A.      Introduction

The purpose of this project is to recommend a process to establish a legal representative for adults who experience diminished capacity to open an RDSP, decide plan terms and/or manage payments out of the RDSP. Making decisions for an RDSP is very demanding.  The RDSP is a financial vehicle that is complex and it requires a plan holder to make educated choices through traditional investment instruments, such as mutual funds. Adults with mental disabilities seeking access to the RDSP may have a need for assistance in RDSP decision-making because their capacity to do so for themselves is diminished. Creating a process to establish a legal representative for RDSP beneficiaries would give them a more accessible alternative to Ontario’s current framework to appoint a guardian, which can involve a complex, lengthy and expensive process. It would also seek to provide them with a less intrusive means to receive assistance by reducing the negative repercussions of guardianship on their well-being.       

This section brings together the options for reform identified in each of the preceding chapters. It summarizes these options and discusses how they can be combined as well as implications for implementation. 

Findings from the preceding chapters are referred to throughout this chapter and you are invited to consult them for further detail. Of particular importance are the benchmarks that the LCO has articulated based on objectives that the options for reform must meet to be effective (Chapter I.C.2). We propose that a process to establish a legal representative for RDSP beneficiaries would meet the following benchmarks: 

  • Responds to Individual Needs for RDSP Decision-Making
  • Promotes Meaningful Inclusion in the Decision-Making Process
  • Ensures that Necessary Protections for RDSP Beneficiaries are in Place
  • Achieves Administrative Feasibility, Cost Effectiveness and Ease of Use, and
  • Provides Certainty to Legal Representatives and Third Parties.

Our summary of the options for reform, immediately below, also refers back to Figure 2, Options for Reform in the Choice of Arrangements. Figure 2 can be used as a visual aid and is located at the end of Chapter V.B on pages 90 to 91.


B.    An Alternative Process to Establish a Legal Representative for RDSP Beneficiaries

1.     Overview of the Options for Reform and Types of Appointment Processes

Chapter V.B., Choice of Arrangements to Establish a Legal Representative for the RDSP, considered how the general arrangement to establish a legal representative for RDSP beneficiaries could be structured. It reviewed existing arrangements in decision-making laws, the law of trusts and the income supports and social benefits sectors. Each of these areas of the law has a process to designate a person or organization to assist adults with diminished capacity in managing their financial affairs. Based on that review, Chapter V.B presented several options that could be adopted in Ontario specifically for RDSP beneficiaries through the following overall appointment processes: 

  • personal appointments
  • streamlined court process
  • administrative tribunal hearing
  • government agency administered

Personal appointments are widely perceived as preferable to external appointments through a court, administrative tribunal and government or other agency. Personal appointments permit adults who meet a level of capacity to proactively choose whom they would like to assist them and in what way. They are also private arrangements that can be cost-effective for the adult and legal representative, and require less support from government than external appointments.

External appointments generally apply to circumstances where an adult does not have a private arrangement, such as a POA, and the adult’s challenges with decision-making are such that he or she cannot meet the threshold of capacity required for a personal appointment. The RDSP beneficiary could initiate an external appointment process him or herself, or another interested party could do so. A court, administrative tribunal or government agency could then appoint a legal representative for the RDSP based on an assessment of incapacity or on an adult’s demonstrated need for assistance. Responding to an adult’s need for assistance is widely perceived as less intrusive than an assessment for incapacity.

In Ontario, both personal and external appointments exist as options under decision-making laws. Adults can execute a POA or undergo a court-based or statutory capacity assessment if it appears they are in need of a guardian. Offering these two avenues to establish a legal representative for the RDSP should be viewed as a possible combination in the options for reform.

The LCO analyzed personal and external appointment processes that could potentially meet the benchmarks for reform. Many of these included arrangements available in Canadian provinces and territories that the federal government recognized as having instituted streamlined processes or other arrangements that could address the concerns of RDSP beneficiaries in the Economic Action Plan 2012.[667] The arrangements reviewed in this discussion paper consist of special limited powers of attorney, supported and co-decision making arrangements, representation agreements, trusts and representative payees for income supports (often called “informal trustees”).

It is important to know that many of these arrangements could be established through both a personal and an external appointment process.[668] This should be recalled in reading through the options for reform. Co-decision making arrangements and representative payees for income supports are an exception. They are only established through an external appointment, as discussed below.

The LCO has identified options for reform that mirror the existing arrangements, listed above, with some amendments. We do not make any specific recommendations in this discussion paper. Rather, we outline several options for reform with a view to receiving feedback from the public. The options for reform reflect our cursory findings on how a given process would need to be implemented in the Ontario context.

Bearing in mind these general observations, the options for reform are briefly explained in the next section and presented in Figure 4, Options for Reform by the Type of Appointment Process. They are the following: 

OPTION 1:      A private authorization granted by an adult who meets the common law threshold for capacity.

OPTION 2:   A private authorization granted by an adult who meets non-cognitive criteria, such as the communication of desire and preferences.

OPTION 3:   A private authorization granted by an adult who meets the common law threshold for capacity and who only needs support to make decisions for him or herself.

OPTION 4:   A self-designated trust created by an adult who meets the common law threshold for capacity.

OPTION 5:   An appointment made by the Superior Court of Justice if its mandate were expanded to facilitate an “alternative course of action” to guardianship.

OPTION 6:   An appointment made by the Consent and Capacity Board if its mandate were expanded.

OPTION 7:   An appointment made under the Superior Court of Justice’s jurisdiction over trusts.

OPTION 8:   An appointment made at a government agency through the approval of a deed of trust.

OPTION 9:   An appointment made at a government agency in a new process as defined by the government.


2.     Options for Reform by the Type of Appointment Process 

a. Personal Appointments

Example: Joan experiences challenges with her financial affairs and cannot meet the threshold of capacity necessary to execute a POA for property in Ontario. She can communicate a desire to have her trusted friend Paula assist her and make decisions on her behalf with respect to an RDSP. She can also demonstrate her preference to receive the maximum allowable government grants and bonds. Joan could possibly appoint Paula as her legal representative for the RDSP.  

The above example illustrates the kind of circumstances that could be appropriate for one of the options for reform based on a personal appointment process (Option 2). Option 2 would permit an adult to appoint a legal representative based on factors such as the expression of desire and preferences, and the existence of a relationship of trust.

There are also other personal appointments in the options for reform. In the LCO’s preliminary consultations, one of the goals for reform that stakeholders identified is the acceptance of a threshold for capacity that is lower than that which is necessary to grant a POA for property in Ontario under the Substitute Decisions Act, 1992. Stakeholders reported that this threshold is unattainable for many adults with mental disabilities seeking access to the RDSP. Therefore, all of the personal appointments considered as options for reform adopt a lower threshold for capacity. These thresholds are defined by either the common law standard or non-cognitive criteria.

Adopting the common law definition of capacity would allow an adult to appoint a legal representative for the RDSP where he or she has the ability to understand the nature and effect of the appointment. A personal appointment using the common law definition could be a decision-making arrangement, such as a POA, as indicated in Option 1. An adult who can meet this threshold for capacity could also create a self-designated trust (Option 4). Trusts are somewhat analogous to a legal representative for property management insofar as the trustee is a fiduciary who makes decision about a person’s property. Several stakeholders in the LCO’s preliminary consultations suggested that a trust could respond appropriately to the challenges of RDSP beneficiaries.

A process based on the common law definition of capacity could also be available to those adults who can make decisions for themselves with assistance (Option 3). Option 3 is modeled on supported decision-making arrangements. Supported decision-making arrangements formalize the role of informal supports that adults with diminished capacity regularly access to assist them. A supporter may be entitled to undertake several activities, including accessing confidential information, giving advice, communicating an adult’s wishes and endeavoring to ensure that his or her decisions are implemented. However, the ultimate seat of decision-making authority remains with the adult, not the supporter. Supported decision-making agreements have not been used or recommended for complex financial transactions. They could cause uncertainty in the context of the RDSP because a supporter’s help would need to be sufficient to enable each adult to enter into a contract with a financial institution him or herself.

In our preliminary consultations, the LCO heard that certain RDSP beneficiaries might not be able to meet the common law threshold for capacity. The common law threshold for capacity to execute an arrangement, such as a POA or a self-designated trust, is low relative to t