A client’s capacity to instruct counsel

Law360 Canada (May 7, 2025, 11:06 AM EDT) --

Jason Moore

Lawyers have an obligation to ensure that their clients have capacity to give them instructions. This obligation is ongoing and lasts from the first meeting with a prospective client through to the end of the retainer. But as a lawyer, what do you do if you suspect that your client may have lost the capacity to give instructions? And what about when another party to a proceeding lacks capacity?

Client capacity

Rule 3.2-9 of the Rules of Professional Conduct states that a legal relationship presupposes that a client has capacity to instruct their counsel. Jurisprudence further recognizes that every (adult) person is presumed capable of instructing counsel on their own (Knox v. Burton, [2004] O.J. No. 1267, at para. 26). This is also reflected in s. 6 of the Substitute Decisions Act, 1992, S.O. 1992, c. 30 (SDA), which recognizes the presumed capacity of every adult to manage his or her own property, which includes the ability to contract.

Capacity is not static and can improve or diminish over time. For example, a minor client protected by a litigation guardian can give instructions on their own when they turn 18; an otherwise healthy 45-year-old client could sustain a serious brain injury and lose capacity; and, perhaps most challenging, an elderly client suffering from early-stage dementia can have capacity on some days but lack it on others. If a client loses capacity, the Rules unequivocally state that “the lawyer has an ethical obligation to ensure that the client’s interests are not abandoned.”

In S.P. v. R.P., 2007 ABQB 449, the court noted that, in the context of litigation, if a person understands “the function of his lawyer, the risk that he is exposing himself to in these Court proceedings, and the issues before the Court,” then he is capable of instructing counsel. Whether a person can instruct counsel will depend upon the complexity of the advice being given by the lawyer, the matters about which instructions must be given, and the surrounding circumstances. The lawyer is responsible for making this determination at the first instance, and should do so relying on careful judgment and their experience.

Other party’s incapacity

When another party to a proceeding is determined to lack capacity, in practice, the court will not permit the proceeding to advance against them until appropriate representation has been arranged for them. This is because, as the Supreme Court recognized in E. (Mrs.) v. Eve, [1986] S.C.J. No. 60, the court’s parens patriae jurisdiction to protect those who cannot care for themselves is of “paramount importance.”

When there is an incapable litigant, there are several possibilities the court will consider to protect both the incapable person and the integrity of the litigation. The tests applied will differ depending on whether the proceedings fall under the SDA or are commercial litigation matters. This also has an impact on when the court will order that the allegedly incapable person undergo a capacity assessment. In a proceeding commenced under the SDA, the court can direct the Public Guardian and Trustee (PGT) to arrange for their representation under s. 3 of the SDA. This representative is known as “Section 3 Counsel,” and is usually a specialized private practitioner nominated by the PGT and paid for out of the assets of the incapable litigant.

If the incapable litigant executed a Power of Attorney for Property, the named attorney for property may apply to be appointed as the incapable litigant’s litigation guardian. In the absence of a Power of Attorney for Property, the incapable litigant’s close family may also apply for that appointment. The litigation guardian can then instruct counsel on the incapable party’s behalf.

The court may also order a litigant whose capacity is in question to undergo a capacity assessment pursuant to s. 105(2) of the Courts of Justice Act, R.S.O. 1990, c. C.43. This can occur in proceedings commenced under the SDA and in commercial proceedings. However, jurisprudence has found that an order to compel an examination is discretionary, should be the exception and not the rule, and should not be granted without good reason and unless the particular requirements of s. 105 (3) are satisfied (626381 Ontario Ltd. et al. v. Kagan, Shastri Barristers & Solicitors et al., 2013 ONSC 4114, at para. 40).

Determining whether a potential client has the capacity to instruct counsel is a critical step for lawyers practising in any area of law. For those who deal with these issues or who are interested in them, there is a lunch and learn seminar on this topic that will feature Clare Burns of WeirFoulds LLP and Gregory Sidlofsky and James Dunphy of Wagner Sidlofsky LLP on Tuesday, May 13, 2025, starting at 12 p.m. This seminar is an opportunity for new and experienced estate and family lawyers to learn about this rapidly evolving area of capacity and the law. For more information and to register, please access this link.

Jason Moore is a lawyer at Wagner Sidlofsky LLP, practising in the estate and commercial litigation groups.

The opinions expressed are those of the author(s) and do not necessarily reflect the views of the author’s firm, its clients, LexisNexis Canada, Law360 Canada or any of its or their respective affiliates. This article is for general information purposes and is not intended to be and should not be taken as legal advice.

Interested in writing for us? To learn more about how you can add your voice to Law360 Canada, contact Analysis Editor Richard Skinulis at Richard.Skinulis@lexisnexis.ca or call 437-828-6772.