Legal Expenses to be Paid by the Estate in Committeeship Applications

In Vieira (Re), 2013 BCCA 420, [Vieira], the BC Court of Appeal commented on the circumstances in which an order for special costs would be made against the estate of an individual when an interested party makes an application for ‘committee of the person’ of that individual.  This case shows that, generally speaking, a successful applicant will be entitled to special costs paid out of the patient’s estate.  Exceptions to this rule may arise, however, where there are concerns over the applicant’s motive, the applicant is guilty of poor conduct during the litigation, the estate is unable to support the order, or the court provides other clearly articulated reasons for deviating from the usual practice.

By way of background, in BC a legally capable individual can execute a representation agreement that gives another person the authority to make health care decisions on his or her behalf in the event that the individual becomes incapable of making those decisions.  However, once a person becomes mentally incapable, only the court can appoint a guardian to make that person’s healthcare decisions.  A person so appointed is called a “committee of the person”.  Usually, this person will be a family member or friend of the incapacitated patient; however, if there is no one available or family conflict necessitates giving the authority to an objective third party, the court can appoint the Office of the Public Guardian and Trustee of British Columbia (“PGT”) to act as the patient’s committee.

Where there is a representation agreement in place, it automatically terminates when a court makes an order of committeeship.  As a result, if an interested third party feels that a patient’s representative is not acting in the patient’s best interests, the third party can make a committeeship application with the goal of removing authority from the representative and taking over as the patient’s committee.

This is precisely what happened in Vieira.  Mr. Vieira’s daughter was appointed as his representative by a representation agreement.  Mr. Vieira’s wife became concerned that his daughter was not using her authority in the best interests of Mr. Vieira and brought an application under the Representation Agreement Act, RSBC 1996, c 405, and the Patients Property Act, RSBC 1996, c 349, to be appointed committee to the person of Mr. Vieira.  The evidence put before the chambers judge by both sides was severely lacking, leaving him unable to make a final determination.  As a result, the judge made an interim (temporary) order appointing the Office of the Public Guardian and Trustee of British Columbia as committee to Mr. Vieira, pending a more complete proceeding in which the issue could be properly decided on its merits.

The chambers judge went on to order that each of the parties would be responsible for his or her own legal costs.  While the court has discretion to make such an order, the usual practice of the BC Supreme Court in committeeship applications is to award special costs to the successful applicant.  These costs are to be paid out of the patient’s estate, and are intended to entirely cover the applicant’s reasonable legal fees.  An award of special costs is greater than a normal costs award, which only compensates a successful party for a portion of their fees.

Mr. Vieira’s wife appealed the chambers judge’s costs order on the grounds that the chambers judge exercised his discretion on an improper basis.  The Court of Appeal noted that while the Patients Property Act, section 27, gives the court very broad discretion to make costs awards, that discretion is not completely unbounded.  It may be appropriate for the court to deviate from its usual practice where there are concerns about the applicant’s motives or conduct during the course of the application, or the ability of the estate to bear an order for costs.  These factors are not exhaustive, so other situations may arise in which it is appropriate for the court to use its discretion to deny special costs to the applicant.

In Vieira, the application for committeeship was successful and brought in good faith without any expectation or possibility of personal benefit to the applicant.  The appointment was found to be in the best interests of the patient, Mr. Vieira.  On these grounds, and because the chambers judge had not properly articulated his reasons for departing from the usual practice, the Court of Appeal overturned the lower court’s ruling that the parties should each bear their own costs.  The Court of Appeal also noted that the chambers judge could have made an order for costs in the cause or an order that the issue of costs be decided by the court making the final decision in the committeeship matter.  While the Court of Appeal might have been inclined to make an order along those lines, both parties indicated that no further proceedings were likely.  The Court preferred to make a final determination on the issue of costs, ordering that the appellant have special costs, paid from the patient’s estate, in both the appeal and the earlier chambers application.

If you have questions about matters relating to committeeships, please feel free to contact one of the lawyers in our Wealth Preservation and Estate Litigation Practice Group.