Court of Appeal for Ontario

Date: 2018-11-29 Docket: C64646

Judges: Strathy C.J.O., Benotto and Roberts JJ.A.

Between

Mark Styres Appellant

and

Alison Martin and Janet Frazer, by her Estate Administrator, Cyril Frazer Respondents

Counsel

Gerry Smits, for the Appellant

Howard E. Staats, Q.C., for the Respondents

Heard: November 23, 2018

On appeal from: the judgment of Justice Patrick J. Flynn of the Superior Court of Justice dated November 3, 2017.

Reasons for Decision

Background

[1] The appellant appeals from the dismissal of his action claiming damages arising from the disposition of a house which he had transferred to the respondent, Alison Martin, his former common law spouse, in 2004. He asks that the judgment be set aside and that he be awarded damages in the amount of $150,000, or, in the alternative, that a new trial be ordered.

[2] The appellant had lived in the house for 20 years. His father had given him the land on which he built the house.

[3] In 1998, the appellant suffered a catastrophic brain injury as a result of a motor vehicle accident and became unable to work.

[4] The appellant began a relationship with the respondent in about 2000. She became his caregiver and in January 2002, he signed a Power of Attorney for Personal Care and for Property, naming her as his attorney. On February 13, 2004, he transferred the house to her. The respondent paid off the appellant's $32,007 mortgage on February 13, 2004, the day of the transfer. The mortgage had to be paid off in order for the transfer to be registered. The parties did not have legal advice or assistance in preparing and registering the transfer.

[5] On December 23, 2009, the respondent granted a mortgage on the house to her mother, to secure a loan to her in the amount of $200,000.

[6] The parties separated in about 2013. The appellant requested that the respondent reconvey title of the house to him. She declined and shortly thereafter transferred the house to her mother, the defendant Janet Frazer, in satisfaction of the mortgage that had come due in 2012. After her mother's death in 2015, her estate sold the house for $300,000.[1]

Trial Decision

[7] At trial, the appellant asserted claims for damages, breach of trust, breach of fiduciary duty and unjust enrichment. The evidence at trial focused on the parties' explanations for the transfer of the house to the respondent in 2004.

[8] The appellant alleged that he had temporarily transferred the house to the respondent in trust to avoid its potential seizure because of Excise Act charges against him for his involvement in selling unmarked cigarettes. The trial judge preferred the evidence of the respondent and her daughter that the house was a gift to her from the appellant.

[9] In brief reasons, the trial judge rejected the appellant's explanation for the transfer and accepted the respondent's. He found that that the respondent was generous and kind to the appellant, gave him the proceeds of her caregiver cheques amounting to a couple of thousand dollars, purchased vehicles which he used, and helped him with child support and various bills, household expenses and utilities. He concluded that this was "hardly predatory conduct of one person taking advantage of another vulnerable one". He determined that there was no trust regarding the house without a written instrument in accordance with the Statute of Frauds, R.S.O. 1990, c. S.19.

[10] The trial judge rejected the evidence of the appellant's appraisal expert concerning the value of the house and found that the appellant would not be entitled to any damages if successful. He awarded costs of $30,000 to the respondent and $15,000 to the estate of her mother.

Appellate Analysis

[11] The appellant submits that the trial judge erred by failing to consider or address the various claims for breaches of trust and fiduciary duty, and unjust enrichment. He submits that the trial judge's reasons are deficient and preclude meaningful appellate review.

[12] We agree. The appeal must be allowed and a new trial ordered.

[13] This was a case of a disabled man, with a catastrophic brain injury and admitted cognitive difficulties, conveying his only significant asset to his caregiver and common law partner, who also held his power of attorney. He had no legal advice, let alone independent legal advice.

[14] While the trial judge was entitled to prefer the evidence of the respondent in relation to the reason for the transfer and to find a gift, those findings were not the end of the necessary analysis. The trial judge was required to address the issues that arose from the appellant's pleaded claims for breaches of trust and fiduciary duty, and unjust enrichment.

[15] In dismissing the trust claims, the trial judge simply said:

We've heard argument about a trust relationship, but there was no trust. Here we're dealing with real property. The Statute of Frauds would require a written instrument.

[16] The absence of writing would, of course, be no answer to a claim of resulting trust nor would it have any relevance to a claim for breach of trust or breach of fiduciary duty.

[17] Insufficient reasons that prevent meaningful appellate review constitute an error of law, reviewable on a correctness standard: Maple Ridge Community Management Ltd. v. Peel Condominium Corporation No. 231, 2015 ONCA 520, at para. 22. In our view, the deficiency of the trial judge's reasons precludes meaningful appellate review.

[18] Unfortunately, we are unable on the basis of the record before us to make the determinations necessary to dispose of the issues that the trial judge failed to address. A new trial is required.

Disposition

[19] Accordingly, the appeal is allowed and the matter is remitted to the Superior Court of Justice for a new trial on all issues before a different judge.

[20] The appellant abandoned the appeal against the estate of Janet Frazer and it is therefore dismissed.

[21] The appellant is entitled to his costs of the appeal from the respondent on the appeal in the agreed upon amount of $6,500, inclusive of disbursements and taxes. The respondent estate is entitled to its costs from the appellant in the amount of $2,500, inclusive of disbursements and taxes.

[22] Given the appellant's success on appeal, we set aside the award of trial costs in the amount of $30,000 to the respondent. As we direct that there be a new trial, we decline to award the appellant his costs of the first trial.

"G.R. Strathy C.J.O."

"M.L. Benotto J.A."

"L.B. Roberts J.A."

[1] The claim against the estate was dismissed by non suit at the conclusion of the appellant's case at trial. The appeal of that order was abandoned.