COURT FILE NO.: CV-20-00636762-0000
DATE: 20210128
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
SUSAN ENG AS LITIGATION GUARDIAN FOR PUI KWAN ENG
Plaintiff
– and –
ELIZABETH ENG and KAVEH RAHRAVANI
Defendants
Paul Portman, for the Plaintiff
John Polyzogopoulos, for the Defendants
HEARD: January 20, 2021
papageorgiou j.
[1] The defendants Elizabeth Eng (“Elizabeth”) and Kaveh Rahravani (“Kaveh”) have brought a motion:
a. To stay or dismiss this action on the basis that it has been improperly commenced by the litigation guardian Susan Eng (“Susan”). The defendants assert that the defendant Pui Kwan Eng (“Pui”) is not under a disability and therefore the proceeding has been commenced by someone without legal capacity to commence the action. They rely upon r. 21.01(3)(b);
b. In the alternative, an order removing Susan as litigation guardian and removing Epstein & Associates as counsel of record for the plaintiff.
[2] For the reasons that follow I am dismissing the defendants’ motions.
Nature of the Action
[3] All the parties are family members. Pui is 90 years old and she is the mother of Elizabeth and Susan. Kaveh is Elizabeth’s husband.
[4] Susan commenced this action as litigation guardian for Pui seeking $370,723.75 and other relief on the basis that Elizabeth and Kaveh misappropriated funds from the sale of Pui’s home, used some of that money to purchase their own home and/or failed to repay loans which she advanced to them. The plaintiff pleads in para. 19:
The plaintiff was improperly taken advantage of due to her poor education, inability to speak English the consequences of her suffering a stroke and her ability to only communicate in a specific dialect of Toishan.
[5] This case is essentially about alleged elder abuse.
The plaintiff’s basis for the appointment of a litigation guardian
[6] Susan relies upon the Capacity Assessment dated December 19, 2019 (the “Capacity Assessment”) conducted by Rena Postoff, a social worker and Designated Capacity Assessor within the meaning of s. 1(1) of the Substitutes Decision Act, 1992, S.O. 1992, c. 30 (“SDA”). The Designated Capacity Assessor concluded that Pui has the capacity to manage her property, but not to instruct counsel.
[7] The defendants say that there is no such thing as “capacity to instruct counsel” and that having found that Pui has the capacity to manage her property, there is no basis for the appointment of a litigation guardian under the Rules of Civil Procedure, R.R.O. 1990, Reg. 194.
Rule 7
[8] I begin the analysis with r. 7 which governs the appointment of litigation guardians.
[9] Rule 7 provides that:
7.01(1) Unless the court orders or a statute provides otherwise, a proceeding shall be commenced, continued or defended on behalf of a party under disability by a litigation guardian.
7.02(2) No person except the Children’s Lawyer or the Public Guardian and Trustee shall act as a litigation guardian for a plaintiff or applicant who is under disability until the person has filed an affidavit in which the person,
(a) consents to act as litigation guardian in the proceeding;
(b) confirms that he or she has given written authority to a named lawyer to act in the proceeding;
(c) provides evidence concerning the nature and extent of the disability;
(d) in the case of a minor, states the minor’s birth date;
(e) states whether he or she and the person under disability are ordinarily resident in Ontario;
(f) sets out his or her relationship, if any, to the person under disability;
(g) states that he or she has no interest in the proceeding adverse to that of the person under disability; and
(h) acknowledges that he or she has been informed of his or her liability to pay personally any costs awarded against him or her or against the person under disability. [Emphasis added.]
[10] Susan commenced the proceeding after filing an affidavit which satisfies the criteria in r. 7.02(2) and therefore, in my view, the proceeding was properly commenced.
[11] The defendants seek to go behind the Designated Capacity Assessor’s conclusion that Pui is under a disability.
[12] Pursuant to r. 1.03(h), “disability” where used in respect of a person who is not a minor means “mentally incapable within the meaning of section 6 or 45 of the Substitute Decisions Act, 1992 in respect of an issue in the proceeding” (emphasis added).
[13] Section 6 of the SDA provides as follows:
6 A person is incapable of managing property if the person is not able to understand information that is relevant to making a decision in the management of his or her property, or is not able to appreciate the reasonably foreseeable consequences of a decision or lack of decision.
(Section 45 of the SDA, although referenced in r. 1.03(h) is not relevant to these proceedings as it speaks to a person’s ability to personally care for herself which is not in issue.)
[14] The defendants say that since the Designated Capacity Assessor concluded that Pui has the capacity to manage her property in general, she cannot be found to be under a “disability” for the purposes of rr. 1 and 7.
[15] They implicitly argue that a person either has capacity or none and that there cannot be different capacities required for different tasks. This approach has been specifically rejected in the Capacity Assessment Office, Guidelines for Conducting Assessments of Capacity (Toronto: Ministry of the Attorney General, 2005), (the “Guidelines”) which states:
The SDA rejects the notion of global incapacity and instead recognizes that capacity may be limited only with respect to certain decisions or classes of decisions. When the assessor receives a request for a capacity assessment, the first question to ask is “capacity for what”? At the broadest level, the law distinguishes between the ability to make personal care and financial decisions, recognizing that a person may lack capacity in one area but not the other.
[16] They also implicitly argue that for a party to be under a “disability”, a party must be found to be incapable of managing all of their property under s. 45 of the SDA.
[17] I disagree.
[18] Although 1.013(h) and 7 of the Rules reference the definitions in s. 6 of the SDA, different considerations apply.
[19] The capacity inquiry that is relevant for the determination of whether someone is under a “disability” for the purposes of the Rules is specifically with reference to “an issue in the proceeding”: 626381 Ontario Ltd. v. Kagan, Shastri, 2013 ONSC 4114, at para 21, Huang v. Braga, 2016 ONSC 6306, at para. 18 (“Huang”). (I note that I referred the parties to Kagan and the Regulations under the SDA for further submissions after the motion was argued, because the law before me was incomplete for the purposes of my rendering a fair and just decision which complied with the Rules.)
[20] In Huang, the Court concluded that the party was under a disability and appointed a litigation guardian in similar circumstances where the Designated Capacity Assessor concluded that the party was capable of managing her property, but incapable of acting for herself in the proceeding: paras 11 and 51.
[21] In, Kagan Justice Stinson described the relevant considerations for finding that a party is under a “disability” for the purposes of the Rules as follows:
[25] … the question is whether the person is able to understand information that is relevant to making a decision in respect of an issue in the proceeding or able to appreciate the reasonably foreseeable consequences of a decision or lack of decision in respect of an issue in the proceeding. As stated in Torok v. Toronto Transit Commission, at para. 40:
The ability to appreciate the reasonably foreseeable consequences of a decision or lack of decision in the litigation includes the ability to consider a reasonable range of possible outcomes, including those that are unfavourable. This ability is essentially the capacity to assess risk, which requires consideration of a variety of results, both positive and negative.
[22] Kagan and Huang support Susan’s interpretation of the applicable standard for ascertaining whether a party is under a disability as directly related to the litigation in question, and not a general question of the party’s capacity to manage all of their property.
[23] In Kagan, Justice Stinson set out the following factors which should be present in a report for the purposes of assessing whether a party is under a disability:
(a) The report should describe the qualifications of the "assessor". When used in this context, "assessor" refers to the professional who will be preparing the report. She or he may but need not be a "health practitioner" as defined in s. 105 of the CJA, nor need they be a qualified "assessor" within the scope of the SDA. The person should, however, have proper credentials and experience sufficient to qualify him or her to provide the opinion sought. The report should include a detailed description of those credentials and experience.
(b) The report should confirm that the author is familiar with the purpose of the examination and the report and the applicable test.
(c) The report should include confirmation that the assessor has sufficient familiarity with the nature and scope of the litigation in which N.A. is involved to apply the test properly.
(d) The report should include a statement as to the scope of information that the author considered necessary to arrive at the required professional opinion, including collateral data such as prior medical history and records, and an explanation as to the reasons why that information is required and sufficient.
(e) The report should include a description of the information sought and provided in connection with the opinion sought and its sufficiency.
(f) The report should include a description of the examination conducted and the observations made.
(g) Lastly, the report should contain an expression of the author's opinion, with specific reference to the test, and an explanation as to the grounds for the conclusions reached.
[24] The Capacity Assessment concluded that the plaintiff has the general capacity to manage property following her assessment of very basic functions such as Pui’s ability to identify her family members, recall things/events, identify coins by name and value, knowing what her income is from her pension, knowledge about what her assets were, an understanding of and simplistic ability to explain why it’s important to have savings, the purpose of a power of attorney and the purpose of a will.
[25] With respect to Pui’s capacity to retain/instruct counsel, the Designated Capacity Assessor applied the following specific test in the Capacity Assessment, which I find is consistent with the considerations set out in Kagan:
With regards to retaining/instructing counsel, a person must demonstrate the following:
An understanding of what he/she wants a lawyer to do for him/her and why;
An ability to understand and process information, options and advice given to him/her; and
An ability to appreciate the advantages, disadvantages and consequences of different options.
In addition, the person must be able to communicate with counsel to instruct counsel; to understand the function of counsel and to know that he/she can dispense of counsel even if not in his/her best interest. Instructing counsel also requires an understanding of the financial/legal issues and the person must be capable throughout the proceedings.
[26] She concluded that Pui was “incapable of instructing counsel” for the following reasons:
On December 9, 2019, Ms. Eng demonstrated a poor understanding of the nature of the legal proceeding [“To get my money back.”]. She acknowledged needing help in dealing with her lawyer. She reported that she wanted Susan to represent her. She stated that she trusted Susan. She expressed confidence in her lawyer and saw no reason to make any changes. Given the complexity of a legal proceeding, in general, the time needed for Ms. Eng to process information since her stroke, and the apparent distress and agitation she demonstrated what her daughter Liz has done to her, it is my opinion that Ms. Eng is incapable of instructing her counsel. She is in need of a litigation guardian.
[27] As noted in Huang, at para. 18, incapacity stems from a source of mental incapacity such as mental illness, dementia, developmental delay or physical injury. It is critical that the Designated Capacity Assessor’s expressed reasons include Pui’s “poor understanding of the nature of the legal proceeding”, “the complexity of a legal proceeding”, “the time needed for Ms. Eng to process information since her stroke” (emphasis added).
[28] Pui has a specific mental impairment caused by a stroke. Given that she is 90 years old and this case is about alleged elder abuse, Pui’s distress and agitation is a factor which the Designated Capacity Assessor properly took into account.
[29] The defendants complain that there are facts set out in the Capacity Assessment which relate to Pui’s culture, education, training, language or cultural experiences and background which are not relevant to someone’s capacity: Huang, at para. 18; Limbani (Litigation Guardian of) v. Limbani, 1999 CarswellOnt 929 (Ct. J. (Gen. Div.)) at paras. 7-11.
[30] While the Capacity Assessment makes reference to some factors which may not be relevant to the assessment of whether she is under a disability for the purposes of the appointment of a litigation guardian under r. 7, these were background and not the basis for her conclusion which is very clearly set out.
[31] In my view, the evaluation done by the Designated Capacity Assessor is an appropriate nuanced assessment which reflects the relevant inquiry required as per Kagan.
[32] The Designated Capacity Assessor has specific training with respect to issues of capacity. Under Regulation 460/05 of the SDA, persons are qualified to conduct assessments if they successfully complete qualifying courses and have certain professional designations including being a social worker. Qualifying courses include instruction in the SDA, standards for the performance of assessments of capacity and procedures for determining if a person needs decisions to be made on her behalf. Designated Capacity Assessors must complete specified continuing education. As well, pursuant to s. 3(1) of Reg. 460/05, Designated Capacity Assessors must follow “Guidelines for Conducting Assessments of Capacity” established by the Attorney General.
[33] The Designated Capacity Assessor has met all training and ongoing certification requirements in compliance with the SDA. She has more than 40 years of experience doing clinical assessments in the field of geriatrics and adult mental health. She has also worked with clients who have suffered brain injuries [strokes, aneurysm, Traumatic Brain Injury] and she has done extensive teaching in the area of dementia, behaviour management, mental status assessments and elder abuse.
[34] The defendants chose not to cross-examine the Designated Capacity Assessor, although the plaintiff made her available for that purpose. They did not seek to conduct their own assessment of Pui. They also chose not to cross-examine Pui, although she was made available for this purpose.
[35] The defendants did not challenge the Designated Capacity Assessor’s qualifications or training apart from suggesting that her assessment was insufficient because she is not a medical doctor, but only a social worker. However, s. 2 of the SDA makes it clear that a Designated Capacity Assessor need not be a medical doctor and specifically states that social workers qualify.
[36] This is the defendants’ motion for the extraordinary remedy of a stay or dismissal; the onus is on them and they have not satisfied me that the proceeding was improperly instituted by Susan as litigation guardian on behalf of Pui.
[37] In my view there were sufficient factors set out in the Capacity Assessment which satisfy the test for “disability” set out in the Rules and the case law.
[38] On the record before me, I am satisfied that Pui does not have the requisite capacity required for the purposes of instructing counsel in this case and, as such, I am dismissing the defendants’ motion for a stay of the action.
Removal of Susan as litigation guardian and counsel for the plaintiff
[39] In the alternative, the defendants seek to remove Susan as litigation guardian on the basis of a conflict of interest.
[40] The defendants argue that Susan is under a “potential” conflict of interest because in June 2019 Pui executed a new Will and Power of Attorney (“POA”) pursuant to which Susan became estate trustee and attorney under powers of attorney. This new will cut Elizabeth out of any inheritance.
[41] The defendants argue that the alleged conflict stems from Susan’s interest to pursue litigation in order to increase the size of Pui’s estate since the larger the estate is, the more she stands to inherit. The defendants allege that there is evidence of suspicious circumstances and possible undue influence surrounding the execution of the new will and POA and the commencement of this action. They say that if the litigation proceeds, “there is a very good chance” that the defendants will be commencing a counterclaim for a declaration that the new POA and Will are invalid on the basis of undue influence or coercion.
[42] They also seek to remove counsel of record because he allegedly received instructions from Pui to prepare the new Will and POA and attended at their execution.
[43] I disagree.
[44] There is no evidence that Susan is not acting in Pui’s best interest. She is a family member with an interest in the ultimate estate, but courts have held that this is not sufficient to disqualify someone from being a litigation guardian; indeed, in most cases it is desirable to have a trusted family member or a person with close ties to the dependent adult: Gronnerud (Litigation Guardians of) v. Gronnerud Estate, 2002 SCC 38, [2002] 2 S.C.R. 417, at para. 21.
[45] The Rules of Civil Procedure do not require that the proposed litigation guardian have no interest in the proceeding, they only require that she have no interest adverse to that of the party under disability: Zabawskyj v. Zabawskyj, 2008 CanLII 19248 (ON SC), [2008] O.J. No. 1650 (Ont. S.C.), at para. 30.
[46] In this case, even taking into account Susan’s alleged interest in increasing the value of the estate, her interests and that of Pui are not adverse.
[47] This litigation as it presently stands does not involve the validity of the Will or the POA. There is no disqualifying conflict in my view at the present time and the possibility of a counterclaim which might raise a conflict does not suffice to grant the defendants the extreme remedy which they seek at this time.
[48] Accordingly, the motions are dismissed.
[49] The defendants requested costs in the amount of $27,000 if they were successful in staying the action and costs in the amount of $19,000 if they were partially successful. The plaintiff requested costs in the amount of $9,000.
[50] The plaintiff is presumptively entitled to costs as the successful party. In my view, given the complexity of this motion and the volume of materials, and the fact that the defendants’ requested partial indemnity costs are $19,000, the plaintiff’s claim for $9,000 is fair and reasonable. I award this amount payable within 20 days of the date of these reasons.
[51] I understand from defence counsel’s further submissions that there is a pending motion for a certificate of pending litigation returnable on March 1, 2021with a requirement that the defendants file responding material by February 1, 2021. He requested that if I dismissed these motions that I modify the timetable for this motion to extend the time for his filing of responding material to February 8, 2021 and that any cross-examinations be conducted within ten business days following the delivery of these materials. I so order. He also requested an adjournment of the scheduled March 1, 2021 return date. I am not prepared to adjourn the date without the consent of the plaintiff. If plaintiff will not consent then the parties should arrange a case conference to address this issue.
[52] The parties may forward a draft Order to my attention.
Papageorgiou J.
Released: January 28, 2021
COURT FILE NO.: CV-20-00636762-0000
DATE: 20210128
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
SUSAN ENG AS LITIGATION GUARDIAN FOR PUI KWAN ENG
Plaintiff
– and –
ELIZABETH ENG and KAVEH RAHRAVANI
Defendants
REASONS FOR JUDGMENT
Papageorgiou J.
Released: January 28, 2021