An appeal from a trustee’s disallowance of a property claim in bankruptcy.
The appellant spouse asserted beneficial ownership of the matrimonial home pursuant to a settlement agreement executed prior to the bankrupt’s insolvency, transferring the bankrupt’s equity in satisfaction of debts owed to her.
The court considered whether the unregistered transfer created a resulting or constructive trust such that the property was excluded from the bankrupt’s estate under s. 67 of the Bankruptcy and Insolvency Act.
The court accepted evidence that the parties intended the transfer to repay funds advanced to the bankrupt’s business and concluded that the bankrupt retained no beneficial interest in the property.
The appeal was allowed and the trustee’s disallowance set aside.
