COURT FILE NO.: CV-20-00084597-0000
DATE: 2023-02-01
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: KATHLEEN REINBOLDT as ESTATE TRUSTEE FOR THE ESTATE OF COLLEEN CAMERON v. CAMERON
BEFORE: Associate Justice M. Fortier
COUNSEL: Jonathan P.M. Collings, for the Applicant
Craig O’Brien, for the Respondent
HEARD: October 13, 2022
E N D O R S E M E N T
Introduction
[1] The Applicant, Kathleen Reinboldt, brought this motion for directions seeking an order for a formal passing of accounts by the Respondent, Ronald Howard Cameron, for his time acting as his mother’s, Colleen Cameron’s, Power of Attorney for Property. Ms. Reinboldt is also seeking an order for directions with respect to a joint hearing/trial to deal with issues surrounding mortgage payments for a mortgage held in Mr. Cameron’s name. Mr. Cameron opposes the motion.
[2] Ms. Reinboldt and Mr. Cameron are siblings and the children of the deceased, Colleen Cameron (“Mrs. Cameron”).
[3] Ms. Reinboldt is the Estate Trustee of her mother’s estate and the sole beneficiary.
[4] Mr. Cameron acted under a Power of Attorney for Property (“POAP”) from March 16, 2017, until his mother’s death on May 27, 2018.
Background
[5] In October 2011, Mrs. Cameron moved into Orchard View Living Centre because she required assisted living. Although she had physical limitations, there is no evidence that Mrs. Cameron lacked legal capacity at any time.
[6] Mrs. Cameron remained at Orchard View until April 30, 2017, when she moved in with Mr. Cameron and his wife, Stephanie, until her death in May 2018.
[7] According to Mr. Cameron, Mrs. Cameron requested the move. The decision to have Mrs. Cameron reside with him and his wife was not made lightly, considering the significant care that Mrs. Cameron required due to her physical health. Following consultations with the Ontario Ministry of Health, the Local Health Integration Network and the Community Care Access Centre for approval, it was agreed that Stephanie would resign from her employment to act as Mrs. Cameron’s Personal Support Worker (“PSW”) on a full-time basis for reasonable compensation.
[8] Following further consultations with Mrs. Cameron, her lawyer, Michael Lever, and her accountant, Norman Adams, it was agreed that $5000 per month was a reasonable appraisal for the costs of Mrs. Cameron’s ongoing care at Mr. Cameron and Stephanie’s home. This amount included rent, Mrs. Cameron’s personal expenses and payment for Stephanie’s PSW costs.
[9] Changes to Mrs. Cameron’s POAPs and prior litigation reflect a history of difficulties and conflict within the family.
[10] Mrs. Cameron made three changes to the appointments of her POAPs over time. She first appointed Mr. Cameron and Ms. Reinboldt jointly in March 2013 as her POAP. She subsequently appointed solely Ms. Reinboldt in August 2013 as her POAP and Estate Trustee because of acrimony between the siblings as a result of litigation, which is described below. Finally, Mrs. Cameron removed Ms. Reinboldt as POAP and appointed Mr. Cameron as her POAP in March 2017, after discovering in the fall of 2016 that Ms. Reinboldt had allegedly inappropriately transferred some of Mrs. Cameron’s investments and withdrawn funds from her bank account.
[11] On August 15, 2013, a settlement was reached regarding unrelated litigation within the family. As part of the agreement, certain lands were transferred by Mrs. Cameron to Mr. Cameron, and a mortgage was placed on Mr. Cameron’s properties with Mrs. Cameron as mortgagee.
[12] Under the agreement, Mr. Cameron was required to pay his mother $1,500 per month, commencing September 1, 2013, until her death. Following her death, the mortgage was to be discharged provided that all the monthly payments of $1,500 were paid to the mortgagee. Any missed monthly payments would become due and owing to Mrs. Cameron’s Estate with interest at the rate of 5% per annum. Mr. Cameron was to provide evidence to the Executor of Mrs. Cameron’s Estate that all the monthly payments were made.
[13] Ms. Reinboldt alleges that she has requested financial disclosure of all transactions but was only given inadequate responses. Moreover, she argues that, pursuant to her calculations, up to $47,500 may be due and owing under the mortgage, which amount, she claims, remains unpaid.
Issues
1- Should the Respondent formally pass accounts as POAP for Mrs. Cameron?
2- If so, should the issue with respect to the Mortgage be tried jointly with the passing of accounts?
Position of the Parties
[14] According to Ms. Reinboldt, Mr. Cameron has provided inadequate accounting for his financial management of Mrs. Cameron’s funds. She alleges that unexplained transactions in their mother’s bank accounts during and after the term of the Respondent’s POAP merit a full passing of accounts.
[15] Although Ms. Reinboldt concedes that Mr. Cameron has provided a significant amount of disclosure, she argues that the formal passing of accounts is necessary so that everything can be put together in an easy, succinct, digestible and potentially challengeable format.
[16] Ms. Reinboldt is particularly concerned about mortgage payments payable to Mrs. Cameron, pursuant to the agreement between the parties in 2013.
[17] Ms. Reinboldt argues that a passing of accounts is necessarily intertwined with an accounting of any payments made under the mortgage, as certain of those alleged payments were immediately withdrawn. The Applicant contends that theses issues require adjudication together, in order to ensure that Mr. Cameon was not effectively paying for the Mortgage out of Mrs. Cameron’s funds.
[18] Mr. Cameron states that over the course of two years, he has produced continuous voluminous disclosure to Ms. Reinboldt in support of his time as POAP, such that he has already informally passed his accounts to her. Mr. Cameron provided a letter to the court from Mr. Adams stating that he has provided Mr. Cameron with all the financial records in his possession and he has no additional accounting records to provide.
[19] Moreover, Mr. Cameron argues that despite the production of significant disclosure, Ms. Reinboldt has brought this motion for directions seeking a formal passing of accounts without specifying any alleged deficiencies in the informal accounting produced to date.
[20] Mr. Cameron maintains that not only has he made all the mortgage payments, he has in fact overpaid for the mortgage beyond his obligation and it should be discharged from title.
[21] In particular, pursuant to the agreement, Mr. Cameron was to start making the payments of $1,500 beginning September 1, 2013, until May 1, 2018. This period equates to 57 monthly payments, whereas Mr. Cameron has made 62 monthly payments and therefore takes the position that he has overpaid the mortgage. He is not seeking a reimbursement.
[22] A summary chart listing the total mortgage payments including copies of the mortgage cheques were provided to Ms. Reinboldt. Mr. Cameron indicates that Ms. Reinboldt has failed to show which mortgage payments remain in dispute or provide any particulars regarding the alleged missed payments.
Disposition
[23] The Applicant’s motion for an order requiring the Respondent to pass his accounts as POAP for Colleen Cameron from March 16, 2017, to May 27, 2018, is dismissed.
The Law and Analysis
[24] Rule 74.15 of the Rules of Civil Procedure[^1] sets out a series of orders for assistance in estate matters. Rule 74.15(1)(i) provides that any person who appears to have a financial interest in an estate may bring a motion for an order “providing for any other matter that the court directs”.
[25] Rule 75.06 sets out the requirements for a motion for directions. Rule 75.06(1) states that “any person who appears to have a financial interest in an estate may apply for directions, or move for directions in another proceeding under this rule, as to the procedure for bringing any matter before the court”. Rule 75.06(3) sets out the powers of the court, including giving directions for “such other procedures as are just”.
[26] I am satisfied that the Applicant is a person who appears to have a financial interest in the estate. I am also satisfied that the court has jurisdiction pursuant to rr. 74.15 and 75.06 of the Rules to require the passing of accounts and to order a joint hearing with other issues on the Application as an Order for Assistance or an Order Giving Directions.
[27] The passing of an attorney’s accounts is dealt with in s. 42(1) of the Substitute Decisions Act (the “SDA”)[^2] and provides that “the court may, on application, order that all or a specified part of the accounts of an attorney or guardian of property be passed”.
[28] Pursuant to s. 42(2) of the SDA, a grantor may apply to pass the attorney’s account. Accordingly, Ms. Reinboldt as Estate Trustee for the Estate of Mrs. Cameron has the authority to apply to pass Mr. Cameron’s accounts.
[29] The language of s. 42(1) of the SDA is permissive, and it remains in the court’s discretion to order a passing of accounts. As held by the Ontario Court of Appeal in Dzelme v. Dzelme:
Section 42(1) of the SDA states: “The court may, on application, order that all or a specified part of the accounts of an attorney or guardian of property be passed” (emphasis added). Even if a person has standing to apply under s. 42(4) of the SDA, it remains in the discretion of the court to order a passing of accounts[^3]
[30] In Dzelme, the Court of Appeal held that the court ought to consider the following two factors when exercising its discretion under s. 42(1) of the SDA:
a) the extent of the attorney’s involvement in the grantor’s financial affairs; and
b) whether the applicant has raised a significant concern in respect of the management of the grantor’s affairs to warrant an accounting.[^4]
[31] If the allegations of misfeasance or wrongdoing are ill defined or the record lacks robust evidence, the court may, in exercising its discretion, dismiss the application requiring an attorney to pass their accounts.
[32] In Lewis v. Lewis, the Ontario Court of Appeal upheld the application judge’s decision to dismiss the application requiring the respondents to pass their accounts. In that case the appellants made veiled allegations of misfeasance or wrongdoing and “the record [fell] far short and lack[ed] evidentiary stamina to suggest that there [was] any direct allegation of misfeasance or wrongdoing”.[^5]
The extent of the attorney’s involvement in the grantor’s financial affairs
[33] Mr. Cameron was involved for a short time in Mrs. Cameron’s financial affairs. The record shows that he provided robust accounting to Ms. Reinboldt for that period.
[34] Mr. Cameron was involved in his mother’s financial affairs for a little over a year, from March 2017 to May 2018. Mr. Cameron’s uncontroverted evidence is that he only acted on financial decisions made by Mrs. Cameron based on her instructions and with her express consent, and at no point prior to Mrs. Cameron’s death did she lose her legal capacity.[^6]
Whether the Applicant has raised a significant concern in respect of the management of the grantor’s affairs to warrant an accounting
[35] In support of her motion, Ms. Reinboldt provided a five-page, 13-paragraph affidavit, most of which reproduced paragraphs from the agreements between the parties relating to the 2013 litigation. Three short paragraphs in Ms. Reinboldt’s affidavit support her motion for an order requiring the Respondent to pass his accounts. The three paragraphs make vague allegations of inadequate accounting, with regards to Mr. Cameron’s account of Mrs. Cameron’s funds, without listed particulars to support the aforementioned contention. The three paragraphs are as follows:
Ronald acted under a power of attorney for property from March 16, 2017 to Colleen’s death on May 27, 2018 but has provided inadequate accounting for his financial management of her funds.
There are unexplained transactions in Colleen’s bank accounts during and after the term of Ronald’s power of attorney that merits a full passing of accounts to take place.
A passing of accounts is necessarily intertwined with an accounting of any payments made under the Mortgage as certain of those alleged payments were immediately followed by withdrawals. These issues therefore required adjudication together in order to ensure that Ronald was not effectively paying for the Mortgage out of Colleen’s funds.
[36] I note that no evidence in the record indicates any concerns Ms. Reinboldt may have had with the transactions related to Mrs. Cameron’s care while she was living with Mr. Cameron and his wife. Rather, Ms. Reinboldt’s emphasis appears to be on the mortgage payments related to the 2013 agreement. Although Ms. Reinboldt alleges that there may have been missed mortgage payments, she has failed to show which mortgage payments remain in dispute, despite the summary chart listing the total mortgage payments made, and copies of the mortgage cheques provided to her by Mr. Cameron.
[37] In contrast, Mr. Cameron filed a 59-paragraph affidavit with numerous exhibits containing an extensive accounting for the period during which he was the POAP for Mrs. Cameron. The affidavit includes information from Mrs. Cameron’s accountant that he had no additional accounting records to provide to the court. Mr. Cameron provided details with respect to expenses incurred in relation to Mrs. Cameron’s care while she resided with him and his wife.
[38] Included in the exhibits attached to Mr. Cameron’s affidavit are accounting records prepared by Mr. Adams that contain:
- A balance sheet summarizing the assets of Mrs. Cameron’s estate as of December 31, 2018;
- A profit and loss statement summarizing the income and total expenses of Mrs. Cameron’s estate as of December 31, 2018;
- Detailed transactions statements for each of Mrs. Cameron’s accounts from March 2017 to May 2018;
- A deposit and disbursement transaction statement from January 217 to May 2018 for each of Mrs. Cameron’s accounts.
[39] A particulars chart, provided by Mr. Cameron to Ms. Reinboldt in September 2021, along with source documentation in support of the particulars chart also formed part of the record. The chart includes details with respect to Mrs. Cameron’s old age security, her Canada Pension Plan payments, her bank service charges, her funeral expenses, gifts that Mr. Cameron was instructed by Mrs. Cameron to provide to her grandchildren, information about Stephanie’s PSW work, confirmation of medical expenses and personal care fees for Mrs. Cameron, clarification on legal fees paid on behalf of Mrs. Cameron, and information about Mrs. Cameras rent charges.
[40] The evidence is clear that since May 2021, Mr. Cameron has disclosed hundreds of pages of documents, provided detailed responses to Ms. Reinboldt questions and sought assistance from Mrs. Cameron’s accountant to prepare the necessary accounting requested by Ms. Reinboldt.
[41] In my view, the Applicant has failed to raise a significant concern of Mr. Cameron’s management of Mrs. Cameron’s affairs to warrant the passing of accounts. The record is clear that at no time did Ms. Reinboldt specify what issues or concerns she has with the accounting provided by Mr. Cameron to date, including in support of this motion. Moreover, Ms. Reinboldt’s veiled allegations of inadequate accounting are not supported by the evidence. As was the case in Lewis, the record in this matter falls far short and lacks evidentiary stamina to suggest that there is any direct allegation of misfeasance, wrongdoing or inadequate accounting.
[42] Finally, the Applicant’s desire to have a formal passing of accounts so that everything can be put together in an easy, succinct, digestible and potentially challengeable format is not a reason upon which the court ought to exercise its discretion pursuant to s. 42(1) of the SDA to order the passing of accounts.
Conclusion
[43] For the reasons outlined above, and in exercising my discretion pursuant to s. 42(1) of the SDA, the Applicant’s motion for an order for a formal passing of accounts by the Respondent, Ronald Howard Cameron, for his time acting as Colleen Cameron’s Power of Attorney for Property is dismissed.
[44] The parties are to schedule a case conference before me to establish a timetable for the hearing of the Application addressing the issues related to the charge, known as Instrument OCI1867326, on Title against Mr. Cameron’s land.
[45] Costs of the motion are awarded to the Respondent. If the parties cannot agree on the amount of costs payable to the Respondent, they may make submissions on the quantum of costs at the case conference referred to above.
Marie T. Fortier
Associate Justice Fortier
DATE: February 1, 2023
COURT FILE NO.: CV-20-00084597-0000
DATE: 2022-MM-DD
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: KATHLEEN REINBOLDT as ESTATE TRUSTEE FOR THE ESTATE OF COLLEEN CAMERON v. CAMERON
BEFORE: Associate Justice M. Fortier
COUNSEL: Jonathan P.M. Collings, for the Applicant
Craig O’Brien and Caitlin Cardill, for the Respondent
ENDORSEMENT
Associate Justice M. Fortier
DATE: February 1, 2023
[^1]: Rules of Civil Procedure, R.R.O 1990, Reg. 194. [^2]: Substitute Decisions Act, 1992, S.O. 1992, c. 30. [^3]: 2018 ONCA 1018, 46 E.T.R. (4th) 43, at para. 7. [^4]: Dzelme, at para. 7. [^5]: Lewis v Lewis, 2020 ONCA 56, at paras. 14, 16. [^6]: Affidavit of Ronald Howard Cameron, Sworn September 16, 2022, at para. 23.