Brief Background and Issues

[1] The parties started living together in 1988, married in 1990, temporarily separated in 1997, reconciled in 1998, and permanently separated on February 7, 2010 (“the date of separation”).

[2] On the date of separation, the parties and their youngest child resided at a house at 335 Penn Avenue (“335 Penn”). They had been living there for about five months.

[3] Ms. Desjardins purchased 335 Penn in her name alone in 2007. The property was renovated and used as a rental income property until the parties moved there at the end of August of 2009. They moved there upon the closing of the sale of their jointly owned previous home at 700 Society Avenue (“700 Society”). At that time, Ms. Desjardins transferred the title of 335 Penn to herself and Mr. Lorenzen as joint tenants.

[4] On the date of separation, Ms. Desjardins was the sole person on title with respect to a house at 314 Avenue Road (“314 Avenue”) that she purchased in 2008. That property was also renovated and rented to tenants.

[5] After the date of separation, both parties continued to reside at 335 Penn until June 20, 2010, when Ms. Desjardins moved out. Mr. Lorenzen continues to reside there.

[6] The parties seek the court’s determination of the following issues:

Who owns 335 Penn: is it owned by the parties in equal or different shares as joint tenants, or by Ms. Desjardins alone by way of a resulting trust?
If 335 Penn is owned by Ms. Desjardins alone, has she been unjustly enriched as the result of a deprivation of Mr. Lorenzen without a juristic reason? If so, what is the appropriate remedy?
Should either party have exclusive possession of 335 Penn, or should 335 Penn be sold and the proceeds distributed between the parties?
Should the values of any of the following properties be excluded from equalization: 335 Penn, 314 Avenue, chattels, RESP accounts, or an RSP?
What is the result of equalization of net family property?
Should there be an unequal division of net family property?
Should Mr. Lorenzen pay occupation rent for 335 Penn?
Should Mr. Lorenzen reimburse Ms. Desjardins one-half of payments she made in relation to the parties’ youngest child’s post-secondary education?

[7] Mr. Lorenzen abandoned the following issues during closing submissions:

Should Ms. Desjardins contribute to expenses paid by Mr. Lorenzen in relation to 335 Penn after Ms. Desjardins moved out?
Should Ms. Desjardins reimburse Mr. Lorenzen one-half of payments she made, after the date of separation, from a joint line of credit secured by 335 Penn?

Detailed Background

[8] The court has carefully considered all of the evidence. Although the parties emphasized certain aspects of the evidence during the trial, some of those aspects are not significant when considered in the context of all of the evidence. The court will summarize the evidence that is most salient to the issues. Except where the context indicates otherwise, the following are findings of fact by the court.

[9] The parties lived together close to 20 years (more than eight years before, and more than 11 years after, their 22 month temporary separation).

1988 to 2005

[10] Ms. Desjardins had a three-year-old son, Justin, when the parties started living together. Mr. Lorenzen adopted Justin. The parties also had a natural son, Jake, in 1992.

[11] During the seven years of marriage prior to the temporary separation, the parties had a joint bank account where both of their incomes were deposited and used for family expenses.

[12] In addition to working, Ms. Desjardins did the cooking, cleaning, laundry, and helped the children with their homework. Mr. Lorenzen maintained the home and vehicles. Both parties were involved in the children’s extracurricular activities. Ms. Desjardins paid for the children’s daycare and managed the family finances.

[13] At the time of the temporary separation, the parties owned a matrimonial home. As a result of the separation and ensuing litigation, the home was sold, and each party received $17,500 from the proceeds.

[14] Ms. Desjardins used her $17,500 to pay half of the down payment for a townhouse for herself and the children. Her mother paid the other half of the down payment.

[15] When the parties reconciled, Ms. Desjardins was skeptical that the reconciliation would last. As a result, she required Mr. Lorenzen to accept three conditions before he could move into her townhouse.

[16] First, he had to repay Ms. Desjardins’ mother the $17,500 she contributed to the down payment. Second, he had to participate in counselling with respect to the issues that led to the separation. Third, he had to agree that he would “walk away” if the parties separated again, rather than engaging in litigation. Ms. Desjardins informed him that she was not willing to go through another forced sale of a family home or a custody battle.

[17] Mr. Lorenzen accepted her terms. He went to counselling, he repaid Ms. Desjardins’ mother $13,500, and he agreed that he would “walk away” in the event of a future separation. As a result, the parties reconciled, even though Mr. Lorenzen did not fully repay Ms. Desjardins’ mother.

[18] Because of Ms. Desjardins’ concerns, however, she kept title to the townhouse in her name only and she did not re-establish a joint bank account. She put her income into her own account. Mr. Lorenzen put his income into his own account.

[19] Ms. Desjardins continued to pay all of the ongoing family expenses, including the mortgage, taxes, insurance, and utilities, from her own bank account after Mr. Lorenzen moved back. Mr. Lorenzen used his income to pay for some of the groceries, his vehicle costs, and cigarettes for himself.

[20] Ms. Desjardins was responsible for all of the family’s finances – except for Mr. Lorenzen’s income.

[21] Mr. Lorenzen has not disclosed his pre-separation banking records despite requests and court orders for disclosure. As a result of his non-disclosure, some of his claims were struck prior to trial and there is an outstanding costs order for $5,000 against him (as a credit against equalization). At trial, he claimed that he could no longer obtain his pre-separation banking records from his bank, because too much time had passed. He did not explain, however, why he did not provide the disclosure earlier. He also claimed that he did not recall where he deposited his pay during the 10 years leading up to the date of separation, although he did say that he put his pay into an account from which he paid the expenses for his vehicle, his cigarettes, and a master bedroom suite. The court finds that his claim that he did not recall where he deposited his pay for 10 years leading up to the date of separation was not credible.

[22] Mr. Lorenzen testified that, pre-separation, he received a lump sum severance payment of about 11 weeks’ pay, followed by 32 weeks of pay continuance while he was working at a new job, and that these funds were used for family purposes, including the purchase of their next house. He did not provide any banking records to confirm this claim.

[23] Around 2001, Ms. Desjardins learned that she could borrow against an expected future inheritance from her father who had Alzheimer’s. As a result, she borrowed $120,000 to buy an unbuilt new home at 700 Society Avenue.

[24] Ms. Desjardins agreed that Mr. Lorenzen should be on title as a joint tenant at 700 Society, because he had paid back most of her mother’s money, and because the parties were moving there together as a family.

[25] The net proceeds from the townhouse, $40,000, were paid into the new house.

[26] The parties and their children moved into 700 Society in October of 2002.

[27] Ms. Desjardins purchased furniture for the home, including a leather couch and chair, a loveseat, a coffee table, a kitchen table, a wicker seat, a wrought iron mirror, a large sectional couch with pullout, and two settees. She also bought light fixtures and window coverings.

[28] Mr. Lorenzen purchased a master bedroom suite.

[29] Ms. Desjardins continued to pay the ongoing family expenses, including the mortgage, taxes, insurance, and utilities, as she had done since reconciliation.

[30] Even though 700 Society was owned jointly, Ms. Lorenzen testified that she did not open a joint account with Mr. Lorenzen at that point, because he was unemployed from time to time, and because his only contribution to the family’s expenses was buying some of the groceries.

[31] In 2005, the parties finished the basement at 700 Society in accordance with a design created by Ms. Desjardins. Mr. Lorenzen framed a base for a fireplace and the walls for a bathroom. He also tiled the bathroom floor. Ms. Desjardins hired an electrician to do the wiring. She purchased a heat pad for the bathroom floor. She installed much of the drywall herself.

2006

[32] In May of 2006, Ms. Desjardins’ father died. Ms. Desjardins was the executrix. She was the beneficiary of 75 percent of the estate, and her sister was the beneficiary of 25 percent.

[33] Her father’s will included a standard clause declaring that no benefit from the estate, whether capital, income, or both, or income from capital, received by a beneficiary would form part of the beneficiary’s net family property (Exhibit 36).

[34] Ms. Desjardins decided to handle the estate on her own. She had an unused savings account that she decided to use for estate purposes. The account was active between June of 2006 and April of 2008 (Exhibit 38).

[35] She testified that kept detailed estate records at that time, but she has not had access to those records since June of 2010, and, as a result, she attempted to reconstruct how she handled the estate by using bank account records and emails from companies that held her father’s investments.

[36] She accused Mr. Lorenzen of hiding or destroying her estate records and other financial records after she left 335 Penn in June of 2010. He denied having done so.

[37] It is not necessary for the court to determine whether such estate records existed and if they did, what happened to them, because the banking records, emails, and other exhibits, including lawyers’ reporting letters, that have been filed, confirm significant aspects of Ms. Desjardins’ reconstruction. Moreover, given the means of the parties at the time, the size of many of the transactions indicates that the source of funds was likely Ms. Desjardins’ father’s estate and/or his investments.

[38] As part of her reconstruction, Ms. Desjardins created an accounting of estate funds (Exhibit 37) that she testified passed through her savings account (Exhibit 38) and her chequing account (Exhibit 10). The total of estate funds she identified in this manner is $731,082. She stated that her share, after taxes and payment of her sister’s share, was $362,600. She conceded, however, that her reconstruction may not be complete. Consistent with that concession, she testified that her father owned between $800,000 and $900,000 in investments when he died.

[39] Indeed, an email in relation to one of Ms. Desjardins’ father’s investments (Exhibit 40) refers to a cheque for $42,647 received by Ms. Desjardins, which is not reflected in the banking records or the accounting.

[40] As a further example, on June 13, 2006, the sum of $26,730.65 was deposited to the parties’ joint line of credit secured by 700 Society (Exhibit 5). Ms. Desjardins testified that the deposit was a transfer of estate funds to temporarily reduce the 700 Society joint line of credit balance to zero. Indeed, the line of credit record shows that the deposit did reduce to balance to zero, but there is no corresponding debit to the savings account or the chequing account.

[41] Additionally, Ms. Desjardins’ calculations on Exhibit 37 indicate that her sister received $126,944.60 as her share of the estate. Yet, there is no such debit from the savings account or the chequing account. In fact, there is a deposit in that exact amount to the chequing account on July 21, 2006. Yet, Ms. Desjardins testified that the deposit was from the estate, and that $125,000 of the deposit was transferred to the savings account and formed part of the total of the estate from which her sister’s share was calculated.

[42] Despite these anomalies, given the level of parties’ incomes and their means at the time, there is no other reasonable alternative explanation for the source of such significant deposits; the larger deposits Ms. Desjardins identified in the accounting must have been from the estate.

[43] Within less than two years, Ms. Desjardins spent her inheritance on a limited number of investments, furniture, trips, clothing, and other family-related expenses, including cosmetic dental work for Mr. Lorenzen, and she bought all of the gifts for special family events, including a boat for Mr. Lorenzen, and the gifts nominally to her from the rest of the family.

[44] Not surprisingly, the banking records show a multitude of significant transfers from savings to chequing, followed by significant credit card payments and significant cheques being cleared, between June of 2006 and April of 2008, at which point the savings account was completely depleted.

[45] Mr. Lorenzen testified that he did not know how Ms. Desjardins spent any of her inheritance. Yet, he also testified that she spent some of her inheritance to buy furniture, a van, trips with friends, trips with family, and shopping. He claimed that he did not know who paid for gifts during cohabitation, that he did not recall Ms. Desjardins paying $5,000 into his RSP, and that he might have paid that himself.

[46] Ms. Desjardins’ investments made with her inheritance are detailed below.

[47] On December 21, 2006, Ms. Desjardins used $4,000 of funds she inherited from her father to open an RESP for Jake (Exhibit 38 and Exhibit 55).

2007

[48] On February 27, 2007, she used $5,000 of funds she inherited from her father to open a spousal RSP for Mr. Lorenzen (Exhibits 38 and 54).

[49] At around this time, Ms. Desjardins decided to use the bulk of her father’s inheritance to buy three residential properties and rent them to tenants.

[50] On June 21, 2007, she used $10,000 of the funds she inherited to make a down payment on the purchase of 335 Penn. The down payment was funded by a transfer of $15,704 from savings to chequing on June 20, 2007. The cheque cleared on June 25, 2007 (Exhibits 38, 10, and 41).

[51] On July 31, 2007, she used $67,622.42 of the funds she inherited to pay the balance due on closing for 335 Penn. The payment was funded by a transfer of $75,000 from savings to chequing on July 26, 2007. The cheque cleared on July 31, 2007 (Exhibits 38, 10, and 44).

[52] At around this time, Ms. Desjardins quit her job so that she could manage the rental properties full-time.

[53] 335 Penn was renovated extensively between August 1, 2007 and early December, 2007 to convert it into two rentable apartments. One of the tradesmen, who worked on the renovations, rented one of the apartments on November 1, 2007 while renovations were being completed. The other apartment was rented in December. The upper apartment rented for $1,600 per month and the lower rented for $1,000 per month. The rent included utilities and a cleaning service.

[54] Ms. Desjardins attempted to reconstruct the payments for the renovations with banking records and credit card statements (Exhibits 10, 37, 38, 53, and 54). She testified that she spent about $90,000, but she could only reconstruct about $50,000 from the records available to her. The evidence satisfies the court that she likely funded the renovations with her inheritance and that she spent at least $50,000 of her inheritance to do so. Moreover, Mr. Lorenzen testified that Ms. Desjardins likely paid $50,000 for renovations at 335 Penn from her inheritance.

[55] Ms. Desjardins was heavily involved in the renovations to 335 Penn. She worked there full-time for several months. She did all the design. She hired, coordinated, and supervised the trades. She purchased materials almost daily to avoid having to pay a markup to the trades. She removed all of the wallpaper and did most of the painting. She tiled the kitchen backsplash, put up drywall, did mudding and sanding, and installed insulation and vapour barrier.

[56] The parties installed the fire doors together.

[57] During evenings and weekends, Mr. Lorenzen framed the laundry room, kitchen, bathroom, and a doorway. Ms. Desjardins estimated that Mr. Lorenzen spent about 80 hours doing the framing. He also did some painting and carried out scrap with the children, who were then 14 and 21 years old.

[58] Mr. Lorenzen claimed that he did all of the plumbing, electrical, and kitchen renovations at 335 Penn. This aspect of his testimony, however, was inconsistent with the testimony of Ms. Desjardins and their son, Jake. The court finds that Jake made a concerted effort to tell the truth and not to show favour toward one parent over the other. Jake testified that professionals were hired to do the plumbing and electrical work. The court accepts Jake’s testimony.

[59] Mr. Lorenzen made quick evening meals for himself and the children during the week, while Ms. Desjardins worked at 335 Penn. She made substantial dinners for the family on Sundays.

[60] Upon completion of the renovations, Ms. Desjardins found tenants, collected the rent, and paid the expenses for the property, including the mortgage, taxes, and insurance.

[61] During the first winter, the parties cleared the snow at the property together. During the second winter, Mr. Lorenzen cleared the snow. The parties and/or their children cut the grass during the summers.

2008

[62] On February 21, 2008, Ms. Desjardins used $5,000 of the funds she inherited to make a down payment on the purchase of 314 Avenue. The down payment was funded by a transfer of $5,000 from savings to chequing on January 30, 2008. The cheque cleared on February 25, 2008 (Exhibits 38, 10, and 46).

[63] On March 13, 2008, she used $71,116.79 of the funds she inherited to pay the balance due on closing for 314 Avenue. The payment was funded by a transfer of $71,116.79 from savings to chequing on March 10, 2008. The cheque was certified on March 10, 2008 (Exhibits 38, 10, and 47).

[64] 314 Avenue was renovated extensively between March 10, 2008 and June of 2008 to convert it into two rentable apartments. The apartments were rented in June. The upper apartment rented for $1,500 per month and the lower rented for $1,200 per month, including utilities and a cleaning service.

[65] Once again, Ms. Desjardins attempted to reconstruct the payments for the renovations with banking records and credit card statements (Exhibits 10, 37, 38, 53, and 54). That evidence satisfies the court that she likely funded the renovations with her inheritance and that she spent at least $36,000 of her inheritance to do so.

[66] It should be noted that three of the transfers to chequing to pay for renovations at 314 Avenue came from the 700 Society line of credit, after the savings account was depleted. Ms. Desjardins testified, however, that those transfers were a repayment to her of inheritance funds used to reduce the 700 Society line of credit to zero in 2006. The total of the transfers to chequing from the line of credit was $28,000 ($8,000 on April 25, 2008, $5,000 on May 9, 2008, and $15,000 on June 5, 2008). The total transferred from inheritance funds, to reduce the line of credit to zero, was $29,832.67 ($26,730.65 on June 13, 2006 and $3,102.02 on June 21, 2006). As a result of the two transfers from inheritance funds and an unrelated third transfer in the amount of $6,424.20 on July 5, 2006, the line of credit balance was essentially kept at zero until April of 2008.

[67] Once again, Ms. Desjardins managed the renovations. She hired, coordinated, and supervised the trades. She worked at the site full-time for two months. She did all the painting and helped the trades with the drywall, sanding, mudding, and installation of vapour barriers. She jackhammered the concrete floor of the garage so a new garage door would fit.

[68] The parties hung the fire doors together.

[69] Mr. Lorenzen framed the walls for the furnace room. Ms. Desjardins estimated that he worked there, in total, about 20 hours during the first week of the renovations. He also carried out scrap with the children.

[70] Mr. Lorenzen testified that he worked on the renovations at 314 Avenue seven days a week, for 40 to 50 hours per week, for three to four months, in addition to his full-time job. That amounts to a total of 516 to 860 hours (3 months x 4.3 weeks x 40 hours / 4 months x 4.3 weeks x 50 hours). He also testified that the renovations took a total of six weeks. In an email he sent to Ms. Desjardins on June 11, 2010, he said that he worked at 314 Avenue for 200 to 300 hours (Exhibit 3). The court does not accept his internally inconsistent testimony about how long he worked there.

[71] Once again, Mr. Lorenzen made quick meals during the week for the children, who were then 15 and 22 years old, and Ms. Desjardins made Sunday dinners.

[72] Mr. Lorenzen cleared snow during the first winter and cut the grass during the summers of 2008 and 2009.

[73] As indicated above, by April of 2008, Ms. Desjardins’ inheritance funds in the savings account were completely depleted. For that reason, she did not purchase a third rental property.

[74] When asked at trial why she did not draw on the 700 Society line of credit to buy a third rental property to complete her plan, she stated that she did not do that, “because I had always intended to do them on my own, I wanted the funds to come from my inheritance, so that the properties would be in my name alone”.

[75] In April of 2008, Ms. Desjardins started drawing on the 700 Society line of credit to meet ongoing expenses of the family, to continue the lifestyle to which they had become accustomed after she received the inheritance.

2009

[76] By June of 2009, the 700 Society line of credit hit its limit of $100,000.

[77] At that point, the parties were in a significant financial bind.

[78] Ms. Desjardins decided that the parties would have to sell 700 Society, because they were losing equity with the passage of time as a result of the draws on the line of credit. Neither party wanted to sell the property. Ms. Desjardins looked for, but was unable to find, a smaller house for a price that would make a significant difference to their monthly expenses. She decided that the family should move to 335 Penn temporarily while she looked for employment to earn an income that would allow them to move to a permanent family home.

[79] Ms. Desjardins asked her banker for advice about ways to save money in the circumstances. The banker suggested increasing the limit on the line of credit on 700 Society to make a permitted penalty-free partial pay down on the 700 Society mortgage to reduce the penalty for discharging that mortgage early upon selling 700 Society.

[80] The banker also suggested exchanging the 335 Penn mortgage for a line of credit on 335 Penn, after making a permitted penalty-free partial pay down on the 335 Penn mortgage to reduce the penalty for discharging that mortgage early.

[81] Ms. Desjardins accepted both suggestions.

[82] She liked the idea of exchanging the 335 Penn mortgage for a line of credit on 335 Penn, because she did not know what the family’s financial circumstances would be going forward, and a line of credit could provide access to funds on a flexible and changing basis, unlike a mortgage, and because she could temporarily use the equity realized from the sale of 700 Society to reduce the line of credit on 335 Penn until she found another house for the family, whereupon she could use the proceeds of 700 Society to purchase the new house.

[83] The parties followed the banker’s advice and increased the limit of the 700 Society line of credit to $300,000.

[84] Mr. Lorenzen testified that the reason he agreed to increase the limit of the 700 Society line of credit was that the “refinancing” would allow Ms. Desjardins to take her equity out of 335 Penn, and that she had told him that as long as she got her equity out of 335 Penn, then the parties would be equal owners of 335 Penn. He said that he trusted her when she told him that the amount of the equity that she should get back was $75,000. He added that, while they were living at 700 Society, they talked about increasing the 700 Society line of credit, so that she could get her money out of 335 Penn, so that they could own 335 Penn equally, and that they would have a joint bank account as well.

[85] He also testified that he did not know why 700 Society was refinanced.

[86] During her testimony, Ms. Desjardins denied telling Mr. Lorenzen that the purpose of “refinancing” 700 Society was to permit her to take her equity from 335 Penn.

[87] On June 25, 2009, Ms. Desjardins used the 700 Society line of credit to reduce the mortgage on 700 Society by $21,000 (Exhibits 5 and 59).

[88] On the same day, she used the 700 Society line of credit to reduce the mortgage on 335 Penn by $32,400 (Exhibits 5 and 44).

[89] The sale of 700 Society closed on August 28, 2009.

[90] On closing, the reduced mortgage and the increased line of credit on 700 Society (which had been increased to $194.569.05) were paid off from the proceeds of sale and discharged.

[91] The net proceeds of sale of 700 Society were $141,501.92. The net proceeds were deposited into Ms. Desjardins’ chequing account, where they remained, pending approval of a line of credit for 335 Penn.

[92] On the same date, the parties and Jake moved into 335 Penn. The fire doors were removed so that the family could use the entire house.

[93] The court accepts the testimony of Marie Garbens, a real estate appraiser, who provided a professional and objective opinion that the value of 335 Penn on that date was between $290,000 and $300,000. The court also accepts her view that Ms. Desjardins overpaid for the property in 2007.

[94] On the same date, title to 335 Penn was transferred from Ms. Desjardins to herself and Mr. Lorenzen as joint tenants for no consideration.

[95] Ms. Desjardins’ explanation for the transfer of title of 335 Penn was, “because I was porting the equity from Society, I felt it only proper to put Mr. Lorenzen’s name on title to reflect or secure his half of the equity that came from Society”. She added that, “the thought never crossed my mind that he would try to take half of Penn or fight me for Penn”.

[96] She stated that she did not think about whether the transfer would have any legal significance and that in hindsight, given the current litigation, she wished that she had left the proceeds of 700 Society in the bank. She said that her decision to add Mr. Lorenzen to the title of 335 Penn was a moral decision, rather than a legal decision, and that she did not have independent legal advice at the time.

[97] She stated that at the time she “knew, because I had arranged the line of credit in favour of discharging the mortgage, that if I found a suitable property, I could have his name removed when the funds moved on, and that was my intention”.

[98] She also testified, “it was never my intention, when I put him on title at Penn, to be forsaking the inheritance money I had put down to purchase it, the inheritance money I had paid to renovate it, that $75,000 and then the $90,000, or the money that having tenants in it for two plus years had paid down the mortgage”.

[99] As noted above, Mr. Lorenzen testified that the purpose of increasing the 700 Society line of credit was to permit Ms. Desjardins to take her equity out of 335 Penn, so that the parties could own 335 Penn equally. He also testified, during examination-in-chief, that his interest in 335 Penn was more than merely a half-interest in the equity that was transferred to 335 Penn from 700 Society, because “as far as I am aware, [she] took her equity out of [335] Penn” and “as far as I was concerned, she had gotten out of [335 Penn] and all of [335 Penn] was joint”. In other words, he testified that he believed that she had taken back her equity from 335 Penn, and, as a result, based on their earlier conversation, the effect of the transfer was that they owned 335 Penn jointly.

[100] During cross-examination, however, Mr. Lorenzen testified that he had not testified earlier that Ms. Desjardins taken her equity out of 335 Penn through the refinancing of 700 Society. He claimed that his lawyer might have said that earlier - but he did not. He stated that, after the refinancing, Ms. Desjardins still had $75,000 more equity in 335 Penn than he did, because that was the amount of her “down payment” on the property from her inheritance, and that, in fairness, she should receive the first $75,000 of proceeds from 335 Penn and they should split the remainder equally. He added that he believed that Ms. Desjardins had already recovered the cost of the renovations of 335 Penn through either the 335 Penn line of credit or the 700 Society line of credit, although he did not point to any specific transactions to support this claim.

[101] Ms. Desjardins denied taking equity back from 335 Penn and, indeed, consistent with her testimony and with Mr. Lorenzen’s alternative testimony, no equity was taken out of 335 Penn. In fact, the opposite occurred. Using $32,400 from the 700 Society line of credit to reduce the 335 Penn mortgage, on June 25, 2009, increased the equity in 335 Penn. Similarly, a transfer of $130,000 of the net sale proceeds from 700 Society to the 335 Penn line of credit, on October 14, 2009, as detailed below, had the same effect – the equity in 335 Penn increased. Upon completion of the second transaction, the balance of the 335 Penn line of credit was $58,731.15, and there was no other debt secured against 335 Penn. Yet, prior to the transfer of equity realized from 700 Society to 335 Penn, the balance of the mortgage against 335 Penn was $188,731.15.

[102] Thus, the transactions that took place were inconsistent with Mr. Lorenzen’s initial testimony that Ms. Desjardins took equity out of 335 Penn but were consistent with Ms. Desjardins’ testimony that she did not take back any equity from 335 Penn.

[103] And contrary to Mr. Lorenzen’s alternative testimony, i.e., after a priority equity repayment of $75,000 to Ms. Desjardins, the parties’ have an equal share of ownership in 335 Penn, the Statement of Agreed Facts (Exhibit 1) states (at paragraphs 22, 30, 31, and 32),

The sale [of 700 Society] yielded net proceeds of sale of approximately $100,000; [e]ach party’s share of the equity was $50,000….The Applicant and the Respondent applied the equity from the net proceeds of the sale of 700 Society Crescent to 335 Penn Avenue. On August 28, 2009 the Respondent transferred 335 Penn into the parties’ joint names for $0.00 consideration. The purpose of the transfer was to provide security for the Applicant’s $50,000 investment. [Emphasis added]

[104] Further, Mr. Lorenzen confirmed during his testimony that the Statement of Agreed Facts was correct.

[105] Additionally, on June 11, 2010, Mr. Lorenzen sent Ms. Desjardins an email, proposing an equal division of the equity in 335 Penn “to be perfectly fair”, without referring to Ms. Desjardins being entitled to the first $75,000 (Exhibit 3).

[106] Also, there is no transaction, or combination of transactions, in the 335 Penn line of credit record (Exhibit 6) or the 700 Society line of credit record (Exhibit 5) during any part of 2007, that could have been a repayment to Ms. Desjardins of the at least $50,000 cost of the 335 Penn renovations. During 2007, the only activity in the 335 Penn line of credit was the payment of small monthly interest charges, and the total of all withdrawals from the 700 Society line of credit that year was $1,884.83. The next significant withdrawals from the 335 Penn line of credit were in April of 2008, for the renovations to 314 Avenue.

[107] Moreover, Ms. Desjardins denied using funds from the 700 Society line of credit to pay for expenses for 335 Penn.

[108] In summary, it is highly likely that the increase in the 700 Society line of credit, and the transfer of some of the equity from 700 Society to 335 Penn occurred for the reasons given by Ms. Desjardins and not for either of the reasons given by Mr. Lorenzen.

[109] On October 3, 2009, Ms. Desjardins converted the chequing account into a joint account with Mr. Lorenzen, because she was not working at the time and, due to their financial situation, she had informed Mr. Lorenzen that he had to make his income available for family expenses.

[110] Before any deposit of Mr. Lorenzen’s income could be made to the account, however, he lost his job.

[111] On October 9, 2009, a joint line of credit on 335 Penn was opened with a zero balance. The credit limit was $355,000.

[112] On October 13, 2009, the mortgage on 335 Penn was discharged by a payment of $188,731.15 from the new joint line of credit on 335 Penn.

[113] On October 14, 2009, $130,000 of the net sale proceeds from 700 Society were transferred to the 335 Penn line of credit. The balance of the net sale proceeds was used for family expenses.

[114] Ms. Desjardins initially testified, consistent with the Statement of Agreed Facts, that the net sale proceeds from 700 Society applied to 335 Penn were $100,000, and that Mr. Lorenzen’s half share, as a joint tenant of 700 Society, was $50,000, but while she was reviewing the banking records in the witness box, she realized that the net sale proceeds applied to 335 Penn were actually $130,000, and that Mr. Lorenzen’s half share was $65,000.

[115] Ms. Desjardins also testified that she realized that the partial prepayment of the 335 Penn mortgage, on June 25, 2009, using funds from the 700 Society line of credit, which was paid off upon the sale of 700 Society, could be considered to have been a transfer of part of the equity in 700 Society to 335 Penn, and that Mr. Lorenzen could be said to be due half of this amount. She stated, however, that she did not believe that would be a fair result, because she had spent considerable inheritance funds on family expenses while the family lived at 700 Society from 2006 to 2008, including mortgage payments, because Mr. Lorenzen’s only contribution to family expenses during that period was the purchase of some of the groceries, and because a prepayment of her inheritance made the purchase of 700 Society possible.

[116] Jake listed 335 Penn as his home address when he applied for university. The address on his driver’s license at that time was 335 Penn.

2010

[117] Mr. Lorenzen directed his EI payments to the chequing account. The first EI deposit was made on January 5, 2010. The EI deposits were made to the account twice a month until, and including, March of 2010.

[118] On February 7, 2010, the parties separated.

[119] The parties agreed that the value of 335 Penn on the date of separation was between $315,000 and $325,000, and the value of 314 Avenue on that date was $320,000.

[120] Mr. Lorenzen testified that he did not know how to value the household contents on the date of separation, but he disagreed with all of Ms. Desjardins’ valuations set out in her March 10, 2015 Financial Statement (Exhibit 29). She testified that she used values for second hand items found on sites such as Kijiji.

[121] Justin moved into 335 Penn in early 2010.

[122] The parties lived separate and apart at 335 Penn until Ms. Desjardins moved out. Until then, she used the basement bedroom, the children used the two upstairs bedrooms, and Mr. Lorenzen slept on the couch in the basement.

[123] On February 8, 2010, Ms. Desjardins transferred $5,000 to herself and $5,000 to Mr. Lorenzen from the 335 Penn line of credit for their individual use.

[124] The parties subsequently instructed the bank to freeze the 335 Penn line of credit. Since the two $5,000 payments there has been no activity on the 335 Penn line of credit, other than payments of small monthly interest charges on the outstanding balance, which has been about $79,000 since then.

[125] Ms. Desjardins testified that, without her permission, post-separation, Mr. Lorenzen went through her purse, took her car keys, entered her locked car, and took the boat key and marina card. Mr. Lorenzen did not allow Ms. Desjardins to use the boat after separation.

[126] By April 4, 2010, Ms. Desjardins had consulted with counsel. On that date, Ms. Desjardins emailed Mr. Lorenzen that 335 Penn would have to be sold and the proceeds held in trust. She also informed Ms. Lorenzen that they would have to make arrangements to equally support Jake’s post-secondary education. At that point, Jake was in grade 12.

[127] Mr. Lorenzen responded that he did not want to sell 335 Penn, because he was unemployed, so he could not afford to go elsewhere. He did not respond to the comment about Jake’s education costs.

[128] In June of 2010, Ms. Desjardins arrived at 335 Penn to find Mr. Lorenzen standing at the top of the stairs holding a personal medical item that she had left in the bottom of her bag. He had spread literature relating to the item around the kitchen and was screaming accusations at her.

[129] Mr. Lorenzen denied that such an event occurred, but Ms. Desjardins sent him an email on June 9, 2010 (Exhibit 91) that refers to him going through her personal belongings and making accusations.

[130] On June 20, 2010, Ms. Desjardins returned to 335 Penn and found Mr. Lorenzen’s pajama bottoms on the pillow on the bed in the basement bedroom. She asked him why they were there, and he replied that he was moving back into the bedroom. She responded that she could not use the couch, because she had a bad back and was working, whereas he was healthy and was not working. He replied that she could sleep in the bed as well.

[131] As a result, she went to a hotel that night.

[132] On June 21, 2010, Ms. Desjardins rented a room in a private home for $500 per month. She had only a dresser and an inflatable mattress the first night.

[133] She returned to 335 Penn the next day and retrieved some clothing, some toiletries, two of the six televisions, and a DVD player.

[134] Mr. Lorenzen testified that he suggested converting 335 Penn back into two apartments, so that each party could have their own unit, but Ms. Desjardins chose to leave 335 Penn instead. Ms. Desjardins denied that Mr. Lorenzen made that suggestion and added that such a suggestion would not have been feasible, given that the children were occupying both bedrooms upstairs. In reply, Mr. Lorenzen testified that he could have slept on the bigger couch upstairs. The court does not accept Mr. Lorenzen’s testimony in this regard, because it is very unlikely that Ms. Desjardins would have chosen a hotel room and then a bedroom in a stranger’s house if she had the option of a complete and separate apartment at 335 Penn.

[135] On June 22, 2010, Mr. Lorenzen emailed her that he had “changed the locks on the house to keep you from moving possessions” and that he told the children not to allow her into 335 Penn (Exhibit 81).

[136] On June 23, 2010, Ms. Desjardins emailed him that if he did not change the locks back that day, she would obtain a court order and bring a truck and the police to the home, so she could retrieve more of her belongings. She said that she would not take items like furniture, rugs, or paintings, which should stay to facilitate a sale of the property. She added that he had removed all of the liquor, DVD movies, the boat key, and various tools from 335 Penn (Exhibit 81).

[137] The same day, Mr. Lorenzen replied that he changed the locks, because she took two televisions and a DVD recorder. He added that the boat was a gift to him. He stated that he would pay the utilities at 335 Penn going forward because the children were living there (Exhibit 81). He subsequently asked Justin to pay one-third of the cost of utilities.

[138] On July 7, 2010, Ms. Desjardins’ counsel wrote to Mr. Lorenzen requesting, amongst other things, his bank account statement for the date of separation (Exhibit 83). As mentioned above, it was never provided.

[139] In the letter, Ms. Desjardins’ counsel advised Mr. Lorenzen that 335 Penn had to be sold, so that Ms. Desjardins could realize her equity to obtain new accommodations and to pay post-secondary costs for Jake. Counsel stated, “There would seem to be no rationale for delaying the sale of the home, and should you continue to delay the inevitable, we will be seeking occupational rent from you”.

[140] Counsel also stated in the letter that Ms. Desjardins required access to 335 Penn to obtain “her personal belongings, required financial records, and agreed upon items”.

[141] While her counsel’s letter, of July 7, 2010, was being introduced into evidence, during her examination-in-chief, Ms. Desjardins testified that she wanted to get her bankers’ boxes of financial documents, which were very important to her, because they comprised all of the paperwork in her life to that point. The next day, during cross-examination, however, it was pointed out to her that the boxes of records were not mentioned in a handwritten list that she claimed she took with her to 335 Penn, in September of 2010, when she went to obtain her belongings with police assistance. She replied that she was not thinking about her records in September, because it was not income tax time. Later, when asked by the court about the meaning of “required financial records” in her lawyer’s letter, her initial response was that she did not remember that reference when she went to 335 Penn with the police in September of 2010. The court noted that she did not reply to the question asked, but instead, focused on explaining the inconsistency in her testimony. The question was repeated. Her reply was that she could not recall whether she had discussed the boxes of records with her lawyer by July 7, 2010, when the letter was written, or whether the reference in the letter related to something else, such as a cheque book. The court finds her answer unconvincing.

[142] On July 13, 2010, Mr. Lorenzen’s counsel at the time replied that Mr. Lorenzen would like to sell 335 Penn but, because he was unemployed, he would need at least a portion of the sale proceeds to obtain alternate living arrangements.

[143] Ms. Desjardins was asked at trial whether it was reasonable of her to be seeking a sale of 335 Penn at that time, given that Mr. Lorenzen was unemployed and the children were living with him. She replied that Justin was working and supporting himself and Jake was starting university in the fall.

[144] Ms. Desjardins testified that she did not bring a motion for possession of 335 Penn at that time, because she could not start an action without filing her last three notices of assessment but they were in her boxes of records at 335 Penn. She added that when Mr. Lorenzen started this action, she was permitted to file an Answer without filing her notices of assessment.

[145] Commencing around late July of 2010, the parties agreed that they would each pay half of the monthly interest on the 335 Penn line of credit, half the monthly taxes for 335 Penn, and half of the cost of a regular cleaning of 335 Penn while litigation was pending. They deposited their payments into the original chequing account for that purpose. They agreed to deposit $405 each per month. In July of 2016, they agreed to change the monthly amount to $497 each.

[146] Jake attended Carleton University from the fall of 2010 to the spring of 2011. He saved between $2,000 and $4,000 for Carleton by working during the summer of 2010. He received a student grant of about $4,000 and a student loan of about $6000. He worked part-time while attending school. His father’s contribution to his attendance at Carleton was moving Jake’s belongings there at the start of the year and buying him groceries once. His mother paid the portion of Jake’s expenses that he could not pay, including payments toward tuition, residence, and a meal plan. Jake stayed with each of his parents from time to time while he attended Carleton.

[147] Ms. Desjardins remained in the rented room until the end of September of 2010. She rented an apartment commencing October 1, 2010, for $1,200 per month.

[148] On September 13, 2010, she advised Mr. Lorenzen by email that she had rented an apartment and, therefore, needed some furniture and other contents from 335 Penn. She asked if she could send him a list of things she needed right away (Exhibit 86). Mr. Lorenzen did not reply.

[149] On September 21, 2010, Ms. Desjardins attended at 335 Penn with a locksmith, a moving truck, and the police to get items to furnish her apartment. She had a letter from her lawyer stating that she could enter the house. Mr. Lorenzen told the police that he would not allow Ms. Desjardins to take anything from the house. While the police spoke with him, Ms. Desjardins was permitted by the police to go into the house and retrieved some of her clothing. The police also told her that she could change the locks, so she had the locksmith change the locks. The movers left with an empty truck, as a result of Mr. Lorenzen’s position.

[150] Ms. Desjardins filed the list that she said that she gave to the police on September 21, 2010 (Exhibit 88). The list does not mention boxes of records.

[151] Ms. Desjardins had no furniture, appliances, or other items for her apartment, so she purchased replacements.

2011 to present

[152] In April of 2011, Ms. Desjardins opened a new line of credit secured by 314 Avenue, because she was paying half of the fixed expenses of 335 Penn, as well as her own expenses. She lived in the apartment until late in 2011, when she moved to the upstairs unit at 314 Avenue, where she continues to reside.

[153] The lower apartment at 314 Avenue was rented for about $1,050 per month until the spring of 2014, when there was a break-in at the lower apartment, which dissuaded Ms. Desjardins from re-renting the lower apartment for about a year.

[154] The next tenant, who currently lives in the basement apartment, is Jake. He is employed and pays rent of $575 per month. His rent was expected to increase to $1,000 per month in the near future when his girlfriend moved in with him.

[155] Jake worked full-time during the summer of 2011 while living at 335 Penn. He then worked in Ottawa from September of 2011 until February of 2012. He paid off his student loan in 2011.

[156] After living in Ottawa, he moved back to 335 Penn with his father. Jake worked full-time and paid rent of $250 to $300 per month to his father until he started a two year programme at Seneca College in the fall of 2013. Jake completed the programme in the spring of 2015. While he attended Seneca, he did not pay rent, and his father paid for Jake’s groceries and bought him a computer. Ms. Desjardins paid for his tuition at Seneca.

[157] The parties agreed that Ms. Desjardins paid a total of $22,249.04 for Jake’s post-secondary education at Carleton and Seneca, as shown in Exhibit 29.

[158] Mr. Lorenzen stated that he believed that Ms. Desjardins used RESP funds for her contributions to Jake’s education. Ms. Desjardins testified that she did use RESP funds, to which Mr. Lorenzen did not contribute, but, rather, were established by her inheritance, and she also contributed some of her own income.

[159] Ms. Desjardins testified that Mr. Lorenzen did not make his monthly payments for 335 Penn on time or in full. She said that, by the time of trial, she had paid $2,006.87 on his behalf, as indicated in Exhibit 66

[160] Mr. Lorenzen testified that he spent about $8,000 maintaining 335 Penn while living there post-separation, including changing the central vacuum system, repairing the water system, shampooing the carpet, replacing the shingles, some patching, painting, and staining, and outside maintenance. He did not file receipts for these expenses.

Question 1 - Ownership of 335 Penn Avenue

Positions of the Parties

[161] Mr. Lorenzen’s Application sought a sale of 335 Penn and a division of the proceeds between the parties.

[162] His opening statement indicated that he wanted to see proof that 335 Penn was purchased with inherited funds. He also suggested that he had a half interest in 335 Penn.

[163] In his closing submissions, he stated that the court should order 335 Penn sold and the net proceeds divided equally between the parties.

[164] The court infers that it is his position, consistent with Financial Statements he filed (Exhibits 7 and 24), and the Net Family Property Statements that he filed with his closing (Exhibits I and J), and part of his testimony, that he owns a full equal share of 335 Penn as a joint tenant.

[165] The court infers that it is also his position, in the alternative, as he testified, that he owns a less than equal share, because Ms. Desjardins has priority in relation to the amount of equity she put into 335 Penn when she bought it (although his alternative position is not reflected in his Financial Statements or his Net Family Property Statements).

[166] Ms. Desjardins’ Answer sought a declaration that Mr. Lorenzen holds his joint tenancy in 335 Penn in a resulting trust for her. She sought a vesting of title for 335 Penn into her name alone, upon repayment to Mr. Lorenzen of his half of the net proceeds of 700 Society that were used to reduce the debt against 335 Penn.

[167] In the alternative, she sought a declaration that Mr. Lorenzen owns 19 percent, and she owns 81 percent of 335 Penn, based on the relative amounts of their respective investments of capital into the property, assuming that his investment was $50,000. She also sought possession of the property.

[168] Her opening statement indicated that she wanted a declaration that Mr. Lorenzen holds his joint tenancy in 335 Penn in a resulting trust for her. She sought a sale of 335 Penn upon terms that she would pay Mr. Lorenzen his half of the net proceeds of 700 Society used to reduce the debt against 335 Penn, or she would pay him no more than 24 percent of the current net value of 335 Penn, based on the assumption that his investment in 335 Penn was $50,000. She also sought possession of the property.

[169] Her closing submissions sought a declaration that Mr. Lorenzen holds his joint tenancy in 335 Penn in a resulting trust for her. She sought a vesting of title into her name alone upon terms that she remove his name from the 335 line of credit. She also sought possession of the property.

[170] She made lengthy and complex submissions in support of her position.

Analysis

[171] Subsection 14 (a) of the Family Law Act (FLA) states,

The rule of law applying a presumption of a resulting trust shall be applied in questions of the ownership of property between spouses, as if they were not married, except that….the fact that property is held in the name of spouses as joint tenants is proof, in the absence of evidence to the contrary, that the spouses are intended to own the property as joint tenants.[^1]

[172] Thus, absent evidence to the contrary, in this case, the fact that 335 Penn is held in name of the parties as joint tenants is proof that they are intended to own the property as joint tenants.

[173] There is, however, evidence to the contrary in this case.

[174] Although Ms. Desjardins’ explanation for the transactions that took place in 2009 is unusual, and the court has some reservation about her credibility or reliability in relation to at least one other aspect of her testimony, based on a close examination of the other evidence, including the transactions, and the underlying financial records, the court accepts her testimony that the family moved to 335 Penn as a temporary measure, during a financial crisis, while she looked for employment that would allow them to move elsewhere. The court also accepts her testimony that the transfer of $130,000 of the net proceeds from the 700 Society sale to the 335 Penn line of credit was intended to be temporary for the same reason and, once she found an alternate home for the family, the $130,000 would be transferred to the new home and Mr. Lorenzen’s name would be removed from the title to 335 Penn. The court also accepts her testimony that her purpose in transferring title in 335 Penn to herself and Mr. Lorenzen as joint tenants for no consideration was to “reflect or secure” his interest in half of the net proceeds from 700 Society while those funds were being used, temporarily, to reduce the debt against 335 Penn while the parties lived there during a temporary financial crisis, because she thought that was the morally proper thing to do in the circumstances – and that it was never her intention to transfer half of the ownership of 335 Penn to Mr. Lorenzen, thereby “forsaking” the inheritance funds she invested in the property and her original intention for the rental property investments. Her testimony about her intention in relation to these transactions was internally consistent and was externally consistent with the other evidence with the exception of Mr. Lorenzen’s testimony.

[175] The court does not accept Mr. Lorenzen’s explanations for the transactions. His testimony about the transactions, as well as some of his other testimony, was internally and externally inconsistent.

[176] Internally, he provided two different explanations.

[177] The first explanation was that the purpose of the refinancing of 700 Society and 335 Penn was to allow Ms. Desjardins to remove her equity from 335 Penn, so that the parties could own it as joint tenants, and that she did remove her equity “as far as [he] was concerned”. The difficulty with this testimony is, as discussed previously, an examination of the transactions and related records establishes that she did not remove any equity from 335 Penn. His testimony was also inconsistent with the Statement of Agreed Facts (Exhibit 1) that indicates that he has lesser interest in 335 Penn than Ms. Desjardins and that “the purpose of the transfer was to provide security for the Applicant’s $50,000 investment”.

[178] The second explanation was that the parties agreed that they would be joint tenants, subject to Ms. Desjardins having a priority claim for the first $75,000 of the equity in 335 Penn, so that she could receive her original investment back. Not only was that inconsistent with his first explanation, it was also inconsistent with the email Mr. Lorenzen sent her on June 11, 2010, very close to the date of separation, which said nothing about a priority claim for $75,000, yet claimed to be written “to be perfectly fair” (Exhibit 3). It is also inconsistent with his sworn Financial Statements that indicate equal equity in 335 Penn without any reference to a priority for $75,000 (Exhibits 7 and 24).

[179] For these reasons, the court finds that Ms. Desjardins provided evidence to the contrary that rebuts the presumption of ownership otherwise established by subsection 14 (a) of the FLA.

[180] Given the rebuttal of the statutory presumption, the court must next consider the common law.

[181] The common law establishes a rebuttable presumption of resulting trust for gratuitous transfers of property. The onus is on the transferee to prove that the transfer was a gift.[^2]

[182] In this case, Mr. Lorenzen has not met the onus of establishing that Ms. Desjardins intended to give him an interest in 335 Penn as a joint tenant, because the court does not accept his explanations for the transfer. The court accepts Ms. Desjardins’ explanation that the purpose of the transfer of title to herself and Mr. Lorenzen, as joint tenants, was to secure his half interest in the net proceeds of sale from 700 Society that were used to temporarily reduce the line of credit on 335 Penn pending the purchase of a permanent family home to replace 700 Society. In short, the court accepts her testimony that she never intended Mr. Lorenzen would have an interest 335 Penn.

[183] As a result, the court finds that Mr. Lorenzen holds his joint tenancy in 335 Penn in trust for Ms. Desjardins who, therefore, is the sole beneficial owner of 335 Penn.

Question 2 – Unjust Enrichment

Positions of the Parties

[184] Ms. Desjardins submitted that if her claim for a resulting trust succeeded, there might be an unjust enrichment claim in Mr. Lorenzen’s favour, even though not pleaded by him, for his half of the net proceeds of 700 Society used to reduce the debt against 335 Penn, or for a percentage of the ownership of 355 Penn, but she argued that there has not been any unjust enrichment, or if there has been an unjust enrichment, then a division of net family property, whether equal or not, would cure the unjust enrichment.

Analysis

[185] The court finds, as initially suggested by Ms. Desjardins, that a vesting of title in 335 Penn in her name alone, without addressing Mr. Lorenzen’s share of the amount of joint equity from 700 Society that was transferred to 335 Penn, would unjustly enrich Ms. Desjardins. She would enjoy a benefit in that amount, he would suffer a deprivation in that amount, and there would be no juristic reason for either consequence.

[186] The amount of unjust enrichment that would occur is readily identifiable.

[187] The enrichment and deprivation is half of $130,000, the net sale proceeds from 700 Society transferred to reduce the 335 Penn line of credit on October 14, 2009, plus half of the $32,400 from the 700 Society line of credit transferred to reduce the 335 Penn mortgage on June 25, 2009. The two amounts total $81,200.

[188] Before arriving at this conclusion, the court considered Ms. Desjardins’ testimony that Mr. Lorenzen should not receive his half of the 700 Society equity that was used to partially prepay the 335 mortgage.

[189] The court was not persuaded by her testimony, which was closer to a submission, for two reasons.

[190] First, the reasons she provided, which are set out again below, apply equally to the repayment of his half of the net sales proceeds used to reduce the 335 Penn line of credit. In other words, she provided no logical or legal basis upon which to distinguish the $130,000 payment from the $32,400 payment.

[191] Second, the court does not accept her argument that her reasons provide a basis upon which the court should find that she would not be unjustly enriched.

[192] Her first reason was that she spent considerable sums of inheritance money on family expenses, including making the mortgage payments, while the family lived at 700 Society, but Mr. Lorenzen paid only for some groceries. The difficulty with this argument is that she testified that it was her idea to have separate bank accounts, and it also seems to have been her idea that she would continue to pay for family expenses, including mortgage payments, taxes, insurance, and utilities. There is no evidentiary foundation upon which the court could conclude that while the parties were living at 700 Society, Ms. Desjardins was not content with Mr. Lorenzen’s contribution of buying some of the groceries. Her testimony certainly indicated that she is not content now, but there was no indication in the evidence that she was not content then. In fact, her insistence that Mr. Lorenzen must contribute more by depositing his income into a joint account after the family financial crisis occurred in 2009 underlines that she did not require him to do that earlier.

[193] Her second reason was that she used an advance of $120,000 from her inheritance to buy 700 Society. In other words, she was suggesting that since $60,000 of his half of the equity in 700 Society came from her inheritance, a later benefit in that amount to her and a corresponding deprivation of that amount from him would not be unjust. There is no evidentiary basis, however, upon which the court could find that Ms. Desjardins had that belief at the time of the purchase of 700 Society. To the contrary, she testified that title to 700 Society was put into the names of the parties jointly, because Mr. Lorenzen repaid most of her mother’s contribution to the townhouse, and because they moved into 700 Society as a family. Despite unequal contributions by the parties to 700 Society, no evidence indicates that Ms. Desjardins ever intended that Mr. Lorenzen would hold his title in 700 Society in trust for her – in fact, her evidence indicated the contrary. Accordingly, the fact that she contributed more to the equity in 700 Society than he did does not provide a basis to retroactively negate her intention at the time. Her intention was that he was a joint owner and he had a right to half of the equity of 700 Society.

[194] Thus, based on unjust enrichment, Ms. Desjardins owes Mr. Lorenzen $81,200 for his share of the equity in 700 Society that was used to reduce the debt secured by 335 Penn, given that 335 Penn is owned beneficially by Ms. Desjardins alone due to a resulting trust.

[195] The court agrees with Ms. Desjardin’s final submission, however, that before finding that such an amount must be paid to Mr. Lorenzen, based on unjust enrichment, the court must consider the result of equalization.

[196] As discussed below, subject to a possible unequal division of net family property, Ms. Desjardins owes Mr. Lorenzen an equalization payment of $120,675. That amount includes equal division of the net equity in 335 Penn on the date of separation. The net equity in 335 Penn on the date of separation was $261,026. Through equalization, Mr. Lorenzen receives a credit for half that amount, i.e., $130,513, which includes the $81,200 that he contributed to the net equity of 335 Penn.

[197] In other words, in this case, his half share of the equity from 700 Society that was applied to 335 Penn, flows through, in its entirety, to the credit he receives through equalization in relation to the amount of the equity in 335 Penn on the date of separation.

[198] Thus, due to equalization, Ms. Desjardins will not be unjustly enriched at the expense of Mr. Lorenzen. That remains true even if the court finds that an unequal division of net family property is appropriate, because unequal division would provide a juristic reason for changing the equalization payment.

Question 3 – What Should Happen to 335 Penn?

[199] Having found that Ms. Desjardins is the sole beneficial owner of 335 Penn, it follows that 335 Penn should be vested into Ms. Desjardins’ name alone and Mr. Lorenzen’s name should be removed from the 335 Penn line of credit.

[200] As will be discussed below, 335 Penn was a matrimonial home on the date of separation. As a result, on that date, both parties had a possessory right to 335 Penn pursuant to subsection 19 (1) of the FLA.

[201] On September 29, 2015, Justice Kaufman granted the parties a divorce effective 31 days later.

[202] Pursuant to subsection 19 (2) of the FLA, the possessory right conferred upon Mr. Lorenzen by subsection 19 (1) of the FLA is extinguished by combined effect of the divorce and the court’s finding that Ms. Desjardins is the sole owner of 335 Penn, unless the court orders otherwise.

[203] Mr. Lorenzen did not argue that he should be permitted to remain at 335 Penn if the court found that Ms. Desjardins is the sole owner of 335 Penn.

[204] Mr. Lorenzen is 54 years old and employed full-time. No evidence was led to indicate that he is not healthy, that he is incapable of supporting himself, or that he will be unable to find alternate accommodations, if given a reasonable period of time to do so.

[205] In these circumstances, Mr. Lorenzen will be required to vacate 335 Penn at or before 4 p.m. on July 1, 2017.

Question 4 – Exclusions from Equalization

335 Penn

[206] Mr. Lorenzen maintained in his Answer, opening statement, testimony, and closing submissions, that 335 Penn was a matrimonial home on the date of separation. He made lengthy submissions in support of his position.

[207] In her Application and opening statement, Ms. Desjardins sought a declaration that 335 Penn was not a matrimonial home on the date of separation.

[208] Ms. Desjardins testified that she did not consider 335 Penn to have been a matrimonial home on the date of separation, because she always intended that the family would only live there temporarily, as a “stop gap” measure while she obtained employment, and that they would move elsewhere on a permanent basis as soon as they could afford to do so. She testified that 700 Society, on the other hand, was a matrimonial home, because they moved there, permanently, as a family. She emphasized that she never intended to “forsake” the inheritance from her father that was invested in 335 Penn.

[209] In closing submissions, Ms. Desjardins submitted that she was not opposing or consenting to 335 Penn being found a matrimonial home, despite her personal belief that it was not a matrimonial home. She indicated that she would address her concern under the rubric of unequal division of net family property.

[210] Section 17 of the FLA defines a matrimonial home as “every property in which a person has an interest….that….was at the time of separation ordinarily occupied by the person and his or her spouse as their family residence”.

[211] Ms. Desjardins had an interest in 335 Penn on the date of separation – she was the owner.

[212] On the date of separation, Ms. Desjardins, Mr. Lorenzen, and Jake had been living at 335 Penn for five months and ten days. Jake changed his driver’s license to 335 Penn. He gave 335 Penn as his address when he applied to university. Mr. Lorenzen testified that he considered 335 Penn to be the family home.

[213] In is unclear how long the parties would have lived together at 335 Penn if they had not separated. Ms. Desjardins did not obtain her current employment until almost a year after the parties moved to 335 Penn.

[214] The court has accepted Ms. Desjardins’ testimony that she intended to move the family elsewhere as soon as possible and that their stay at 335 Penn was temporary.

[215] Nevertheless, the court finds that, on the date of separation, 335 Penn was ordinarily occupied by Ms. Desjardins, and her spouse, Mr. Lorenzen, as their family residence.

[216] Accordingly, 335 Penn was a matrimonial home on that date.

[217] Subsection 4 (2) of the FLA states, “The value of the following property that a spouse owns on the valuation date does not form part of the spouse’s net family property…Property, other than a matrimonial home, that was acquired by gift or inheritance from a third person after the date of marriage.”

[218] As a result, despite the fact that 335 Penn was purchased by Ms. Desjardins using inheritance funds and would otherwise be excluded from equalization, because it was a matrimonial home it is included in equalization pursuant to the FLA.

314 Avenue

[219] In his opening statement, Mr. Lorenzen suggested that 314 Avenue should not be excluded from equalization, because it had not been proven that 314 Avenue was purchased with inherited funds, and because joint funds from the 700 Society line of credit were used for some of the renovations and, thus, were comingled with inherited funds.

[220] Ms. Desjardins submitted that the evidence was clear that she purchased 314 with inherited funds, and that, although $28,000 of the renovations were paid from the 700 Society line of credit in 2008, these funds were a repayment of inheritance funds that had been temporarily paid into the 700 Society line of credit in 2006.

[221] The court accepts Ms. Desjardins’ submission. As set out above, she satisfied the court that the funds used to purchase 314 Avenue likely came from her inheritance. She also satisfied the court that the payments for renovations to 314 Avenue from the 700 Society line of credit in 2008 were repayments of inheritance funds deposited to the line of credit in 2006 to keep its balance at zero, and that the balance was kept at zero until the funds were withdrawn for the renovations to 314 Avenue in 2008.

[222] Accordingly, 314 Avenue will be excluded from equalization.

Chattels

[223] Mr. Lorenzen submitted that the parties’ chattels on the date of separation should not be included in equalization, because there was no reliable evidence of their value. As noted above, he testified that he did not know how the contents could be valued. Nevertheless, he disagreed with Ms. Desjardins’ valuations.

[224] In her financial statement sworn March 10, 2015 (Exhibit 29), Ms. Desjardins provided a lengthy numbered list of estimates for the date of separation values of the chattels based, with a few exceptions, on her research on well-known websites such as Kijiji.

[225] The court has reviewed Ms. Desjardins’ estimates and will comment first about items she valued at $1,000 or more.

[226] The parties valued the van (item 2 on Ms. Desjardins’ list) differently. Ms. Desjardins valued the van at $3,000 on the date of separation. She filed proof that she traded in the van in 2011 for $3,000 (Exhibit 68). It is well known, however, that trade-in prices for motor vehicles can involve various factors including the negotiated price for the replacement vehicle. Further, the trade-in occurred over a year after separation. Mr. Lorenzen suggested that the van was worth $10,000 (Exhibit 24), but he provided no evidence to support his view. In his closing submission, he suggested a compromise position of $7,000. It would not have been overly difficult for Mr. Lorenzen to provide a more reliable valuation of the van from on-line or from a dealer, if he wished to do so. The court finds that a valuation of $5,000, mid-way between the parties’ final valuations, would be reasonable in the absence of better evidence.

[227] The parties also valued the Dodge SX (item 1) differently. Mr. Lorenzen suggested $5,000 (Exhibit 24) and Ms. Desjardins suggested $3,000 (Exhibit 29). The Statement of Agreed Facts (Exhibit 1), however, stipulates $5,000, which is the value the court will use.

[228] The value provided for the boat (item 3), being 50 percent of its cost three years earlier, does not seem unreasonable. The boat was gifted to Mr. Lorenzen in late 2006. The value differs from the stipulation in the Statement of Agreed Facts, which is the original cost of the boat. Given that Ms. Desjardins’ valuation is fairer to Mr. Lorenzen, the court will accept her valuation.

[229] The court does not have sufficient evidence to value the timeshare (item 7), the hockey card collection (item 8), or the surround sound system (item 22).

[230] The value for the movies (item 9) does not seem unreasonable, but the court does not have sufficient evidence to accept the valuation, despite the absence of evidence to the contrary. Nevertheless, the court is confident that reducing the suggested valuation by 60 percent would be fair to Mr. Lorenzen. The court is satisfied that items were worth at least $800 in total. It would not have been difficult for Mr. Lorenzen to obtain a valuation from a used movies store if he sought a lower valuation.

[231] Some of the appliances at 335 Penn (items 139, 140, and 141) are shown, to some extent, in photographs in the October of 2016 appraisal of 335 Penn (Exhibit 93). The value suggested does not seem unreasonable, but the court does not have sufficient evidence to accept the valuation, despite the absence of evidence to the contrary. Nevertheless, the court is confident that reducing the suggested valuation by 60 percent would be fair to Mr. Lorenzen. The court is satisfied that these items were worth at least $1,200 in total. Mr. Lorenzen could have obtained a rough valuation from a used appliance store if he sought a lower valuation.

[232] The court has reviewed the rest of the list but is not going to comment about those items individually. The court does not have sufficient evidence to accept the valuations, despite the absence of evidence to the contrary. Some of the valuations seem high, and some seem low. The court is confident, however, that reducing the suggested valuations by 60 percent would be fair to Mr. Lorenzen. Admittedly, some of the values become absurdly low as a result. For example, the valuation for the dining room table and chairs shown in Exhibit 93 (item 10) drops to a total of $80. If Ms. Desjardins wanted the court to find a higher value, however, she should have provided more cogent evidence – although the court appreciates that doing so might not have been justifiable in terms of time or expense.

RESPs

[233] The parties agreed that the RESPs should be excluded from equalization (paragraph 51 of Exhibit 1).

RSP

[234] Ms. Desjardins opened a spousal RSP for Mr. Lorenzen in 2007. It is excluded, because she used inherited funds.

Question 5 – Equalization

[235] The net worth of each party on the date of marriage was zero.

[236] Given that seven years has passed since separation and that Ms. Desjardins purchased replacement household chattels over six years ago, and that she did not seek, at trial, the return of any of the household items that Mr. Lorenzen has been enjoying since separation, the court finds, given the limited value of each item, for the sake of simplicity, and to be consistent with the approach taken by the parties, that the chattels each party has possessed since separation should be deemed to be owned by that party.

[237] Thus, on the date of separation, Mr. Lorenzen had ownership of a vehicle that the court has valued at $5,000, a boat that the court has valued at $10,000, other chattels that the court has valued at $9,448, $770 being his half of the balance in the savings account, $1,000 being the balance in his chequing account, and $46,742 in RSPs, for a total of $72,960. He had liabilities of $11,685 for notional disposition costs for the RSPs. Thus, his net family property was $61,275.

[238] On the date of separation, Ms. Desjardins owned 335 Penn, which was appraised between $315,000 to $325,000 on the date of separation, but both parties used $320,000 in their Net Family Property calculations, which the court will use as well, a vehicle that the court has valued at $3,000, other chattels that the court has valued at $329, $770 being her half of the balance in the savings account, and $50,000 in an RSP, for a total of $374,099. She had liabilities of $58,974 for the 335 Penn line of credit and $12,500 for notional disposition costs for the RSP. Thus, her total net family property was $302,625.

[239] The difference between the net family property of each party on the date of separation was, therefore, $241,350.

[240] As a result, subject to a possible unequal division of net family property and the $5,000 costs order, Ms. Desjardins owes Mr. Lorenzen $120,675 for equalization.

Question 6 – Unequal Division

Positions of the Parties

[241] Mr. Lorenzen maintained in his Application, opening statement, and closing submissions that there should not be an unequal division of net family property.

[242] He submitted that this case does not fall within any of the circumstances enumerated in subsection 5 (6) of the FLA which provides for the possibility of an unequal division.

[243] He also emphasized that the threshold test for an unequal division, i.e., that equalization would be “unconscionable”, is exceptionally high and that an “unfair”, “unjust”, or “harsh” equalization is not sufficient to “shock the conscience of the court”, as required by law, and that onus of meeting this very high standard of proof falls upon the person seeking an unequal division.

[244] Ms. Desjardins maintained in her Answer, opening statement, testimony, and closing submissions that there should be an unequal division of net family property.

[245] Ms. Desjardins testified that there should be an unequal division of net family property, because Mr. Lorenzen did not contribute to Jake’s education, and because he kept almost all of the chattels that were in the matrimonial home on the date of separation, and, as a result, she was required to buy replacement chattels for herself.

[246] In closing submissions, she pointed to three of the eight circumstances set out in subsection 5 (6) of the FLA which might justify an unequal division.

[247] The first circumstance was “having regard to the part of spouse’s net family property that consists of gifts made by the other spouse”. She suggested that this provision applied given Ms. Desjardins’ gifts to Mr. Lorenzen of the boat, the RSP, and an undivided half interest in 335 Penn (if the court made that finding).

[248] The second circumstance was “having regard to the fact that one spouse has incurred a disproportionately larger amount of debt or other liabilities than the other spouse for the support of the family”. She underlined that, unlike Mr. Lorenzen, she depleted her inheritance and her income to support the family.

[249] The third circumstance and main focus of her argument was “having regard to any other circumstance relating to the acquisition, disposition, preservation, maintenance or improvement of property”.

[250] In that regard, she asked the court to consider that Mr. Lorenzen benefitted from gifts of property she gave him that were purchased with her inheritance: the boat, the RSP, and a half share in the ownership of 335 Penn (if the court made that finding).

[251] She also asked the court to consider Mr. Lorenzen’s minimal financial support for the family after the parties reconciled in 1998 while she “depleted” her “inheritance of almost $500,000” from her father and her income to support the family. She emphasized that Mr. Lorenzen did not offer to assist financially, even when the parties were in crisis during the summer of 2009.

[252] She also asked the court to consider that, when 700 Society was sold, Mr. Lorenzen benefitted by being entitled to half of the net proceeds whereas she received less than her initial investment of $120,000 from her inheritance.

[253] And, finally, she submitted that until just over five months prior to separation, 335 Penn was an excluded asset and that the parties only moved to 335 Penn temporarily, as a “stop gap” measure during a financial crisis, and, as a result, Mr. Lorenzen gained a “windfall” on equalization. Ms. Desjardins suggested that the court should adjust equalization so that the result would be the same as if 335 Penn was excluded from equalization.

Analysis

[254] The law governing an unequal division of net family property was accurately set out by Mr. Lorenzen.

[255] The onus is on Ms. Desjardins to establish that equalization would be “unconscionable” and would “shock the conscience of the court”.

[256] The issue of whether Mr. Lorenzen should contribute to the costs of Jake’s post-secondary education is a separate issue that will be addressed separately. It has no bearing on equalization.

[257] Mr. Lorenzen’s refusal to allow Ms. Desjardins to take chattels from 335 Penn and his use of the chattels for over seven years led to the court’s finding about ownership of the chattels. As a result, almost all of the chattels were part of his net family property for equalization and Ms. Desjardins received a credit for half of the proven value of the chattels. He is not responsible for her decision to purchase new chattels to replace used chattels.

[258] The “gift” provision in subsection 5 (6) is intended to support a claim for unequal division by a person who received a gift, on the basis that it would be unconscionable for the person who gave the gift to receive back a credit on equalization for half of the value of gift. That provision does not assist Ms. Lorenzen.

[259] The “debt or other liabilities” provision in subsection 5 (6) is intended to apply to debts and liabilities. It does not apply to amounts paid without incurring a debt or liability. Ms. Desjardins did not go into personal debt to support the family. She exhausted the non-invested portion of her inheritance and she incurred joint debt on the 700 Society line of credit.

[260] The “other circumstances” provision in subsection 5 (6) is sufficiently broad that it could be applicable to this case, depending upon all of the circumstances.

[261] Mr. Lorenzen did benefit from the gifts made by Ms. Desjardins, but she made the gifts well before separation, and there is no evidence to suggest that she did not make the gifts willingly. The $120,000 contribution toward 700 Society was made in 2001, the boat was gifted in 2006, and the RSP contribution was made in early 2007. There was no suggestion that the parties were not getting along at those times – in fact, the evidence suggests that they were.

[262] Ms. Desjardins also mentioned the “gift” of an undivided half share in 335 Penn, if the court made that finding, but the court did not make that finding. To the contrary, the court found that Ms. Desjardins is the sole beneficial owner of 335 Penn.

[263] As noted earlier, there was no evidence that Ms. Desjardins asked or wanted Mr. Lorenzen to contribute more to the family expenses from 1998 to 2009. It was clear from the testimony of the parties and Jake that Ms. Desjardins controlled the financial circumstances of the parties. It was her decision, in 1998, that they would have separate bank accounts and that she would continue to pay expenses for the family after reconciliation. When she changed her mind in the summer of 2009 and asked Mr. Lorenzen to contribute his income towards family expenses, and changed the chequing account back to joint, in October of 2009, to facilitate that, he did not object, and as a result, his EI benefits were paid into the account, prior to separation and for two months after separation (Exhibit 10).

[264] Moreover, Ms. Desjardins did not “deplete” her “inheritance of almost $500,000” from her father.

[265] She used most of her inheritance to purchase and renovate 335 Penn and 314 Avenue.

[266] The current value of 335 Penn is about $655,000, according to Ms. Desjardins’ financial statement dated October 11, 2016 (Exhibit 33). The line of credit against 335 Penn is about $80,000. Accordingly, her equity in 335 Penn alone is about $575,000.

[267] The parties agreed that the value of 314 Avenue on the date of separation was $320,000. Although no current valuation of 314 Avenue was provided, given that it was the same value as 335 Penn on the date of separation, and given the evidence of Ms. Garbens that market forces account for the significant increase in value of 335 Penn, it is evident that Ms. Desjardins also has equity in 314 Avenue, even though her current debt secured by 314 Avenue is about $285,000, according to her financial statement.

[268] The fact that Ms. Desjardins did not get back the $120,000 advance from her inheritance when 700 Society was sold does not assist her claim. She gave half of that amount to Mr. Lorenzen when she invested the funds in a jointly owned property. The court has already found that was a gift. As a result, her own investment, from the advance of her inheritance into 700 Society, was only $60,000. The court is aware that the equity from the townhouse was also invested into 700 Society, but Mr. Lorenzen repaid Ms. Desjardins’ mother most of her contribution to the equity in the townhouse. As a result, Ms. Desjardins’ investment into the purchase of 700 Society from her inheritance and from what she likely considered, at the time, to be her share of the proceeds from the townhouse was likely around $85,000 in total.

[269] Finally, while it is true that 335 Penn was an excluded asset until five months and ten days prior to separation, there is no evidence that Mr. Lorenzen moved into 335 Penn with the intention to separate, or to cause a separation, or to take financial advantage of Ms. Desjardins in any way, or that he formed any of these intentions while living at 335 Penn.

[270] Further, while the court has accepted that the parties’ move to 335 Penn was intended to be temporary, how long they would stay there was unknown at the time they moved. As noted earlier, Ms. Desjardins did not obtain a permanent job until almost a year after they moved into 335 Penn. It is likely that additional time would have been required before they could have moved elsewhere. Moreover, 335 Penn was a matrimonial home.

[271] In the final analysis, none of the circumstances in this case, considered individually or cumulatively, persuade the court that an equalization payment of $121,675 from Ms. Desjardins to Mr. Lorenzen, in the context of an almost 20 year marriage and cohabitation, would be “unconscionable” or would “shock the conscience of the court”.

[272] Accordingly, there will not be an unequal division of net family property.

Question 7 – Occupation Rent

Positions of the Parties

[273] Mr. Lorenzen made lengthy closing submissions opposing the payment of occupation rent for 335 Penn.

[274] He underlined that occupation rent is a discretionary remedy. He submitted that Ms. Desjardins must show that no other remedy is available to establish justice and fairness between the parties.

[275] He emphasized that Ms. Desjardins made no formal claim for exclusive possession or occupation rent before the Application was served upon her in February of 2015. He observed that both parties have always been willing to sell 335 Penn, but upon different conditions. He underlined that Ms. Desjardins made no effort to force a sale of the property.

[276] In her Answer, opening statement, testimony, and closing submissions, Ms. Desjardins sought occupation rent from the date she left 335 Penn (June 20, 2010) to the date of judgment.

[277] In her lengthy submissions, she emphasized that she was excluded from 335 Penn by Mr. Lorenzen when he changed the combination on the locks and instructed Jake and Justin not to allow her into the home.

[278] She underlined that her lawyer gave written notice to Mr. Lorenzen, on July 7, 2010, that she would be seeking occupation rent if 335 Penn was not sold expeditiously to permit her to access her equity to obtain new accommodations and contribute to Jake’s post-secondary expenses.

[279] She emphasized that she could not bring a motion for exclusive possession, because she did not have access to her income tax returns and notices of assessment, because Mr. Lorenzen held them at 335 Penn.

[280] She also emphasized that, as the owner of 335 Penn, she was prevented from living at the property or earning income from renting the property and, yet, starting around July of 2010, she paid $405 per month towards the monthly interest on the 335 Penn line of credit, taxes, and cleaning costs, and that amount was increased to $497 per month in July of 2016. She also underlined that Mr. Lorenzen was behind in these payments by about $2,006 when the trial started.

[281] She mentioned that she was now living at 314 Avenue and losing potential rental income from there, as well as from 335 Penn. As a result of not having that income to meet her expenses, she said, she had increased her line of credit on 314 Avenue.

[282] She also emphasized that Mr. Lorenzen’s monthly payments in the amount of $405 or $495 were very little to reside in a home that previously has been rented out for $2,600 per month, particularly since he collected some rent from Jake while Jake was living there and not attending school.

[283] She underlined that Mr. Lorenzen has been living at 335 Penn alone since Jake moved out in September of 2015. She argued that Mr. Lorenzen could have rented out one of the two units from at least that point forward to cover all of the carrying costs.

[284] She maintained that the appropriate amount of occupation rent for 335 Penn was the previous rent for 335 Penn, i.e. $2,600 per month, less a credit for Mr. Lorenzen’s monthly contribution, less a deduction for notional income tax at the rate of 30 percent.

[285] Ms. Desjardins also testified that she believes that 335 Penn is not a matrimonial home, that Mr. Lorenzen’s conduct forced her to leave on June 20, 2010, that Mr. Lorenzen does not need to be living in a three bedroom home with two kitchens, and that the condition of the property has declined while he has been in possession.

Analysis

[286] Occupation rent is a discretionary remedy available to address injustice. Whether there should be an award of occupational rent and, if so, for how much, depends on all of the circumstances, including whether there is another way to address any unfairness that exists between the parties.[^3]

[287] As discussed earlier, the court accepts Ms. Desjardins’ testimony that Mr. Lorenzen’s conduct effectively forced her to leave 335 Penn on June 20, 2010, after the parties had been living there, separate and apart, for about four and half months post-separation. As discussed earlier, the court does not accept that Mr. Lorenzen offered to move to the upstairs unit.

[288] Additionally, within two days after Ms. Desjardins leaving, Mr. Lorenzen changed the door lock code and instructed the children not to allow her to enter 335 Penn. Later, he refused to allow her to enter to remove some chattels she needed for her new apartment.

[289] On July 7, 2010, Ms. Desjardins’ counsel gave Mr. Lorenzen timely notice of Ms. Desjardins’ intention to seek occupation rent, if he did not agree to a sale of 335 Penn. Ms. Desjardins testified, however, that she did not want to sell 335 Penn and was using the threat of a forced sale to pressure Mr. Lorenzen into resolving all of their issues quickly.

[290] Mr. Lorenzen’s counsel responded in timely manner, on July 13, 2010, indicating a willingness to sell 335 Penn if Mr. Lorenzen would receive some of the proceeds, so he could obtain new accommodation.

[291] That was a reasonable suggestion, given that Ms. Desjardins admits that Mr. Lorenzen’s equity from 700 Society was tied up in 335 Penn.

[292] Mr. Lorenzen was unemployed at that time, and both children were living with him. Justin was capable of supporting himself, but Jake was not. Mr. Lorenzen’s income from EI was $790 every two weeks. Ms. Desjardins testified that Mr. Lorenzen always obtains a new job before his EI expires.

[293] Jake continued to live at 335 Penn during the summer of 2010, while Ms. Desjardins was renting a room.

[294] Both parties had possessory rights to 335 Penn, because it was a matrimonial home, but neither party applied under section 24 of the FLA for exclusive possession.

[295] Mr. Lorenzen did not apply, because he was in possession.

[296] Ms. Desjardins testified that she did not apply, because she did not have copies of her income tax returns and notices of assessment available to start an Application. The court does not accept her explanation, given that a party may seek leave to file an Application without filing income tax returns or notices of assessment, and given that she had sought legal advice by early July of 2010. It is not clear, however, that Ms. Desjardins would have succeeded on a motion for exclusive possession at that point. Perhaps not, given Mr. Lorenzen’s unemployment, Jake’s situation, and given that she had the option of moving to 314 Avenue.

[297] Neither party brought a motion for sale of 335 Penn – likely because neither of them wanted a sale.

[298] Mr. Lorenzen adequately maintained 335 while living there. His conduct did not increase or decrease its value. It has gone up in value due to market forces.

[299] Mr. Lorenzen has been living in 335 for more than six and half years since Ms. Desjardins gave him notice that she would seek occupation rent if the property was not sold. Her equity in 335 Penn has been tied up for that period and she has been paying half of the monthly interest on the 335 Penn line of credit, half the taxes, and half the cleaning service costs while paying for her own accommodation and replacement chattels.

[300] Factors supporting an award of occupation rent are: Mr. Lorenzen’s provocative conduct that caused Ms. Desjardins to leave 335 Penn, his almost immediate exclusion of her from 335 Penn, the timely warning in Ms. Desjardins’ lawyer’s letter about a potential claim for occupation rent, Ms. Desjardins’ having to pay for other accommodation and chattels while still contributing to the overhead for 335 Penn, the lengthy time Mr. Lorenzen has been in possession of a home that very easily could be reconverted into two units, allowing one unit to be rented to cover the overhead for both units, and the fact that the court has rejected an unequal division of family assets as a means to address any unfairness between the parties.

[301] Factors contrary to an award of occupation rent are: Mr. Lorenzen was on EI when Ms. Desjardins left the home, Jake had just completed grade 12 and was going to be attending university in the fall, 335 Penn was a matrimonial home and, as a result, Mr. Lorenzen had a possessory right to the home prior to the parties’ divorce, Ms. Desjardins never brought a motion for exclusive possession, Ms. Desjardins never brought a motion for partition and sale, Ms. Desjardins did not agree to a sale of the property upon the reasonable terms that some of Mr. Lorenzen’s equity would be returned to him, and Jake lived with Mr. Lorenzen rent-free while attending Seneca College.

[302] Despite Mr. Lorenzen’s conduct that led to Ms. Desjardins leaving 335 Penn, and her almost immediate exclusion from 335 Penn by Mr. Lorenzen, the court is not satisfied that occupation rent should be paid commencing the date Ms. Desjardins left 335 Penn, or during the summer of 2010, because Mr. Lorenzen was unemployed at the time, Jake was living with him at 335 Penn, and Mr. Lorenzen was providing Jake with free room and board. As a result, Mr. Lorenzen was not in a financial position to find suitable alternate accommodation for himself and Jake. Additionally, Mr. Lorenzen was agreeable to selling 335 Penn, as proposed by Ms. Desjardins, at that time, as long as he would receive some of the proceeds to allow him to obtain alternate accommodation. That was a reasonable position for him to take, given that half of the equity from 700 Society that was invested temporarily in 335 Penn was his, and given that 335 Penn was a matrimonial home and, therefore, subject to equalization. Ms. Desjardins, on the other hand, did not intend to sell 335 Penn, and her warning about seeking occupation rent, if the property was not sold, was a strategy to motivate Mr. Lorenzen to settle all issues. Nevertheless, he had notice that she would seek occupation rent. An additional consideration is that Ms. Desjardins did not bring a motion for exclusive possession or for partition and sale.

[303] While Jake attended Carleton and during the ensuing summer, Jake stayed at 335 Penn when not in Ottawa. Mr. Lorenzen continued to provide Jake with free room and board. Mr. Lorenzen’s income in 2010 was $23,710 (Exhibit 1). Mr. Lorenzen’s income in 2011 was $39,402 (Exhibit 1). Despite Mr. Lorenzen’s improved income during the latter part of this period, the court is not satisfied that occupation rent should be paid, based on the other reasons in the previous paragraph.

[304] When Jake moved to Ottawa in the fall of 2011, it was for the purpose of working full-time. He paid off his OSAP loan that fall, and when he returned to 335 Penn in March of 2012, he worked full-time and paid rent to Mr. Lorenzen. Jake continued working full-time and paying Mr. Lorenzen rent until he started attending Seneca in September of 2013.

[305] Mr. Lorenzen’s income in 2012 was $44,696 (Exhibit 1). His income in 2013 was $40,851 (Exhibit 1).

[306] Despite the fact that Ms. Desjardins did not bring a motion for exclusive possession or a motion for partition and sale, given Mr. Lorenzen’s sustained improved financial circumstances, the fact that Jake was working full-time on a sustained basis and paying rent to Mr. Lorenzen to live at 335 Penn, and given that Mr. Lorenzen had received notice over a year earlier that occupation rent would be sought, the court is satisfied, on a balance of probabilities, that for the period of September of 2011 to August of 2013, it would be just and fair for Mr. Lorenzen to pay occupation rent.

[307] While Jake attended Seneca College, he, once again, received free room and board from Mr. Lorenzen. Mr. Lorenzen’s income in 2014 was $45,759 (Exhibit 24). The evidence did not establish whether Jake paid rent during the summer of 2015. The court is not satisfied that occupation rent should be paid for this period given that Jake was back in school and, as far as the court is aware, not paying rent.

[308] Jake left 335 Penn in September of 2015 and moved to 314 Avenue where, until the time of trial, he had been paying rent in the amount of $575 to Ms. Desjardins. Mr. Lorenzen’s income in 2015 was about $40,000 (Exhibit 25). Mr. Lorenzen continued to live at 335 Penn, occupying two rentable living units, until the trial. His anticipated income in 2016 was about $40,000 (Exhibit 7). The court is satisfied, on a balance of probabilities, that during the period of October of 2015 to present, it would be just and fair for Mr. Lorenzen to pay occupation rent.

[309] Accordingly, the court finds that Mr. Lorenzen should pay occupation rent from September of 2011 until August of 2013 and from October of 2015 until the date he must vacate 335 Penn.

[310] The gross rent earned by 335 Penn was $2,600 per month including utilities and the cleaning service. Ms. Desjardins suggested that $2,600 per month is the appropriate gross occupation rent.

[311] Mr. Lorenzen’s sworn financial statement dated October 12, 2016 (Exhibit 25) states that he currently pays about $50 per month for water, $100 per month for heat, and $190 per month for electricity at 335 Penn, while living there alone. If someone else lived in the basement unit, with the fire doors once again separating the units, they would likely pay about the same amount for utilities. If there was more than one person living in either unit, the cost of utilities would likely be higher.

[312] Given that utilities were included in the rent, it seems reasonable, therefore, to deduct $800 from the gross rent suggested by Ms. Desjardins. That reduces the appropriate net rent amount to $1,800 per month.

[313] In addition, Mr. Lorenzen has been paying half the line of credit interest, property taxes, and cleaning amounts, which were included in the rent. He should, therefore, receive credit for his share which was $405 per month until July of 2016. That reduces the appropriate net rent amount to $1,395 per month.

[314] In addition, Mr. Lorenzen has maintained the property, which is an expense Ms. Desjardins would have been required to pay. The court is confident that a notional reduction of $150 per month for maintenance expenses is fair to Ms. Desjardins. Accordingly, the appropriate net rent is $1,245 per month.

[315] Ms. Desjardins suggested using a notional income tax rate of 30 percent against the net rent. That reduces the appropriate net rent amount to $872 per month.

[316] Thus, in addition to his payment of half of the line of credit interest, property taxes, and cleaning service, Mr. Lorenzen should pay an additional $872 per month to Ms. Desjardins for the period of September 1, 2011 to August 1, 2013, and from October 1, 2015 to June 1, 2016. That amounts to $28,776 over 33 months.

[317] From July 1, 2016 onward, the net rent amount is reduced to $1,061 per month due to the increase in the payments for line of credit interest, property taxes, and cleaning. After application of notional income tax, that reduces the net rent amount to $743 per month. That amounts to $6,687 for the nine months up to and including March of 2017.

[318] The court accepts Ms. Desjardins’ testimony that Mr. Lorenzen was in arrears in the amount of $2,006 at the date of trial. Accordingly, that amount will be added to the occupation rent due up to and including March of 2017.

[319] Thus, in total, Mr. Lorenzen owes Ms. Desjardins occupation rent in the amount of $37,469, up to and including March of 2017.

[320] In addition, he must make his monthly expense payments of $497 for December of 2016, January of 2017, February of 2017, and March of 2017, if he has not done so already.

[321] He shall also pay Ms. Desjardins occupation rent for 335 Penn, in the amount of $1,240 per month for April, May, and June of 2017. This monthly amount is comprised of his regular monthly expense payment of $497, plus the net rent amount of $743 per month. The total for three months is $3,720. This total amount shall be set off against the equalization payment owed by Ms. Desjardins.

[322] None of these amounts are taxable or tax deductible for either party – these amounts are tax neutral.

[323] Mr. Lorenzen shall be solely responsible for the cost of utilities in relation to 335 Penn until he vacates the property.

Question 8 – Jake’s Post-Secondary Expenses

Positions of the Parties

[324] In her Answer, opening statement, and closing submissions, Ms. Desjardins sought reimbursement for one-half of the amount she paid towards Jake’s post-secondary education.

[325] As noted earlier, the parties agreed that Ms. Desjardins paid $22,249 towards Jake’s post-secondary education at Carleton and Seneca. Thus, Ms. Desjardins seeks $11,125 from Mr. Lorenzen.

[326] Ms. Lorenzen filed a detailed accounting for the expenses she paid (Exhibit 29). She paid $13,161 in relation to Jake’s year at Carleton, $8,522 in relation to his two years at Seneca, and $563 for miscellaneous expenses at both institutions. She paid the expenses using funds she inherited from her father, which she invested in RESPs, as well as some of her own income.

[327] Mr. Lorenzen’s closing submissions opposed reimbursement of Ms. Desjardins for these expenses.

[328] He suggested that Ms. Desjardins did not provide sufficient information for the court to be able to make an informed decision about Jake’s contribution. He submitted that Ms. Desjardins should have provided proof of Jake’s ability to contribute, and his actual contributions, to his post-secondary expenses.

[329] Mr. Lorenzen testified that he did not contribute to Jake’s education costs at Carleton or Seneca, but Jake lived with him rent-free while going to Seneca, and he provided Jake with food, as well as lodging, with utilities. His claim for child support for Jake was struck before trial.

Analysis

[330] As noted earlier, Jake saved between $2,000 and $4,000 for Carleton by working during the summer of 2010. He received a student grant of about $4,000 and a student loan of about $6,000. He worked part-time while attending Carleton. His father’s contribution to his attendance at Carleton was moving his belongings there at the start of the year and buying him groceries once. His mother paid the portion of Jake’s expenses that he could not pay, including payments toward tuition, residence, and a meal plan.

[331] Jake worked full-time during the summer of 2011 while living at 335 Penn. He then worked in Ottawa, from September of 2011 until February of 2012. He paid off his student loan from Carleton in 2011.

[332] The court is satisfied that the evidence supports a finding that Mr. Lorenzen should pay his proportionate share of the $13,161 in Carleton expenses paid by Ms. Desjardins.

[333] Jake moved back to 335 Penn with his father in February of 2012. He worked and paid rent of $250 to $300 per month to his father until he started the two year programme at Seneca in the fall of 2013.

[334] Jake worked part-time while attending Seneca. He did not seek OSAP funding. His mother paid for his tuition. His father allowed him to live rent-free at 335 Penn, paid for his groceries, and bought him a computer.

[335] Despite Jake not applying for OSAP, the court is satisfied that he made a reasonable contribution to his expenses by working full-time from 2011 to 2013, before starting at Seneca, and by working part-time while at Seneca.

[336] Further, Ms. Lorenzen’s claim for one-half of $8,522 in expenses, over two years, of which $7,116 was for tuition, is reasonable in the circumstances, as is her claim for one-half of $563 for miscellaneous expenses.

[337] For the sake of simplicity, the court will divide the expenses for Jake’s two years at Seneca into equal amounts for each academic year. For the same reason, the court will divide the expenses incurred for each academic year into equal amounts for each term. And, for the same reason, the miscellaneous expenses will be divided equally amongst all six terms. It would serve no useful purpose to be more precise, as the difference would be insignificant.

[338] Mr. Lorenzen’s 2010 income was $23,710. Ms. Desjardins’ 2010 income was $23,777. The court finds that Mr. Lorenzen should reimburse Ms. Desjardins $3,335 for his equal share of Jake’s expenses in 2010.

[339] Mr. Lorenzen’s 2011 income was $39,402. Ms. Desjardins’ 2011 income was $28,107. The court finds that he should reimburse Ms. Desjardins $3,868 for his 58 percent share of Jake’s expenses for 2011.

[340] Mr. Lorenzen’s 2013 income was $40,851. Ms. Desjardins’ 2013 income was $60,155. The court finds that Mr. Lorenzen should reimburse Ms. Desjardins $891 for his 40 percent share of Jake’s expenses for 2013.

[341] Mr. Lorenzen’s 2014 income was $45,759, according to his financial statement dated November 4, 2014 (Exhibit 24). Ms. Desjardins’ 2014 income was $65,228. The court finds that Mr. Lorenzen should reimburse Ms. Desjardins $1,827 for his 41 percent share of Jake’s expenses for 2014.

[342] Mr. Lorenzen’s 2015 income was $39,962, according to his financial statement dated October 12, 2016 (Exhibit 25). Ms. Desjardins’ 2015 income was $63,456, according to her financial statement dated October 11, 2016 (Exhibit 33). The court finds that Mr. Lorenzen should reimburse Ms. Desjardins $869 for his 39 percent share of Jake’s expenses for 2015.

[343] Thus, in total, Mr. Lorenzen shall reimburse Ms. Desjardins $10,790 for Jake’s post-secondary expenses.

Consolidation of Amounts Owed

[344] Ms. Desjardins owes Mr. Lorenzen $120,675 for equalization.

[345] Mr. Lorenzen owes Ms. Desjardins $5,000 for costs (ordered on October 5, 2016 by McGee J.), $37,469 for occupation rent to the end of March of 2017, $3,720 for occupation rent for April, May, and June of 2017, and $10,790 for his share of Jake’s post-secondary expenses. The total of these amounts is $56,979.

[346] Ms. Desjardins, therefore, owes Mr. Lorenzen $63,696 as at today’s date.

Orders

[347] The court orders the following on a final basis:

Ms. Desjardins is declared to be the sole legal and beneficial owner of 335 Penn Avenue, Newmarket, Ontario, legally described as Lot 12, Plan 128, East Gwillimbury; Newmarket.
Title to 335 Penn Avenue, Newmarket, Ontario, legally described as Lot 12, Plan 128, East Gwillimbury; Newmarket, is hereby vested solely in Ms. Desjardins.
Ms. Desjardins shall forthwith arrange for Mr. Lorenzen to be removed from the line of credit secured by 335 Penn Avenue, Newmarket, Ontario, legally described as Lot 12, Plan 128, East Gwillimbury; Newmarket.
After, and subject to, the determination of costs, Ms. Desjardins shall pay Mr. Lorenzen $63,696.
Mr. Lorenzen shall forthwith pay Ms. Desjardins $497 per month for expenses in relation to 335 Penn Avenue for each of December of 2016, and January, February, and March of 2017, unless he has already done so.
Mr. Lorenzen shall provide Ms. Desjardins with vacant possession of 335 Penn Avenue, Newmarket, Ontario, legally described as Lot 12, Plan 128, East Gwillimbury; Newmarket, at 4 p.m. on July 1, 2017.
Mr. Lorenzen shall pay all utility costs incurred prior to 4 p.m. on July 1, 2017, in relation to 335 Penn Avenue, Newmarket.

Costs

[348] If the parties are unable to resolve the issue of costs, either party may serve and file brief written submissions as to costs within 21 days of the release of this judgment, the other party may serve and file brief written submissions in response within 21 days of receipt of the first party’s submissions, and the first party may serve and file a very brief written reply within 7 days of service of the response.

F. Graham J.

Released: March 27, 2017

[^1]: R.S.O. 1990, c. F3. [^2]: Pecore v. Pecore, 2007 SCC 17; Korman v. Korman, 2015 ONCA 578, 126 O.R. (3d) 561. [^3]: Ombac v. George, 2015 ONSC 1938 (paras. 33 – 35).

Brief Background and Issues

Detailed Background

1988 to 2005

2006

2007

2008

2009

2010

2011 to present

Question 1 - Ownership of 335 Penn Avenue

Positions of the Parties

Analysis

Question 2 – Unjust Enrichment

Positions of the Parties

Analysis

Question 3 – What Should Happen to 335 Penn?

Question 4 – Exclusions from Equalization

335 Penn

314 Avenue

Chattels

RESPs

RSP

Question 5 – Equalization

Question 6 – Unequal Division

Positions of the Parties

Analysis

Question 7 – Occupation Rent

Positions of the Parties

Analysis

Question 8 – Jake’s Post-Secondary Expenses

Positions of the Parties

Analysis

Consolidation of Amounts Owed

Orders

Costs

Judge

Counsel

Parties

Areas of Law

Fact Patterns

Expert Witnesses

Issues

Legal Tests 3

Legislation 1