This is a scenario far too many people can picture: Your mother has had the same Power of Attorney for years. Then, without much explanation, she signs new documents appointing one of your siblings and not you. That sibling arranged the appointment, drove her there and sat through the meeting. It comes out later that the lawyer your mother met with was not her usual lawyer. You learn about your exclusion after your mother’s bankers refuse to discuss your mother’s financial matters with you.

Is the new Power of Attorney valid?

Possibly. Your mother is entitled to change her mind, provided she has the necessary capacity and is making her own decision. She does not need everyone’s permission. But the circumstances surrounding that decision matter. A signature does not put an end to the inquiry.

What are “Suspicious Circumstances”?

Lawyers often encounter this expression in Will disputes. Something about the preparation or signing of the Will raises a legitimate question about whether the person understood the document or made the decision freely.

The same concerns can arise with a Power of Attorney.

A Power of Attorney for Property gives the attorney considerable control over the grantor’s finances. A Power of Attorney for Personal Care can authorize decisions about health care, housing and other personal matters when the grantor cannot make the relevant decision themselves. There is plenty at stake. Suspicious circumstances surrounding the making of the Powers of Attorney, do not automatically invalidate either document. They can, however, affect what must be proved and who must prove it.

A Disappointed Family Member is Not Enough

Consider two situations.

(1) In the first, a parent meets privately with her lawyer, explains why she wants to replace one child with another and demonstrates that she understands the appointment. The excluded child considers the decision unfair.

(2) In the second, a parent depends heavily on one child, who arranges the new document, answers questions for her and tells her she will lose access to her money unless she signs.

Both situations may produce a family dispute. The second raises much more serious questions about how the document came to be signed. The issue is whether the appointment reflects the parent’s capable and independent decision. It is not whether the rest of the family approves.

Who Has to Prove Capacity?

Ontario’s Substitute Decisions Act, 1992 contains presumptions of capacity. Ordinarily, an allegation that someone lacked capacity requires evidence.

In Vanier v. Vanier, 2017 ONCA 561, the Ontario Court of Appeal recognized that where suspicious circumstances of undue influence surround the execution of a Power of Attorney, the usual presumption of capacity does not operate. The burden of establishing capacity shifts to the person appointed under the document.

That is a significant consequence. Someone relying on the appointment may have to establish that the grantor had the capacity to do so at the material time. Capacity and undue influence nevertheless remain separate questions. A person may understand a document but be pressured into signing it. Equally, a person’s dependence on a family member does not, by itself, establish incapacity or coercion – but it IS evidence of undue influence.

When the Person Being Appointed Also Does the Translating

Nguyen-Crawford v. Nguyen, 2010 ONSC 6836, illustrates the problem.

An elderly mother’s primary language was Vietnamese. Her daughter accompanied her to the lawyer’s office and translated both the Power of Attorney documents and the lawyer’s advice. The evidence showed that the mother was dependent on her daughter to a large degree, and it was the daughter who was appointed under the documents. The daughter and her husband subsequently treated the mother’s money as their own.

The Court found that the usual presumption of capacity could not be relied upon. The daughter failed to establish the necessary capacity, and the Powers of Attorney were declared ineffective. There is nothing inherently improper about helping a parent get to a lawyer’s office. But when the person receiving authority also controls the conversation, it becomes harder to establish whose instructions the lawyer actually received.

An independent interpreter can make a considerable difference.

What Will a Court Examine?

In Rudin-Brown v. Brown, 2021 ONSC 3366, the Court discussed factors relevant to identifying suspicious circumstances. In practical terms, the questions include:

1. How was the person functioning when the document was signed? Physical and mental impairments require attention, although illness or disability alone does not establish incapacity.

  2. How different is the new POA? An abrupt departure from longstanding arrangements may require an explanation.

    3. Did the appointment make sense for that person? The choice should be considered against their circumstances and interests.

    4. What happened during preparation and signing? Who gave instructions, who attended and whether the person could speak privately may all

        matter.

    5. How involved was the person receiving authority? Arranging the document and directing its preparation can become important parts of the

        evidence.

These are matters to investigate. They are not a checklist that automatically determines validity.

A Diagnosis Does Not Answer the Whole Question

A person with dementia does not necessarily lack capacity to grant a Power of Attorney. The legislation sets out particular requirements.  The relevant question is whether the person met those requirements when the document was signed.

For a continuing Power of Attorney for Property, Section 8 of the Substitute Decisions Act, 1992 addresses capacity to grant the document. Section 47 addresses capacity to grant a Power of Attorney for Personal Care.

Neither age nor a diagnosis should replace that assessment.

Get the Instructions Right and Keep the Evidence

If you are helping a parent arrange Powers of Attorney, expect the lawyer to want a private conversation with your parent. That protects your parent’s opportunity to speak freely and helps establish that the instructions are theirs.

Where language is an issue, arrange an independent interpreter. Where an appointment is changing, the reasons should be explored and recorded. If capacity is in question, further assessment may be appropriate.

If you are concerned about a document already signed, preserve the earlier Powers of Attorney and make a dated record of the events causing concern. Identify who arranged the document, who attended and what your parent said at the time. If money is being moved or access to care is affected, delay may make the problem harder to address.

A properly prepared Power of Attorney should make life easier when help is needed. Taking care with the instructions and signing process can prevent it from becoming the next family dispute.

MKC Law Office in Peterborough assists clients with preparing Powers of Attorney and understanding the authority those documents confer. To discuss your arrangements or concerns about an existing appointment, call 705-748-2241.

Ian Keay