COURT FILE NO.: CV-11-51981

DATE: 2013/01/15

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

LAURIE KAVANAGH

Plaintiff/Defendant by Counterclaim

– and –

MARK LAJOIE

Defendant/Plaintiff by Counterclaim

Dani Grandmaître, for the Plaintiff/Defendant by Counterclaim

Claude-Alain Burdet, for the Defendant/Plaintiff by Counterclaim

HEARD: March 27-28, July 5-6, and September 5-6, 2012

REASONS FOR decision

Kane J.

[1] This action concerns the entitlement to property located at 299 Oakdale Avenue (“Oakdale”) in the City of Ottawa. The issue is whether the plaintiff/defendant by counterclaim exerted undue influence and dominance over her father to become an owner as a tenant in common, to the detriment of her brother, the defendant/plaintiff by counterclaim.

[2] The defendant son seeks to set aside the conveyance of an interest by his late father to his sister and argues that he, under the previous registration as joint tenant with the father, is now, as survivor, the exclusive owner of Oakdale. The son alleges the transfer from joint tenancy to tenancy in common is the result of his sister exerting undue influence on the deceased father. The son places in issue the father’s mental capacity to manage his affairs and understand this transfer of a one-half interest to his sister.

[3] The son further argues that under the joint tenancy ownership of Oakdale by him and his father, he, upon registration of that conveyance, received an inter vivos gift of survivorship which cannot be defeated by the subsequent transfer by the father to the daughter. Accordingly, the son seeks to nullify and void his father’s termination of the previous joint tenancy and the transfer of the father’s interest to his daughter.

[4] This Court’s interim decision dated December 23, 2011 denied the sister’s request for an order of partition and sale of Oakdale because the brother opposed that sale and alleged he alone was the rightful sole owner. Since then, Oakdale was sold on consent of these siblings. The net proceeds were paid into court awaiting this decision.

[5] At trial, the defendant, pursuant to his remedy to set aside the current registered title, was ordered to proceed first in presentation of evidence and argument, followed by his sister. That sequence of presentation of evidence and argument does not alter the legal onus of the parties or the issues to be decided.

FINDINGS OF FACT

[6] The parties are the only siblings of the late Donald and Marilyn Lajoie (Mr. and Mrs. Lajoie). Mark is the older of these two siblings. He was adopted by the Lajoies before the birth of Laurie.

[7] Marilyn Lajoie died in November, 2004. Donald Lajoie died in June, 2010. Each of the parties is married with children.

[8] Donald Lajoie was in his 70s during the events under review. Before retirement, he had worked in the insurance industry and later in property management.

[9] Mr. and Mrs. Lajoie over the years have been extremely generous to each of their adult children. Each of the children received gifts in the form of an interest in real property and money. Each of the parties received an automobile from the parents. The parents paid off the son’s student loans. The family cottage was sold to the daughter and her husband for some $20,000 in 1997 and paid for at the rate of $250 per month over the next eight years. Laurie later, after some renovations, sold the cottage for some $80,000. Mr. Lajoie paid for renovations to Laurie’s home. The parents’ tradition of generosity was not replicated in the parties’ treatment of one another.

[10] Mr. and Mrs. Lajoie over the years owned several residential properties in Ottawa. They lived at 178 Breezehill Avenue (“178”). They also owned 184 Breezehill Avenue (“184”). Mr. and Mrs. Lajoie told their children and it is accepted by the parties that the parents’ plan and hope was that each of the children would receive, as a gift title, to one of these properties and thereby live close to their parents. Specifically, in the plan of the parents, 178 was to go to Mark while 184 was to be for Laurie.

[11] By 2003, Mr. Lajoie was given the Oakdale property by Aunt Nellie who thereupon moved into a seniors’ home. Mr. Lajoie felt obliged to protect that property in case Aunt Nellie required financial assistance in the future. He was sensitive to it being sold to someone outside the family before her death.

[12] Mrs. Lajoie up until her death in 2004 encouraged Mark and his future wife to consider taking and moving into Oakdale, in substitution for 178, to avoid having to wait until she and her husband vacated 178.

[13] The daughter, Laurie, began to realize this parental plan as early as 1997 when she and her husband began living rent free in 184. They carried out repairs to update this property during their occupation.

[14] The original plan enunciated by Mrs. Lajoie took further form following her death in November, 2004. On January 16, 2005, Mr. Lajoie transferred title of 184 to Laurie and her husband so they could sell it and apply the sale proceeds against their purchase of a new home in Ottawa on Hare Street. Mr. Eric Honey acted as solicitor for them on the purchase of the Hare Street property.

[15] 184 was sold by Laurie and her husband for some $265,000. They renovated the Hare Street property over the following year. In the interim, Laurie and her family moved into and lived with her father at 178. Mr. Lajoie and the Kavanaghs moved into the Hare Street property in 2006. Laurie’s father paid for some of the renovation costs of the Hare Street property. Laurie testified she cannot remember how much of the renovation costs her father paid for.

[16] At the time of transferring 184 to Laurie in early 2005, Mr. Lajoie told his son that he wanted to sell 178 to access money to live on. Mr. Lajoie proposed that his son’s “interest” in 178 be transferred to Oakdale. Mr. Lajoie showed Mark appraisals of Oakdale and of 178. Mr. Lajoie said that if Mark agreed to this change, title in Oakdale would be transferred from himself to Mark and him as joint tenants, and later transferred to Mark alone when Mark moved back to live in Ottawa. Mark agreed. Mark thereupon or shortly thereafter suggested to his father that Oakdale be rented in the interim. Mr. Lajoie said not then.

[17] Mr. Lajoie thereupon engaged the legal services of Mr. Honey who prepared and registered a transfer of the Oakdale title from himself to him and his son as joint tenants in February, 2005. Mr. Lajoie and Mark attended and executed a direction and authorization at Mr. Honey’s office on February 7, 2005, transferring title to them as joint tenants for a consideration of $2.00.

[18] The events of life intervened in the parental plans of Mr. and Mrs. Lajoie. Mark was finishing his doctoral studies in July, 2005 and was living in Montreal. Mark got married in 2005. He commuted on occasion for work to Ottawa while continuing to live in Montreal. He slept in the Oakdale property several nights per week in 2006 and 2007. Mark’s wife obtained employment and as a result they moved to Regina in July, 2007. They were anxious to buy a home in Regina, preferably without a mortgage.

[19] Oakdale had remained vacant between 2003 and 2007 in anticipation that Mark might move back and live in Ottawa.

[20] In the spring of 2006, Mr. Lajoie purchased a van for himself and used money from Aunt Nellie’s account for the down payment and subsequent monthly payments. Title of the van was transferred in 2007 to Laurie after Mr. Lajoie lost his license. Monthly payments thereafter continued to be paid out of Aunt Nellie’s bank account.

[21] In July, 2007, Mark again proposed to his father that Oakdale be rented in the hope of raising some money from the property. Mark found a tenant, negotiated the terms of the lease, and understood that he had his father’s agreement. Mr. Lajoie then changed his mind and said no. Mark admitted this caused a heated conversation with his father. The proposed tenant had terminated his existing lease in anticipation of moving into Oakdale. It was awkward as the proposed tenant was a friend of Mark.

[22] Anxious to access his interest in Oakdale, Mark on several occasions after moving to Regina asked Mr. Lajoie to agree to sell Oakdale so he could buy a home in Regina without a mortgage. Mr. Lajoie refused these requests to sell Oakdale but understood his son’s desire to access the value of Oakdale. From Mark’s point of view, he had received no money since becoming a joint tenant of Oakdale or upon the sale of 178. In Regina, he was anxious to access benefits as his sister had.

[23] Mark also suggested to Mr. Lajoie several times during 2008 and 2009 that the Oakdale property should be sold. Mr. Lajoie did not agree.

HEALTH OF MR. LAJOIE

[24] Mr. Lajoie, who had always been very active, began to experience some health issues. He was treated for prostate cancer in 2002. At 76 years of age, his hip was replaced in June, 2006. He suffered a stroke in August, 2006 and had a mild stroke in October, 2006. Mr. Lajoie moved into a nursing home for a short period and disliked that. His daughter offered him the use of a condominium she and her husband owned or to come and live with them. He chose the latter and moved in with approximately October, 2006 just before his second stroke. He then spent three months in hospital in a rehabilitation program. He returned to and lived with his daughter and her family from December, 2006 until his death in June, 2010.

[25] Laurie was given signing authority on Mr. Lajoie’s bank account in 2005. She also had signing authority on Aunt Nellie’s bank account.

[26] Mr. Lajoie’s residence with his daughter permitted the sale of 178. Mr. Kavanagh prepared 178 for sale. 178 was sold by Mr. Lajoie in 2007.

[27] Following the sale of 178, Laurie heard her father on the telephone with Mark. Her father was talking about his sale of 178. She testified that the conversation on her father’s part was heated. Following that call, Mr. Lajoie asked her to send Mark a copy of the Mrs. Lajoie’s will to demonstrate that 178 was bequeathed to Mr. Lajoie and not Mark. Mark was hoping to receive some or all of the sale proceeds of 178. Based on the prior statements by his mother, Mark anticipated his mother’s will would state that he was to receive 178. Her will provided that all of her estate was left to Mr. Lajoie.

[28] Mr. Lajoie had a bed/sitting room on the first floor of the Hare property where resided until his death in 2010. Upon moving in with his daughter, Mr. Lajoie required the presence of a caregiver. He had lost some use of his left arm and was walking with the aid of a walker. The caregiver continued employment in the Kavanagh home as a live-in nanny/housekeeper and was paid throughout by Mr. Lajoie until his death.

[29] Mr. Lajoie did not pay rent to Laurie while living with her. He did however make occasional financial contributions above his payment of the cost of the caregiver/nanny/housekeeper.

[30] Mr. Lajoie signed a power of attorney for personal care prepared by Mr. Honey in favour of Laurie and in the alternative, her husband, in August, 2007. On the same date, Mr. Lajoie signed a will in which his residue was to be divided equally between Laurie and Mark. Laurie was named executrix and her husband, as alternate trustee.

[31] Mark and his wife purchased a home in Regina in the spring of 2009.

THE PROPOSAL

[32] In June, 2009, Mr. Lajoie, who was then 79 years old, advised his son that he was reluctant to sell Oakdale but he would present a proposal regarding Oakdale during his son’s upcoming July visit to Ottawa which would keep Oakdale in the family and get some money to the son. No other details of the proposal were then provided to Mark.

[33] Mr. Lajoie presented the specifics of his proposal to mark at the Kavanagh home on July 12, 2009. The proposal involved the prior involvement and agreement of Laurie and her husband. Laurie admits that she and her father prior to July 12, 2009, considered several scenarios as to Oakdale and Mark’s need to access money from it. Laurie and her husband were the key to raising money to buy out Mark’s interest in Oakdale.

[34] As part of the discussions between Laurie and Mr. Lajoie, it was necessary to determine a value of Oakdale. Laurie contacted a real estate agent and obtained copies of property listings considered similar in nature and condition to Oakdale. Mr. Lajoie and Laurie concluded that the value of Oakdale in 2008 was approximately $350,000 and, due to a decrease in property values, was worth $320,000 in 2009. Laurie agreed in testimony that she settled with her father how much her brother would be offered for his interest in Oakdale in July, 2009.

[35] Conceptually, Laurie considered Mark as being entitled to one half of the value of Oakdale. Laurie and her husband were prepared to buy out Mark’s one-half interest if they received a quit claim deed in return. The plan was for the father to communicate the proposal to Mark upon his visit to Ottawa, get Mark’s agreement and then meet with a lawyer immediately to get the paperwork signed, transferring title of Oakdale.

[36] Laurie testified she and her husband only agreed to purchase her brother’s interest in Oakdale in order to help her father and eliminate Mark’s pestering of Mr. Lajoie which she found troublesome. That however was not her only incentive. She testified that she and her husband were not seeking to buy one-half of Oakdale. She did not want to own it jointly with Mark. Her position was that Mark had to be bought out of Oakdale.

[37] Mr. Lajoie understood but had become of Mark’s persistent attempts to access money from Oakdale. Mark admitted that after moving to Regina, he asked his father on several occasions for permission to rent and sell it. In each case Mr. Lajoie would not consent.

JULY 12, 2009

[38] In her affidavit, Laurie states Mr. Lajoie offered and Mark accepted to release his interest in Oakdale for $165,000 but then reversed his acceptance on July 14th, the date of the meeting with Mr. Honey to sign the transfer. She also testified that her father’s ultimate gift to her of one-half of Oakdale came as a complete surprise. There are contradictions in these positions and the instructions she communicated to Mr. Honey.

[39] Mr. Kavanagh normally would have been aware in July, 2009, how much money he and his wife, or his wife, was agreeing to pay to buy out Mark’s interest in Oakdale. His evidence and affidavit are silent on the point. He states in his affidavit:

35. I do not recall anything specific of the events that transpired in the month of July 2009 which resulted in Donald severing the joint tenancy and transferring his half interest of 299 Oakdale to Laurie.

[40] Mr. Kavanagh was not asked during his testimony any questions as to the details of the offer agreed upon by Laurie and presumably himself before it was communicated to Mark on July 12, 2009.

[41] The 2009 appraised value of Oakdale at $320,000, less a real estate commission Laurie testified her father conceptually deducted, divided by two, equals $150,000. One-half of the 2008 appraised value of Oakdale at $350,000, less 6% commission, produces the figure of $165,000. Laurie testified the offer of $165,000 was more than the then current market value for one-half of Oakdale which she felt was $150,000.

[42] Mark and his wife arrived in Ottawa on July 11, 2009. They came to Laurie’s house and visited on Sunday, July 12, 2009.

[43] Mark testified that Mr. Lajoie, in the presence of Laurie, proposed that Mark would receive a total of $270,000 for a release of his interest in Oakdale, being the $320,000 less real estate commission. The sum of $120,000 was to be paid to him immediately by Laurie, with the $150,000 balance to be paid in ten years.

[44] Mr. Lajoie showed Mark a 2008 appraisal of Oakdale in the amount of $350,000 and a property assessment of $320,000 for 2009. Mark expressed concern with the values presented and pointed out he was being asked to accept a reduced market value price of $270,000 ($320,000 less a fictional commission) with the majority of that not to be paid, without interest, for ten years while the property value would increase to Laurie’s benefit.

[45] Both Mark and his wife testified, which I accept, that Laurie was present for parts of the above discussions. Laurie urged Mark to accept the proposal as fair. Laurie’s testimony that she made no comment to Mark about releasing his interest in Oakdale on July 12, 2009, is inaccurate.

[46] Mark in discussion of the proposal on July 12, said that perhaps Laurie should pay him $150,000 then and receive Mr. Lajoie’s interest in Oakdale, Laurie and Mark would become co-owners of Oakdale and when it was sold in the future, each of them would receive one-half of the proceeds of sale. Mr. Lajoie responded that he and Laurie had discussed but discarded the possibility of them owning Oakdale together as they could not get along.

[47] Laurie’s email to Mr. Honey records title of Oakdale was to be transferred from Mark and Mr. Lajoie to Laurie and her husband, not a transfer from Mark to her, nor a transfer to Laurie and Mr. Lajoie. Laurie and her husband were not offering to pay Mark $270,000 for a one-half interest in Oakdale.

[48] The testimony of Mark and his wife, combined with Laurie’s email to Mr. Honey lead to the conclusion that the proposal was for the Kavanaghs to buy all of Oakdale for $270,000 and not $165,000 for Mark’s one-half interest as Laurie testified.

[49] Mr. Kavanagh was called as a witness by Laurie. He testified he was aware an offer was to be presented in July, 2009 to Mark regarding Oakdale, however he was not present when the offer was made. As stated, Mr. Kavanagh was not asked in testimony how much Mark was to be offered.

[50] It is further noted that the consideration of $270,000 is similar to and logically consistent with the $265,000 benefit Laurie obtained on her sale of 184. Laurie was directly involved in setting the price and terms of the offer communicated by Mr. Lajoie to Mark on July 12, 2009. The terms thereof had to be acceptable to her or to her and her husband.

[51] The proposal was communicated by Mr. Lajoie, however it was in substance an offer from Mr. Lajoie and Laurie.

[52] Laurie’s testimony that she did not know who decided what the proposal price would be is not credible. Laurie, and likely she and her husband, settled on terms of consideration acceptable to them and to be paid by them. Mr. Lajoie agreed and presented the proposal.

[53] The obvious attraction to the $270,000 offer made to Mark was that he would get some money immediately and in ten years, would receive in total, almost the same monetary amount Laurie had received out of 184. In the interim, Oakdale could be rented which would insure a revenue flow would be available for the benefit of Aunt Nellie. Oakdale in fact had been rented since 2008, with the income retained to pay operating expenses of Oakdale, the van payments, and to offset costs of Aunt Nellie.

[54] Transferring Oakdale at that time to Mark would result in its immediate sale and the resulting elimination of the existing revenue stream. Mr. Lajoie was opposed to that. The sale of Oakdale and elimination of the revenue stream would negatively impact Laurie who would then have to make the van payments alone.

[55] Had the $270,000 offer been accepted, Laurie would benefit as the price proposed for Oakdale was at a market low, further reduced by a fictional real estate commission, a 10-year interest-free loan and market value increase during ten years. If Aunt Nellie passed away as she did in January, 2011, Laurie would further benefit from the rental income from Oakdale. Mr. Kavanagh could continue to maintain Oakdale in the interim, as had been the case since 2003.

[56] Laurie was invested in the proposal her father communicated and hoped Mark would accept it. The key was obtaining Mark’s consent.

LAURIE’S EMAIL OF JULY 12, 2009

[57] Requiring the services of a lawyer, Ms. Kavanagh contacted Mr. Honey’s office prior to the July 11th weekend. She advised Mr. Honey’s office that they needed to come in quickly to have documents signed to transfer ownership of Oakdale and asked that that be done by Tuesday, July 14, 2009. Laurie repeated this request via email to Mr. Honey sent by her shortly after 8 p.m. on Sunday, July 12, 2009. She then faxed this email to Mr. Honey’s office later in the afternoon on July 13, 2009, and telephoned his office a few minutes later to confirm receipt of the fax.

[58] The production of this email from Laurie occurred pursuant to an undertaking given on her cross-examination in 2011. It was not among the exhibits attached to her previous three affidavits. Laurie’s January 12, 2012 affidavit states that Mark agreed to sell his one-half interest in Oakdale to her for $165,000 on July 12, 2009, whereupon Mr. Lajoie contacted and set up an appointment with Mr. Honey, following which Mark changed his mind and refused to sell his interest for $165,000. This version of the proposal is inaccurate.

[59] Laurie does not deny sending this email to Mr. Honey but alleged in-chief that she has no recollection of the email or its contents.

[60] Laurie’s email refers to her prior discussion with Mr. Honey or his staff and states:

(a) “We” would like to change the registered owners of Oakdale from Mr. Lajoie and Mark to herself and her husband.

(b) She hoped the legal documents to accomplish this could be signed on Tuesday, July 14, 2009, because her brother would then be in Ottawa.

(c) The reduced legal fees for the above transaction would be $300.

[61] Laurie testified she could not explain why her email refers to her and her husband becoming the owners of Oakdale.

[62] Whether the offer was $270,000 payable over ten years or $165,000, Mark was being asked to sign off any interest in the property. He was not prepared to do so.

JULY 14, 2009

[63] Mark dropped by Laurie’s house to say goodbye to his father on Tuesday, July 14, 2009. He and his family were about to drive back to Toronto on their return to Regina. Laurie testified that beyond answering the door and saying hello to Mark, she did not speak to him. In fact, Laurie asked Mark if he could stay long enough to attend the appointment scheduled that day with Mr. Honey. Mark said no and told Mr. Lajoie that he had decided to not accept the July 12 proposal, that he would wait until property values increased and Oakdale was eventually sold.

[64] Laurie had not told Mark about the scheduled appointment that day with Mr. Honey. That nondisclosure evidences the tension in their relationship and Mr. Lajoie’s decision to tell Mark very little in advance about the buyout plan until he was present in Ottawa.

[65] On July 14, 2009 Laurie became annoyed upon hearing Mark’s decision not to sell Oakdale. She expressed that annoyance to Mark and stated that he would have to pay for the cancellation of the appointment with Mr. Honey. Mr. Lajoie interjected and stated he would pay for the appointment. Laurie’s evidence that Mark’s wife was not present for this conversation is incorrect. Up to that point, Mark’s wife had had a good relationship with Mr. and Mrs. Lajoie and had no reason to not come in to say goodbye to her father-in-law. She testified that as of this July, 2009 visit, she had no concerns as to Mr. Lajoie’s cognitive capacity.

[66] Mark suggested in this conversation to his father that they simply leave Oakdale as it was currently registered and wait until the real estate market values improved and the property was sold. That would have kept Oakdale in the family in the interim and maintained the revenue stream for Aunt Nellie’s protection. It left open however the likelihood of Mark continuing thereafter to request of his father that Oakdale be sold. Mark and his wife said their goodbyes and left. Mark believed the status quo would continue. He knew his father’s age and state of health. He understood as joint tenant that he would become sole owner upon his father’s death.

[67] Mr. Lajoie and Laurie were disappointed a deal had not been struck. Given his age and state of health, a continuing push by Mark to liquidate Oakdale was not what Mr. Lajoie wanted, especially as a sale would defeat his wish to use Oakdale as a revenue stream to assist Aunt Nellie and make the monthly van payments. Laurie was disappointed as the proposed sale was to her advantage. She had agreed with her father to maintain Oakdale until Aunt Nellie’s death, the property would over time increase in value, the revenue stream paid her van payments and would halt the pressure from Mark on their father.

[68] Over the next year, Mark and his father spoke several times by phone. Those talks included the possibility of renovating Oakdale and using the rental income to pay for the renovations.

[69] Under the proposal, the effect was that Laurie would receive more from the parents than Mark had received, even though historically the parents had always attempted to treat both siblings equally. The issue is whether Mr. Lajoie was acting under undue influence from Laurie or some form of mental incapacity in conveying that added benefit from Oakdale to her.

[70] The assets in Mr. Lajoie’s estate at the time of death, including death benefits, totalled some $21,000. His then debts totalled some $13,000. If Mr. Lajoie wanted to do something extra for the consideration and care his daughter and son-in-law had shown him since 2006, he could only afford to do that through Oakdale.

[71] Laurie, at the time and now, as confirmed in her testimony, is comfortable with and justifies her receipt of a greater share of her parents’ wealth because she and her husband cared for Mr. Lajoie since 2006. She denies she exerted any influence on her father to obtain this greater share via her part ownership in Oakdale.

[72] Mark testified that he has no direct evidence of Laurie exerting undue influence on his father, only circumstantial evidence.

[73] Mark has no evidence that any of the Oakdale rental income was used for anything other than Oakdale property costs and for Aunt Nellie. He simply has never received an accounting from his sister and does not trust her.

[74] Mark on the other hand never paid anything towards Oakdale expenses since moving to Regina. He left the maintenance and cost issues to his father and Laurie to care for. He has no knowledge beyond documents produced in this trial what revenues or monies were received from the property or how they were spent.

MEETINGS WITH MR. HONEY

[75] By July, 2009 Mr. Honey had previously acted on several prior occasions for Mr. Lajoie and other members of his family dating back some 15 years. Those prior occasions included the 2005 transfers of 184 and Oakdale in 2005 and the sale of 178 in 2007.

[76] In the 2005 transfer of Oakdale to Mark and Mr. Lajoie, Mr. Honey would have acted for the transferor and the transferees, including Mark.

[77] Mr. Honey acted as solicitor for Laurie and her husband on several occasions prior to 2009, including the preparation of their wills, the purchase of their condo, on the sale of 184 and their purchase of 941 Hare.

[78] Laurie testified that after Mark’s refusal of the proposal on July 14, 2009, Mr. Lajoie decided to proceed with the appointment with Mr. Honey. She drove her father to the lawyer’s office and remained in the waiting room. Mr. Lajoie met with Mr. Honey. That meeting and the next several meetings between the two men resulted in a registration of a transfer on Oakdale by Mr. Lajoie to himself, thereby severing the joint tenancy and converting title to himself and Mark as tenants in common. Mr. Lajoie thereupon transferred his interest as tenant in common to Laurie for $2.00 consideration.

[79] When Mr. Lajoie attended upon Mr. Honey, he did not have Mark’s agreement to convey his son’s interest in the property. Mr. Lajoie could not change that. What he could still control however was the elimination of having to deal with Mark on this issue in the future and keeping Oakdale and the revenue from it, available so long as another family member was a title owner, subject to a partition and sale action. At 79 years of age and reduced health, Mr. Lajoie wanted to do something further for Laurie and her husband and he wanted the Oakdale title resolved. He did not want Oakdale sold then which would have been the case if Mark owned it alone.

[80] Mr. Honey has practiced in the area of estates and real estate for some 36 years. In the preparation of wills, he has seen many testators leave more to one as opposed to another family member. If he has any concern why that is occurring, his practice is to inquire whether the testator is under any pressure to divide unequally.

[81] In real estate work, he has on many occasions acted to sever a joint tenancy by one of two separating spouses, even when he acted for both spouses on the purchase.

[82] He stated that in his areas of work, it is very common to act for several generations of the same family.

[83] Mr. Honey testified that he met with Mr. Lajoie alone on July 14 or 15, 2009. Mr. Lajoie stated that he wanted to transfer his interest in Oakdale to Laurie. Mr. Honey explained to him that such a transfer would sever the joint tenancy with Mark and remove the right of survivorship in Mark’s favour. With that explanation, Mr. Honey asked Mr. Lajoie whether that was truly his intention. Mr. Lajoie replied in the affirmative. Mr. Lajoie stated that he had changed his previous intention that Mark would, by survivorship, become the sole owner upon his father’s death.

[84] Mr. Honey testified that in their first meeting, Mr. Lajoie appeared upset with his son, that there had been family discussions regarding transfer of title of this property but it could not be done by agreement. Accordingly, Mr. Lajoie instructed Mr. Honey that he wanted to transfer an interest in the property to his daughter.

[85] Mr. Lajoie alone and then Laurie at a later point signed a direction and authorization on July 14, 2009, in Mr. Honey’s office authorizing the registration of a transfer document attached. As introduced as exhibits, the direction and draft transfers were separate documents. Mr. Honey testified that clients of his are never asked to sign directions without the documents it refers to being attached at the time. The Court is left with the testimony of Mr. Honey who stated that the direction and transfer are printed off and signed at the same time. The Court has no contrary evidence as to what transfer documents accompanied which directions.

[86] The directions have a box to be ticked if the document authorized is a transfer, a mortgage or another document. The boxes on these directions are not ticked however that level of detail is not determinative of the issues in this case.

[87] Mr. Honey on July 14, 2009, initially incorrectly understood that one transfer only was necessary under Land Titles to severe the joint tenancy and transfer Mr. Lajoie’s severed interest in Oakdale to Laurie. Upon presentation for approval to the Land Titles office, he was advised that two transfers were necessary unless Mark joined with his father in a transfer to Mark and Laurie as tenants in common, in which case only one transfer was required. Mr. Honey did not have such an instruction from Mark to prepare a single transfer from him and his father to Mark and his sister.

[88] A decision was made to proceed with two transfers rather than one, thus avoiding the requirement to obtain Mark’s signature on a single transfer. Mr. Honey believed that Mr. Lajoie and Laurie’s intention was to keep Mark unaware of the transfer and severance.

[89] Accordingly, Mr. Honey then prepared one transfer from Mr. Lajoie to himself and a second transfer from Mr. Lajoie to Laurie. Mr. Honey then called and had Mr. Lajoie re-attend at his office on July 21, 2009, to explain the necessity of two transfers. Mr. Honey states that he explained the error to Mr. Lajoie and that he would have to register two transfers. Mr. Honey acknowledges that he should have obtained two directions signed by Mr. Lajoie on July 21, 2009, rather than one and should not have relied upon the July 14 direction for the second July 21 transfer.

[90] Mr. Honey states that he confirmed with Mr. Lajoie on July 21, 2009, that it was still his intention to sever the joint tenancy with Mark and transfer his resulting one-half interest to Laurie. Mr. Lajoie confirmed that remained his intention.

[91] Mr. Honey does not accept that he was in a conflict to the interests of Mark in carrying out the instructions of Mr. Lajoie to sever the joint tenancy and transfer his interest to Laurie. He explained this occurs frequently in spousal separations. He is of the opinion that faced with this request, he has no legal obligation to call Mark and advise of the request to register a transfer severing the joint tenancy. He states that such a communication would breach his confidentiality as to the instructions received to sever without consent, which he does not consider is his responsibility to ask for. He states that in July, 2009, Mr. Lajoie was his client and Mark was his former client and as such, Rule 2.04 of the Rules of Professional Conduct was not in his opinion breached.

[92] Mr. Honey did not accept that his registration of the transfer of the joint tenancy in 2005 for Mark and Mr. Lajoie required that he send Mr. Lajoie for independent legal advice in July, 2009, as he was then acting for Mr. Lajoie, not Mark, and he then provided Mr. Lajoie with independent legal advice on the 2009 matter.

[93] A joint tenancy may legally be severed in three ways. Not all of those require the agreement of the other joint tenant. Mark received title as a joint tenant which in law, could be severed by he or his father, without the consent of the other.

[94] Neither Mr. Lajoie nor Laurie told Mark that title of Oakdale was changed after Mark returned home following in July 14, 2009. Mark did not become aware until his father died in 2010 when Laurie revealed that he and she owned the property as tenants in common. Mark then realized that his father and sister had kept this knowledge from him. His shock and feeling of betrayal by such family members are understandable. As Mr. Honey testified however, Mark’s prior knowledge of his father’s intention to register a transfer to end the joint tenancy, beyond the powers of persuasion, could not prevent his father from doing so.

[95] Mr. Honey testified that he asked Mr. Lajoie specifically and on more than one occasion during their two meetings in July, 2009 whether Mr. Lajoie was being pressured to transfer an interest to his daughter. Mr. Lajoie denied being pressured and did not appear to Mr. Honey to be under pressure to convey an interest to his daughter.

[96] Mr. Honey testified that he was satisfied on the basis of the discussions he had during these two meetings with Mr. Lajoie that he fully understood the instructions he was giving, the severance of the joint tenancy, the termination of the right of survivorship and the transfer of his resulting one-half interest to his daughter.

[97] Mr. Honey testified that he was not concerned Mr. Lajoie had mental competency issues limiting what he was doing or the instructions he was giving. Unlike the questionnaire Mr. Honey has a client complete on this issue in the preparation of a will, he testified that he did not use such an instrument in real estate or in this case. He was at the time unaware Mr. Lajoie had suffered a stroke in 2006.

[98] After registration of the two transfers in July, 2009, Mr. Lajoie did not subsequently contacted Mr. Honey to discuss the Oakdale property.

[99] On Mark’s direction through his lawyer, Laurie sent one-half of the Oakdale rent cheques to Mark after payment of property taxes and insurance, commencing in February, 2011.

[100] A new lease of Oakdale was signed in April of 2010. The 2010 lease states that Laurie alone is the landlord and owner even though she knew Mark was also an owner.

[101] Mr. Lajoie’s health further deteriorated in the beginning of 2010. He attended a number of medical appointments thereafter accompanied by his daughter. He was admitted to hospital into palliative care on May 25, 2010, and died on June 4, 2010.

[102] Laurie agreed in cross-examination that a full accounting is reasonable and necessary to establish what total revenue money from Oakdale was received, when and how was that money spent.

[103] The eagerness of Laurie to benefit personally as to Oakdale at her brother’s expense does not by itself demonstrate undue influence over Mr. Lajoie.

[104] Laurie cited instances when she tried unsuccessfully to persuade her father to do things.

[105] Notwithstanding the several instances of important testimony by Laurie which this Court rejects, the central issue remains whether Mr. Lajoie was susceptible to or under undue influence by her in his severance of the joint tenancy and transfer of his resulting interest as tenant in common to his daughter.

[106] The rejection of Laurie’s testimony on important evidence clearly undermines her credibility. She would likely be unsuccessful if this action was only about herself and her brother, as opposed to what her father independently intended, and even then, but for the other witnesses called.

[107] Ms. Martin was a long time and close friend to the Lajoie family and considers the parties as part of her family. She was very close to the parents and heard repeatedly over the years that each party, in order to be treated equally, would receive one house, including Mark getting Oakdale after it was transferred to Mr. Lajoie in 2003.

[108] Mr. Timlin was a long time close friend of Mr. Lajoie whom he described as very sociable, happy, outgoing, independent, and not someone easily convinced. He saw Mr. Lajoie weekly for 20 years and monthly commencing in 2009 until he died. He stated that he noticed no change in the mental capacity or independence of this friend after his two strokes in 2006. The deceased never mentioned to him that his daughter was controlling him. He did not discuss the properties with him.

[109] Ms. Woods is another old friend of Mr. Lajoie. They were friends from school. She saw him frequently after he moved into his daughter’s home. He expressed to her the feeling of gratitude he felt for the care his daughter and husband provided to him. He appeared happy living at his daughter’s home and in fact told her so.

[110] She described Mr. Lajoie as a very pleasant individual. She also described him as having a good mind which did not deteriorate after the strokes in 2006. She stated that he was not someone who could be pressured to do something he did not want to do. She stated Mr. Lajoie demonstrated no confusion, no memory loss or change of personality after his strokes.

[111] Mr. Lajoie did not discuss the properties and his children with her.

[112] Mr. Kavanagh liked his father-in-law and described him as generous and a straight shooter. He stated that his wife and her father had a very good relationship and that his wife respected him. He testified that Mr. Lajoie remained active and independent after his strokes, planned his time including swimming and attending Good Companions on separate days each week.

[113] Mr. Kavanagh testified that he never saw Laurie pressure her father and he would have spoken up if he had witnessed such conduct. He testified that he did the maintenance on Oakdale and that Laurie paid for the expenses of that property prior to it being rented out in 2008. He states that Mark to his knowledge did not contribute to the operating expenses or maintenance of that property over the years.

MENTAL CAPACITY

[114] The admission papers for ambulatory care at a local rehabilitation hospital in December, 2006, record Mr. Lajoie stating that he had a close relationship with his daughter. It records improvements in his mobility, speech recovery and reading since the first stroke. He had lost his driver’s license and was being transported by his son-in-law and Para Transpo. He expressed interest in resuming his active social life and card games with his friends. The recorded goal of

[115] Mr. Lajoie in the abovementioned admission papers records his wish to increase his independence and pursue community distances unaccompanied by a family member. Mr. Lajoie records that accommodations made to the washroom in the Kavanagh home allowed him to bathe himself. He dressed himself but required assistance with his shoes. He planned to enrol in aqua fit classes. He continued to mourn the loss of his wife.

[116] The two strokes by December, 2006, caused Mr. Lajoie some impairment of short term memory, rate of information processing and visual impairment. His higher executive functions, such as his ability to make decisions about important personal issues, are recorded as remaining strong after the stroke.

[117] Mr. Lajoie was released from hospital in December, 2006, and received twice weekly therapy until April, 2007. His discharge report in March, 2007 notes good recovery from the stroke with a relatively independent level of functioning. His mobility on the left side remained reduced. Laurie was added to the signing authority of Mr. Lajoie’s bank account, wrote up cheques at his request but she testified she did not withdraw money from his account absent his direction.

[118] Neither party called Dr. Cohen as a witness. His letter was introduced as an exhibit to Laurie’s affidavit forming part of her examination-in-chief. Dr. Cohen was Mr. Lajoie’s family doctor between 2006 and 2009. Dr. Cohen’s states his opinion that Mr. Lajoie throughout this period was mentally competent to make decisions regarding his personal and financial affairs. The defendant did not object to the filing or use of such medical reports, several of which reflect physicians continuing to accept decisions made by Mr. Lajoie as to his medical care.

[119] The Court is conscious as to the caution necessary for this form of evidence without the author being called to testify. With that qualification, I note that several of the other physicians accepted decisions by Mr. Lajoie as to health care treatment issues up to 2010. That reinforces the above opinion of Dr. Cohen.

[120] Mark testified that his father’s mental health and cognitive capacity were not affected by the strokes. That is confirmed by Laurie and a number of witnesses who testified. What changed was his level of activity and dependency on others.

[121] The evidence of the parties including Mark’s wife, friends of Mr. Lajoie who testified, the deceased’s 2006 medical reports and the testimony of Mr. Honey lead this Court to conclude that Mr. Lajoie was not suffering from any mental impairment when he attended and gave instructions to Mr. Honey to grant an interest in Oakdale to Laurie in 2009. The evidence is to the contrary. His impairment as a result of the two strokes and with age was of a physical nature as in the reduction of physical capacity in the use of his left arm and leg, as opposed to mental capacity.

[122] Ms. Purdham in her affidavit indicates that in the July 14, 2009 conversation with Mark, Mr. Lajoie appeared confused by concepts such as the effects of inflation, the notion of “use value” as opposed to “exchange value”. Many people may not fully understand these distinctions. That however is not a sign of mental incapacity. More importantly, during her cross-examination Ms. Purdham stated that upon leaving to return to Regina in July, 2009, she did not have concerns as to Mr. Lajoie’s mental capacity.

ERRORS IN LEGAL SERVICES

[123] This was not presented as a separate argument or ground by the defendant. It is rather presented in support of the proposition that:

(a) Mr. Lajoie did not have independent legal advice in the transfers in July of 2009 of Oakdale, and

(b) The number of errors committed in the severance transfer documentation and the transfer to Laurie documentation somehow relate to the issue of undue influence.

[124] There were several technical errors. If Mr. Honey has problems of compliance under Rule 2.04(4) of the Professional Conduct Rules, those are matters between him and Mark.

[125] The first of the above matters is however relevant if undue influence is demonstrated, as the onus thereupon shifts to Laurie to disprove undue influence.

INTER VIVOS GIFT MAY NOT BE DIVESTED

[126] An analysis of severance of title held in joint tenancy will be the first point of analysis. The law accords with the explanation provided by Mr. Honey. One joint tenant, without the consent of the other joint tenant, is legally entitled to sever and end that joint tenancy, thus terminating the right of survivorship, by one joint tenant registering a transfer from and to himself: see: Horne v. Evans (1987), 39 D.L.R. (4th) 416 (Ont. C.A.), at p. 421, and Bank of Montreal v. Bray (1997), 36 O.R. (3d) 99 (C.A.), at p. 107. That is a right of title to which Mark became a joint owner of Oakdale in 2005. He and his father individually thereafter had the individual right to sever the joint tenancy without the consent of the other.

[127] It is further noted that there is no fiduciary relationship between joint tenants as to liabilities: see A.W. La Forest, Anger & Honsberger Law of Real Property, loose-leaf (consulted in October 2012), (Toronto: Carswell, 2012), ch. 14 at 14-9.

[128] For the first of the above reasons, this Court does not accept Mark’s legal argument that what he received in 2005 upon becoming one of two owners as joint tenants of Oakdale was an inter vivos gift in which the right to sever that joint tenancy was extinguished by the actions of Mr. Lajoie. The cases relied upon by the defendant in support of this position do not involve the registration of real property as joint tenants. Rather, they involve the right of survivorship in things such as joint bank accounts or investment funds as in Pecore v. Pecore, 2007 SCC 17, [2007] 1 S.C.R. 795, Jardine v. Jardine, and a promise to transfer a business and transfer a real property into joint tenancy as in Murray v. Murray, 2010 ONSC 4278.

[129] The defendant presented no law that once real property was transferred into joint tenancy, thereby creating the right of survivorship, the legal right of either owner to sever is defeated due to a resulting trust or otherwise. That result would rewrite the above law of joint tenancy. No authority has been presented in support of that principle in the case of ownership as joint tenancy of real property.

[130] What Mark in 2000 was offered and accepted was the substitution of his “interest” in 178 to become a joint tenant in Oakdale with his father on the understanding that the father’s interest therein would be released to Mark when he moved back to Ottawa. Even between those two lay individuals, sole ownership was a conditional commitment by Mr. Lajoie. That triggering event, of moving back to Ottawa, never occurred.

UNDUE INFLUENCE

[131] The Supreme Court in Geffen v. Goodman Estate, [1991] 2 S.C.R. 353, clarified the law and provided some guidance as to the scope of the doctrine of undue influence and its evidentiary companion, the presumption of undue influence. The framework articulated therein and from Bank of Montreal v. Duguid (2000), ONCA 5710 and Coish v. Walsh (2001), NFCA 41, is as follows:

1- The equitable doctrine of undue influence was developed not to save people from the consequences of their own folly, but to save the donor from being victimized by other people, to protect the weak or momentarily weak from entering into disadvantageous transactions.

2- In the context of gifts, equity will intervene and set aside such arrangements if procured by undue influence.

3- That equitable protection is available in the following circumstances:

(a) Firstly, where it has been proven that the gift was the result of influence expressly used by the donee for the purpose. These cases involve evidence of unfair and improper conduct, coercion, cheating, often some personal advantage obtained by the donee who is in a close confidential relation to the donor.

(b) Where there is no evidence of undue influence, the court will thereupon determine whether the relationship between these parties gave rise to a presumption of undue influence.

(c) Where the relationship between the donor and donee at or shortly before the execution of the gift has been such that there existed a potential for domination or persuasive influence over the donor. A relationship containing tools or capacity which could be used for undue influence, such as relationships involving the giving of advice to the donor, management of the donor’s affaires, a fiduciary duty or familial relationship, are insufficient alone to initiate a presumption of undue influence. The donee must have a persuasive or dominating influence over the will of the donor. In that case, a presumption of undue influence arises thereby shifting the burden of proof to the donee to prove the absence of abuse, that the gift is not the result of the donee’s undue influence. In commercial transactions, the plaintiff must also show that the donor was unduly disadvantaged or the done was unduly benefitted.

(d) Independent advice to the donor regarding the gift is often sufficient to satisfy this shifted burden of proof. Factors in determining whether such advice is sufficient to rebut the presumption include:

(i) whether the donee was present when the advice was given the donor,

(ii) whether the advisor although technically engaged by the donor, in fact took instructions from the donee,

(iii) whether the gift was substantially all of the donor’s property and did the adviser know this,

(iv) whether the advisor asked whether other family members who might be disadvantaged by the gift had been advised, and

(v) whether the advisor discussed alternatives with the donor.

[132] As Mark stated in his testimony, there is no direct evidence that the gift or transfer of an interest in Oakdale to Laurie was the result of influence expressly used by her to obtain that result.

[133] The next issue involves consideration of the relationship in issue and determining the following:

(1) Did Laurie’s relationship with Mr. Lajoie contain tools or capacity capable of exerting undue influence on him?

(2) Whether there existed a potential for domination or persuasive influence by Laurie over her father.

(3) Did Laurie within that relationship have a persuasive or dominating influence over the will of her father, Mr. Lajoie?

(4) If the answer to the above questions is affirmative, has the donee (Laurie) rebutted the resulting presumption?

TOOLS OR CAPACITY TO EXERT UNDUE INFLUENCE

[134] This Court answers the first question in the affirmative. Mr. Lajoie was 79 years old. His health was stable but had deteriorated shortly before. He had reduced mobility and dexterity with his writing hand. He had sold 178 in 2007 and did not appear in 2010 to have much of those proceeds or other assets remaining beyond Oakdale. He had invested in renovations to 941 Hare to accommodate his presence but had no ownership interest. He required a place to live, had resided with Laurie and her family for 18 months and did not want to live in a senior’s home. As to a place to live, he knew he was tied to and dependent upon and maintaining the favour of his daughter and son-in- law. He lost his spouse some four years previously and was emotionally dependent upon his daughter and son-in-law.

POTENTIAL

[135] Given the conclusion to the above question, this Court finds that, subject to the next issue, there existed a theoretical potential for domination or persuasive influence by Laurie over her father.

PERSUASIVE OR DOMINATING INFLUENCE OVER DONOR

[136] This Court nonetheless finds that Laurie did not have or use persuasive or dominating influence over her father to obtain a gift in Oakdale.

[137] In addition to everything else she and her husband received from her parents over the years, Laurie was quite content to receive this interest in Oakdale, to the detriment of her brother. She feels no unease in defending her moral and now legal title to this interest. She has justified receiving more than an equal share of her parents’ assets based on the kindness, attention and labour she and her husband gave to Mr. Lajoie between 2005 and 2009. Oakdale in her mind is payment for the services rendered.

[138] Prioritizing one’s personal gain ahead of the interest of one’s brother is not determinative however of the issue in this action.

[139] Mr. Lajoie was older but remained active with friends and activities, in spite of his age and medical issues. Most important, Mr. Lajoie in 2009 and before, was fully capable of and often refused to do things asked of him when he did not agree.

[140] A number of the witnesses testified to his strength to follow his own course. He did this repeatedly with Mark. Despite repeated requests from Mark to rent and then sell Oakdale, some forcefully communicated, and notwithstanding Mark’s purchase of a home requiring mortgage financing to do so, Mr. Lajoie said no to Mark regarding Oakdale on several occasions. Mr. Lajoie resisted Mark’s requests after undergoing a hip replacement and suffering two strokes in 2006, after 178 was sold in 2007, and again in 2008 and 2009.

[141] In the agreement to substitute Mark’s replacement of 178 with Oakdale in 2005, Mr. Lajoie demonstrated pursuit of his wishes over the interest of Mark. Title of Oakdale was not simply transferred to Mark as had occurred to Laurie and her husband in the case of 184. Mr. Lajoie instead set up title in joint tenancy because he had the interest of Aunt Nellie to care for and had limited personal capacity to address those needs. He also told Mark that, unlike Laurie, full title of Oakdale would be transferred to his son upon his returning to live in Ottawa, which did not occur.

[142] The above determination and independence of mind by Mr. Lajoie was equally exercisable towards his daughter had she attempted to dominate her father’s will and obtain something he wanted to give to his son only.

[143] The resulting unequal division of parental assets on the death of Mr. Lajoie was not in accordance with the original intentions of the two parents as frequently expressed to their children and friends. Mr. Lajoie altered those expressed plans, as parents do from time to time. The resulting fairness or unfairness is not the issue. The issue is whether Mr. Lajoie made this decision himself or did Laurie dominate her father or exert undue influence over him to obtain this result.

[144] Considerable time was consumed during the testimony of Mr. Honey as to whether he was an independent advisor when he met with Mr. Lajoie twice at the time of the transfer as he had acted in the past and was acting for Laurie to the extent she was receiving title in this case. He acted for Mr. Lajoie alone on the transfer to himself severing the joint tenancy.

[145] On the evidence, Laurie was not present when Mr. Lajoie explained the failed negotiations on July 15, 2009, to Mr. Honey which is what led to the severing of the joint tenancy and the creation of the tenancy in common between the siblings. Laurie’s email instructions on July 12, 2009 to Mr. Honey were altered and not implemented. This Court concludes that Mr. Lajoie, alone with Mr. Honey, instructed that solicitor.

[146] Mr. Honey did not have a complete understanding of Mr. Lajoie’s financial position. He did not inquire whether Mr. Lajoie had communicated his intention to sever title with Mark but was under the impression that Mark was unaware of this unilateral severance of joint title.

[147] The Court received no expert opinion evidence as to Mr. Honey’s ability to provide independent legal advice in these two transfers involving Mr. Lajoie. Mr. Honey however had known and done some legal work for Mr. Lajoie for over 15 years. They had a relationship and history independent of Laurie. He is experienced in the area of wills and separation of family property and was sensitive to the issue of capacity and undue influence. His presence alone in his office with Mr. Lajoie satisfies this Court that any influence Laurie attempted to direct towards the final outcome would be countered by the advice of Mr. Honey and his sensitivity to the issue of undue influence.

[148] Mr. Lajoie was not enjoying the repeated requests from Mark to access the equity in Oakdale. He felt conflicted between wanting to help Mark and preserving Oakdale to assist Aunt Nellie. Mr. Lajoie also wanted to show his appreciation for all the work his son-in-law and daughter had provided him since 2006. Oakdale was his only means of addressing those three objectives. Mr. Lajoie was disappointed that the July, 2009 buyout negotiations were unsuccessful. He decided to resolve these conflicting interests by severing the joint title and conveying his resulting one-half interest to Laurie despite Laurie’s statement to her father that she did not want to own Oakdale with her brother.

[149] The above analysis leads this Court to conclude that Laurie did not have a persuasive or dominating influence over the will of the Mr. Lajoie as to her receipt of an interest in Oakdale. She had influence with her father and attempted on occasion to influence him. She did not however dominate or control his will. As such the presumption of undue influence has not been established. Mark’s claim to set aside the transfer of his father to himself and the transfer then of Mr. Lajoie’s interest to Laurie is therefore dismissed.

REBUTTAL OF PRESUMPTION

[150] Should the above conclusion be incorrect and the presumption of undue influence exists on the evidence, this Court is of the opinion that such presumption has been rebutted by the same facts and analysis set forth above, notwithstanding this Court’s rejection of Laurie’s evidence in the areas so identified.

MONETARY CLAIMS AND ACCOUNTING

[151] Laurie was unsuccessful in November, 2011 in claiming an interim order that Oakdale be listed and sold. Mark opposed that request. This Court refused her request. The parties subsequently agreed and sold the property. The net proceeds of sale totalling $388,753 plus interest since deposit, subject to any adjustments as considered below, then should be divided equally between the parties and paid out of court accordingly.

[152] Mr. Lajoie died in June, 2010. The property was rented from April 15, 2008. A new one- year lease with different tenants ran from April 28, 2010 until April 30, 2011. Laurie since 2008 has deposited the rent and paid the bills on Oakdale.

[153] Despite her brother’s ownership interest in Oakdale throughout this period, Laurie has never considered it necessary to consult him or account to him regarding the property or the revenue or expenses in relation thereto. It was only in response to being sued that she gradually began to produce over time some financial records. She is hereby ordered to provide at her sole cost a full and complete accounting before the Master here in Ottawa of all money she received or directed deposited from Oakdale since April 15, 2008 to the date of this decision (the “Period”) and out-of-pocket paid disbursements of that property for the Period. In relation thereto, she is ordered to serve Mark within 45 days of this decision with a complete chronological statement of account showing revenue generated by and the expenses of the property, evidence of deposit and the payees thereof and evidence of expenses of that property paid or disbursement of such rental income during the Period.

[154] Expenses claimed by Laurie are not to include disbursements she incurred for the purpose of the litigation regarding Oakdale nor van payments following the death of Mr. Lajoie. Transfers of Oakdale rental income to or its use in payment of expenses of Aunt Nellie are in the upcoming accounting to be considered appropriate expenditures from rental income.

[155] Any rental income received and not accounted for during the Period shall be the responsibility of Laurie and constitute a debit against her share of the proceeds of sale. Any disbursement of rental money from Oakdale for the benefit of Laurie or Mark, or their spouses or children, shall form a credit in favour of the other in the upcoming accounting. Laurie is entitled to a credit for any costs of Oakdale she has paid personally during the Period.

[156] In November, 2011, Mark wrote Laurie and:

(1) demanded receipt of one-half of the Oakdale rent;

(2) demanded an accounting of revenue and expenses of Oakdale; and

(3) stated he would be seeking an order of partition and sale of Oakdale.

[157] Laurie responded in March, 2011 and stated:

(1) she would divide revenues from Oakdale when its final expenses are paid.

(2) the current lease would expire in April 30, 2011, and she intended to serve the appropriate notice ensuring occupancy rights expired on that date.

(3) Oakdale could be listed for sale come May 1, 2011.

[158] Laurie proposed a listing real estate firm for the sale on Oakdale on June 15, 2011.

[159] Mark, on June 15, 2011, advised he considered he had a personal claim to Oakdale and was not in agreement it be sold at that time.

[160] Laurie issued a Notice of Application July 29, 2011, and on November 29, 2011 sought an order of partition and sale of Oakdale. Such an order could not be granted due to Mark’s claim to set aside the transfer by Mr. Lajoie in July, 2009. The property remained vacant until its sale on June 19, 2012.

[161] In the accounting, Laurie will not be entitled to a credit for lost and imputed rental income of Oakdale not received after April 30, 2011. Contrary to her allegation on the partition and sale motion, she in fact did not terminate the lease as of April 30, 2011. Her prior notice to the tenants terminated a right to over hold upon the expiration of the defined term in the lease. There is no evidence whether the existing tenants wanted to enter into a new lease, or the terms thereof, whether the property could have been leased after May 1, 2011, for how long or for how much. There are no subsequent requests in evidence after Laurie notified her brother that she was sending out notice to the tenants preventing over holding effective of the end of the lease. There is no merit to Laurie’s claim that Mark should now credit her for rent of the property not received between May 1, 2011, and its sale on June 19, 2012. That claim is denied for these reasons.

[162] The office of the Master is respectfully requested to proceed with the above accounting and incorporate the terms herein commencing with para. 130 and thereafter.

[163] The parties may submit brief costs outlines as to this action within the next 30 days. Such costs outlines should incorporate the fact that Mark was unsuccessful and Laurie’s testimony in several areas was rejected.

Kane J.

Released: January 15, 2013

COURT FILE NO.: CV-11-51981

DATE: 2013/01/15

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

LAURIE KAVANAGH

Plaintiff/Defendant by Counterclaim

– and –

MARK LAJOIE

Defendant/Plaintiff by Counterclaim

REASONS FOR DECISION

Kane J.

Released: January 15, 2013