Court File and Parties
COURT FILE NO.: ES-496-13 DATE: 2016-09-22 ONTARIO SUPERIOR COURT OF JUSTICE
BETWEEN:
Elizabeth Fournier Applicant
- and - Joseph Harinko, as estate trustee for the Estate of Jozsef Harinko, Sr. Respondent
Counsel: Judy Fowler Byrne, for the Applicant Jennifer Krotz, for the Respondent
HEARD: September 19, 2016
The Honourable Mr. Justice P.B. Hambly
REASONS FOR JUDGMENT
Introduction
[1] This is an application by a daughter brought against her brother, as executor of their father’s estate, for an order that a house which passed to her brother on the death of their father by right of survivorship, is held by him as the trustee of their father’s estate in trust for the beneficiaries of their father’s Will. The beneficiaries of the Will are the daughter and her brother in unequal shares in favor of the brother. The parties have each filed their own affidavits. The brother has also filed the affidavit of his father’s solicitor, of his daughter and of his former wife, who is the mother of their daughter.
The Facts
[2] Jozef Harinko (“Jozef”) was born on February 28, 1920. He died at the age of 91 on October 23, 2011. His wife, Erzebet, was born on November 1, 1924. She died at the age of 74 on May 19, 1998. Their daughter, Elizabeth Fournier (“Elizabeth”), the applicant, was born on September 18, 1947. She is age 69. Jozeph, Erzebet and Elizabeth resided in Hungary. The family emigrated to Canada in about 1956, at the time of the Hungarian Revolution. Joseph Harinko (“Joseph”), the son of Jozeph and Erzebert, was born on July 17, 1959 in Canada. He is age 57. There is 12 years difference in age between Elizabeth and Joseph. The family settled in Kitchener, Ontario.
[3] Elizabeth left home at an early age. She moved to British Columbia where she currently resides. The evidence is conflicting as to how often she was in communication with her parents after she moved out of their home. It is clear that she rarely visited with her parents and with her father after the death of her mother. There was a breakdown in the relationship between Elizabeth and her parents. She did not attend her mother’s funeral. Elizabeth caused a statement of claim to be issued against the estate of Jozsef on June 12, 2013. She alleges incest against Jozsef when she was 13 and 14 and physical abuse against her by Jozsef and Erzebet when she was a child.
[4] Joseph was married to Cindy Showenko (“Cindy”) in 1986. They had a daughter named Natasha Harinko (“Natasha”) in 1986. They first lived with Cindy’s parents and then with Jozsef and Erzebet at their house on Samuelson Street in the City of Cambridge. In 1992 Jozsef and Erzebet purchased a house on Barrie Street in the City of Cambridge. Because Joseph was a first time home buyer he was eligible for a government grant of $7,000. He was put on title as a joint owner with his parents of the house on Barrie Street so that he could get this grant. Joseph, Cindy and Natasha lived with Jozsef and Erzebet for a time at the house on Barrie Street. This living arrangement broke down. Joseph, Cindy and Natasha moved out and Joseph was taken off title.
[5] Joseph and Cindy separated in 2003. Cindy continued to communicate with Joseph and to visit Jozsef until 2008 when she entered into another relationship.
[6] On February 21, 1997, Jozsef and Erzobat purchased a house at 431 Westvale Drive in Kitchener. Ownership of this house vested in Jozsef on the death of Erzobat in 1998.
[7] George Ingram is a lawyer who specializes in real estate conveyancing and estate planning. He has practiced in the City of Cambridge since 1982. He represented Jozsef and Erzebet from 1992 when he assisted them in the purchase of a home in Cambridge. After the death of Erzebet he prepared a will and powers of attorney for Jozsef. He named Joseph as his executor and power of attorney and Cindy as an alternate. In his Will, Jozsef divided the residue of his estate in the proportion of 70% to Joseph and 30% to Elizabeth. Jozsef told Mr. Ingram that he wanted to benefit Joseph more than Elizabeth because of the concern that Joseph had shown for him. He said that Elizabeth communicated with him on an infrequent basis.
[8] In 2003 he retained Mr. Ingram to draft a Codicil to his Will. He removed Cindy as an alternate executor and power of attorney and replaced her with his granddaughter. He did this because Joseph and Cindy had separated. He changed the division of the residue to 65% to Joseph and 35% to Elizabeth. He told Mr. Ingram that he felt that this change in the proportion of the division of the residue between Joseph and Elizabeth was more appropriate.
[9] On August 25, 2009 Jozsef contacted Mr. Ingram by phone. They had further telephone conversations in late January or early February 2010. Jozsef told Mr. Ingram that he wanted to transfer the Westvale house to himself and Joseph, as joint tenants, in recognition of the care that Joseph had provided to him since the death of Erzobet. Mr. Ingram explained to him that upon his death the house would pass directly to Joseph outside his Will. Jozsef also told Mr. Ingram that he wanted to change the proportion of the division of the residue to 74% to Joseph and 26% to Elizabeth. Mr. Ingram met with Jozsef and Joseph on February 12, 2010 at which time documents were signed to effect this. Joseph attended with his father to translate for his father, who still was more comfortable in speaking Hungarian than he was in English. Mr. Ingram stated that he met with Jozsef alone and was satisfied that he was carrying out his instructions.
[10] Mr. Ingram was cross examined on his affidavit on January 23, 2015. He stated the following:
Q. And do you recall exactly what you told him at that time. A. Well, he mentioned a thing about bringing Joe onto the house and I did inquire as to why and basically as I expressed in my affidavit, Joe had really at that time was doing a lot for his father, taking him to doctors’ offices, taking, going to get groceries with him and to get him out of the house occasionally for drives and so on and also as I mentioned in the affidavit that I did ask about Elizabeth, his daughter.
Q. In 2009 when you spoke to him on the phone though was it your understanding that he wanted to give the house to his son or that he just wanted to add him to the title. What was your understanding? A. No, add him to the title. The effect of which after I explained joint tenancy, I said if you predecease him then he would become the sole owner of the house by operation of law whether or not you made a will and so he knew but he said the main reason why he got him on was to recognize the substantial contribution in time and effort, he did a lot, Joe Jr. by that time was doing a lot of work around the house.
[11] Natasha attached a letter to her affidavit in which she described the many services that her father performed for her grandfather. She also attached a petition signed by about 40 friends and neighbours of Jozsef in which they expressed support for Joseph receiving the house on the basis of the services that he provided to his father.
[12] Jozsef stopped driving in 2000. He suffered a heart attack in 2008. Joseph drove Jozsef to do necessary and important tasks, such as shopping, going to medical appointments and attending at Erzebet’s grave. Joseph and Natasha lived with Jozsef at the Westvale house, from the time, after Joseph and Cindy separated. They have lived there since the death of Jozsef to the present.
Analysis
[13] The issue before me is whether the Westvale house vests in Joseph or whether he holds it on a resulting trust for the Estate of Jozsef. It was valued February 29, 2013 at between $265,000 and $288,000, Joszef’s assets at the time of his death, exclusive of the house, were $134, 440.76. Counsel argued the case before me on the basis that there was about $125,000 in cash available for distribution and the house had a value of $275,000.
[14] When a person transfers property to another without consideration there is a presumption that the transferee holds the property in trust for the transferor. This presumption applies to a transfer of property by a father to an adult child. The adult child may rebut that presumption with evidence of his father’s actual intention at the time of the transfer on a balance of probabilities. Pecore v. Pecore 2007 SCC 17, [2007] 1 S.C.R. 795; Saylor v. Marsden Estate [2007] SCC 18.
[15] There is abundant evidence that when Jozsef transferred the Westvale house in February 2010 to himself and Joseph jointly, that he intended that Joseph would have the entire beneficial interest in the house upon his death. He well understood the concept that the beneficial interest in property jointly owned by two people vests in the survivor on the death of the other. Joseph had briefly been a joint owner of the Barrie Street property in 1992, in order that he could obtain a government grant. Mr. Ingram explained to him the effect of making Joseph a joint owner when he carried out his instructions to do this in February 2010. He had long been estranged from Elizabeth. Joseph had performed many services for Jozsef, which Jozsef told Mr. Ingram was the reason for wanting to benefit Joseph.
Result
[16] The application is dismissed. Costs should follow the event. However, to make Elizabeth pay the costs herself of the litigation without regard to the unequal division in the Will of the modest residue and Joseph acquiring ownership of the house would not be just. In awarding cost, the court must have regard to the principles of reasonableness and access to justice. ([Boucher v. Public Accountants, 2004 O.J. No. 2634). Joseph claims substantial indemnity costs of $23,845.41 and partial indemnity costs of $15,936.53. There will be an order that the substantial indemnity costs of Joseph be paid out of the assets of the estate to him in the amount of $23,845.41.
P.B. Hambly J.
Released: September 22, 2016