Court File and Parties
Newmarket Court File No.: FC-18-55276 Date: 2021-02-19 Ontario Superior Court of Justice – Family Court
Between: Maryna Hutsul, Applicant And: Dmitri Kostikov, Respondent
Counsel: Alexandra Abramian, for the Applicant Dmitri Kostikov, Self-Represented
Heard: January 25, 2021
Decision Re: Applicant’s Motion to Amend Her Pleading
MCKELVEY J.:
Introduction
[1] The Applicant in this action lived in a common law relationship with the Respondent. She now seeks an interest in properties that were acquired during the relationship. The case has proceeded to final submissions and an issue has arisen with respect to whether the Applicant’s pleading includes a claim based on a joint family venture. The Applicant has brought a motion to amend her pleading to specifically rely on an allegation of a joint family venture. This application is opposed by the Respondent.
Background
[2] In the application there is no reference to a joint venture. Instead the following is claimed:
A declaratory order that the Respondent holds a 50 percent interest in the property municipally known as 105 Cherry Hills Road, Concord, Ontario in trust for the Applicant by way of a resulting trust and in the alternative by way of a constructive trust;
A declaratory order that the Respondent holds a 50 percent interest in the property municipally known as 125 Burton, Barrie, Ontario in trust for the Applicant by way of a resulting trust and in the alternative by way of a constructive trust;
A declaratory order that the Respondent holds 50 percent interest in the property municipally known as 21 Michelle Drive, Barrie, Ontario in trust for the Applicant by way of a resulting trust and in the alternative by way of a constructive trust;
A declaratory order that the Respondent holds 50 percent interest in the property municipally known as 302 Livingston Street West, Barrie, Ontario in trust for the Applicant by way of a resulting trust and in the alternative by way of a constructive trust; and
A declaratory order that the Respondent holds 50 percent interest in the property municipally known as 118 The Queensway North, Keswick, Ontario in trust for the Applicant by way of a resulting trust and in the alternative by way of a constructive trust and an order that the Respondent pay to the Applicant one half of the net sale proceeds.
[3] The nature of the relief sought is confirmed at paragraphs 24 and 25 of the pleading. These paragraphs state as follows:
The Applicant is entitled to a trust interest in the family residence as she contributed financially towards the purchase and upkeep of the home.
The Applicant is also entitled to a trust interest in the four investment properties as she contributed her share of the equity in the family residence towards the purchase of each of the investment properties.
[4] During the course of trial it became apparent that the Applicant was relying on a joint family venture in support of her claim. The joint family venture doctrine was created as a result of the Supreme Court of Canada’s decision in Kerr v. Baranow, 2011 SCC 10. Justice Cromwell’s decision in Kerr recognizes a separate basis for an unjust enrichment claim where both partners have contributed to the accumulation of wealth in the relationship. The difficulty is that the claim under the joint family venture doctrine was not pleaded. Instead, the claim was restricted to a constructive trust claim based on the alleged contributions by the Applicant to the acquiring and maintenance of the properties in question.
[5] Initially this issue was brought to the attention of the Applicant’s solicitor on February 11, 2020 following completion of the evidence in this case. At that time the Applicant’s solicitor requested an adjournment so that she could re-frame her submissions based on a constructive trust analysis. I granted the adjournment on condition that the Applicant’s revised final submissions be delivered by March 11, 2020. This was subsequently revised at the request of the Applicant’s solicitor to March 18, 2020 due to a personal emergency.
[6] Unfortunately, due to the pandemic, this case was not brought back before me until January 25, 2021. Just prior to that attendance on January 21, 2021, the Applicant delivered supplementary closing submissions in which she submitted that a joint family venture was encompassed in her pleading. In the alternative, she stated that in the event the Applicant should have pled joint family venture, Rule 11(3) of the Family Law Rules provides that the Court shall give permission to a party to amend an application, answer or reply, unless the amendment would disadvantage another party in a way for which costs or an adjournment could not compensate. The Applicant’s solicitor, did not, however, include any notice of motion or supporting affidavit to amend the application.
[7] At the time of hearing on January 25, 2021, the Applicant’s solicitor sought leave to bring a motion to amend the application. This necessarily involved some delay. The affidavit sworn in support of the application was from Brigitta Tseitlin. In her affidavit at paragraph 6 she states that,
The Respondent has been aware that the Applicant’s claims towards an interest in the real properties are based, in part, on the fact that the parties were engaged in a joint family venture including the Applicant’s position that the parties pooled their efforts and financial resources in order to amass real estate and savings for their future retirement.
[8] At paragraph 7 of the affidavit, Ms. Tseitlin states that during a case conference with Justice Bennett on April 26, 2018, the Applicant’s claim for an interest in the real properties based on a joint family venture were canvassed and discussed. This issue was allegedly discussed again at a settlement conference on January 14, 2019.
[9] Ms. Tseitlin goes on to state at paragraph 11 that,
Prior to the commencement of trial, on April 30, 2019 the Applicant served the Respondent with her trial opening statement. In the Applicant’s trial opening statement at paragraphs 25 to 18, the Applicant outlines the evidence that will be presented at trial regarding the fact that her and the Respondent’s twelve year period of cohabitation was a “true joint venture” including that the parties chose to invest their joint monies into the purchase of various real properties as a retirement plan and that it was through their mutual effort that the parties worked together towards a common goal of ensuring they had sufficient assets and funds for themselves and their family.
[10] Mr. Kostikov also gave evidence orally on the motion. In his evidence he agreed that he understood the Applicant’s claim was based on the Applicant’s position that the claim was based on their relationship.
[11] In considering the Applicant’s motion, I have also taken into account whether any applicable limitation period has lapsed. The application asserts that the parties separated on October 31, 2017. This request for an amendment to the application has therefore been brought over two years from the date that the cause of action arose. However, in the Ontario Court of Appeal decision in McConnell v. Huxtable, 2014 ONCA 86, the Court dealt with an action for unjust enrichment seeking a remedial constructive trust in a property owned by the appellant. In the alternative she sought a monetary award. The Court held that the applicable limitation period was ten years pursuant to s. 4 of the Real Property Limitations Act. Thus, it would appear that there is no limitation period issue to be addressed.
[12] In Stetco v. Stetco, 2014 ONCA 370, the Court of Appeal dealt with an appeal from a decision of the trial judge which allowed the wife to amend her pleading at trial to claim an unequal division of property. In dismissing this aspect of the appeal, the Court of Appeal stated,
The husband also advanced, but did not strenuously press an argument that the trial judge erred by allowing the wife to amend her pleading at trial to claim an unequal division of property. The trial judge found that both parties had expected the claim to be an issue at trial. It had been identified as a live issue for trial at the Trial Management Conference and in the opening statement of the husband’s counsel. The trial judge found the claim had been left out of the wife’s application by oversight. When the amendment was allowed, the husband did not request an adjournment. We agree with the trial judge’s observation (made in her costs decision at para. 19) that the husband’s alleged “surprise” at the amendment was “purely strategic and patently insincere”.
[13] In light of the fact that the Respondent was aware of the fact that a joint family venture theory of the case was to be pursued by the Applicant, I have concluded that the Applicant is entitled to amend her application accordingly. However, the conduct of the Applicant’s counsel in failing to seek an amendment to the pleading more promptly and failing to deliver a motion record within the time contemplated by my Order on February 11, has resulted in a significant issue arising on the day set for final submissions. It also necessitated an adjournment of the original date scheduled for final submissions on February 11, 2020. I fully intend to take these issues into account when addressing the issue of costs in this action.
Justice M. McKelvey Released: February 19, 2021