Court File and Parties
COURT FILE NO.: CV-14-497611 DATE: 20170418 ONTARIO SUPERIOR COURT OF JUSTICE
B E T W E E N:
MARIA FERNANDA MELO-AVELINO Moving Party
- and -
DEOLINDA DE MELO and CARLOS DE MELO and MARIA ANTOINETTA ANGELO DE MELO Responding Parties
COUNSEL: John R. Hart, for the Moving Party Courtney Kazembe, for the Responding Parties
DECISION
D.L. Corbett J.:
[1] This motion comes to me by way of a circuitous route.
[2] This matter concerns the care of Deolinda De Melo, an elderly woman who has been found to be incapable of managing her own property. The moving party, Maria Melo-Avelino, is Deolinda’s daughter. The responding party Carlos De Melo is Deolinda’s son.
[3] On April 7, 2011, Deolinda executed powers of attorney for personal care and for property appointing her daughter Maria as her attorney.
[4] On April 29, 2013, Dr David Tal assessed Deolinda as being “not capable of decisions regarding Property or Financial matters”. The basis of Dr Tal’s assessment was “moderate Alzheimer’s disease” and “verbal reasoning… [that] demonstrates SEVERE impairment, with performance below 1%, corrected for age, gender and education.”
[5] Deolinda executed powers of attorney on November 11, 2013, appointing her son Carlos as her attorney for personal care and for property.
[6] For many years Carlos lived with his mother and he has continued to do so since 2011.
[7] Maria commenced an application for a declaration that the 2013 powers of attorney are not valid, that the 2011 powers of attorney are valid, and for an order appointing her as her mother’s attorney for personal care and for property.
[8] The application came on before me on April 15, 2014. I ordered that the application proceed to trial on all issues and that, in the interim, the 2013 powers of attorney would govern, without prejudice to a further motion to set aside the 2013 powers of attorney. I seized myself of case management of the application and advised the parties that they could return before me if they had any difficulties moving the matter to trial.
[9] Almost 3 years later, the parties sought an appointment before me. It turned out that the appointment was not for some sort of case management order or direction. The application had been settled back in the summer of 2014. The parties now had a disagreement arising out of their settlement. In bringing it before me they were able to expedite the process for obtaining a court date and they avoided the cost and inconvenience of commencing a fresh application.
[10] I intend to deal with the current motion with the same view to a practical resolution of matters that the court brought to bear back in 2014.
[11] Deolinda is very elderly: she turns 87 in October 2017). She has had a diagnosis of moderate Alzheimer’s disease since at least as early as April 2013. She owns the house in which she lives but has no other material assets. She has modest monthly income (around $1400 per month). She is cared for by her son, in her own home, and thus she does not incur expense for attendant care or for a professionally supported living facility.
[12] In recognition that there were few assets and little income, the parties came to a practical arrangement in the summer of 2014. Deolinda’s money would be managed by the lawyers, in a trust arrangement, and Deolinda would continue to live in her home with her son. Her daughter Maria would have a broad ability to exercise access, and so she would be able to see for herself how Deolinda was faring from a health and daily living point of view.
[13] The trust arrangements with the lawyers have apparently provided satisfactory oversight for large financial decisions (of which there have been few), but almost no oversight of monthly living expenses. Instead of all Deolinda’s money flowing through bank accounts managed by the lawyers, the money is controlled by Carlos. Maria has asked for an accounting of the monthly income and expenses and is not satisfied with the explanations that she has been given.
[14] Maria has not been exercising access: she says that she does not go because she is afraid of her brother, and Carlos says that there is no impediment to Maria coming to see their mother, and that he wishes that she would do so: it would brighten Deolinda’s life to see Maria.
[15] On this motion, Maria asks that I declare that the settlement was void from the outset, or alternatively, that I set it aside as having been breached. She asks that I put her in charge on the strength of the 2011 powers of attorney.
[16] The lawyers do not wish to continue to be involved as trustees of Deolinda’s money: since the current arrangements do not satisfy all parties that the money is being managed reasonably, then the lawyers do not want to continue. Deolinda does not have enough money to pay for professional trustees and the lawyers do not want to continue to provide a free service if the current informal arrangements are not satisfactory to the entire family.
[17] Carlos does not much care whether the current arrangement remains in place or whether he manages his mother’s affairs under the 2013 powers of attorney. He opposes having his sister put in charge of family finances.
[18] In my view: (i) The trust arrangements ought to be set aside, which has the effect of undoing the settlement between the parties back in 2014. I would not make this order effective back to 2014 (ie I would not declare the settlement void from the outset – the parties have changed their positions over the past 2.5 years on the strength of the settlement agreement). (ii) The record on the relative strength of the parties’ cases and the practicalities of the situation are no different today than they were when the case was before me in April 2014: I would direct that issues concerning the validity of the competing powers of attorney go to trial. (iii) On the record before me, it does not seem to me that there is any serious concern of material financial mismanagement by Carlos: Deolinda’s monthly income is modest and the savings to Deolinda resulting from Carlos being present in the home to care for her seems to more than outweigh any incidental benefit he may be receiving. (iv) There are insufficient assets and income available to justify regular formal accountings. Carlos will be required to account for his exercise of the powers of attorney periodically and at the termination of those powers of attorney. I would not require a formal accounting at this time: the information provided satisfies me of the propriety of substantial transactions, and of the reasonableness of the general monthly arrangements. (v) If any interim orders are required to protect Deolinda’s property (ie the equity in her house), I would be prepared to grant such an order, so that the position of all parties is reasonably protected in the long run.
[19] On this basis, order to go as follows: (a) Settlement agreement terminated as of March 15, 2017; (b) Trust under the settlement agreement terminated effective March 15, 2017; (c) Any accounting of the trust activities from the start of the trust to March 15, 2017 stayed until further court order or the death of Deolinda De Melo; (d) My order of April 15, 2014 is revived and continued on the terms set out in that order effective March 15, 2017; (e) Any accounting by Carlos of his activities as attorney for Deolinda under the powers of attorney dated in November 2013 shall not be required until ordered by a court or the death of Deolinda De Melo; (f) Any party may apply to this court for an order protecting assets of Deolinda De Melo, by way of motion brought before me at 9:00 am any day I am sitting, to be arranged with my assistant, on reasonable notice to all affected parties; and (g) Maria shall be entitled to see her mother, on reasonable notice to Carlos, to be arranged between the parties. If there are difficulties bringing this about, any party may seek further directions from my by appointment at 9:00 am any day I am sitting, to be arranged with my assistant.
[20] In my view the parties ought to bear their own costs of this motion.