One of the most important steps of setting up an estate plan is to name an executor of your estate. The executor is the person, or people, who will be responsible for managing the estate and ensuring the instructions the deceased left in a will are carried out. An executor will also be responsible for confirming the finances for the estate and ensuring all of the deceased’s property is accounted for. At certain points in a person’s life, one may need assistance in their day-to-day or financial affairs. To do this, they may name somebody as their power of attorney for personal care, or their power of attorney for property. The person acting as power of attorney is able to make decisions for the other as it relates to which type of power of attorney they have been assigned. A power of attorney for personal care may be responsible for making health decisions for the other, while a power of attorney for property may be responsible for financial decisions.

When someone dies, the executor of the estate or the beneficiaries may want a power of attorney for property to participate in a passing of accounts, which is a process through which the accounts the power of attorney was responsible for are audited. However, the law can present many nuances which lead to disagreements over how estates are managed. In a recent decision from the Ontario Superior Court of Justice, the former wife of the deceased was not satisfied with the financial information provided by her former husband’s granddaughter/power of attorney. She requested more detail, but the granddaughter stated her grandfather may have named her power of attorney for property, but she did not actually perform that role since he was capable of doing so up until his death.

Former spouse seeks passing of accounts

The granddaughter (“CT”) was appointed power of attorney for the deceased in early 2015. At this time, a joint account between the deceased and CT was opened. At this time, he also stopped living in his home and moved into an assisted living facility.

Upon the deceased’s death, his former spouse (“IW”) had questions about some transactions that took place in the joint account, particularly an unexplained cash withdrawal of $4,000, a $10,500 gift to CT to renovate her bathroom, “personal” expenditures of $4,461.15, Tim Horton’s card expenses of $7,210, and cash taken out for the deceased totalling $7,040.

Granddaughter says deceased was capable of managing finances

CT told the court that she and the deceased had an agreement that she would pay his bills and then reimburse herself from the joint account. When IW expressed she was not satisfied with the banking information provided by CT, the former told the court that while she was named power of attorney for the deceased, she did not exercise those powers “if at all, until the very end” of the deceased’s life. She said the deceased was perfectly capable of managing his own finances until he died, and that she only accessed the joint account when he instructed her to do so. She added that if he had objected to any transactions involving the account, he could have and would have done so while he was alive.

The court heard evidence that the deceased was physically infirm, and that he suffered from occasional bouts of depression, but was not provided with much in the way of evidence to support claims that he was not able to manage his finances. Much of the evidence provided by IW was anecdotal.

What does the evidence say about the deceased’s ability to manage finances?

The court looked at the relationship each party had with the deceased, noting that CT had spent a great deal of time with him over the years preceding his death, while IW saw him only infrequently. While IW took the position that the deceased was incapable of making financial decisions, she was unable to back that up with evidence save for a neighbour’s written statement concerning the deceased’s behaviour. The court could not accept that statement as evidence because it amounted to hearsay.

At the same time, CT’s evidence tended to be backed up by others, including his partner/companion at the time of his death who said she had no concerns about the deceased’s state of mind in the months before his death. She said they regularly spent time together and that he understood the value of money, controlled his own wallet, and paid for things when they went out (including charges to a Tim Horton’s card). At times, however, his depression did lead him to pull away from relationships. CT provided evidence from doctors, though they were not able to comment on his ability to make financial decisions, instead, they stated that he received medication related to depression.

The court stated that it had no reason to find that the deceased was not able to manage his own finances, again largely because IW had failed to present any evidence to support such a claim. Furthermore, the court looked at the account activities challenged by IW and found that they were not improper and showed no indication of routine “siphoning off” of funds. Because of this, the court found the accounts to be approved as submitted and that no passing of accounts was necessary.

Contact Campbell Litigation if you are involved in an estate of inheritance dispute

The estate litigation team of Campbell Litigation led by Richard Campbell understands that disputes over what happens to the estate of a loved one can be a costly and time-consuming process at a period when emotions are already strained. We regularly work with clients on both ends of estate disputes, including those looking to enforce or challenge a will, trust, or estate. We defend estates against claims and represent clients who look to make a claim against an estate, including those related to spousal or child support. Please contact us online or by phone at 519-886-1204 to talk today.