Can a Power of Attorney Be Forced to Pass Their Accounts in Ontario?
A parent gives one child Power of Attorney over their property.
Years later, the family begins asking questions.
There are withdrawals nobody recognizes. Money has been transferred between accounts. The attorney has reimbursed themselves for expenses. Perhaps substantial gifts have been made. When the other family members ask for records, they are told that the finances are private or that everything was done with the parent’s approval.
At that point, the dispute is no longer simply about trust.
It is about accountability.
In Ontario, a person acting under a Continuing Power of Attorney for Property can be required by the Court to formally account for their management of another person’s finances.
And a Passing of Accounts can do considerably more than require someone to produce a stack of bank statements.
The Power Belongs to the Attorney, But the Money Does Not
There is an important terminology point at the outset.
The “Power of Attorney” is technically the legal document. The individual exercising the authority is the attorney for property.
In everyday conversation, however, people commonly refer to that individual as “the Power of Attorney.”
Whatever terminology is used, the underlying principle is the same.
An attorney for property is entrusted with someone else’s financial affairs. That authority may include access to bank accounts, investments, real estate and other significant assets.
It is not a licence to treat those assets as their own.
The attorney is exercising fiduciary powers for the benefit of the person who granted the authority.
There Is a Legal Duty to Keep Accounts
Ontario law does not permit an attorney for property to operate without records.
The Substitute Decisions Act, 1992 and its regulations impose accounting and record-keeping obligations on attorneys acting under Continuing Powers of Attorney for Property. The legislation also gives the Court express authority to order that all or part of an attorney’s accounts be formally passed.
That distinction matters.
A family member may say:
“I know Mom wanted me handling everything.”
That may be true.
It does not eliminate the obligation to account for what happened to Mom’s money.
What Is a Passing of Accounts?
A Passing of Accounts is a formal Court process through which a fiduciary’s financial administration is presented for review.
For an attorney for property, that means accounting for the financial transactions undertaken while exercising authority under the Power of Attorney.
The process can require scrutiny of matters such as:
• Money received and spent
• Bank and investment transactions
• Transfers between accounts
• Expenses paid on behalf of the grantor
• Payments made to the attorney
• Compensation taken by the attorney
• Gifts or loans made from the grantor’s property
• Significant changes in the grantor’s assets
The objective is not simply to reconstruct the bank balance.
It is to determine whether the attorney administered the property properly.
Who Can Ask the Court to Order a Passing of Accounts?
Not every concerned relative automatically has standing to demand a Court-supervised accounting.
Section 42 of the Substitute Decisions Act, 1992 identifies several people who may apply.
They include:
• The attorney
• The person who granted the Power of Attorney
• The grantor’s guardian of the person or attorney for personal care
• A dependant of the grantor
• The Public Guardian and Trustee
• The Children’s Lawyer
• A judgment creditor of the grantor
The Court may also grant leave to another person to bring the application.
That last category can be particularly important in family disputes.
A concerned child or sibling may have serious questions, but the Court must still determine whether that person should be permitted to invoke the formal accounting process.
What Usually Triggers an Accounting Dispute?
Passing of Accounts proceedings rarely begin because someone casually wants to review paperwork.
Usually, something has happened.
Common warning signs include:
• Large or unexplained withdrawals
• Transfers to the attorney personally
• Payments to people connected to the attorney
• Significant gifts that appear inconsistent with the grantor’s prior behaviour
• Unexplained depletion of investments
• Sale proceeds that cannot be traced
• Compensation taken without a clear explanation
• Missing bank statements or receipts
• Refusal to provide meaningful financial information
• A dramatic reduction in the grantor’s assets
None of these facts, standing alone, necessarily proves misconduct.
A large withdrawal may have a perfectly legitimate explanation. A transfer may have been authorized. An attorney may properly be entitled to compensation.
The point of the accounting process is to replace suspicion with evidence.
What If the Attorney Says the Transactions Were Gifts?
This is where many Power of Attorney disputes become serious.
An attorney may say:
“Mom wanted me to have the money.”
Or:
“Dad always helped the grandchildren.”
The legal question is not resolved simply because the attorney says the grantor was generous.
An attorney exercising fiduciary authority must be able to justify transactions undertaken with the grantor’s property.
Where significant transfers benefited the attorney personally or people close to them, the transaction may attract particularly careful scrutiny.
The larger and more unusual the transaction, the more important the surrounding evidence becomes.
Can a Power of Attorney Take Compensation?
Potentially, yes.
Ontario’s Substitute Decisions Act, 1992 permits an attorney under a Continuing Power of Attorney for Property to take compensation in accordance with the prescribed framework, subject to the terms of the Power of Attorney itself.
But compensation and personal use of the grantor’s money are not the same thing.
Compensation should be identifiable and capable of justification.
An attorney cannot simply withdraw money periodically and characterize the transactions later as compensation if the accounting does not support that position.
A Passing of Accounts can place the amount and propriety of compensation directly before the Court.
What Happens If the Records Are Incomplete?
Poor records are not merely an inconvenience.
They can become a central problem in the litigation.
An attorney has been entrusted with another person’s property. If substantial funds have moved and the attorney cannot explain where they went, the absence of records can make it extremely difficult to demonstrate that the fiduciary obligations were properly discharged.
The practical lesson is straightforward:
If you are managing someone else’s money under a Power of Attorney, document what you do.
Bank statements alone may not explain why a transaction occurred.
Receipts, invoices, contemporaneous notes and supporting documentation can become extremely important years later when memories have faded and family relationships have deteriorated.
The Court’s Powers Go Beyond Reviewing the Numbers
This is one of the most important aspects of a Power of Attorney Passing of Accounts.
Section 42 gives the Court significant powers during the proceeding.
In an application involving an attorney’s accounts, the Court may, among other things:
• Suspend the Power of Attorney while the application is determined
• Appoint the Public Guardian and Trustee or another person to act as guardian of property on an interim basis
• Direct the Public Guardian and Trustee to bring a guardianship application
• Order an assessment of the grantor’s capacity
• Terminate the Power of Attorney
Those remedies demonstrate why a Passing of Accounts can become much more than an accounting exercise.
If the evidence raises serious concerns about the attorney’s continued management of the property, the Court can address the underlying authority itself.
Can the Court Require Money to Be Repaid?
Where the accounting demonstrates that money was improperly taken or expenditures cannot be justified, financial consequences may follow.
The precise remedy depends on the facts and the relief sought, but fiduciaries can be required to answer for losses caused by improper conduct.
That is why a Passing of Accounts should not be viewed as simply an exercise in disclosure.
It can determine whether the attorney’s administration was proper and whether financial adjustments are required.
What Happens After the Grantor Dies?
Death does not necessarily make questions about the attorney’s prior financial management disappear.
The Power of Attorney itself terminates on death, but the transactions undertaken while it was in force may remain highly relevant to the deceased’s estate.
If substantial assets disappeared during the grantor’s lifetime, the estate trustee may need to understand what happened before the estate can be properly administered.
This is one reason Power of Attorney disputes frequently become estate disputes.
A family may only discover questionable transactions after death, when historical statements are reviewed and the value of the estate is materially lower than expected.
How Is This Different From Challenging the Power of Attorney Itself?
The two issues can overlap, but they are not identical.
A challenge to the Power of Attorney may concern whether the document is valid, whether the grantor had capacity when it was signed, whether the attorney should continue acting, or whether guardianship is required.
A Passing of Accounts asks a different question:
What did the attorney actually do with the property while exercising that authority?
These issues can overlap with broader questions about challenging a Power of Attorney in Ontario, particularly where concerns extend beyond the accounting itself and call the attorney’s continued authority into question.
When Does Guardianship Become Relevant?
Sometimes an accounting exposes a larger problem.
If the grantor is incapable and the existing attorney can no longer be trusted to manage the property, simply reviewing the historical accounts may not be enough.
Someone still needs to manage the person’s finances going forward.
That is where guardianship can become relevant.
Ontario’s statutory framework allows the Court, in appropriate circumstances during a Passing of Accounts, to take steps directed toward the appointment of a guardian and to protect the grantor’s property while the dispute is being resolved.
Where the dispute involves ongoing risk to a vulnerable person’s assets, court intervention may be required to protect the grantor’s property and determine who should manage it going forward. These disputes can develop into Estate Litigation, particularly where allegations of financial misconduct or competing guardianship applications arise.
A Practical Perspective
Power of Attorney disputes often begin with a simple question:
Where did the money go?
Sometimes the answer is entirely legitimate.
The attorney paid for care, housing, taxes, medical needs and ordinary expenses over many years. Once the records are reviewed, the apparent discrepancy can be explained.
Other times, the records reveal something very different.
That is why allegations of financial misconduct should not be made casually, but concerns about unexplained transactions should not simply be ignored either.
A Passing of Accounts provides a structured Court process for determining what actually occurred.
For attorneys, the lesson is documentation and transparency.
For concerned family members, the lesson is that suspicion alone is not evidence, but Ontario law provides meaningful tools to obtain answers where the circumstances justify Court intervention.
And where an attorney cannot properly explain what happened to another person’s property, the consequences can extend far beyond being ordered to produce bank statements.