CITATION: O’Brien v. Bell 2023 ONSC 4140
DIVISIONAL COURT FILE NO.: 22-1314
(Oshawa)
DATE: 20230713
SUPERIOR COURT OF JUSTICE – ONTARIO DIVISIONAL COURT
RE: CAROL O’BRIEN and DONNA MCDONALD, Applicants / Respondents
AND: JANICE BELL (AKA JANICE DIVICENZO), Respondent / Appellant
BEFORE: COUNSEL:
HEARD:
D.L. Corbett, Trimble and Schabas JJ.
Gavin J. Tighe and Daria Risteska, for the Appellant
Robert H. Waddell, for the Respondents
at Oshawa by ZOOM, June 26, 2023
D.L. Corbett J. ENDORSEMENT
[1] We heard first from the respondents on the question of whether the impugned order is final or interlocutory, and then we heard from the appellant on all issues on appeal. Despite Mr. Tighe’s excellent written and oral submissions, we did not find it necessary to call upon the respondent on the main issues on appeal. We advised the parties that the appeal was dismissed, with these reasons to follow.
[2] The parties require a quick decision. The respondent, Carol O’Brien, is in her eighties and requires her share of the net proceeds of sale of the house to fund her living expenses. In this case, justice delayed would be justice denied.
Jurisdiction and Standard of Review
[3] The impugned order is either a final order under the Partition Act, RSO 1990, c.43, appeal from which lies to this court pursuant to s. 7 of the Act, or it is an interlocutory order made in the course of Partition Act proceedings, in which case appeal lies to this court with leave: Courts of Justice Act, RSO 1990, c.134, s. 19(1)(b). The question of whether the impugned order is final or interlocutory is addressed below. Either way, jurisdiction over appeal proceedings lies in this court.
[4] The “appellate standard” of review applies to this appeal: Canada (Minister of Citizenship and Immigration v. Vavilov, 2019 SCC 65. On questions of law, the standard of review is correctness. On questions of fact, the standard is “palpable and overriding error”. On questions of mixed fact and law, the standard of review is palpable and overriding error except in respect to extricable legal questions, to which the correctness standard applies: Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 SCR 235, paras. 8 – 37.
Final v. Interlocutory Order
[5] The subject property is a family home, title to which is held jointly by Ms O’Brien and Ms Bell, who are mother and daughter respectively. Ms O’Brien seeks partition and sale of the home and payment to her of her share of the net proceeds. Ms Bell opposes the application on the basis that, she says, Ms O’Brien gifted her interest in the home to Ms Bell. Disposition of the case is urgent in that Ms O’Brien was 82 years old at the time of the decision below (in May 2022) and needs her money out of the house to fund her expenses.
[6] The court below ordered sale of the house, with a distribution of some proceeds to Ms O’Brien and to Ms Bell, with the balance to be held in trust pending final disposition of the application, which will determine the parties’ precise entitlements.
[7] On one view, the order for sale of the house is a final order under the Partition Act– at least by implication it rejects Ms Bell’s claim to be entitled to a 100% interest in the property and grants the very remedy available on a final basis under the Act: sale of the property. A long line of cases has held that, even where terms have been ordered that are interlocutory (such as partial distribution and securing a balance pending further litigation), an order for sale extinguishes the parties’ rights to own and occupy the property and is therefore a final order: Hill v. Hill, 2017 ONSC 1683, para. 71 (SCJ), Niranjan v. Rajaghatta, 2020 ONSC 1321, para. 3 (Div. Ct.), Vlasiu
v. Saperia, 2021 ONSC 564, para. 2 (Div. Ct.). The Vlasiu decision does not provide details of the order under appeal, but a subsequent decision in that case shows that the impugned order included terms similar to those ordered by the court below in the case at bar: Vlasiu v. Saperia, 2021 ONSC 2733 (SCJ).
[8] In the face of this line of authority the respondent argues that since some of the terms of the order are interlocutory, leave is required. This is no answer to the line of authority described above. An order may contain aspects that are final and aspects that are interlocutory. Appeal rights are determined by examining the issue on appeal. In this case, the issue on appeal is the order for sale, which is a final order under the Partition Act. Leave to appeal is not required.
The Merits of the Appeal
[9] The court below was entitled to decide the issues before it on the basis of the materials filed, the applicable legal principles, the way in which the case was argued, and the justice of the case. The decision below rests on a conclusion that Ms O’Brien did not gift the entirety of her capital to her daughter when the house was purchased and title was taken jointly. The record below overwhelmingly supports this conclusion. The court below was not in a position to make precise findings about all the contested factual issues, and was not prepared to make findings about the precise division of net proceeds, given the scale of conflict in the untested affidavit evidence. But the court below was prepared to find that the property should be sold and some proceeds divided so that the parties could move forward with their lives pending final resolution of the remaining issues. I would emphasize, today, that this should be done without further delay.
[10] Procedurally, the court below could have characterized the proceeding as a motion for summary judgment, applied the test for summary judgment, and (to the extent that it found it necessary to do so), used the special powers afforded a judge on such a motion. Alternatively, the
court below could have characterized the proceedings before it as a motion for interim relief, and then applied the test in RJR McDonald to arrive at the order that was made. Instead, the court below approached the proceeding as it was presented to the court, on the materials provided to the court, and made an order that corresponded with the record, common sense and justice, leaving some matters to be decided later.
[11] The court below identified the correct principles on an application for partition and sale: the onus lay on the applicant to establish joint ownership. Once she satisfied that onus, the onus then lay on the responding party to establish a defence to the application, such as oppression.
[12] The primary issue on appeal concerns the first step of the analysis: did the applicant establish joint ownership. The uncontested evidence is (a) title to the property was taken jointly and was never changed; (b) Ms O’Brien advanced funds towards the purchase of the property – at least $80,000, and Ms Bell advanced no funds towards the purchase; (c) as recently as 2016, Ms O’Brien provided in her will that her share of the house would pass to Ms Bell on Ms O’Brien’s death (by implication, Ms O’Brien did not believe that her share in the house had already passed to Ms Bell by way of gift as of 2016).
[13] Ms Bell produced no documentary evidence to establish a gift of the entirety of the house to her at the time it was acquired or at any time thereafter.
[14] The “competing” affidavit evidence does not advance the analysis much further. On Ms O’Brien’s evidence, title would pass to Ms Bell on Ms O’Brien’s death, but not before. On Ms Bell’s evidence, this arrangement was a promise from which Ms O’Brien could not resile, and Ms Bell relied on it in organizing her life and financial affairs for many years. The point of departure – for this application – is whether the promise – as understood by Ms Bell, was an outright gift to Ms Bell from the outset. If it was, then Ms Bell could have kept the house and excluded Ms O’Brien from it.
[15] Ms Bell’s characterization would have it that Ms O’Brien, now in her eighties, is left destitute and dependent on the charity of her other daughter, Ms McDonald. In response to this point, counsel for the appellant noted that Ms O’Brien could move back into the house with Ms Bell and her family. Ms O’Brien does not wish to do this. And just as a decision to take title jointly does not preclude a change of heart later, neither does it compel Ms O’Brien to live with Ms Bell after their falling-out.
[16] Counsel for Ms Bell argued that alternative arrangements could have been made to enable Ms O’Brien to access equity in the home to fund her cost of living. This is true. But those options were not put to the court below, nor would there be a legal basis for the court to impose such terms if they were not agreed. The issue decided by the motion judge is stark. If Ms Bell is correct, she would be entitled to exclude her mother from the house and would have no obligation to use equity in the home to provide funds to her mother.
[17] It is in this context that I read the following passage taken from the decision below:
There is clearly a dispute amongst the parties regarding their relationship and the property. I cannot solve that dispute on the material filed as none of the parties an affiants have been cross- examined. (Decision, para. 10)
In context, this statement concerns the exact division of proceeds of sale, and not the issue of whether the mother has an interest in the house. Clearly, she does, and the court below was satisfied – on an interim basis – that her interest is at least 25% - if not the full 50% reflected in the way in which title is held. I see no palpable and overriding error in this conclusion.
[18] The application judge concluded that the request for sale – though it may work some hardship on the appellant – is not oppressive. This finding does not disclose a palpable and overriding error: Ms O’Brien needs access to her capital to fund her expenses.
[19] Ms Bell alleges undue influence, and that Ms O’Brien’s capacity is declining. The application judge reviewed the evidence tendered in support of these allegations and found it wanting. I see no error in this conclusion. There is a presumption of capacity, and the constellation of facts does not support a conclusion that Ms O’Brien chose to leave her home of many years to enter a retirement facility for anything other than her own reasons, principally the falling out between her and Ms Bell. Her decision to move in with Ms McDonald came later, a sequence of events inconsistent with an “undue influence” theory of the falling out between mother and daughter.
[20] I would dismiss the appeal, with costs in the agreed amount of $7,500, inclusive, payable by the appellant to the respondent.
D.L. Corbett J.
I agree:_______________________________
Trimble J.
I agree:_______________________________
Schabas J.