Replacing Attorney for Property with Public Guardian and Trustee
1. Introduction
It is not very common for the court to appoint a guardian of property for a person, especially if the person is already represented by an attorney for property. However, it will do so if it is necessary to protect the person’s property. The issue arose in Public Guardian and Trustee v Hara.[1]
2. Facts
The case concerns an application by the Public Guardian and Trustee (‘PGT’) for an order appointing the PGT as permanent guardian and trustee for property for Fumio Hara (‘Fumio’) and terminating the existing continuing power of property under which Fumio appointed his brothers Gerald and Katsushi Hara as his attorneys.
It is clear that Fumio is incapable of managing his property. He is 91 years old, suffers from dementia, and lives in a long-term care facility. A mini-mental examination rendered a very low score that indicated severe cognitive impairment.
The evidence provided in three affidavits of the PGT and in Gerald’s admissions showed that Gerald had misappropriated a lot of money from Fumio through cheques written on Fumio’s bank accounts, mostly in favour of Gerald and some in favour of Katsushi. The cheques did not indicate what they were for but expenses incurred with the use of Fumio’s credit card were clearly not incurred for his benefit. Gerald also mismanaged Fumio’s funds and emptied Fumio’s retirement fund. Gerald also failed to pay Fumio’s taxes, or his bills, including his fees at the long-term care facility. Fumio owned a condo in Burlington and for unexplained reasons Gerald took out a large mortgage on the condo. In 2024 Gerald agreed to sell the condo. The PGT paid Fumio’s unpaid accounts and was paid the balance of the net proceeds of the sale on the condo.
Gerald is willing to relinquish his role as attorney but would like a relative to take on the role of guardian. However, none has come forward to take on the role. Gerald argues that the PGT cannot be appointed guardian because of a term in the power of attorney that precluded the PGT from managing his affairs.
Katsushi consents to the relief sought by the PGT. He did not carry out his duties as attorney because he lived elsewhere and because of his own age and health issues. So he left the role of attorney to Gerald.
The PGT does not question that Fumio’s power of attorney was valid when he executed it.
3. Analysis and Judgment
Justice Kurz began his analysis by noting that, as an attorney, Gerald is a fiduciary and is not entitled to take any profits, benefits, or advantages from his position, except with the consent of the grantor.
His Honour then went on to consider the provisions of the Substitute Decisions Act, 1992[2] (‘SDA’) regarding the appointment of a guardian of property for a person. Section 22(1) empowers the court to appoint a guardian for a person who is incapable of managing property and it is necessary for decisions to be made on the person’s behalf. Subsection (2) permits the court to appoint a guardian for property even though there is a statutory guardian. But subsection (3) provides:
The court shall not appoint a guardian if it is satisfied that the need for decisions to be made will be met by an alternative course of action that,
(a) does not require the court to find the person to be incapable of managing property; and
(b) is less restrictive of the person’s decision-making rights than the appointment of a guardian.
His Honour then discussed the court’s reluctance to appoint a guardian in place of an attorney, because it interferes with the wishes of the grantor who appointed the attorney. He referred to Re Schaefers Estate, in which Fragomeni J stated:
[24] The jurisprudence establishes that two issues require consideration. First, there must be strong and compelling evidence of misconduct or neglect on the part of the attorney before a court should ignore the clear wishes of the donor [grantor]. With respect to this issue, the evidence has to establish that the donor was capable of granting proper power of attorney.
[25] The second issue relates to whether the court is of the opinion that the best interest [sic, interests?] of an incapable person are being served by the attorney.
Similarly, in Glen v Brennan,[3] Somers J stated:
9 The courts have generally taken the view that a written power of attorney executed by the donor at a time when he was apparently of sound mind … is simpler to deal with and gives the donee more flexibility in dealing on behalf of the donor. Also favouring a continuation of the appointment respects the wishes of the person who made the grant.
Justice Kurz concluded:
26 Based on the uncontested evidence before the court and Gerald’s own admissions, he has more than breached his fiduciary duties to his brother, Fumio. He has shredded them. He has treated Fumio’s property and money as if they were his own. He misappropriated hundreds of thousands of dollars of his brother’s money on what appears to be the brazen assumption that he was entitled to the money. He was not. He has also mismanaged Fumio’s money so that he missed many months of payments to the home at which he resides and is cared for and has failed to even file his tax returns. He has also caused expenses on the Condo to be expended unnecessarily after Fumio went into his care home.
27 I can think of no more clear case to remove an attorney.
His Honour took the view that although Fumio strongly preferred family members to manage his financial affairs rath
er than the government, the SDA permits the court to appoint the PGT as Fumio’s guardian of property. In any event, no family members came forward to take on the role of guardian. Thus, the PGT must be appointed as the guardian of last resort.
In light of Gerald’s egregious conduct, His Honour awarded substantial indemnity costs.
—
[1] 2025 ONSC 145.
[2] SO 1992, c 30.
[3] 2006 CarswellOnt 93.
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Written by: Albert Oosterhoff
Posted on: July 2, 2025
Categories: Commentary, WEL Newsletter
1. Introduction
It is not very common for the court to appoint a guardian of property for a person, especially if the person is already represented by an attorney for property. However, it will do so if it is necessary to protect the person’s property. The issue arose in Public Guardian and Trustee v Hara.[1]
2. Facts
The case concerns an application by the Public Guardian and Trustee (‘PGT’) for an order appointing the PGT as permanent guardian and trustee for property for Fumio Hara (‘Fumio’) and terminating the existing continuing power of property under which Fumio appointed his brothers Gerald and Katsushi Hara as his attorneys.
It is clear that Fumio is incapable of managing his property. He is 91 years old, suffers from dementia, and lives in a long-term care facility. A mini-mental examination rendered a very low score that indicated severe cognitive impairment.
The evidence provided in three affidavits of the PGT and in Gerald’s admissions showed that Gerald had misappropriated a lot of money from Fumio through cheques written on Fumio’s bank accounts, mostly in favour of Gerald and some in favour of Katsushi. The cheques did not indicate what they were for but expenses incurred with the use of Fumio’s credit card were clearly not incurred for his benefit. Gerald also mismanaged Fumio’s funds and emptied Fumio’s retirement fund. Gerald also failed to pay Fumio’s taxes, or his bills, including his fees at the long-term care facility. Fumio owned a condo in Burlington and for unexplained reasons Gerald took out a large mortgage on the condo. In 2024 Gerald agreed to sell the condo. The PGT paid Fumio’s unpaid accounts and was paid the balance of the net proceeds of the sale on the condo.
Gerald is willing to relinquish his role as attorney but would like a relative to take on the role of guardian. However, none has come forward to take on the role. Gerald argues that the PGT cannot be appointed guardian because of a term in the power of attorney that precluded the PGT from managing his affairs.
Katsushi consents to the relief sought by the PGT. He did not carry out his duties as attorney because he lived elsewhere and because of his own age and health issues. So he left the role of attorney to Gerald.
The PGT does not question that Fumio’s power of attorney was valid when he executed it.
3. Analysis and Judgment
Justice Kurz began his analysis by noting that, as an attorney, Gerald is a fiduciary and is not entitled to take any profits, benefits, or advantages from his position, except with the consent of the grantor.
His Honour then went on to consider the provisions of the Substitute Decisions Act, 1992[2] (‘SDA’) regarding the appointment of a guardian of property for a person. Section 22(1) empowers the court to appoint a guardian for a person who is incapable of managing property and it is necessary for decisions to be made on the person’s behalf. Subsection (2) permits the court to appoint a guardian for property even though there is a statutory guardian. But subsection (3) provides:
The court shall not appoint a guardian if it is satisfied that the need for decisions to be made will be met by an alternative course of action that,
(a) does not require the court to find the person to be incapable of managing property; and
(b) is less restrictive of the person’s decision-making rights than the appointment of a guardian.
His Honour then discussed the court’s reluctance to appoint a guardian in place of an attorney, because it interferes with the wishes of the grantor who appointed the attorney. He referred to Re Schaefers Estate, in which Fragomeni J stated:
[24] The jurisprudence establishes that two issues require consideration. First, there must be strong and compelling evidence of misconduct or neglect on the part of the attorney before a court should ignore the clear wishes of the donor [grantor]. With respect to this issue, the evidence has to establish that the donor was capable of granting proper power of attorney.
[25] The second issue relates to whether the court is of the opinion that the best interest [sic, interests?] of an incapable person are being served by the attorney.
Similarly, in Glen v Brennan,[3] Somers J stated:
9 The courts have generally taken the view that a written power of attorney executed by the donor at a time when he was apparently of sound mind … is simpler to deal with and gives the donee more flexibility in dealing on behalf of the donor. Also favouring a continuation of the appointment respects the wishes of the person who made the grant.
Justice Kurz concluded:
26 Based on the uncontested evidence before the court and Gerald’s own admissions, he has more than breached his fiduciary duties to his brother, Fumio. He has shredded them. He has treated Fumio’s property and money as if they were his own. He misappropriated hundreds of thousands of dollars of his brother’s money on what appears to be the brazen assumption that he was entitled to the money. He was not. He has also mismanaged Fumio’s money so that he missed many months of payments to the home at which he resides and is cared for and has failed to even file his tax returns. He has also caused expenses on the Condo to be expended unnecessarily after Fumio went into his care home.
27 I can think of no more clear case to remove an attorney.
His Honour took the view that although Fumio strongly preferred family members to manage his financial affairs rath
er than the government, the SDA permits the court to appoint the PGT as Fumio’s guardian of property. In any event, no family members came forward to take on the role of guardian. Thus, the PGT must be appointed as the guardian of last resort.
In light of Gerald’s egregious conduct, His Honour awarded substantial indemnity costs.
—
[1] 2025 ONSC 145.
[2] SO 1992, c 30.
[3] 2006 CarswellOnt 93.
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