compel the respondents to pass their account because there was insufficient evidence of any financial transgression.  The monthly amount paid for the mother’s care was not unreasonable.

Preservation & non-dissipation Order:

There was no evidence of dissipation on the part of the respondents. On the contrary, there was evidence indicating that the applicant had been less than forthright in his financial dealings with his mother.

Citing the tripartite test set out in RJR MacDonald Inc. v. Canada (Attorney General)[4], the Court found that the applicant has no existing right to any specific fund concerning his mother’s property. Although, he may have such a right in the future. As such, the Court declined to make an order for preservation of the property.

Costs:

Since the success on the application was divided, no order was made with respect to costs.

Takeaways:

A concern over a living person’s capacity does not trump that person’s right to privacy, however, documents that are clearly relevant to the central issue of capacity, are likely to be ordered produced (especially where other medical records have been provided). There are provisions for this disclosure in the Rules of Civil Procedure and the Courts of Justice Act[5], under the SDA and at common law. The decision is noteworthy and a warning given the Court refusal to order the attorneys to pass their accounts where there on its face exists insufficient evidence of financial transgression or misappropriation.

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[1] Borges at para. 25.

[2] Bishop et al. v. Bishop, (2006) O.J. no. 3540 (S.C.)

[3] Seepa v. Seepa, 2017 ONSC 5368, at para. 28

[4] RJR MacDonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311, at pages 347-349

[5] Rules of Civil Procedure, RRO 1990, Reg 194, http://canlii.ca/t/535gc