Toronto Estates and Trusts Monitor

Financial abuse of the elderly is, unfortunately, an increasing problem.  The aging population and increasing rates of dementia are factors that are leaving seniors exposed to exploitation by friends or family members.  Currently, approximately 500,000 Canadians suffer from dementia and that number is expected to more than double over the next generation.  

As I have blogged about previously, having a power of attorney for property in place appointing a substitute decision maker to act when the grantor of the power of attorney no longer has the capacity to make decisions is a good idea.  However, unfortunately it is not uncommon for the person named as attorney to use his position to take advantage of a vulnerable senior and to misuse his authority. 

While examples of power of attorney abuse include the extremes, such as outright theft or changing title to assets, it can also be more subtle – such as an attorney who is also the main beneficiary of an estate not making appropriate expenditures for the incapable person’s benefit so as to protect his own inheritance. 

The recent saga involving the estate of Mickey Carroll, best known for playing a Munchkin in the Wizard of Oz is a good example of the dangers of power of attorney abuse.  Apparently, after Carroll’s death in 2009 his relatives became concerned that there was money missing from his estate. 

They hired a private investigator to look into the situation and the investigator’s findings have resulted in the relatives suing Carroll’s former caretaker and three of her friends for more than $500,000.  In their lawsuit, the relatives allege that during a time when Carroll was suffering from dementia, the caretaker and her friends convinced him to grant a power of attorney in their favour. 

The suit further alleges that after obtaining the power of attorney, the caretaker and her friends convinced Carroll to take out a sizeable line of credit against his home and not long after that he started signing cheques made out to “cash” for tens of thousands of dollars – something that was inconsistent with his prior spending habits. 

The relatives are seeking the return of the missing funds.  In an interview she gave not long after Carroll’s death, the caretaker characterized the allegations of the missing funds as being “foolish”. 

A couple of weeks back, I blogged about the issue of bullying in nursing homes.  Social dynamics in nursing homes are a live issue – and one that will continue to become even more so as the population continues to age (and life expectancy continues to grow). 

A recent episode of the CBC Radio program, The Current, touched on the interesting issue of the dynamics at play with respect to Lesbian, Gay, Bi-Sexual, Transgender, and Transexual [“LGBT”] seniors in long term care facilities. 

As the program points out, by 2036 approximately 25% of the Canadian population will be over the age of 65.  In a “strength in numbers” sense, this might mean that elderly members of the LGBT community will find themselves in care facilities with others like them. 

However, a question that arises is whether care facilities are ready to accommodate this type of diverse population or whether seniors who, potentially, did not get the opportunity to “come out” until relatively late in life are discriminated against or even pushed back into “the closet.”

A recent entry in the Huffington Post discussed the documentary, “A Place to Live: the Story of Triangle Square”, which followed the attempts of several seniors to secure a place in Triangle Square, the first affordable housing facility for LGBT seniors in the united states.  While the documentary provides a hopeful outlook for members of the LGBT community in the United States, last week’s episode of the Current indicates that the current reality in Canada is quite frightening. 

Most of us will remember some form of bullying from the high school cafeteria – but do you expect to encounter it in the dining room of a nursing home? 

According to a recent article in the New York Times, when it comes to social interactions in assisted living facilities, “older” doesn’t necessarily mean “more mature” and social bullying is a phenomenon that can extend into old age.  As Marsha Frankel, the clinical director of senior services at Jewish Family and Children’s Service in Boston puts it, “What happens to mean girls?  Some of them go on to become mean old ladies.”

Some examples of the “senior bullying” described in the article include:

• Attempting to monopolize communal space (such as by insisting on choosing the t.v. channel and trying to control who sits where);
• Excluding others from social situations (such as by claiming a seat is being saved when it’s not, so as to avoid sitting with someone else); and
• Being generally nasty (such as by insulting others or by being intolerant of cultural or religious differences). 

While cognitive impairment, such as from dementia, can be an underlying cause of bullying, it is not always the reason.  More frequently, it is because the older people are at a point in life where they feel powerless (not unlike adolescence) and bullying can provide a sense of control and acquiring power. 

In some cases, the victims of the bullying are able to shrug it off – but in other cases it can have a very detrimental effect on their well being.  Seniors are often in very vulnerable stages of their lives and living in a care facility while being the object of bullying can contribute to feelings of anxiety and depression as well as encourage withdrawal from social situations.  

Dealing with the problem of bullying is complicated.  According to the article, “caring community” workshops make little difference.  However, apparently encouraging staff to intervene as when bullying occurs and teaching seniors to be more proactive in standing up for themselves has been helpful.

For those who believe in the adage “you can’t go home again”, you might not need to worry – home might come to you.  The Wall Street Journal reports that the multi-generational family household is making a comeback. 

The WSJ cites a study by the Pew Research Center in Washington, DC that found that a record number of Americans (49 million to be exact) are living in a home with at least two adult generations or a grandparent and another generation.  This amounts to about 16.1% of the population and represents an increase of 17% since 2000. 

The rise in multi-generational homes represents a distinct trend reversal. After World War II and through to the 1980s, the popularity of the extended family household declined – from about 25% in 1940 to 12% in 1980.  However, since 1980 the rates have crept back up. 

One reason for the most recent upswing has been the economic downturn.  An increase in retirees experiencing shortfalls in their savings has made moving in with relatives a financial necessity.  Another reason is demographics – the population is aging and the need for elder care is becoming more common.  For dual income families, having grandparents in the house can carry obvious benefits when it comes to child care or paying a mortgage.

However, setting up an extended household has its complications – especially as far as finances are concerned.  This is particularly the case when the family members decide to purchase or renovate a property together.  Careful consideration should be given to how the purchase/renovations will be funded, how title to the property will be held, and how this might affect the estate plans of those involved.

Antigonish, Nova Scotia has hosted the opening of the first Alzheimer’s Café in Canada.

The purpose of an “Alzheimer’s Café” is to unite those suffering from Alzheimer’s disease, their caregivers, and the general public in an informal setting that resembles a café (complete with food, drink, and entertainment) rather than an institutional setting.  The objective is to move away from a traditional “support group” model and towards interactions that are more social in nature. 

The reason behind Alzheimer’s cafés is a good one.  A big issue that arises with those suffering from dementia is that they become housebound and secluded from the social world.  This can occur for a variety of reasons – they might have difficulty with mobility, they may be embarrassed about their condition, or they might be fearful of leaving the house. 

Over time, the isolation can start to spiral (as an individual becomes more isolated he becomes less and less likely to voluntarily leave his home) – and it can accelerate mental decline.

Openly discussing dementia can be difficult because of the social stigma that surrounds the disease.  An objective of Alzheimer cafés is to allow people to openly discuss their experiences with dementia (whether as someone who suffers from the disease or as someone who instead is a relative or caregiver of someone who is a sufferer).    

The idea for Alzheimer cafés originated from Dr. Bere Miesen, a Dutch psychiatrist, in 1997; they have since become ubiquitous in the Netherlands.  The concept has also become popular elsewhere in Europe – the first café of this type opened in the United Kingdom more than ten years ago and it has apparently also gained ground in the United States.    

The idea has been spearheaded in Canada by Danielle Martensson, a nursing student at St. Francis Xavier University.  The group has had two events in Antigonish since January and plans its official opening next month.   

The aging population has left more and more people with the prospect of having a very difficult conversation: telling an aging parent it’s time to consider moving to a nursing home. 

In the easiest circumstances, the parent acknowledges that the time has come to make the move.  However, this is frequently not the case – for an individual who has lived independently for most of her life (sometimes residing for decades in a home which now carries heavy emotional value), the decision to move to a care facility can be an extremely difficult one.   

The Globe and Mail recently ran an excellent article written by Dr. Joti Samra, a Vancouver-based psychologist, that offered tips on how to broach the topic of a nursing home with an aging parent.  The suggestions include:

• Plan in advance – think about what you want to say, what the options are, and what timelines might be involved;
• Give the parent advanced warning about the discussion so she doesn’t feel taken off guard or attacked;
• Consider whether anyone else should be involved in the discussion – there may be value in involving another relative so the parent feels supported and understands her best interests are at heart.  However, avoid ganging up on the parent;
• Listen to the parent’s concerns and show empathy.  Acknowledge that this is a very difficult topic for her to consider and appreciate that she may be defensive or sad.  Ask what’s important to her and consider how those issues can be incorporated into a solution about appropriate living arrangements; and
• Keep in mind that repeat conversations might be necessary – a workable solution might not be achieved after the first conversation so don’t get frustrated or give up hope.

Moving to a nursing home isn’t easy for anyone, but there are times when there might be no other choice – opening the lines of communication early will allow everyone more time to mentally prepare for the change.

In his recent decision in Baranek Estate, Justice Brown observed that “the so-called ‘battle of competing powers of attorney’ is emerging as a growing area of litigation.  This is a most unhealthy development.”  The facts behind Justice Price’s recent decision in Nguyen-Crawford v. Nguyen would seem to give credence to Brown J.’s complaint.

Nguyen-Crawford v. Nguyen involved a fight amongst the five children of an elderly woman who was impaired by a stroke.  In 1998, powers of attorney for property and for personal care had been executed by the woman in favour of her youngest daughter.  In 2009 (after she had suffered a stroke) the mother granted powers of attorney for property and personal care to her other four children. 

The youngest daughter then commenced an application seeking a declaration that the 2009 powers of attorney were invalid on the basis that her mother was incapable. After conceding the invalidity of the 2009 powers of attorney, the four other children challenged the validity of the 1998 powers of attorney on the basis of incapacity and undue influence. Specifically, they argued that the only translation their mother (who did not speak English) received of the powers of attorney was from the daughter being named. They also asked to be appointed as the mother’s guardians of property and personal care.

Pursuant to s. 8 of the Substitute Decisions Act, 1992 (“SDA”) an individual is capable of granting a continuing power of attorney for property if she understands, amongst other things, the nature and extent of her assets as well as the obligations of an attorney for property.  Pursuant to s. 47 of the SDA, an individual is capable of granting a power of attorney for personal care if she is able to understand whether the proposed attorney has a genuine concern for the person’s welfare and appreciates that the attorney might need to make decisions for the person. 

Here, Price J. found that although the mother was not under disability in 1998 and had the capacity to sign powers of attorney there were suspicious circumstances surrounding the execution of the documents.  The mother was dependant on the daughter being appointed and the daughter had provided the only translation of the powers of attorney and the legal advice given concerning them.  As a result, he found that the circumstances of undue influence were such as to render the powers of attorney invalid. Ultimately, he appointed the four other children as the mother’s guardians of property and personal care.   

The Superior Court of Justice’s recent decision in Urbisci v. Urbisci discusses the circumstances under which the court should require an individual to undergo a capacity assessment against his or her will. 

By way of background, the applicants were the daughter and estranged husband of the alleged incapable person (“Maria”).  They sought a court order requiring Maria, who had an incurable brain tumor, to submit to a capacity assessment.  Maria opposed the order.    

Section 2 of the Substitute Decisions Act, 1992 (the “SDA”) provides that absent reasonable grounds to believe to the contrary, an individual is presumed to be capable.  However, pursuant to s. 79(1), if an individual’s capacity is in issue in a proceeding under the SDA and the court is satisfied that there are reasonable grounds to believe a person is incapable, it can order a capacity assessment. 

The court has long rejected the idea that it was harmless to require an individual to undergo a capacity assessment.  The decisions of Strathy J. in Abrams v. Abrams and Pattillo J. in the unreported decision of Flynn v. Flynn, both discuss the intrusive and demeaning nature of the process.   

Brown J., the judge hearing the application, proceeded to set out some of the factors the courts have turned their minds to when determining whether there were reasonable grounds to believe that a person was incapable, including:

• The wishes of the person sought to be examined;
• The nature and quality of both medical and non-medical evidence regarding the person’s capacity;
• Where there has been a previous assessment, the assessor’s qualifications, the comprehensiveness of the report, the report’s reliability, whether there is evidence of bias, and whether the evidence considered was appropriate;
• The probative value of the assessment vis-à-vis the issue before the court;
• The potential harm that might result if the assessment does not take place; and
• The urgency of the capacity assessment.

Ultimately, Brown J. decided not to order the capacity assessment.  He found that although Maria’s health was declining, the evidence suggested that she still had the capacity to manage her own affairs. Particularly persuasive were medical records and opinions filed by Maria’s various doctors suggesting capacity; evidence of her capacity provided by her estate planning lawyer; and supportive evidence provided by disinterested family and friends.

Over the past week, the Globe and Mail has been running an interesting series on various issues relating to dementia. 

According to Alzheimer’s Disease International, an estimated 35.6 million people worldwide suffer from dementia.  By 2030, the number is expected to double to more than 65 million.  

The costs of caring for people with dementia are significant – it is estimated that more than $350 billion per year is spent on medical care and residential care. Unpaid labour by family caregivers has an estimated value of $253 billion.  Twenty years from now, the total costs are projected to exceed $1.1 trillion.  To put these numbers into context, Alzheimer’s Disease International estimates the current costs of dementia to be equivalent to 1% of the global gross domestic product – in geographic terms this amount would be equivalent to that of the world’s 18th largest economy, falling in between Indonesia and Turkey. 

While those suffering from dementia clearly need supportive care and medical treatment, they often also need financial protection. 

The financial risks faced by those suffering from dementia are wide ranging.  In some cases, the extent of an individual’s diminished capacity is not spotted quickly enough (or, if it is, there is no one with the authority to make financial decisions on the individual’s behalf).  This can lead to situations where the person enters into unwise financial transactions or is taken advantage of by unscrupulous acquaintances or relatives.  The Ontario Superior Court of Justice’s decision in the much discussed case of Banton v. Banton (involving an 88 year old retirement home resident who married a 31 year old waitress at the home) illustrates the devastating effects that incapacity can have on the financial decisions someone makes.

In other situations, an elderly person’s diminished capacity can provide a battleground for fighting family members, all of whom are convinced that they ought to be the one to control the individual’s finances.  The ongoing case of Abrams v. Abrams provides a good example of the complexity and scope of litigation that can emerge when family members, all with the stated objective of protecting an incapable person, become pitted against each other.

On a non-litigious note, elder mediation is growing in popularity, although it is still fairly new.  The idea behind elder mediation is to get everyone in the same room with the joint objective of getting the individual with dementia the best care.

I came across an interesting article in the September edition of “Risky Business”, the magazine published by LawPro, the liability insurer for lawyers in Ontario.  The article details the various “malpractice hazards” which arise in various practice areas. 

In the area of wills & estates, the types of claims lawyers face appear increasingly influenced by the demographics of the population.  Specifically, with the aging population, LawPRO sees an increased risk of claims arising because of issues related to a client’s capacity.  In addition, the number of elderly individuals with large estates just increases the incentive that families will have to fight and the potential that those disputes will entangle the lawyer who did the estate planning.  

LawPRO makes the following suggestions of ways to reduce the risk of a claim:

a)    Be on the lookout for signs of undue influence.  In situations where the client is making drastic changes to his or her will, explore who is benefitting from the changes and what has motivated the client to make them;

b)    Make sure to meet with the client alone to ensure that the client understands the legal implications of what he or she is instructing you to do and is making decisions freely;

c)    Clarify who you are acting for and taking instructions from so as to ensure there is no conflict of interest.  This is particularly important when your initial contact is not with the client but rather with a family member of the client; and

d)    Make sure to satisfy yourself about your client’s mental capacity and, just as importantly, make sure to document what enquiries you made in case your client’s capacity is later challenged.

When litigation over an estate occurs, the reasons are frequently unrelated to the lawyer who did the estate planning.  However, angry beneficiaries don’t always feel that way.  It is always a good idea for a lawyer doing estate planning to ensure that he or she will be protected in the future if issues involving the will or the client’s capacity arise.