goodintentions
MortgageBroker mbabc.ca spring 2014 | 43
broker cannot be expected to understand the
medical opinion such as to apply it to the legal
test for capacity except perhaps in the most
straightforward of cases.
Although it would undoubtedly be the
safest course, it would certainly be overkill to
require that every contributor have obtained
independent legal advice in every instance
before a gi letter was acceptable. e benefi t
of involving the lawyer for purposes of the
contributor receiving independent legal advice
is that the lawyer would be in a position to
apply the legal test of mental capacity. In
doing so the lawyer could seek, as needed,
such medical and other assistance to make
that determination.
If, a er taking precautions, the mortgage
broker is not satisfi ed as to the capacity of the
contributor, the mortgage broker should at least
advise the client that a prospective lender will
need to be explicitly advised as to the concerns
surrounding the gi letter. e mortgage broker,
at that point, must consider whether to decline to
include the gi letter in the process at all.
While this article discusses capacity
limited by mental ability, capacity may be
limited by other factors. In each instance, the
mortgage broker needs to consider what steps
need to be taken to overcome any barrier
in determining capacity. For example the
contributor not being fl uent in English may
mean that they cannot form the intention
to make a gi as they do not understand the
process, the documents, or the transaction.
Consideration would need to be given as to
whether the specifi c circumstance calls for
just an interpreter or a lawyer who speaks the
contributor's native tongue and can act as both
an interpreter and a lawyer.
Of course underlying all of the cautionary
steps is the recommendation to document the
course chosen and the reasons for choosing
the course. Such notes would be a valuable
tool if, notwithstanding acting prudently, the
appropriateness of the steps taken and the
decisions made are later questioned.
In each instance
the mortgage
broker needs
to consider what
steps need to be
taken to overcome
any barrier in
determining
capacity.
p38-43_Gifting.indd 43 14-05-08 2:27 PM
