May 5 2026 | Joseph Zayouna

Catastrophic Injury and Capacity: When Guardianship or Power of Attorney Matters in Ontario

When a loved one suffers a serious brain injury in Ontario, your first worry is whether they will recover.. Very quickly, though, a second set of questions arrives: who pays the bills now, who talks to the insurer, and who decides about their care? If you are asking these things, you are asking exactly the right questions, and you are not behind. These decisions have a legal structure in Ontario, and understanding it early protects both the person you love and the injury claim that may help fund their recovery.

This guide explains, in plain terms, how decision-making authority works when an injury affects a person’s mental capacity, the difference between a power of attorney and guardianship, and why this matters for a catastrophic injury claim.

When a Serious Injury Affects Mental Capacity

“Capacity” is the legal ability to understand information relevant to a decision and to appreciate the consequences of making it, or not making it. After a catastrophic brain injury, a person may temporarily or permanently lose the capacity to manage their property or to make personal care decisions.

Capacity is not all-or-nothing. A person might be able to make some decisions but not others, and capacity can change as they recover. In Ontario, decision-making for an incapable adult is governed mainly by the Substitute Decisions Act, 1992. There are two ways someone can be authorized to step in: a power of attorney or a court-appointed guardianship. For some health and care decisions, Ontario’s Health Care Consent Act already lets certain family members decide without a guardianship order.

Power of Attorney: The Plan Made in Advance

A power of attorney (POA) is a document a person signs while they still have capacity, naming someone they trust to act for them. A Continuing Power of Attorney for Property lets the named person manage finances and property even after the person becomes incapable, and a Power of Attorney for Personal Care covers health care, housing, and daily living decisions.

If your family member signed these documents before the injury, the named attorney can usually step in without going to court. This is faster, less costly, and keeps the decision inside the family’s chosen plan. The catch is timing: a power of attorney has to be made while the person still has capacity, so after a catastrophic injury it is often too late, which is where guardianship comes in.

Guardianship: What Happens When There Is No Power of Attorney

If there is no valid power of attorney and the person can no longer make their own decisions, a family member can apply to become their guardian. In Ontario this generally means applying to the Superior Court of Justice and providing evidence of incapacity, often including a formal capacity assessment.

There can be a guardian of property, a guardian of the person, or both. Capacity is decision-specific, so a court can order a partial or limited guardianship that covers only the areas where the person cannot decide for themselves. Guardians answer to a higher level of oversight than an attorney under a POA; they may have to file a management plan and report to the Office of the Public Guardian and Trustee, and can be removed if they do not act in the person’s best interests. Guardianship is thorough and protective, but it takes time and involves cost and paperwork, which is one reason acting early matters.

Power of Attorney vs. Guardianship at a Glance

How Capacity Affects a Catastrophic Injury Claim

Decision-making authority is not just an estate-planning issue. It directly affects the injury claim itself. If the injured person cannot manage their own legal affairs, the claim is usually advanced by a litigation guardian who acts for them, and a settlement involving an incapable person often requires court approval before it is finalized.

This is also why catastrophic cases are often resolved with structured settlements and careful financial planning, so that compensation lasts across a lifetime of care. You can see the wider picture of a serious claim in our catastrophic injury claim checklist for Ontario, and learn more about these injuries on our brain injury page.

Long-term needs often overlap with disability benefits as well, which we cover on our long-term disability page.

Practical Steps to Protect Finances and Care Decisions

While every situation is different, families in this position can usually take a few sensible steps:

• Find out whether your loved one has already signed a power of attorney, and locate the documents.
• Secure finances early: protect bank accounts, pause or redirect automatic payments, and keep careful records.
• Keep medical and care records organized, since they support both care decisions and the injury claim.
• Get legal advice before signing anything from an insurer.
• If there is no power of attorney, ask a lawyer promptly about guardianship so the process is not delayed.

Frequently Asked Questions