July 25, 2023
In the world of estate litigation, an issue that frequently arises is the capacity of an elderly individual to create a will or execute a power of attorney. As is widely known, there are different levels of capacity required for an individual to carry out different tasks; the highest level of capacity is required for a testator to create or alter his or her will.
A similar issue, though perhaps less discussed, is that of the capacity needed to retain and instruct counsel. The case Calvert (litigation guardian of) v. Calvert, 1997 CanLII 12096 (ON SC) notes that this similarly requires a high level of capacity. The reasons for this are clear: just like creating a will, instructing one’s lawyer requires the ability to engage in long-term or strategic thinking, assess risk and understand legal principles.
An individual incapable of retaining or instructing counsel due to mental or cognitive incapacity, is referred to as being “under disability”; this term may also be used to refer to minors and absentees. There are a number of laws in Ontario that make provisions for individuals under disability, notably Rule 7 of the Rules of Civil Procedure, which establishes that persons under disability are to be represented by a litigation guardian. The scope of a litigation guardian’s duties is narrower than those of a guardian or attorney, and relate only to the legal proceedings for which he or she was appointed. Often the litigation is a family member, however a lawyer or the Public Guardian and Trustee of Ontario may act as well. The Court has the authority to order the individual in question to be assessed to determine capacity, under both the Courts of Justice Act and the Substitute Decisions Act, and will generally rely on the opinion of a qualified capacity assessor.
The relevant tests are explained in a helpful case called Costantino v. Costantino, 2016 ONSC 7279. Firstly, the test for the capacity to instruct counsel includes the requirements that the person in question must understand the nature of what they have instructed, must be able to process the lawyer’s advice and the options presented, and that the individual must comprehend the benefits and risks of the various options that are available. The Court also provides another, more detailed, series of seven factors to be considered when determining if a party is under disability and thus requiring a litigation guardian. Further, the Court provides a clear instruction on the onus of proof and standard of proof required for such a finding to be made.
Of note, in this case Justice Price makes sure to explain who does not qualify as a person under disability that must be represented by a litigation guardian, quoting an earlier case, C.C. v. Children’s Aid Society of Toronto. This case points out that there is a clear line between litigants that are unable to understand the risks and consequences of their decisions and those that merely fail to understand these same risks and consequences. The latter group is not under disability, and does not need a litigation guardian. In particular, such individuals may not, after the fact, seek to undo steps taken in the litigation or withdraw from a previously agreed-upon settlement on the grounds that he or she failed to understand the consequences of these earlier decisions, unless clear evidence is provided that the person was in fact incapable when these decisions were made, and that a litigation guardian ought to have been acting at the time.