ONTARIO

SUPERIOR COURT OF JUSTICE

COURT FILE NO.: 30336/08
DATE: 2015 06 10

B E T W E E N:

Michael Johnson
Applicant

G. Evans, Counsel for the Applicant

• and -

The Estate of Verna Hazel Johnson, Robert Wayne Johnson, personally and as Trustee of the Estate of Verna Hazel Johnson, Respondents
Respondents

A. Wilford, Counsel for the Respondent

HEARD: May 21, 2015

REASONS FOR JUDGMENT

WOOLLCOMBE J.

A. Overview

[1] The deceased, Verna Hazel Johnson (“Verna”), died intestate. She had two sons, Robert Wayne Johnson (“Wayne”) and Thomas Lorne Johnson (“Lorne”). Lorne predeceased his mother, leaving one son, Michael Johnson (“Michael”). This application arises from a disagreement between Verna’s son Wayne, and her grandson Michael, about entitlement to the estate. The applicant, Michael, claims to be entitled to one half of the value of the estate, consisting of both one half of the proceeds of the sale of the deceased’s house and one half of the value of the bank and investment accounts held jointly by Verna and Wayne. The respondent, Wayne, who has over the course of the litigation disputed Michael’s claim to half of the proceeds of the sale of the home, now acknowledges this entitlement. Wayne’s position remains that Michael has no interest in the bank and investment accounts that he held jointly with his mother.

[2] The parties agree that the issue of what forms part of the estate and the parties’ entitlement to the estate ought to be determined on this application, rather than at a trial. While the court expressed concerns to the parties at the outset of the hearing about the absence of evidence that might be relevant to determining this issue, both counsel made clear that they wished the issue of entitlement decided on this application on the existing record. They are agreed that no further evidence would be available to assist at a trial. On this basis, this decision sets out the applicant’s entitlement to the deceased’s assets.

B. The Relevant Facts

The parties

[3] Verna Hazel Johnson died intestate at the age of 98 on June 12, 2009. She was a widow for the last 25 or 30 years of her life. She lived in her own home in Toronto until a few months before her death, at which time she moved to a nursing home in Meaford, Ontario. She had two sons: Lorne, who died on November 13, 2007, and Wayne.

[4] Verna’s son Wayne lives in Meaford, Ontario. He has provided one relatively brief affidavit. He says that his mother always told Lorne and him that they would share her estate. He says that she put her money in joint names with her sons as a form of estate planning, with the intent that the money would be theirs, and not form part of the estate. He says that after his brother Lorne died, his mother clearly indicated that everything would go to him. He says that he cared for her, visited her, and bought her groceries on a regular basis to support her.

[5] Verna’s grandson Michael is about 34 years of age and lives in Lindsay, Ontario. He has provided two affidavits. He says that he had a reasonably close relationship with his grandmother and up until his father’s death in 2007 he always received a cheque from her for his birthday and at Christmas. He also says that when he attended Durham College for a period of time, he would see his grandmother more often as he was geographically closer to her.

The application for certificate of appointment of estate trustee without a will

[6] Following Verna’s death in June 2009, nothing was done in respect of the estate for some time. More than two years later, on September 27, 2011, Wayne signed an application for certificate of appointment of estate trustee without a will in the Superior Court of Justice in Owen Sound. On that application, in the section entitled “Persons entitled to share in the estate”, Wayne included his own name and the name of his deceased brother Lorne. Wayne indicated that the value of personal property in the estate was “$0” and that the value of real estate was $200,000.00. He asserted that he was entitled to apply to be estate trustee because he was “the only living child for the deceased”. The certificate for appointment of estate trustee without a will was issued by the Registrar on October 14, 2011.

The applicant’s claim

[7] Michael says that he was never consulted about the particulars of his grandmother’s estate. In December, 2011, two and a half years after his grandmother had died, Michael’s counsel advised Wayne’s counsel of Michael’s view that he was entitled to half of his grandmother’s estate on the basis of s. 47(2) of the Succession Law Reform Act. Counsel for Wayne responded that he had been unaware of Michael’s existence and that while his client was going to prepare a list of the costs and expenses he had incurred in caring for his parents and the estate, he was prepared to offer Michael $50,000.00 as a full and final settlement. Counsel for Michael responded in January 2012 requesting a copy of the appraisal or assessment relied upon to provide the court with a valuation of $200,000.00 for the home, and an accounting for what became of the funds held jointly by the Verna and Wayne.

[8] Wayne’s counsel responded that he had just learned that Lorne’s will had left nothing to Michael. Consequently Wayne’s position was that Michael had no claim in Verna’s estate. Counsel for Michael responded immediately that he viewed this to be incorrect and that s. 47(2) of the Succession Law Reform Act was the relevant legislation.

[9] More than three months later, on April 30, 2012, Wayne’s counsel advised that Verna’s home had been sold for $320,000. He provided a trust ledger statement and suggested that with what he said were proper deductions, including executor fees of $18,719.31, legal fees of $8,000.00 for the estate issues, and $20,080.00 of costs associated with caring for the deceased, the net balance from the sale of the home was $242,326.44. Wayne offered to pay Michael half of this ($126.163.22) if Michael accepted it as a full and final settlement of the estate.

The litigation and various court orders to date

[10] Michael issued a Notice of Application on July 31, 2012. He sought a determination of the value of the estate and of his interest in the estate. He also sought an accounting of all claims by Wayne against the estate. On August 17, 2012, a consent order was made by Justice Wein requiring, among other things:

• An accounting of all funds held in the name of the deceased either solely or with Lorne Johnson or Wayne;

• That Michael be entitled to compel production of all solicitor records, notes and files relating to the deceased;

• That Michael be entitled to compel production of all financial records over the three years prior to death of the deceased and all files relating to the assets held either solely or jointly by the deceased from any financial or banking institution or agency;

• That within 30 days, Wayne deliver to Michael and file with the court a statement of assets of the deceased setting out the nature and value of the estate just prior to death and each of the assets to be administered by the state trustee during litigation;

• That there be an order directing a stay of distribution of the assets.

[11] In the period that followed, Michael continued to make requests for disclosure from Wayne. The disclosure revealed that Verna had held both bank accounts and investments.

[12] Wayne’s affidavit in response to Michael’s application was signed on September 13, 2012. In it, he claims that when he filled out the application to be appointed estate trustee, he “had forgotten” that Lorne had a child from his first marriage, and that he had not seen Michael since Lorne’s funeral. As discussed above, he makes clear his view that all of his mother’s money was to go to him.

[13] On January 25, 2013, the matter returned to court and a consent order was made by Justice Conlan that included:

• An accounting of all funds held in the name of the deceased either solely or with Lorne Johnson or Wayne;

• That Wayne has 40 days deliver to Michael and file with the court a statement of assets of the deceased setting out the nature and value of the estate just prior to death and each of the assets to be administered by the state trustee during litigation;

• That the parties agree that s. 47(2) of the Succession Law Reform Act applies to this situation such that there is entitlement of Michael to a share of the estate as agreed or ordered;

• Wayne only claims executor’s compensation and any valid disbursement as set out in the passing of accounts;

• Wayne shall pass accounts for any joint account he had or controlled with the pat Verna Johnson from 2007 to date of death and then to the present. All accounts to be fully supported with documentation. Accounts to be submitted within 40 days of today.

• The parties acknowledge that Michael has been advanced approximately $149,000.00 from the sale proceeds;

• All issues regarding the passing of accounts and the joint bank accounts to be adjourned to May 10, 2013;

• Wayne agreed to be examined on or before April 23, 2013.

[14] There was considerable correspondence between the parties over the months that followed with Michael’s counsel continuing to seek disclosure and suggesting that examinations for discovery be scheduled. Eventually a notice for examination for discovery was served. Counsel for Wayne was not available on that date or any of the other dates suggested. His position was that he was awaiting documents from the banks and that the passing of accounts could not be finalized until he had that information. The May 10, 2013 return date was adjourned, on consent, to July 19, 2013, peremptory on Wayne.

[15] On July 19, 2013, the matter was before Justice Donohue. In her endorsement, she noted Michael was concerned because as records had been provided, they had indicated that the accounts had grown to between $300,000 and $700,000. She noted that control of those funds had remained in Wayne’s hands and that the accounting that had been ordered on August 17, 2012 and again on January 25, 2013 had not been done. Michael sought the appointment of an estate trustee during litigation. Wayne sought to postpone the order pending a two-day trial to determine whether the bank accounts were gifts or whether the respondents held the accounts in trust for the estate.

[16] Justice Donohue determined that it was appropriate to appoint an estate trustee during litigation and so ordered. Among other things, her order was:

• That Morgan and Partners be appointed as estate trustee during litigation over the property of the estate;

• That Wayne file pleadings in reply and setting out any claims against the estate and his tracing of his later mother’s assets held in joint accounts into his personal accounts within 30 days;

• The sum of $300,000.00 from Wayne’s account be deposited with the estate trustee during litigation pending resolution of the matter.

• The matter was to return to court within 30 days of the filing of the report of the estate trustee during litigation.

• Costs of $6,250.00 were ordered paid by Wayne personally for failure to comply with the orders of Justice Wein and Justice Conlan.

[17] There continued to be issues with Wayne not complying with court orders. The matter returned before Justice Snowie on September 19, 2013. She made a further consent order:

• That the order of Justice Donohue that the sum of $300,000.00 from Wayne’s account be deposited with the estate trustee during litigation pending resolution of the matter be complied with by September 27, 2013 failing which the respondent’s pleadings were to be struck;

• That the estate trustee pending litigation be authorized to trace all funds in the name of Wayne at TD Canada Trust or Royal Bank of Canada;

• That Wayne comply with Justice Donohue’s order that he file pleadings in reply and setting out any claims against the estate and his tracing of his late mother’s assets held in joint accounts into his personal accounts on or before October 11, 2013.

• That Wayne pay the cost order made by Justice Donohue and pay costs of the motion with disbursements and HST fixed at $1822.00.

[18] As is apparent from this chronology, Wayne was far from diligent in complying with the various consent court orders that were made between August, 2012 and September, 2013. There is no evidence from Wayne explaining his conduct. Wayne has never provided pleadings in reply.

The reports of the estate trustee for litigation

[19] The first report of the trustee is dated May 28, 2014 and indicates that the trustee’s review was ongoing. By that point, the trustee had found over 50 accounts and sub accounts at Toronto Dominion Canada Trust Bank (“TD”) and six accounts at Royal Bank of Canada (“RBC”) in which the deceased’s estate funds were held at some point between November 30, 2007 and May 28, 2014, with transfers between these accounts over this period amounting to over $5,000,000.00. The trustee noted that the create

[20] on of new accounts and the shifting of funds was a common occurrence. The trustee was also of the view that there existed other accounts that had not been brought to its attention. The trustee indicated that its review had been frustrated by a delay and lack of documentation by TD. It was also observed that there were likely tax obligations exigible on the estate assets and no information as to whether income tax filings had been properly completed.

[21] The trustee confirmed that there were total account balances between $360,000 and $605,000 over the relevant period. The trustee found that the deceased’s accounts could be segregated into investment accounts, primarily at TD, and banking accounts, also primarily at TD. The deceased’s RBC accounts were all closed in 2009 and 2010. The trustee attempted to trace the deposits and withdrawals from the various accounts and concluded that there were deposits from unknown sources and withdrawals of money that were dissipated to unknown sources.

[22] The second report of the trustee is dated August 25, 2014. The trustee repeats that there may be tax obligations to Canada Revenue Agency for unpaid estate tax on the investments. The report sets out balances for the combined investment accounts (11 accounts) and bank accounts (5 accounts) held by the deceased and Wayne at various times including at Lorne’s death (November 13, 2007) and at Verna’s death (June 11, 2009). During oral submissions, the parties agreed that there was an error in the trustee’s accounting as one of the investment accounts and one of the bank accounts belonged exclusively to Wayne and these accounts were never held jointly. Accordingly, the amounts in the trustee report needed to be corrected.

[23] Wayne’s counsel suggests a further error in the trustee’s report in that there was a 2008 transfer from Wayne’s personal account (501706) into a jointly held account (8666741). It is his position that this reduces the Verna’s assets by $30,000 commencing after the transfer. I accept this amendment should be made to the trustee’s report.

[24] The corrected figures, accounting for both the two accounts that were held by Wayne personally, and for the $30,000.00 transfer from his personal account in 2008, suggests that the total account balances are as follows:

November 30, 2007 $451,021
June 11, 2008 $447,450
June 11, 2009 $470,574
June 11, 2010 $352,608
June 11, 2011 $364,385
June 11, 2012 $370,701
June 11, 2013 $365,601

C. The applicable legal principles

[25] The legal issue before me is whether Michael has a valid claim to the accounts jointly held by Verna and Wayne. This turns on Verna’s intention and the status of the funds when Verna made the accounts joint. The case law in Pecore v. Pecore, 2007 SCC 17, Sawdon Estate v. Sawdon, 2014 ONCA 101, and Mroz (Litigation guardian of) v. Mroz, 2015 ONCA 171 has identified four potential options concerning the status of funds in a joint bank account held between a parent and an adult child:

(a) The funds in the accounts result back to the estate as a consequence of the death of the parent by way of a resulting trust (Mroz at para. 72, Pecore at para. 36, Sawdon Estate at paras. 67-71).

(b) The funds were placed into a joint account by the transferor parent with the transferee adult child with the intention that the adult parent retain exclusive control of the account until her death and thereby gift the right of survivorship to the adult child (Pecore at paras. 46 and 70.

(c) An outright gift was made to the adult child when the joint account was created (Pecore at para. 70).

(d) An express trust was created when the adult parent created a joint account (Sawdon Estate, para. 67).

[26] In this case, the first two possibilities need to be considered. The starting point for this analysis is the Supreme Court of Canada’s decision in Pecore. Writing for the majority, Justice Rothstein clarified the law regarding the presumptions of resulting trust and advancement. Pecore established that: (1) the presumption of resulting trust applies to gratuitous transfers of property from a parent to an adult child; and (2) the trial judge must begin his or her inquiry with that presumption and then weigh all of the evidence in an attempt to ascertain, on a balance of probabilities, the transferor's actual intention at the time of transfer. See also: Sawdon Estate, at paras. 56-57.

[27] The Supreme Court in Pecore, at paras. 56-70, set out some of the factors that may be relevant in determining the intention of the deceased at the time of the transfer of the joint interest to the bank accounts. These include:

(a) Evidence of the deceased's intention, including, where admissible, evidence subsequent to the transfer;

(b) Bank documents - the clearer the wording in the bank documents as to the deceased's intention, the more weight that evidence might attract;

(c) Control and use of the funds in the account - the circumstances must be carefully reviewed and considered to determine the weight to be given to this factor

(d) Granting a Power of Attorney - the court should consider whether a granted power of attorney is some evidence, one way or another, of the deceased's intention; and

(e) Tax Treatment of Joint Accounts - this is another circumstance which might shed light on the deceased's intention.

D. Application of the legal principles to the facts

The positions of the parties

[28] It is Michael’s position that Wayne has failed to provide evidence sufficient to rebut the presumption of a resulting trust. Michael says that there is an absence of evidence to support Wayne’s assertion that Verna intended for everything to go to him. Michael notes that Verna’s bank statements were all sent to her directly and that there is no evidence that Wayne had anything to do with management of the accounts. If in fact Verna was trying to estate plan as Wayne suggests, Michael says it makes no sense that she would not have also done so in relation to the home, which by virtue of the S.L.R.A. is part of her estate. Further, Michael highlights that there was never a power of attorney. He emphasizes that Wayne did not attend at discoveries and was very slow to produce disclosure and to provide information about the various accounts. He also argues that Wayne’s assertion that he “forgot” about Michael is not credible, that Wayne has repeatedly failed to comply with court orders, and failed to be forthright about the size of the estate. Finally, he points out that Wayne has not provided any estate tax returns. With respect to a letter provided by TD that the accounts were held jointly with right of survivorship, Michael points out that there are no underlying documents to support this assertion, and that the letter and conduct of the bank are entitled to little weight.

[29] If the date of Verna’s death is identified as the date from which to determine the value of her estate, as set out at paragraph 23 of this decision, the accounts were valued at $470,574.00. Michael claims entitlement to half of this or $235,287.00.

[30] It is Wayne’s position that the best evidence as to the nature of Verna’s accounts is a letter from TD and the fact that both TD and RBC treated the accounts as though they were joint with right of survivorship, and permitted the names on the accounts to be changed to Wayne’s alone after Verna’s death. He suggests that that Verna was an astute business woman, who set up joint accounts well before her death, and managed her funds effectively and on her own, not needing assistance. Wayne argues that the fact that she put the accounts in joint names when this was not needed by her to manage the accounts suggests that she intended to give the money to him. Wayne’s counsel argues that there was a clear intention to give the money to her only son, who was also her caregiver, and that there is no evidence at all to suggest that she wished to give anything to her grandson Michael. Counsel points out that Michael was unaware that his grandmother had even died for a couple of years and that Verna could not have intended anything to go to Michael. Moreover, he points to the fact that Wayne put $30,000.00 into one of the joint accounts in April 2008 as evidence he believed that there was a right of survivorship.

[31] Wayne’s position is that Michael has no entitlement to the accounts. He argues that if there were entitlement, Wayne would only be entitled to 25% of the value of the accounts. As I understand his position it is that Wayne owns 50% of the value in the accounts and thus only 50% would be held in any resulting trust. The resulting trust funds would then be divided between him and Michael. He offers no authority to support his analysis. I see no basis for concluding that Wayne is the beneficial owner of 50% of the estate and Michael’s claim relates only to the remaining 50%. I reject this claim.

Analysis

[32] I begin my analysis from the presumption of a resulting trust in the accounts that were held jointly between Verna and Wayne, her adult son. This presumption may be rebutted if evidence is adduced that satisfies me, on a balance of probabilities, that the deceased intended and did make an inter vivos gift to him of the interest in the joint bank and investment accounts. Pecore makes clear, at para. 44, that the presumption will only be rebutted if there is evidence to rebut it on a balance of probabilities.

(a) Evidence subsequent to the transfer

[33] The deceased’s actions or statements after the joint accounts were set up might provide evidence relevant to her intent at the time she set up the joint accounts.

(i) The deceased’s statements to Wayne

[34] I have considered Wayne’s affidavit evidence in which he says that Verna created joint accounts with him and his brother with the intention that the money would be theirs, and not part of the estate. He also says that after his brother died, Verna “clearly indicated that everything would go to me”. On their face, Wayne’s statements appear to be some evidence, albeit self-serving, as to the deceased’s intention.

[35] My difficulty with accepting what Wayne says is that he has not revealed himself to be particularly credible in these proceedings. I am troubled by the fact that when he completed the application to be appointed as estate trustee, he somehow “forgot” about his nephew Michael, which I find difficult to accept. I am also unimpressed by the manner in which he has conducted himself through this litigation. It appears to me as though he never wanted Michael to be aware of the potential size of the estate, and that when Michael began to ask questions, Wayne actively tried to avoid sharing the relevant information with him. While his explanation that he never believed the joint account to be part of the estate may be true, it is surprising that if this were the case that he would not have said so immediately by being forthcoming about the accounts and their nature, rather than orchestrating what has been very protracted proceedings in order to unearth what accounts his mother in fact held. I conclude that I cannot rely on Wayne’s statements about his mother’s intent.

(ii) Treatment of the joint accounts after Lorne’s death

[36] The manner in which Verna treated her joint accounts with her son Lorne may be some evidence about her intentions in creating these joint accounts. Prior to Lorne’s death, Verna, Wayne and Lorne held at RBC one joint bank account. Verna and Lorne held at RBC two joint investment accounts. Following Lorne’s death in November, 2007, the jointly held accounts were closed and the assets were transferred to three new accounts in the names of Verna and Wayne. I conclude from this that Verna’s intent was not to gift the account outright to her son Lorne. However, in my view, the simple act of creating a joint account does not, by itself, rebut the presumption of a resulting trust. This evidence does not assist in determining Verna’s intention.

(iii) The absence of a will

[37] I view the absence of a will as an important fact to consider. These cases usually require a determination of whether the intention of the deceased was for jointly held assets to be a gift with survivorship to the transferee, or to be held in a resulting trust upon death, and to be distributed according to the deceased’s will. There is usually an underlying tension between where the money would go if it were viewed as a gift or as a resulting trust, and the result of the distribution proceeding one way or the other is considered in determining the deceased’s intent. There are two possible scenarios explaining why Verna created the joint accounts with Wayne and did not have a will. On one hand, she might have done so if she sought to retain some control of the accounts until death, but to gift the right of survivorship to Wayne, thinking that a will was not necessary. On this analysis, the absence of a will assists Wayne as it suggests that Verna thought she could accomplish through joint accounts what could otherwise have been achieved in a will. On the other hand, she could have added her son as a joint account holder to help care for her (as he said in his affidavit he did) and to provide for his expenses while she was alive, and failed to advert to what the absence of a will would mean to her estate after her death. I have no compelling evidence before me that persuades me either way.

(iv) The deceased’s treatment of her house

[38] Another aspect of evidence subsequent to the transfer that I am asked to consider is the way in which Verna dealt with her home, which differed from the way she dealt with her bank and investment accounts. She owned a home in Toronto, with title in her name alone. It was sold after her death for $320,000. Michael says that if the purpose of holding joint accounts with Wayne was truly for the purpose of estate planning, as Wayne suggests, then surely Verna would have ensured that title to her home was also jointly held. Wayne offers no explanation for why Verna chose not to put the house into his name, along with hers.

[39] At this point, all that anyone can do is to speculate about why Verna chose to leave title to her house in her name alone. The fact is that she did, and that this was different from how she handled her bank accounts and investments. I find it hard to believe that Verna would scrupulously add her son to her various bank and investment accounts for the purposes of estate planning, but not add him as a joint tenant on the house. I am not persuaded that much can logically be inferred from the way Verna dealt with her home and I decline to draw any inference about her intention with respect to her joint financial accounts from the way in which she held her home.

(b) Bank documents

[40] There is no documentation from either bank providing direct evidence that the various accounts were set up with a right of survivorship. There are no original banking documents before me that might provide evidence as to Verna’s intentions regarding how the balance of the accounts should be treated upon her death.

[41] Wayne invites me to put considerable weight on one letter from TD, dated October 25, 2012:

Our records from the TD Estate Department state that all accounts, terms and any financial assets with TD Canada Trust in the name of Verna Johnson were set up Joint, Right of Survivorship with Wayne Johnson therefore the assets were not part of the Estate process.

[42] There are a number of difficulties with Wayne position. First, I am troubled by the fact that the estate trustee during litigation has provided a letter, dated May 20, 2015, stating that when the trustee asked TD to provide confirmation of the ownership of the accounts into which the funds were traced, TD was silent regarding right of survivorship. I find the failure of TD to provide to the trustee any documentation about the joint accounts to support the assertion in the letter seriously undermines the credibility of the content of the letter and I place no weight on it. Second, there is nothing from the RBC stating that Verna’s accounts were joint with right of survivorship, and the trustee never received any documentation that would indicate that the RBC accounts had a right of survivorship.

[43] Wayne says that it is clear that the banks treated the accounts as though they were joint, with a right of survivorship. He says that I can conclude from this that the accounts were set up intentionally to create a right of survivorship. While I accept that the banks appear to have proceeded on this basis, I am not satisfied that this fact advances the argument about the deceased’s intention, which is the focus of my inquiry. What the banks did may or may not be what the deceased understood would happen. Furthermore, when the banks are unable to provide any documentation to justify the way in which they treated the bank and investment accounts, I am not prepared to rely on their actions as evidence of the deceased’s intention.

(c) Control and use of the funds

[44] I am aware of the need to be careful in relying on evidence about how the funds were controlled and used as this may or may not provide evidence as to Verna’s intention. In Pecore at para. 45 Justice Rothstein stated:

In cases where the transferor's proven intention in opening the joint account was to gift withdrawal rights to the transferee during his or her lifetime (regardless of whether or not the transferee chose to exercise that right) and also to gift the balance of the account to the transferee alone on his or her death through survivorship, courts have had no difficulty finding that the presumption of a resulting trust has been rebutted and the transferee alone is entitled to the balance of the account on the transferor's death.

[45] He went on to say at paras. 63-66:

However, evidence of use and control may be of marginal assistance only and, without more, will not be determinative for three reasons.

First, it may be that the dynamics of the relationship are such that the transferor makes the management decisions. He or she may be more experienced with the accounts. This does not negate the beneficial interest of the other account holder. Conversely, evidence that a transferee controlled the funds does not necessarily mean that the transferee took a beneficial interest. Ageing parents may set up accounts for the sole purpose of having their adult child manage their funds for their benefit.

Second, in cases involving an ageing parent and an adult child, it may be that the transferee, although entitled both legally and beneficially to withdraw funds, will refrain from accessing them in order to ensure there are sufficient funds to care for the parent for the remainder of the parent's life.

Finally, as previously discussed, the fact that a transferor controlled and used the funds during his or her life is not necessarily inconsistent with an intention at the time of the transfer that the transferee would acquire the balance of the account on the transferor's death through the gift of the right of survivorship.

[46] There is little evidence before me about control of the funds in the various accounts. Indeed, there is no evidence at all as to who was making the decisions in relation to the various investment accounts. In terms of use of the bank accounts, the trustee’s report indicates that there were two jointly held chequing accounts – one at TD (3307054) and one at RBC (5102124). The TD account was used for multiple transactions weekly but the trustee was unable to determine whether Verna or Wayne or both were using the account. The RBC statements reveal that they were sent to Verna at her Toronto address. This alone does not indicate much. The RBC account was also used for things including insurance payments, convenience stores, Canadian Tire, Walmart and for $12,000 at the Beer Store between November 2007 and its close in 2009. The trustee could not conclude who was benefitting from the account. Given that Verna died on June 12, 2009, and there were seven more Beer Store withdrawals that month, I am prepared to conclude that Wayne made those withdrawals and to infer, as well, that he had used the funds in the account regularly in the months before.

[47] The difficulty is that even if Verna was content for Wayne to use the funds in their joint chequing accounts for his regular expenses, this does not assist in determining whether she intended to gift to him the right of survivorship in these accounts. Given the absence of much helpful evidence about the use and control of the funds, I decline to draw any inference as to Verna’s intention on this basis.

(d) Granting of a power of attorney

[48] There is no evidence before me that the deceased Verna ever granted a power of attorney to anyone.

(e) Tax treatment of joint accounts

[49] There is no evidence before me of any tax returns ever filed by the deceased, her estate, or Wayne.

(f) Conclusions about the nature of the deceased’s bank and investment accounts

[50] As set out above, there are a number of areas in which there is little evidence before me. Wayne has not provided evidence to satisfy me on a balance of probabilities that the presumption of resulting trust should be rebutted.

[51] In making this comment I am cognizant of the comments in Sawdon Estate that “the relevant presumption can be rebutted by evidence of the transferor’s contrary intention on a balance of probabilities.”

[52] In this case I am left with the self-serving evidence of Wayne whose conduct during this litigation calls into question his veracity. I am also left with evidence that Verna did not plan her estate well. She opened a number of accounts and put her sons on as joint account holders. There are no bank documents from which I can infer her intention with respect to those accounts at the time they were made joint. Money was spent from two of those chequing accounts – I cannot tell who was spending it, on what basis, and cannot draw any inferences from those expenditures. Verna chose not to hold her home jointly with either son. There is no explanation for this choice. She had no will or power of attorney documents. There were no tax documents put before me. As a result I find the funds from the account result back to the estate trustee during litigation to be distributed pursuant to the intestacy regime under the Succession Law Reform Act. The value of the estate to be divided is the value at the time of Verna’s death of $470,574.00. Michael is entitled to one half of this amount.

(g) The proceeds of the sale of the house

[53] It is now agreed by the parties, quite properly, that because Verna was intestate, pursuant to s. 47(2) of the Succession Law Reform Act, Michael is entitled to half of the sale proceeds.

[54] The house was sold for $320,000.00 with a deposit of $15,000.00 and a balance of $304,512.95 paid on closing. The trust ledger statement provided by Wayne’s counsel appears to omit the $15,000 deposit. It also suggests deductions of $20,080.00 for Verna’s care. No justification has been offered for this. There are proposed executor fees of $18,719.31. Again, there is no evidence to support this. The ledger also includes $8000.00 in legal fees and disbursements on the estate file. There is no justification for this. Accordingly, I find that the only appropriate deductions are the $3887.20 in legal fees for the real estate file and $1,500.00 in preparing the house for sale. The parties need to re-calculate the net proceeds of the sale purchase on this basis, accounting for the payment of $146,312.00 that has already been made to Michael, and determining a balance owing. The balance owing to Michael should be paid forthwith.

F. Order

[55] In accordance with these reasons, I order:

• That the value of the deceased’s estate is $470,574.00;

• The applicant is entitled to half of the value of deceased’s estate ($235,287.00), pursuant to the intestacy regime under the Succession Law Reform Act;

• That the applicant is entitled to half of the net proceeds from the sale of the deceased’s home, as calculated in accordance with this decision.

G. Costs

[56] Either party seeking costs may file written costs submissions, with a maximum four pages in length with any attached Costs Outline and Authorities attached. This may include submissions as to the costs of this application and as to payment of the estate trustee during litigation. Such submissions are to be filed within two weeks of the date these reasons are released. The responding party may file responding written submissions with the same length restrictions, within one week of the date of the costs submissions.

Woollcombe J.

Date: June 10, 2015

COURT FILE NO.: 30336/08
DATE: 2015 06 10

ONTARIO
SUPERIOR COURT OF JUSTICE

B E T W E E N:

Michael Johnson

• and –

The Estate of Verna Hazel Johnson, Robert Wayne Johnson, personally and as Trustee of the Estate of Verna Hazel Johnson

REASONS FOR JUDGMENT

Woollcombe J.

Released: June 10, 2015