Power of Attorney Abuse in Ontario and When to Take Legal Action

A power of attorney gives someone the legal authority to make decisions for another person, but that authority comes with important legal responsibilities. When a power of attorney misuses that authority, ignores the grantor’s wishes or puts their own interests ahead of the grantor’s, the result can be a serious legal dispute.

At Gionet Fairley Wood LLP, we assist clients with estate disputes involving the misuse of powers of attorney for property or for personal care. These cases can arise during a person’s lifetime or become part of an estate dispute after their death. They can also become particularly difficult when family members disagree about what the grantor wanted or how their affairs have been handled.

The type of power of attorney involved is important to note. A continuing power of attorney for property deals with financial affairs, while a power of attorney for personal care gives an attorney authority to make certain personal decisions when the grantor is incapable of making them.

What Is a Power of Attorney in Ontario?

A power of attorney is a legal document that allows one person, known as the grantor, to give another person authority to act on their behalf as their attorney.

A continuing power of attorney for property can give an attorney broad authority over financial affairs. Depending on the document, this can include managing bank accounts, paying expenses, handling investments and dealing with real estate.

A power of attorney for personal care is different. It can give an attorney authority to make decisions about healthcare, housing, nutrition, clothing, hygiene and safety when the grantor is incapable of making these particular decisions. 

In both cases, the attorney is acting for the grantor. They do not become the owner of the grantor’s assets or have unlimited authority over their affairs.

What Is Power of Attorney Abuse?

Power of attorney abuse occurs when an attorney misuses their authority or fails to fulfill the legal duties that come with the appointment.

For an attorney for property, this may involve taking money for themselves, making inappropriate gifts, using the grantor’s funds to pay personal expenses or selling property without a legitimate reason.

For an attorney for personal care, the concerns are different. Abuse may involve ignoring the grantor’s known wishes, making decisions that are not in their best interests or failing to provide appropriate care. It can also involve controlling who has access to the grantor or making significant decisions without proper regard for the grantor’s values and prior capable wishes.

A disagreement with an attorney does not automatically amount to abuse. As an example, family members may have different views about how money should be spent or where someone should live. A legal dispute arises when there are grounds to believe the attorney has exceeded their authority or breached their duties.

What Are the Warning Signs of Power of Attorney Abuse?

Financial misconduct can sometimes be identified through bank statements, property records and other documents. Unexplained withdrawals or transfers, large payments to the attorney or their family members, missing assets, new joint accounts and unexplained property transactions can all raise questions.

Another concern is an attorney who cannot account for how the grantor’s money was used. An attorney for property has record-keeping obligations and may be required to account formally for their management of the grantor’s assets.

Personal care abuse may be harder to identify. A grantor may become isolated from family and friends, experience inadequate care or be moved into a living arrangement that does not reflect their needs or known wishes.

Concerns can also arise when an attorney refuses reasonable communication about the grantor’s care or makes decisions that conflict with wishes the grantor expressed while capable. Ontario law requires an attorney for personal care to follow the grantor’s known prior capable wishes in the circumstances set out in the legislation.

These signs do not prove misconduct on their own. However, they justify obtaining legal advice and investigating the attorney’s conduct.

What Duties Does an Attorney Have in Ontario?

An attorney for property has a fiduciary duty to the grantor. They must act honestly, diligently and in good faith and must keep records of transactions carried out on the grantor’s behalf. They must also act in accordance with the grantor’s best interests and comply with the requirements of the Substitute Decisions Act. 

An attorney for personal care has different obligations. They must make decisions in accordance with the grantor’s known wishes. Where those wishes are not known or do not apply, decisions must be based on the grantor’s best interests, taking their values and beliefs into account. The attorney must also encourage the grantor to participate in decisions to the greatest extent possible and consider their independence and quality of life.

These duties are important when a dispute reaches court because the question is not simply whether family members approve of the attorney’s decisions. The court may need to determine whether the attorney complied with the legal duties attached to their appointment.

Can a Power of Attorney Be Challenged in Court?

Yes. The appropriate legal remedy depends on the circumstances, the type of power of attorney involved and whether the grantor is still capable.

If the grantor is capable of making the relevant decisions, they may be able to revoke the power of attorney. A more difficult situation arises when the grantor is incapable and family members believe the attorney is abusing their authority.

For a power of attorney for property, the court can review the attorney’s management of the grantor’s assets. An interested person may seek an order requiring the attorney to pass their accounts. This process can require the attorney to produce financial records and explain transactions carried out during the appointment. Where misconduct is established, the court may have authority to order repayment or other relief. An attorney can also be removed in appropriate circumstances.

Personal care disputes can also arise where there are concerns about an attorney’s ability or willingness to act in accordance with their duties. An interested person may bring an application to the Ontario Superior Court of Justice and, depending on the circumstances, the court may make orders concerning the attorney’s authority or appoint a guardian of the person.

Some disputes involving treatment decisions or findings of incapacity fall within the jurisdiction of the Consent and Capacity Board. However, where the broader issue is an attorney’s conduct and whether they should continue acting, court proceedings may be necessary. 

What Happens in a Power of Attorney Dispute?

A legal dispute often begins with questions about what the attorney has done and whether those actions can be supported by the grantor’s wishes and the attorney’s legal duties.

For property disputes, financial records are central to the case. Bank statements, investment records, tax documents, real estate records and receipts help establish how the grantor’s assets were managed. The court can examine transactions and determine whether they were authorized and appropriate.

Personal care disputes require different evidence. Medical records, care plans, correspondence, witness evidence and documentation of the grantor’s wishes may all be relevant. The court needs to consider what the grantor was capable of deciding, what wishes they expressed while capable and whether the attorney acted in accordance with those wishes.

The evidence is particularly important when family members have conflicting accounts of what the grantor wanted. A court will look beyond the fact that relatives disagree and consider the legal duties governing the attorney’s conduct.

Can Money Taken Through Power of Attorney Abuse Be Recovered?

In some cases, an attorney who has improperly taken or transferred the grantor’s assets can be ordered to repay them.

The court may examine individual transactions as well as the attorney’s overall management of the grantor’s property. If funds were transferred to the attorney, used for personal expenses or given to others without proper authority, the attorney may be required to account for those transactions.

The timing of the investigation is crucial. Financial records may become harder to obtain as time passes, and money may have been transferred or spent. Where there is a concern that assets are being depleted, obtaining legal advice promptly can help determine what court remedies may be available.

When Should You Speak to an Estate Litigation Lawyer?

A power of attorney dispute can involve significant financial loss, questions about capacity and serious disagreements between family members. Once concerns arise about an attorney’s conduct, it may be difficult to resolve the issue without examining the legal authority granted by the document and the attorney’s actions.

We recommend seeking legal advice when there are unexplained financial transactions, missing assets, questions about personal care or evidence that the attorney is not following the grantor’s known wishes.

At Gionet Fairley Wood LLP, we represent clients with disputes involving powers of attorney abuse throughout Barrie, Simcoe County, Muskoka, and Ontario. We can assess the circumstances, identify the relevant legal issues and advise on the court processes that may be available to resolve issues.

If you believe a power of attorney has been misused, getting legal advice early can help preserve evidence and determine the appropriate way to protect the grantor or their estate. Contact us at 705-468-1088 or reach out through our website to get started.

The information provided in this blog is for general informational purposes only and should not be construed as legal advice. If you have legal questions, we strongly advise you to contact us.