Mr. Ranjit Sangha prepared several legal documents to plan for a
potential mental incapacity. This included an Enduring Power
of Attorney Instrument appointing his daughter, Ms. Maya Sangha,
along with two of his close friends and advisors as attorneys (the
"POA"). The POA stated that the attorneys must act by
majority decision. Mr. Sangha also appointed Ms. Sangha and
his two other children under a Representative Agreement to look
after his affairs. Ms. Sangha was Mr. Sangha's primary
Representative, and she made most of his care arrangements. Mr.
Sangha became dissatisfied with the level of control Ms. Sangha had
over his affairs and took steps to revoke some of her authority. He
also set up a Nomination of Committee by which any of his children
could apply to be named committee. The day after this occurred, Ms.
Sangha petitioned the court to be named committee. She used Mr.
Sangha's credit card to pay for her application, claiming that
she understood that she had her father's permission to do so
given a discussion between them that she was to manage his
financial affairs and could pay any management expenses from his
account. When the other attorneys and Ms. Sangha's siblings
became aware of her actions, they moved to oppose her petition and
also brought a claim against her for breach of her fiduciary duty
as her father's attorney.
The BC Supreme Court found Ms. Sangha was in breach of her
fiduciary obligation as an attorney acting under a power of
attorney instrument. The Court noted that Ms. Sangha ignored the
majority-rule provision in the POA. She was ordered to repay
the full amount she spent from her father's accounts
($105,474.05), with interest.
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It is not uncommon for parents to provide monetary gifts to their adult children. Parents may wish to help their child with a down payment on a property, or help pay out their child's existing mortgage.
On March 31, 2014, BC's new Wills, Estates and Succession Act1 ("WESA") will come into force. WESA introduces new protections for beneficiaries of estates that are in danger of being disputed or deemed ineffective by a court.
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