The validity of powers of attorney can be challenged on the basis that the grantor was incapable when she signed the power of attorney. The requisite capacity to grant a power of attorney for property is set out in s. 8(1) of the Substitute Decisions Act, 1992, SO 1992, c. 30 (the “SDA”) which provides that:
8(1) A person is capable of giving a continuing power of attorney if he or she,
(a) knows what kind of property he or she has and its approximate value;
(b) is aware of obligations owed to his or her dependants;
(c) knows that the attorney will be able to do on the person’s behalf anything in respect of property that the person could do if capable, except make a will, subject to the conditions and restrictions set out in the power of attorney;
(d) knows that the attorney must account for his or her dealings with the person’s property;
(e) knows that he or she may, if capable, revoke the continuing power of attorney;
(f) appreciates that unless the attorney manages the property prudently its value may decline; and
(g) appreciates the possibility that the attorney could misuse the authority given to him or her.
Section 8(2) of the SDA provides that a person is capable of revoking a continuing power of attorney if he or she is capable of giving one. Importantly, the SDA provides that a person can be capable of granting and revoking a continuing power of attorney for property even if that person is incapable of managing their property (s. 9(1)).
The SDA also sets out the requisite capacity to grant a power of attorney for personal care. Section 47(1) provides that:
47(1) A person is capable of giving a power of attorney for personal care if the person,
(a) has the ability to understand whether the proposed attorney has a genuine concern for the person’s welfare; and
(b) appreciates that the person may need to have the proposed attorney make decisions for the person.
Similar to powers of attorney for property, the SDA provides that a person is capable of revoking a power of attorney for personal care if he or she is capable of giving one (s. 47(3)), and that a power of attorney for personal care is valid if, at the time it was executed, the grantor was capable of giving it even if the grantor is incapable of person care (s. 47(2)).
While the SDA sets out the legal test for a grantor’s capacity to grant and revoke a power of attorney, it does not provide what evidence a challenger of a power of attorney should marshal. Typically the challenger of a power of attorney will obtain the file of the lawyer who prepared the power of attorney (if they were prepared by a lawyer). The drafting lawyer will often be examined on their file and the preparation and signing of the powers of attorney. Where the powers of attorney were not prepared by a lawyer (for example prepared by the grantor from a fill-in-the-blanks form), the challenger may seek to examine the individuals who witnessed the grantor signing the powers of attorney.
The grantor’s medical records covering the period of time leading up to the date of the powers of attorney and beyond are also often sought. These medical records become relevant to a professional who can provide a medical opinion on the capacity of the grantor at the time the powers of attorney were signed. Last but not least is the evidence of the family, friends, and caregivers who have witnessed the grantor day-to-day or week-to-week and can attest to the grantor’s behaviour and conduct. Whether a grantor has capacity to grant and revoke powers of attorney is a legal test but it is not limited to the legal opinion of the lawyer who drafted the powers of attorney.
