Court File and Parties

Court File No.: FC-15-1468 Date: 2020-12-21 Superior Court of Justice - Ontario

Re: Rehab Alsalem, Applicant And Khalid Fahad Aba-Alkhail, Respondent Munirah Othman Aba-Alkhail, Respondent

Before: The Honourable Mr. Justice Marc Smith

Counsel: Teshebaeva Henderson, Counsel for the Applicant Julie Gravelle, Counsel for the Respondent Khalid Fahad Aba-Alkhail Khalid M. Elgazzar, Counsel for the Respondent Munirah Othman Aba-Alkhail

Heard: December 8, 2020 by video conferencing

Reasons for Decision

M. Smith J

[1] The Respondent Khalid Fahad Aba-Alkhail (the “Father”) brings a summary judgment Motion seeking a finding that the property located at 19 Staten Way, Ottawa, Ontario is being held in trust by the Applicant Mother for the benefit of the Father and Mother. Further, the Father seeks that the property be sold within thirty days.

[2] The Applicant Rehab Alsalem (the “Mother”) opposes the Motion.

[3] The Respondent Munirah Othman Aba-Alkhail (the “Paternal Grandmother”) supports the Motion.

[4] For reasons that follow, the Father’s Motion is granted.

BACKGROUND

[5] The parties were married on December 25, 2003 in Saudi Arabia.

[6] There are four children of the marriage: Fahad Abakhail (born on April 4, 2005), Khaiel Abakhail (born on March 22, 2006), Firas Abakhail (born on September 3, 2007), and Munirah Abakhail (born on May 17, 2009).

[7] The parties separated in or around July 2012.

[8] The property municipally known as 19 Staten Way, Ottawa, Ontario was purchased on or about March 9, 2007 for the sum of $419,359.00 (the “matrimonial home”). On November 20, 2015, Justice Corthorn ordered on consent that this property be treated as the matrimonial home for all purposes. The Mother is the sole registered owner of the matrimonial home.

[9] On October 15, 2016, the Paternal Grandmother issued a Statement of Claim against the Father and the Mother, seeking amongst other things, an order for payment of the sum of $700,000.00 representing loans made to the Father and the Mother for the purchase of the matrimonial home and in the alternative, a declaration that the Father and the Mother are holding the matrimonial home in trust for the Paternal Grandmother (the “Civil Action”).

[10] The Paternal Grandmother resides in Saudi Arabia.

[11] On December 12, 2016, Justice Engelking ordered on consent that the Civil Action be joined to this family law proceeding.

[12] Until very recently, the three youngest children resided with the Father, while the eldest child resided with the Mother, all on a full-time basis. The Father lost his apartment as of November 1, 2020. The three youngest children moved in with the Mother, pending the Father finding suitable accommodation.

[13] The Paternal Grandmother is now prepared to abandon her claim to have an ownership interest in the matrimonial home.

THE ISSUES

[14] The issues in this Motion are:

a. Is there a genuine issue for trial that the matrimonial home is being held in trust by the Mother for the benefit of the Father and Mother?

b. Is there an unjust enrichment?

c. Should the matrimonial home be sold?

THE POSITION OF THE PARTIES

The Father

[15] The Father says that the matrimonial home was purchased with the financial assistance of the Paternal Grandmother and it has since doubled in value. The monies advanced by the Paternal Grandmother were a loan and not a gift.

[16] The Motion is being brought at this time for two reasons: (1) a significant change in circumstances has occurred, being that the Father has been evicted from his accommodation leaving the three children and himself homeless and (2) it is not until very recently that the Paternal Grandmother has agreed to relinquish any proprietary rights in the matrimonial home.

[17] The Father states that the matrimonial home was registered solely in the Mother’s name to make the home exempt from land transfer tax since the Mother was a first-time homebuyer. It is undisputed that the matrimonial home is being held in trust for the Mother and Father.

[18] The Father submits that given he is not a registered owner of the matrimonial home, a two-step process must be followed. First, he must prove that the matrimonial home is being held in trust for the Mother and himself. Second, he must establish that there exists an unjust enrichment and that the appropriate remedy is a proprietary award.

[19] The Father has no income and he is in a difficult place of hardship. The Mother is equally unemployed and unable to provide the Father with a monetary value of his portion of the equity in the matrimonial home.

The Paternal Grandmother

[20] Similar to the Father’s argument, the Paternal Grandmother submits that there is no dispute that she has advanced funds for the purchase of the matrimonial home.

[21] The Paternal Grandmother concedes that she no longer has a proprietary interest in the matrimonial home and is prepared to amend her Statement of Claim accordingly. However, she seeks that her investment be protected.

[22] The Paternal Grandmother claims that she advanced the Mother and Father the sum of $419,359.00 for the purchase of the matrimonial home as well as $30,000.00 for renovations to the basement. She is further claiming a portion of the profits in lieu of interest on the loans, as interest is generally prohibited in her religion.

[23] The Paternal Grandmother asks that the matrimonial home be sold and that one third of the proceeds be held in trust, pending the determination of the issues in the Civil Action.

The Mother

[24] The Mother claims that she has had five counsels throughout the years, some of the materials were drafted in haste and she has had difficulty in understanding the English language.

[25] The Mother says that there is a genuine issue for trial and the Father has not provided trial worthy evidence. She claims that a trust claim is one of the most complex issues in family law and it cannot be decided upon conflicting affidavits.

[26] The Mother argues that the funds advanced by the Paternal Grandmother were gifts and there is no evidence before the Court to the contrary. She denies that the advancement of monies leads to the conclusion that there is a trust claim.

[27] The Mother acknowledges that the property purchased in 2007 is the matrimonial home. She says that, considering the traditional marriage, it is not unreasonable to conclude that the gifts made by the Paternal Grandmother were made to the Mother only. The Mother claims that the matrimonial home is hers.

[28] The Mother argues that the parties were divorced on January 8, 2013 in Saudi Arabia. As such, she argues that the Father is statutorily prohibited from making an equalization claim and that this is a triable issue.

[29] The Mother indicates that the Father has exhibited vexatious and oppressive behaviour, barring him from seeking the sale of the matrimonial home. Further, even if the Father succeeds in the trust claim, there is no reason to sell the home as a monetary award can be made.

THE LAW

Summary Judgment

[30] Rule 16 of the Family Law Rules, O. Reg. 114/99 (“FLR”) sets out the criteria for a summary judgment motion. Rule 16(6) of the FLR provides that a Court may make a final order if there is no genuine issue requiring a trial of a claim or defence. If the only genuine issue is the amount to which a party is entitled, a trial shall be required (Rule 16(7) of the FLR).

[31] It has been widely accepted that the Supreme Court of Canada decision Hryniak v. Maudlin, 2014 SCC 7, [2014] 1 S.C.R. 87, applies to family law proceedings. The Court found that there will be no genuine issue for trial if the judge is able to reach a fair and just determination on the merits on a summary judgment motion when the process (1) allows the judge to make the necessary findings of fact, (2) allows the judge to apply the law to the facts, and (3) is a proportionate, more expeditious and less expensive means to achieve a just result (at para. 49).

[32] On a summary judgment motion, it is expected that both parties have an obligation to put their best foot forward (Chao v. Chao, 2017 ONCA 701, at para. 24). To defeat the motion, the responding party must put forward some evidence demonstrating that there is a genuine issue for trial.

Unjust Enrichment

[33] In the case of Kerr v. Baranow, 2011 SCC 10, [2011] 1 S.C.R. 269, the Supreme Court of Canada confirms the three requirements that must be present for an unjust enrichment claim: (1) enrichment; (2) corresponding deprivation; and (3) absence of juristic reason (at paras. 36-45).

a. For the first requirement, the party must show that he/she gave something to the other party which he/she received and retained. The benefit must be tangible.

b. The second element requires the party who has suffered the loss to establish not only that the other party has been enriched but that the enrichment corresponds to a deprivation.

c. The last element of the unjust enrichment claim is that the enrichment and detriment must have occurred without a juristic reason, meaning that there would be no reason in law for the party’s retention of the benefit conferred by the other party.

[34] Once the three elements have been made out, an appropriate remedy must be determined by the Court, either a monetary or proprietary award. The Court will impress a proprietary remedy only if a monetary award would be insufficient and if there is a direct link between the contributions and the property (Kerr v. Baranow, at paras. 46 and 50).

Sales of the matrimonial home

[35] Section 2 and 3 of the Partition Act, R.S.O. 1990, c. P.4, provides that a beneficial owner to the land has a prima facie right to an order for the partition and sale of the matrimonial home.

[36] The Court is required to order the sale of the matrimonial home unless it can be established that the party seeking the sale has acted in a malicious, vexatious or oppressive conduct in relation to the sale of the matrimonial home (Marchese v Marchese, 2019 ONCA 116).

[37] Section 19(1) of the Family Law Act, R.S.O. 1990, c. F.3 (“FLA”) provides that both spouses have an equal right to possession of a matrimonial home.

[38] The powers of the Court are set out in section 9(1) of the FLA. The Court may order: (a) that one spouse pay to the other spouse the amount to which the Court finds that spouse to be entitled under this Part; (b) that security, including a charge on property, be given for the performance of an obligation imposed by the order; (c) that, if necessary to avoid hardship, an amount referred to in clause (a) be paid in instalments during a period not exceeding ten years or that payment of all or part of the amount be delayed for a period not exceeding ten years; and (d) that, if appropriate to satisfy an obligation imposed by the order, (i) property be transferred to or in trust for or vested in a spouse, whether absolutely, for life or for a term of years, or (ii) any property be partitioned or sold.

[39] If a spouse is not registered on the title of the matrimonial home but is able to establish a proprietary interest in the matrimonial home and obtain a declaration of beneficial ownership, then he/she may have a right to an order for the sale of the property, pursuant to section 10 of the FLA (Rawluk v. Rawluk, 1990 CanLII 152 (SCC), [1990] 1 S.C.R. 70).

ANALYSIS

Issue #1 - Is there a genuine issue for trial that the matrimonial home is being held in trust by the Mother for the benefit of the Father and Mother?

[40] The Father bears the burden of demonstrating that there is no genuine issue requiring a trial. I am entitled to assume that the evidentiary record contains all the evidence that the parties would present if the matter proceeded to trial as both parties are required to put their “best foot forward”.

[41] I accept the Mother’s argument that there is no documentary evidence before me regarding the advancement of funds by the Paternal Grandmother to ascertain if it is a gift or a loan. That is not, however, the question that needs to be decided on this Motion. Rather, it is whether the matrimonial home is equally owned by the Father and Mother.

[42] This is an appropriate case for summary judgment because the Mother’s claim that the matrimonial home is hers or that the Paternal Grandmother’s gifts were made for her sole benefit is not substantiated by the evidence. I find that the evidence supports the conclusion that the Mother and Father equally share the matrimonial home.

[43] The Paternal Grandmother has relinquished her rights in the matrimonial home and now only seeks repayment of her loans. The Mother’s claims that the advancement of monies by the Paternal Grandmother were gifts and not loans does not prevent me from deciding the issue at hand.

[44] Let me first address the Mother’s argument that the Father’s claim is statutorily barred. The Mother relies upon sections 7(1) and 7(3) of the FLA, which reads as follows:

Application to court

7 (1) The court may, on the application of a spouse, former spouse or deceased spouse’s personal representative, determine any matter respecting the spouses’ entitlement under section 5. R.S.O. 1990, c. F.3, s. 7 (1).

Limitation

(3) An application based on subsection 5 (1) or (2) shall not be brought after the earliest of,

(a) two years after the day the marriage is terminated by divorce or judgment of nullity;

(b) six years after the day the spouses separate and there is no reasonable prospect that they will resume cohabitation;

(c) six months after the first spouse’s death. R.S.O. 1990, c. F.3, s. 7 (3).

[45] The Mother’s Application was commenced over five years ago (July 9, 2015) and this is the first time that the issue of limitation has been raised. The Mother provides in her affidavit material a translated document from the General Court of Dammam which she says is proof that they were divorced on January 8, 2013. It is noted that this document was translated on the same day of her Application and despite this being the case, the Mother has never asserted such a claim, nor has she taken any steps to amend her pleading. In any event, I find that the Mother’s assertion fails because the Father’s property claim is based upon unjust enrichment and it has been found that such a claim has a limitation period of ten years (McConnell v. Huxtable, 2014 ONCA 86).

[46] The Mother also raises an issue that English is not her native language and she has difficulty understanding complex issues in English. In my view, this is not a factor to consider when reviewing her affidavit evidence. She has been represented by counsel throughout all of the proceedings and there is no evidence before me that language has been a barrier during this past five years. Moreover, at the Motion, an interpreter was present for the Mother’s benefit, yet there were no requests that any of the submissions be translated.

[47] Turning back to the issue of determining if there exists a genuine issue for trial, I conclude that based on the following, the evidence establishes that the Father has a proprietary interest in the matrimonial home:

a. In the Mother’s initial Application dated July 9, 2015, she makes no claims relating to property.

b. The Mother acknowledges in her Reply (para. 33) that any funds provided by the Paternal Grandmother were gifted to both the Father and the Mother. By way of an Amended Application dated January 4, 2016, the Mother seeks an equalization of net family properties.

c. The amendments to the Application refer to the matrimonial home as the only significant asset owned by the Mother and the Father.

d. On November 20, 2015, the Mother consents to an Order that the house located at 19 Staten Way, Ottawa, Ontario be treated as the matrimonial home for all purposes.

e. On August 25, 2016, the Mother deposes that:

i. the matrimonial home was paid in cash.

ii. the matrimonial home was solely registered in her name to benefit from the tax credit as a first-time buyer.

iii. the matrimonial home was purchased by both the Mother and the Father as it was the expectation that this was a family home.

iv. the matrimonial home was purchased with the proceeds of the Father’s previous home and with the help of the Paternal Grandmother.

v. any funds provided by the Paternal Grandmother were a gift to both the Mother and the Father.

f. On September 9, 2016, the Mother reiterates in her affidavit evidence that the advancement of funds by the Paternal Grandmother was made for the benefit of the Mother and Father. She further deposes that she would consent to an Order that the net proceeds of the sale of the matrimonial be held in trust but seeks to have $100,000 paid to both the Mother and the Father.

g. In part 4(a) of the Mother’s sworn Financial Statement dated January 30, 2017, she lists the matrimonial home as an asset, without qualifying her percentage of interest, which I interpret to mean that it was equally shared.

h. On September 10, 2020, the Mother states in her affidavit that the matrimonial home was purchased for $419,359.00. She acknowledges once again that the matrimonial home was purchased partially with funds from the Father and the balance from the Paternal Grandmother and maintains that it was a gift to both the Mother and Father, as a family.

[48] In the Mother’s most recent affidavit dated December 3, 2020, she does not address the issue of ownership of the matrimonial home. She provides no evidence in support of her position that the alleged gifts provided by the Paternal Grandmother were made solely to the Mother or that the matrimonial home is not being held in trust for both the Mother and the Father. In my view, on the issue of proprietary interest, the Mother’s evidence does not contradict the Father’s evidence that the matrimonial home was meant to be a family home, held jointly for both parents.

[49] Despite the Mother’s argument that the matrimonial home is hers alone, the Mother’s own pleadings and evidence paint a very different picture. The Mother’s evidence has been consistent throughout that the funds advanced by the Paternal Grandmother was for the benefit of the Mother and the Father. I find that the Mother has always considered the matrimonial home as a joint asset, as evidenced by her own actions. Take for example in 2016, the Mother sought an order from the Court that the matrimonial home be sold and that both the Father and Mother receive an equal share of the proceeds of sale (i.e. $100,000.00).

[50] The issue for trial is whether the funds advanced by the Paternal Grandmother were loans or a gift, and not whether the Father has a proprietary interest in the matrimonial home. I am satisfied that the Father has discharged his burden of demonstrating that a trial is unnecessary. On the evidentiary record before me, I conclude that the Father has an equal interest in the matrimonial home.

Issue #2 - Is there an unjust enrichment?

[51] The short answer to this question is yes.

[52] The onus is on the Father to show that the Mother has been unjustly enriched to his detriment. Applying the test set out in Kerr v. Baranow, I find that the three requirements have been satisfied:

a. The tangible benefit received is the matrimonial home that was acquired on March 9, 2007 for $419,359.00. The Mother acknowledges that it was registered solely in her name because she was a first-time home buyer and could therefore benefit from the tax credit. Although the Mother disputes that the funds advanced by the Paternal Grandmother were loans, she accepts that the Father has contributed to the purchase of the matrimonial home with the proceeds of sale from his previous home in Hamilton, Ontario. There is no doubt that since the separation on July 15, 2012, the matrimonial home has increased in value.

b. The deprivation is clear. The Father sold his Hamilton, Ontario property for $189,000.00, all of which was transferred into the purchase of the matrimonial home. The Mother did not contribute financially to the purchase of the matrimonial home. I am mindful however that the Mother says that she has incurred costs ($55,000.00) with respect to property taxes, renovations and the upkeep of the matrimonial home. That said, I accept that for approximately four years, the Mother has been renting portions of the matrimonial home and keeping the proceeds. The Father, who has contributed the most, has been deprived of ownership.

c. In terms of the third requirement, namely the absence of juristic reason, I find that there is no evidence to suggest that the matrimonial home was gifted solely to the Mother. It is clear in the evidence that the matrimonial home was registered solely in the Mother’s name for the purposes of obtaining a tax credit. Nothing more. There is no evidence before me to establish that the Father had any intentions to make a voluntary and gratuitous transfer of the matrimonial home to the Mother. As such, there is an absence of juristic reason for the Mother’s enrichment.

[53] On the evidentiary record before me, I conclude that the Father is entitled to full recognition of his fifty percent beneficial interest in the matrimonial home, meaning that he is entitled to proprietary ownership as opposed to a monetary award. Although no formal appraisals have been submitted to the Court, there is consensus among the parties that post-separation, the matrimonial home has increased in value. The Father is entitled to share in this appreciation of value.

Issue #3 – Should the matrimonial home be sold?

[54] The short answer to this question is also yes.

[55] The Father has recently been evicted from his previous home, he has no income and no place to live. He has been forced to return the three youngest children that were in his care to the Mother, until such time as he can find suitable accommodation for his children and himself. This can only be described as a difficult hardship and a change in circumstances. He seeks an order for the sale of the matrimonial home and that some of the proceeds of sale be distributed to the parties. With these monies, he would be able to find a new home for his children and himself.

[56] Having found that the Father has a beneficial interest in the matrimonial home, he has a right to seek an order for the sale of the matrimonial home, unless the Mother can show that he has acted in a malicious, vexatious or oppressive manner in relation to the sale.

[57] The Mother is resisting the sale of the matrimonial home for the following reasons:

a. Pleadings - the Father has not claimed partition and sale of the matrimonial home in his Amended Answer. I agree with the Father that he was unable to do so given that the Mother was the sole registered owner of the matrimonial home. Once the Paternal Grandmother agreed to relinquish her rights in the matrimonial home, he brought this Motion and he has now succeeded in obtaining an Order that he has an equal interest in the matrimonial home.

b. Limitation Period – as stated earlier, the Mother claims that there is an outstanding issue of the statutory limitation period for claiming property. I disagree for the reasons enunciated above.

c. Difficulty for the Mother and children – the Mother indicates that she does not have employment and it would be difficult for her to find new accommodation if the house is sold. This is no different than the Father’s position. The Mother also says that this would be disruptive for the children given that all four are taking medication for tuberculosis and a public nurse comes to the Mother’s home every day. Prior to losing his accommodation, the Father was caring for three of the four children and there is insufficient evidence before me to conclude that he is unable to do so once he finds a new home. Further, in most family law disputes and this case is no different, disruption to the children is inevitable. I find that it is in the best interest of the three youngest children that they be reunited with their Father as quickly as possible.

d. Father’s blameworthy conduct – the Mother submits that the Father’s motivation for bringing this Motion for the sale of the matrimonial home “is to make her life difficult”. She says that he was abusive during the cohabitation and continues to be post-separation. She refers to a number of texts in the Arabic language where the Father threatens the Mother. These texts are not in relation to the sale of the matrimonial home. Regarding the bringing of this Motion, I find the Father’s intentions are genuine. Returning the children to the Mother’s care is a prime example of the seriousness of the Father’s dire situation. On the evidence, there is no basis to conclude that this Motion is vexatious nor that the Father’s conduct, in relation to the sale of the matrimonial home, is malicious or oppressive.

e. Prejudice to the Mother – the Mother argues that she has had exclusive possession of the matrimonial home since 2016 and she has incurred costs of approximately $55,000.00 with respect to the matrimonial home. She would like to purchase the Father’s interest in the home. However, the Mother is currently unemployed and has not provided any evidence that this is a viable option in the future. In terms of the exclusive possession of the home, I agree with the Father that she sought this order under the pretence that the matrimonial home be immediately listed for sale, as evidenced in her Notice of Motion dated August 25, 2016 and the accompanying affidavit dated August 26, 2016.

[58] I find that the Mother has not met the onus of establishing any reason that the matrimonial home should not be sold. I do not find that the Father has acted inappropriately in regard to his request that the matrimonial home be sold. The evidentiary record before me leads me to conclude that the matrimonial home will have to be sold at some point in the near future and there is no compelling reason to delay the inevitable.

[59] There are allegations by both parties that, since the date of separation, they have each generated rental income while living in the matrimonial home. In addition, the Mother alleges that she has incurred $55,000.00 in relation to the upkeep and renovation of the matrimonial home. There will need to be a determination on the unpaid share of income and expenses from the date of separation to the date of sale. I therefore believe that some funds need to be held in trust pending the resolution of these issues. This would, in my view, address any alleged financial prejudice to the Mother.

[60] Then, there is the Paternal Grandmother’s Civil Action where she claims that she has loaned a substantial sum to the parties for the purchase of the home. The evidence clearly demonstrates that the matrimonial home was purchased in full (no mortgage), without any financial contribution by the Mother. The determination of whether the Paternal Grandmother gifted or loaned these funds to the parties requires a trial. Pending a resolution of this matter, I find that it is appropriate to withhold the sum of $419,359.00 from the proceeds of sale.

[61] The Paternal Grandmother also seeks that the funds be held in trust to take into account a loan of $30,000.00 made to the parties for the renovation of the basement as well as a portion of the profits from the sale of the matrimonial home. There is insufficient evidence before me to reasonably conclude that additional funds were advanced to the parties or that there was an agreement that she be entitled to profits from the sale of the matrimonial home. I decline the Paternal Grandmother’s request to hold further funds in trust.

[62] In my view, until such time as these foregoing financial issues be decided or agreed upon, the sum of $500,000.00 should be held in trust.

[63] There shall be an Order for the sale of the matrimonial home within forty-five (45) days of this decision, in accordance with terms and conditions to be agreed upon by the parties. I expect that the parties will cooperate with one another for the expeditious sale of the matrimonial home and not conduct themselves in a manner that would frustrate my Order.

LISTING FOR TRIAL

[64] The parties have been separated since July 2012. The family law proceedings were commenced in July 2015 while the Civil Action was commenced by the Paternal Grandmother in October 2016. These proceedings have been ongoing for quite some time and I believe that it is in the best interest of the parties that the remaining issues be resolved as soon as possible. The matter shall be listed for trial at the next available sitting.

CONCLUSION

[65] For the foregoing reasons, I order the following:

a. The Father has an equal interest in the matrimonial home which is being held in trust by the Mother for the benefit of the Father and Mother.

b. The matrimonial home shall be listed for sale within 45 days of the date of this decision upon terms and conditions to be agreed between the parties. It is my expectation that the parties, through their respective counsel, will cooperate with one another without any delays to give effect to this Order. In the event that the parties are unable to agree on any aspect of the sale, this Motion may be returned to me on an urgent basis.

c. The net proceeds of the sale shall be distributed as follows: (i) the sum of $500,000.00 shall be deposited into Court, pending a further Order or written agreement between the parties; and (ii) the remaining proceeds of sale shall be equally distributed between the Father and Mother.

COSTS

[66] If the parties are unable to agree on costs of this Motion, the Father shall serve and file his costs submissions (no more than three pages) along with his Bill of Costs and Offers to Settle by no later than January 15, 2021. The Mother shall then serve and file her responding submissions (no more than three pages) along with her Bill of Costs and Offers to Settle by no later than January 29, 2021. If required, the Father can serve and file a reply (no more than one page) by no later than February 5, 2021.

M. Smith J

Released: December 21, 2020

COURT FILE NO.: FC-15-1468 DATE: 2020-12-21

ONTARIO SUPERIOR COURT OF JUSTICE

B E T W E E N:

Rehab Alsalem Applicant

-and-

Khalid Fahad Aba-Alkhail Munirah Othman Aba-Alkhail Respondents

REASONS FOR DECISION

Justice Marc Smith

Released: December 21, 2020