



COURT OF APPEAL FOR ONTARIO

CITATION: Lewis v. Lewis, 2020 ONCA 56

DATE: 20200129

DOCKET: C67329

Hoy A.C.J.O., Doherty J.A. and Marrocco A.C.J. (
ad
    hoc
)

BETWEEN

Sheldon Lewis, Marilyn
    Lewis, Donna Buckley and Marlene Lewis

Applicants (Appellants)

and

Donald Lewis
,
Douglas Lewis
, the
    Estate of Emerson Walker Lewis, and the Estate of Marie Theresa Lewis

Respondents (
Respondents
)

Patrick J. Kraemer, for the appellants

Carol Craig, for the respondents

Heard: January 17, 2020

On
    appeal from the order of Justice Hugh K. OConnell of the Superior Court of
    Justice, dated July 31, 2019, with reasons reported at 2019 ONSC 4595.

REASONS FOR
    DECISION

[1]

On April 16, 2013, Emerson and Marie Lewis appointed the respondents,
    two of their six adult children, as their attorneys for property. The
    appellants  the remaining four children  appeal the order of the application
    judge, dismissing their application under ss. 42(1) and (4) of the
Substitute
    Decisions Act, 1992
, S.O. 1992, c. 30, (the SDA) for leave to require
    the respondents to pass their accounts.  The court was advised that Emerson and
    Marie Lewis died about seven weeks apart, shortly after the application was
    heard.

[2]

The appellants had also unsuccessfully challenged Marie Lewiss
    appointment of the respondents as her attorneys for personal care and property.
    Their further appeal was also dismissed.

[3]

We dismissed this appeal, for reasons to follow. These are our reasons.

[4]

Section 42(1) of the SDA provides that [t]he court may, on application,
    order that all or a specified part of the accounts of an attorney or guardian
    of property be passed. In turn, s. 42(4) partially sets out who may make an
    application under s. 42(1). The list includes specified persons and any other
    person, with leave of the court. The jurisprudence suggests that any other
    person will not often be granted leave to bring an application under s. 41(1):
    see e.g.,
Groh v. Steele
, 2017 ONSC 3625, 29 E.T.R. (4th) 121, at
    para. 53

[5]

The parties agree that the test to be applied in determining whether a
    person should be granted leave of the court under s. 42(4) to make an
    application under s. 42(1) is that set out in
Ali v. Fruci
(2006), 22
    E.T.R. (3d) 187 (Ont. S.C.), at para. 3: the court must be convinced that (1)
    the person or persons seeking leave have a genuine interest in the grantors
    welfare; and, (2) a court hearing the application under s. 42(1) may order the
    attorney or guardian to pass his or her accounts.

[6]

Even where a person has standing to apply under s. 42(4), it remains in
    the discretion of the court to order a passing of accounts under s. 42(1):
Dzelme
    v. Dzelme
, 2018 ONCA 1018, 46 E.T.R. (4th) 43, at para. 7; see also
McAllister
    Estate v. Hudgin
(2008), 42 E.T.R. (3d) 313 (Ont. S.C.), at paras. 9, 13. In
Dzelme
, at para. 7, this court stated that factors a court considers
    in exercising its discretion under s. 42(1) include the extent of the
    attorneys involvement in the grantors financial affairs and whether the
    applicant has raised a significant concern in respect of the management of the
    grantors affairs to warrant an accounting.

[7]

On appeal, the first prong of the test in
Ali v. Fruci
is not
    at issue: the respondents concede that the appellants had a genuine interest in
    their parents welfare. The question is whether the appellants have established
    any basis for this court to interfere with the application judges conclusion
    that the second prong of the test was not met. That requires consideration of
    the applications judges reasons in light of
Dzelme
.

[8]

The application judge found that the record falls far short and lacks
    evidentiary stamina to suggest that there is any direct allegation of
    misfeasance or wrongdoing. Considering what the attorneys have done and are
    willing to do, he was not persuaded that he should exercise his discretion to
    grant leave to the appellants and order an accounting. He concluded that there
    was no reason to believe that a court hearing the matter may order an
    accounting by the attorneys.

[9]

The appellants argue that the application judge erred in finding that
    there was a lack of evidence relating to misfeasance or wrongdoing, erred in
    principle in the exercise of his discretion by focusing on whether there is a
    concern about misfeasance or wrongdoing, and improperly considered that Marie Lewis
    had capacity when she appointed the respondents as her attorney for property as
    a factor in his analysis.

[10]

We are not persuaded that there is a basis for this court to interfere
    with the application judges order dismissing the appellants application under
    s. 42(4).

[11]

Some brief background about the extent of the respondents involvement
    in their parents financial affairs and what the attorneys have done is
    helpful.

[12]

The uncontested evidence was that Emerson Lewis remained capable of managing
    his and his wifes intertwined affairs. He continued to receive all bank
    statements until he and his wife moved into a long-term care facility in
    October 2016. The respondents helped their father manage his and their mothers
    finances, such as paying his bills for him, but kept him apprised of all
    actions taken on their behalf. Before the appellants commenced their
    application, the respondents responded to their request to provide copies of
    documentation and continued to provide documentation in the course of the
    application. In his reasons, the application judge repeated  and, in our view,
    reasonably accepted  the respondents counsels characterization of the
    respondents as acting either at their fathers request, or with his knowledge
    and consent.

[13]

Moreover, Emerson Lewis, who was represented by counsel and participated
    fully in the application, gave evidence that he had no concerns with the
    respondents involvement in the management of his and his wifes affairs and
    wanted the litigation to come to an end.

[14]

We agree with the application judges finding that the record falls far
    short and lacks evidentiary stamina to suggest that there is any direct
    allegation of misfeasance or wrongdoing.

[15]

We agree with the appellants that an attorney can be ordered to pass
    accounts, and accordingly leave can be granted under s. 42(4), in the absence
    of significant concerns about misfeasance or wrongdoing.
Dzelme
frames
    this part of the inquiry more broadly: whether the applicant has raised a
    significant concern in respect of the management of the grantors affairs to
    warrant an accounting: at para. 7. Other matters, such as a significant erosion
    of the grantors financial position, could raise a significant concern in
    respect of the management of the grantors affairs: see e.g.,
McAllister
    Estate
,

at paras. 15-16.

[16]

However, the application judges reasons must be considered in the
    context of the record and the appellants submissions. Emerson and Marie
    Lewiss investment portfolios increased between the time that the respondents
    were appointed their attorneys for property and the time the appellants brought
    this application. The appellants made veiled allegations of misfeasance or
    wrongdoing.  The application judges focus on the lack of evidence of
    misfeasance or wrongdoing was responsive to their allegations. We are not
    persuaded that the application judge imposed a narrower test requiring proof of
    misfeasance or wrongdoing and thereby erred in principle in the exercise of his
    discretion.

[17]

Nor, in our view, did the application judge consider that the fact that
    Marie Lewis had capacity when she appointed the respondents as her attorneys for
    property was a reason to deny the appellants leave under s. 42(4). To the
    contrary, he specifically stated that whether she had capacity was not germane
    to the application.

[18]

Accordingly, the appeal was dismissed, and the appellants were ordered
    to pay the respondents their costs of the appeal, fixed in the amount of
    $13,500, inclusive of costs and disbursements.

Alexandra Hoy
    A.C.J.O.

Doherty J.A.

Marrocco A.C.J.S.C. (
ad
    hoc
)


