How to Hold an Attorney or Guardian of Property Accountable in Ontario
In Ontario, an attorney or guardian of property has significant authority over the financial affairs of another person, usually someone incapable of managing their own finances. While this role is fiduciary in nature, concerns can arise about potential mismanagement. Fortunately, Ontario law provides clear legal pathways to hold attorneys and guardians accountable through a process known as a passing of accounts.
What Is a Passing of Accounts?
A passing of accounts is a formal court-supervised process in which an attorney or guardian of property submits financial records for approval. This mechanism ensures transparency and offers a remedy when there are concerns about how an individual’s assets are managed.
Who Can Apply to Compel a Passing of Accounts?
Authorized Applicants Under Section 42 of the SDA
Under Section 42 of the Substitute Decisions Act (SDA), the following individuals may apply to the court to compel an accounting:
- The grantor or incapable person
- Any attorney or guardian of property
- Any attorney for personal care or guardian of the person
- Dependants of the grantor or incapable person
- The Public Guardian and Trustee
- The Children’s Lawyer
- A judgment creditor of the grantor or incapable person
- Any other person, with leave of the court
“Any Other Person” – What the Court Considers
A person applying as “any other person” must meet a two-part test:
- They must have a genuine interest in the grantor’s welfare.
- There must be reasonable grounds to believe a court may order the passing of accounts.
The Ontario courts have emphasized that such applications should be granted sparingly due to the intrusive nature of financial reviews.
Estate Beneficiaries and Their Rights
Before the Grantor’s Death
Beneficiaries of a future estate generally do not have an automatic right to demand an accounting while the grantor is still alive. They must apply under Section 42(4) and meet the court’s leave criteria.
After the Grantor’s Death
Things change if the attorney for property also becomes the estate trustee. In this case, the beneficiary can apply for a passing of accounts for the period when the person was acting as attorney. The court has clarified that there can be no “internal” accounting between a fiduciary and themselves acting in two capacities.
When Will the Court Order a Passing of Accounts?
The court does not automatically grant such requests. Instead, it weighs several factors:
| Factor | Description |
|---|---|
| Extent of Involvement | How deeply the attorney or guardian is involved in managing financial affairs. |
| Significant Concern | Evidence of possible mismanagement or questionable financial conduct. |
Each case is assessed on its merits. The court balances privacy concerns with the need for transparency and protection of vulnerable individuals.
FAQs About Attorney or Guardian of Property Accountability
1. What is an attorney for property?
An attorney for property is someone appointed under a power of attorney to manage another person’s financial affairs when they are unable to do so themselves.
2. What is the difference between an attorney and a guardian of property?
An attorney is appointed by the individual, while a guardian is appointed by the court when no power of attorney exists or the attorney is unfit to serve.
3. Can a family member apply to the court to review the attorney’s actions?
Yes, family members may apply under Section 42(4) as “any other person,” provided they demonstrate a genuine interest and reasonable grounds.
4. What happens during a passing of accounts?
The fiduciary must present detailed financial records, including bank statements, receipts, and a summary of income and expenses. The court then decides whether the management was proper.
5. Is court approval required every time for an attorney or guardian?
No. Only when someone applies and the court grants the application for review under the SDA.
Conclusion
If you have concerns about how an attorney or guardian of property is managing a vulnerable individual’s finances, Ontario’s Substitute Decisions Act offers a clear mechanism for oversight. Section 42 enables interested parties to apply to the court for a passing of accounts, offering protection for the grantor and accountability for the fiduciary. It’s an essential safeguard to ensure transparency and ethical management of another person’s assets.
Consulting a lawyer experienced in guardianship or estate law is recommended if you’re considering initiating this process. They can assess your eligibility and help you navigate the legal standards required to protect a loved one’s financial well-being.
