When a person becomes mentally incapable of making important decisions for themselves, committeeship is a legal mechanism Canadian courts can employ to make important decisions relating to medical care or financial issues.
In this week’s blog, we’re going to examine how the process of committeeship works in Canada, the duties of a committee, and how the individuals who form the committee are chosen. Let’s dive in.
Background: What is a Committeeship?
In British Columbia, if an adult becomes mentally incapable of making important legal, financial or medical decisions for themselves, the BC Supreme Court has the power to appoint an individual(s) to make those decisions on their behalf. Should an individual know they will soon become incapable of making their own decisions, they have the right to appoint a committee themselves in advance. The committee usually consists of individuals known and trusted by the person in question and may even include a representative from the Public Guardian and Trustee.
When is a Committeeship Appropriate?
If you’ve never heard of the committeeship process, you aren’t alone. In British Columbia, there’s a high legal threshold for the Supreme Court to proceed with appointing a committee. It’s usually done in cases of sudden incapacitation, whether that’s through a mental illness, physical disability, or a degenerative disease with a poor prognosis.
The BC Supreme Court will lean on medical expertise before appointing a committee, with the opinion of two physicians sought when deciding whether an individual is incapable of managing themselves or managing their affairs.
Why is the Barrier to Entry for Committeeship so High?
Typically, a committee has complete authority to deal with an individual’s estate once appointed. They have broad powers in areas like finance and medical care, sometimes making life or death decisions, or decisions with big financial impacts upon the estate of the incapacitated individual.
There are important things a committee cannot do on the individuals’ behalf. They can’t change their will, vote on their behalf, or consent to a marriage on their behalf.
The Duties of the Committee
Making the decision to act as part of a committee for an individual is a solemn and important responsibility that carries certain legal expectations.
The committee has a financial responsibility to act in the individual’s best interests. In fact, they must put the individual’s interests above their own. This means they cannot mix the individual’s assets with their own, and they must avoid conflict-of-interest scenarios. If the committee cannot meet these requirements, they must notify the court.
The committee does have the power to invest on the individual’s behalf, but they must follow the Trustee Act when making any investments. If an investment is made in areas the Trustee Act doesn’t allow, the committee may have to compensate the individual for any losses incurred.
A committee can be responsible for the following areas:
- Managing the individual’s property
- Banking on their behalf
- Paying any expenses that are due
- Creating budgets for the individual’s family
- Handling property sales
- Running the individual’s business
- Handling any lawsuits involving the individual
- Filing tax returns on behalf of the individual
- Applying for any pensions or benefits due to the individual
The committee is also responsible for keeping detailed records of the assets, liabilities and cashflow for the individual’s estate. They must deliver periodic reports to the Public Guardian and Trustee which will be audited.
Does the Committee Receive Payment?
For the work they carry out, a committee will be paid a reasonable fee. This money is taken from the property owned by the incapacitated individual and the size of the fee depends on the size and complexity of the estate that’s being managed.
This is another reason why it’s important for committees to keep detailed written records of the work they carry out, and the time taken to complete it. The Public Guardian and Trustee makes the decision on the fee each time it approves the committee’s accounts.
Learn More About Committeeship in Canada
If you, or a loved one, is interested in finding out more about Nomination of Committees we’d love to discuss your options. Westside Family Law can assist with any legal questions you may have surrounding estate law. Contact us and we’ll be happy to assist!