CITATION: Lindsay v. Lindsay, 2021 ONSC 7085
DIVISIONAL COURT FILE NO.: 626/2021
DATE: 20211103
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
Swinton, Lederer and Doyle JJ.
BETWEEN:
SHELLY-ANN GWENDOLYN LINDSAY
Applicant (Respondent in Appeal)
– and –
MICHAEL LINDSAY
Respondent (Appellant in Appeal)
James Bennett, Andrew Rogerson for the Applicant (Respondent in Appeal)
Michael Lindsay, Self-represented Appellant
HEARD at Toronto (by videoconference): October 21, 2021
reasons for Decision
Doyle J.
Overview
[1] Michael Lindsay (“the husband”) appeals the order of Justice Finlayson dated June 29, 2021 (2021 ONSC 4674) where the Court granted Shelly-Ann Lindsay’s (“the wife”) motion for partition and sale of their jointly owned matrimonial home and dismissed the husband’s motion for summary judgment enforcing an agreement that he alleged had been reached by the parties on the matrimonial home.
[2] The two issues are interconnected, as the husband argued that the partition and sale should be not be ordered as the parties had an agreement whereby the wife would sell her interest in the matrimonial home to the husband provided that the husband would pay a loan in her name. He requests the order be set aside or, in the alternative, requests that all sale proceeds be distributed equally between the parties.
[3] The wife requests a dismissal of the appeal and costs. For the reasons that follow, I would dismiss the appeal.
Background
[4] The parties commenced cohabitation in 2009/2010, married on July 29, 2011 and separated in January-March 2020. The wife left the matrimonial home located in Whitby in July 2020 although she did return to it intermittently until February 2021.
[5] The wife is 53 years of age and works for Manulife where she earns approximately $75,000. The husband is 71 years old and is a college professor who is planning to retire. His annual income is approximately $200,000.
[6] After the parties were married, the husband purchased a 50% interest in the wife’s property for $56,017.66. This property is the matrimonial home and held as tenants-in-common.
[7] The husband borrowed $110,000 to finance the purchase of another property in Muskoka from the wife’s line of credit (“LOC”), which he admits is still owing to her.
[8] After the separation, the wife was interested in having the matrimonial home sold and the parties entered into negotiations.
[9] Most of the wife’s savings are in a Registered Retirement Savings Plan and she is currently paying half of the property taxes on the matrimonial home and the LOC.
[10] The husband has assets valuing a total of $3.2 million with numerous debts. He wishes to remain in the matrimonial home as part of his retirement plan.
[11] Counsel for the parties exchanged correspondence in an effort to resolve their issues, including the sale of the matrimonial home. The relevant exchanges for this appeal are:
i. A letter dated April 6, 2020, from the wife’s counsel marked “without prejudice” indicating that she was prepared to sell her interest in the matrimonial home for $315,000 provided that the husband paid the LOC;
ii. A letter dated May 4, 2020, from the husband’s counsel indicated that he would buy her interest for $295,000, pay the LOC and added terms dealing with household contents and expenses;
iii. A letter dated May 6, 2020, from the wife’s counsel marked “without prejudice” stated that the wife would accept $313,000 for her interest in the matrimonial home and she requested a full and final release of spousal support from the husband; and
iv. A letter dated May 12, 2020 from the husband’s counsel, stated that he accepted her offer to sell her interest for $313,000 but did not address the issue of the spousal support release and added other terms – for example, about contents and legal counsel.
[12] In August 2020, the wife commenced an application requesting, among other things, spousal support, a sale of the matrimonial home pursuant to the Partition Act, trust claims and a determination of property issues under the Family Law Act, R.S.O. 1990, c. F.3.
[13] In his answer, the husband included a claim for summary judgment regarding the alleged agreement for the transfer of the matrimonial home and dismissal of her claims. He did not claim spousal support.
[14] The parties attended a case conference on January 26, 2021. At that time, neither party could advise the Court as to whether the different dates of separation would have a significant impact on the financial issues. Spousal support was also discussed. The Court ordered, among other things, appraisals of four real properties owned by the husband (including Florida property) and business valuations of his two companies.
[15] The motions which are the subject of this appeal were heard before Finlayson J. on June 17, 2021 and his reasons were released on June 29, 2021. He granted the wife’s request for an order of partition and sale of the matrimonial home and dismissed the husband’s motion for summary judgment regarding an alleged agreement between the parties.
Issues on appeal
[16] The issues for this appeal are:
i. Did the motion judge err in not finding there was an agreement between the parties?
ii. Did the motion judge err in failing to find detrimental reliance?
iii. Did the motion judge err in granting the wife’s request for an order of partition and sale of the matrimonial home pursuant to s. 2 of the Partition Act, R.S.O. 1990, c. P.4?
Standard of Review
[17] As the Supreme Court of Canada noted in Housen v. Nikolaisen[^1], the standard of review on this appeal of a judge’s order is correctness on a pure question of law: at para. 8. Questions of mixed fact and law, which involve applying a legal standard to a set of facts and which lie along a spectrum, are usually subject to the more stringent standard of palpable and overriding error: Housen, at paras. 26, 36-37.
Husband’s Position
[18] The husband argues that the motion judge err in finding that there was no contract between the parties which provided that he would buy out the wife’s interest in the matrimonial home. The term regarding spousal support which was included in the wife’s offer was not relevant to the transfer of the property and had not been claimed in the husband’s pleadings.
[19] The husband argues that the motion judge’s order deprived the parties of the certainty and finality of a final agreement. His analysis runs contrary to the principles of contract law.
[20] Also, the motion judge is said to have erred in ordering the sale as the husband had detrimentally relied on the terms of the parties’ agreement and the wife should be estopped from seeking the partition and sale.
[21] Based on the record before the motion judge, he should have found that there was an agreement and he should not have made a finding indicating that it was “obvious” that the husband wanted to use the possibility of a future spousal support claim as a credit against any equalization payment he may owe the wife. The husband was not motivated by a claim for spousal support.
[22] The fact that there were no drafts of the agreement does not detract from the fact that there was an agreement.
[23] Regarding the sale of the matrimonial home, the motion judge failed to consider the prejudice to the husband as a 71 year old man living in the matrimonial home, how a sale would interfere with his retirement plans and the particular fact that he has spent years working on the gardens. The motion judge failed to consider the hardship that the sale would cause him.
[24] The motion judge erred in treating the wife’s request for partition and sale as a partial summary judgment motion, and hence this error tainted his analysis of the issues, including the parties’ respective burdens of proof with respect to a partition and sale.
[25] Mr. Lindsay argued that the motion judge erred in finding that he owed an equalization payment to the wife as there were two separation dates claimed (the husband says it was March 14, 2020 and the wife says it is January 1, 2020) thereby resulting in different net family properties for the parties.
[26] Alternatively, although not pleaded in his notice of appeal, the husband, in oral argument, requested that the Court order the release of all the sale proceeds to the parties upon the sale of the matrimonial home. The motion judge had ordered that $50,000 be distributed to each of the parties, as the wife had requested, and the balance would remain in the real estate lawyer’s trust account.
Wife’s Position
[27] The wife submits that the motion judge did not commit any palpable or overriding error in finding that there was no agreement between the parties. There was no unequivocal acceptance to an offer that was clear with respect to the terms of the agreement, and the parties were not ad idem.
[28] The husband did not accept the terms set out in the letter of the wife’s counsel dated May 6, 2020 and therefore, there was no meeting of the minds.
[29] Also, the motion judge did not commit an error in fact or law by not finding that there had been detrimental reliance or oppression. Based on the record before him, it was reasonable for the motion judge to make the conclusions that he did.
[30] The motion judge provided the proper analysis that resulted in ordering the sale of the matrimonial home.
[31] The wife objects to a change of the distribution of the sale proceeds, as this was not claimed in the notice of appeal and therefore was not addressed in the respondent’s materials. This issue is not properly before the Court and should not be considered by this Court.
Issue #1: Did the motion judge err in not finding there was an agreement between the parties?
[32] The motion judge did not make a palpable and overriding error in finding there was no agreement between the parties respecting the sale of the matrimonial home, and he did not err in refusing to order partial summary judgment.
[33] Based on the evidence before him, the motion judge did not err in denying the husband’s motion for summary judgment on the basis that the husband’s acceptance did not match the terms of the wife’s offer, and therefore there was no meeting of the minds.
[34] The motion judge acknowledged that pursuant to s. 55(1) of the Family Law Act, a domestic contract requires the following formalities:
55 (1) A domestic contract and an agreement to amend or rescind a domestic contract are unenforceable unless made in writing, signed by the parties and witnessed. R.S.O. 1990, c. F.3, s. 55 (1).
[35] The motion judge accepted that in the general law of contract, parties can be found to be bound by an agreement made through counsel pending litigation. See Harris v. Harris[^2] and Pastoor v. Pastoor[^3].
[36] He went on to thoroughly discuss the applicable legal principles concerning settlements by correspondence. There was no allegation of duress or disadvantage and both parties were represented by counsel.[^4]
[37] In my view, the motion Judge did not err in finding that there was no meeting of the minds. Based on the evidentiary record before him, there was no unequivocal acceptance of the wife’s offer in the May 12, 2020 letter from the husband.
[38] The husband’s counsel’s letter dated May 12, 2020 accepted the wife’s offer regarding the amount to buy out her interest in the matrimonial home for $313,000, but was silent on the other term of her offer, i.e. a waiver of the husband’s future claims of spousal support.
[39] The husband’s letter did not accept the full terms and thus constituted a counteroffer.
[40] The wife’s terms of the offer letter dated May 6, 2020 were not severable so that the husband could accept only part of the offer.
[41] Even though the husband submits that his request for spousal support was not “obvious” or tenable given his background and education, the motion judge did not err in finding that there was no agreement on the sale of the home, given the terms of the wife’s letter of May 6 and the failure to accept all of the terms in the husband’s letter of May 12.
[42] I see no error in his analysis and determination that there was no meeting of the minds.
[43] With respect to his role in a motion for summary judgment, he articulated and followed the analysis set out by the Supreme Court in Hryniak v. Mauldin[^5].
[44] At para. 73 of his decision[^6], the motion judge states:
The husband has failed to make out a prima facie case for judgment on this evidence. It is patently obvious on the face of the correspondence, that the wife’s offer to sell her share in the matrimonial home for $313,000.00 included the requirement that the parties enter into a spousal support release, but not a release of equalization. The husband’s response of May 12, 2020 was an obvious attempt to obtain the house at the $313,000.00 transfer price, while still preserving his ability to claim spousal support later on to offset the wife’s claim to equalization.
Even though the husband did not claim spousal support in his answer filed and there is an argument that a release of spousal support would not have provided him with additional consideration, nevertheless it was a term of the agreement.
[45] Therefore, I would not give effect to this ground of appeal.
Issue #2: Did the motion judge err in failing to find detrimental reliance?
[46] I find that the motion judge did not make a palpable and overriding error in finding there was no detrimental reliance.
[47] Despite the fact that the motion judge found there was no agreement based on the letters exchanged, he went on to consider whether the parties’ behaviour after the exchange of the above-mentioned correspondence was consistent with the existence of an agreement.
[48] Pursuant to r. 16(6.1) of the Family Law Rules, O. Reg. 114/99, the motion judge exercised his powers to determine if there was a genuine issue requiring a trial on this issue, that is, he weighed the evidence and evaluated the credibility of the parties.
[49] The motion judge thoroughly reviewed the evidence and drew reasonable inferences from the evidence as required under r. 16(6.1)3.
[50] Firstly, he did not accept the husband’s contention that the wife moved out of the matrimonial home for the final time in July 2020 because she knew she was transferring her interest to him.
[51] The evidence below belies that assertion by the husband:
The wife was continuing to pay 50% of the property taxes of the matrimonial home;
The husband was supposed to assume the LOC, but the motion judge noted that the husband had not taken over the responsibility and the wife had still serviced the debt for over one year; and
There were no draft agreements exchanged by counsel incorporating the terms of the alleged agreement.
[52] The husband’s contention that he wished to keep the matrimonial home as part of his retirement plans and all his belongings are in the home is not probative evidence that there was an agreement to sell, and that the wife should be estopped from denying the same. Finally, the motion judge had no evidence of part performance.
[53] Also, the motion judge made no overriding or palpable error in using his fact-finding power under the summary judgment provisions under r. 16. His findings are amply supported by the evidence.
[54] Based on the evidence, the motion judge did not err in finding that there was no agreement and in refusing to grant summary judgment and this ground of appeal fails.
Issue #3: Did the motion judge err in granting the wife’s request for an order of partition and sale under the Partition Act?
[55] I find no error in the motion judge granting the order for partition and sale.
[56] However, I note that it was not necessary for the motion judge to employ the analysis used in a summary judgment motion on this issue as the Partition Act provides the Court authority to grant an order for sale on an interim motion.
[57] The wife’s notice of motion simply requested a sale under that Act rather than summary judgment. Her factum before the motion judge articulated the law on that basis.
[58] Section 2 of the Partition Act provides the authority for ordering partition and sale without the need to proceed by way of summary judgment:
2 All joint tenants, tenants in common, and coparceners, all doweresses, and parties entitled to dower, tenants by the curtesy, mortgagees or other creditors having liens on, and all parties interested in, to or out of, any land in Ontario, may be compelled to make or suffer partition or sale of the land, or any part thereof, whether the estate is legal and equitable or equitable only. R.S.O. 1990, c. P.4, s. 2.
[59] In Martin v. Martin[^7], the Ontario Court of Appeal concluded that s. 10 of the Family Law Act did not grant a court the authority to order the interim sale of the matrimonial home, but the Partition Act does do so. Osborne J.A. stated:
There is, however, ample authority for an order for the sale of the jointly owned matrimonial home to be made pursuant to the provisions of s. 2 of the Partition Act . See Batler v. Batler (1988), 67 O.R. (2d) 335 (H.C.J.) and Silva v. Silva (1990), 1990 6718 (ON CA), 1 O.R. (3d) 436, 75 D.L.R. (4th) 415 (C.A.).
Although there is clear jurisdiction under the Partition Act to order the sale of the parties' matrimonial home I do not wish to be taken to have endorsed the wholesale issuance of these orders. In my view, an order directing the sale of a matrimonial home before trial should only be made in cases where, in all of the circumstances, such an order is appropriate. Orders for the sale of a matrimonial home made before the resolution of Family Law Act issues (particularly the determination of the equalization payment), should not be made as a matter of course. See Binkley v. Binkley (1988), 1988 8717 (ON CA), 14 R.F.L. (3d) 336 (Ont. C.A.). In addition, spousal rights of possession (s. 19) and any order for interim exclusive possession should be taken into account.
[60] Although it was not necessary for the motion judge to consider the principles applying to a summary judgment motion, this does not detract from the motion judge’s proper analysis as to whether such an order should be granted.
[61] It is common ground that a co-owner of land is entitled to bring the co-ownership to an end, either by partition or a sale, unless there is malicious, vexatious, or oppressive intent or conduct. No such conduct is alleged in this case.
[62] The motion judge remarked that there was no evidence of malicious, vexatious, or oppressive conduct on the part of the wife and referred to the leading cases Martin, above, and Silva v. Silva [^8].
[63] The motion judge reviewed the evidence and although there was no draft net family property statement, both financial statements showed two dates of separation and that “in very broad strokes”[^9] the husband would owe the wife an approximate amount of $200,000 equalization payment.
[64] The wife’s equity is tied up in the matrimonial home.
[65] The record indicated that the husband had multiple properties and condominiums and more liquidity than the wife.
[66] The parties had pleaded unequal division of net family properties, but neither party argued that this was a basis to defer the sale.
[67] The motion judge carefully canvassed whether the matrimonial home could possibly be a security for the husband’s equalization payment, and both parties agreed that given the husband’s other assets, the matrimonial home would not be needed as security.
[68] Neither party argued that the matrimonial home was needed to satisfy an equalization payment pursuant to s. 9(1)(d)(i) of the Family Law Act (i.e. a vesting order).
[69] Based on the evidence before him, the motion judge was entitled to exercise his discretion to make an order for partition and sale, and there is no basis for appellate interference with his order for sale.
[70] The husband now makes an alternative argument that if the sale of the matrimonial home is to proceed, the sale proceeds should be divided equally between the parties, rather than pay out only $50,000 to each party in accordance with the motion judge’s order.
[71] I would not give effect to this relief, as this was not articulated in the husband’s notice of appeal, and it is not captured by the broad relief sought in para. 4 of this notice of appeal: “Such further relief as this Honourable Court deems just”. The purpose of a notice of appeal is to alert the other party to the issues to be addressed on the appeal, and the disposition of the sale proceeds was not raised.
[72] Moreover, at para. 93, the motion judge’s analysis as to why $50,000 was to be distributed was reasonable based on the record before him. The husband’s motion material indicates that he did not make an alternative argument regarding the release of the funds. Therefore, there is no basis for this Court to interfere with the motion judge’s order regarding the distribution of funds.
Conclusion
[73] For these reasons, the appeal is dismissed.
[74] I have considered the costs requested by the wife. She is the successful party and is presumably entitled to costs. A fair and reasonable amount in the circumstances is that the husband pay the wife costs in the amount of $7,500 within 30 days.
Doyle J.
I agree _______________________________
Swinton J.
I agree _______________________________
Lederer J.
Date: November 3, 2021
CITATION: Lindsay v. Lindsay, 2021 ONSC 7085
DIVISIONAL COURT FILE NO.: 626/2021
DATE: 20211103
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
Swinton, Lederer and Doyle JJ.
BETWEEN:
SHELLY-ANN GWENDOLYN LINDSAY, Applicant (Respondent in Appeal)
AND:
MICHAEL LINDSAY, Respondent (Appellant in Appeal)
REASONS FOR DEcision
Doyle J.
Released: November 3, 2021
[^1]: 2002 SCC 33, [2002] 2 S.C.R. 235. [^2]: 1996 CarswellOnt 2794. [^3]: 2007 28331 (ON SC), [2007] O.J. No. 2851 (S.C.). [^4]: 2021 ONSC 4674, at para. 59. [^5]: 2014 SCC 7, [2014] 1 S.C.R. 87. [^6]: Supra, note 4. [^7]: 1992 7402 (ON CA), [1992] O.J. No. 656 (C.A.). [^8]: (1990), 1990 6718 (ON CA), 1 O.R. (3d) 436 (C.A.). [^9]: Decision : Para. 90