STATUTORY GUARDIAN – SECURITY BOND
The Public Guardian & Trustee (“PGT”) of Ontario becomes the statutory guardian of any person in Ontario who becomes incapable without having a Continuing Power of Attorney for Property. It is possible for someone (usually a relative) to apply to replace the PGT and become a substitute guardian.
To guard against the risk of the substitute guardian dealing with the assets of the incapable person improperly, the substitute guardian is required to post a security bond. The PGT typically requires a security bond equal to double the value of the assets of the incapable person. The security bonds are generally arranged through an insurance company and there is an annual premium.
The premiums for the security bond can be expensive and they must be paid each year so long as the person remains the substitute guardian.
A person who has been appointed substitute guardian may apply to court to reduce the amount of the security bond or to waive it entirely. Although the PGT may not consent to the security bond being reduced or waived, in appropriate cases they may not oppose the request. In that case, if a court can be satisfied that it makes sense, a court will order the reduction or elimination of a security bond. The court may require that the substitute guardian provide the PGT with accounting on an annual basis as a condition of the reduction or elimination of the security bond.
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