Oudeh v. Prior-Oudeh, 2021 ONSC 3718

COURT FILE NO.: FS-18-004919

DATE: 20210521

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

EYAD OUDEH

Applicant

– and –

COLLEEN PATRICIA PRIOR-OUDEH

Respondent

Karmel Sinclair, for the Applicant

David Tobin, for the Respondent

HEARD: March 1, 2, 3, 4 and 5, 2021 (Written closing and cost submissions dated March 5, 9, 12 and 29, 2021)

Kimmel J.

Table of Contents

Overview.. 4

Summary of Outcome. 5

The Issues to be Decided. 6

(a) 705 Hillsdale. 7

(i) The Evidence About the 1986 Purchase of Nora’s 50% interest in 705 Hillsdale.... 10

(ii) The Evidence About the Carrying Costs Associated with 705 Hillsdale. 12

(iii) The Evidence About Patricia Prior’s Intentions. 13

(iv) Challenges to the Court’s Reliance on Patricia Prior’s Affidavits. 15

(v) Credibility Challenges to the Priors’ Evidence. 16

(vi) Conclusion: Was there Consideration for the Transfer of a 50% Interest to the Respondent?. 20

(vii) Is there a Presumption of a Resulting Trust?. 21

(viii) Was the Transfer of a 50% Interest to the Respondent a Gift that Rebuts the Presumption of Resulting Trust?. 21

(ix) Findings Regarding 705 Hillsdale. 23

(b) 106 Blaisdale. 23

(c) The Notional Cost of Disposition of Property. 27

(d) Value to be Attributed to Disputed Date of Marriage Deductions Claimed by the Applicant and the Respondent 28

(e) Value to be attributed to the Respondent’s Chevrolet Equinox on the Date of Separation 29

(f) Equalization of Net Family Property. 30

(g) Interest on the Equalization Payment 32

(h) Corollary Relief. 33

(i) Costs. 33

Costs of the Trial 34

The Applicant’s Costs Position. 34

The Respondent’s Costs Position. 34

Costs Principles and Analysis. 35

Previous Orders of Costs Payable “in the cause”. 36

Judgement and Final Disposition. 36

Overview

1The applicant (husband) and respondent (wife) were married for over 28 years. They were married on June 19, 1987 and separated on December 1, 2015 with no reasonable prospect that they would resume cohabitation (the “valuation date” or “date of separation”). They have two adult daughters, one of whom is employed full time and the other of whom is in university full time. At present, they both reside with their mother (the respondent).

2The parties settled all issues prior to trial except their disputes about their respective net family property calculations and the equalization payment that flows from those calculations. Their disputes primarily focus on two properties:

a. First, the matrimonial home located at 106 Blaisdale Road in Scarborough, title to which was held in the name of the applicant (husband) and his mother as joint tenants when the parties married and until the applicant’s mother died on May 14, 2009, before separation.

b. Second, the home of the respondent’s mother located at 705 Hillsdale Avenue East in Toronto, title to which was held in the names of the respondent (wife) and her mother as tenants in common until the respondent’s mother died on or about April 3, 2020, after separation.

3The applicant seeks to reduce the value attributed to the matrimonial home on separation based on a lawsuit that was commenced in 2010 by his mother’s estate concerning a bequest of her interest in the matrimonial home under a 1985 will to all of her children equally (including the applicant’s two siblings). The estate’s claim is for $250,000.00 and the applicant asks the court to recognize this claim as a liability for purposes of reducing the value of his net family property as of the date of separation. The respondent argues that the court should not discount the value of the applicant’s net family property for this contingent claim that has never been pursued beyond the pleadings stage. Since a certificate of pending litigation (“CPL”) was registered over ten years ago, the applicant has taken no steps to have the CPL removed and/or the estate’s claim dismissed. None of the other estate representatives or beneficiaries were called as witnesses at trial.

4The respondent seeks to exclude from her net family property the entire value of her mother’s home at 705 Hillsdale on the basis that it was only put in her name in 1986 to facilitate a mortgage loan to her mother and it was never intended that the respondent hold any direct or contingent beneficial interest in this property while her mother was alive. The respondent maintains that, having contributed nothing to the purchase or any of the carrying costs of her mother’s home for over thirty years, there is a presumption that she was holding title to this property in trust for her mother, who remained the sole beneficial owner of her home during the entire duration of the parties’ marriage and after their separation. The respondent maintains that she only became a beneficial owner of her mother’s home by way of gift or inheritance after her mother died.

5The applicant disputes that any presumption of resulting trust arose in respect of the respondent’s titled interest in the 705 Hillsdale property, but, if it did, seeks to rebut the presumption that the respondent was holding title to this property in trust for her mother during her mother’s lifetime. The applicant challenges the respondent’s credibility and the lack of third party records to corroborate her position. He is skeptical because the respondent’s 50% titled ownership of her mother’s home was kept a secret from him until it was disclosed in these proceedings. He contends that the respondent has not established that she gave no consideration for the transfer to her of a 50% interest in 705 Hillsdale, or he contends that the respondent’s mother gifted her the home when it was put in the respondent’s name in 1986, prior to the marriage. The applicant asserts that the respondent and her mother and sister have been engaged in an elaborate cover-up regarding the respondent’s title to and interest in this property, which has unravelled due to conflicting testimony about it. The applicant urges the court to place little or no reliance upon the affidavit evidence of Patricia Prior (the respondent’s mother) sworn June 12, 2019 and February 18 and March 9, 2020, before she passed away.

6There are some other small items of dispute regarding the various inclusions and exclusions from the parties’ net family property, but these two properties are by far the most significant from a value perspective. There was no direct appraisal or valuation evidence before the court in respect of either property. The applicant says he received an appraisal that valued the matrimonial home at $555,000.00 on their separation date, and he maintains that he received a letter of opinion from an appraiser that the respondent’s 50% interest in 705 Hillsdale should be valued at $660,000.00 on their separation date, which is only $10,000.00 more than the value that the respondent attributed to it in one of her sworn financial statements.

7The respondent works as an educational assistant for the Toronto District School Board and has consistently reported annual income in the range of $55,000.00 to $58,000.00 since 2015 and estimates her annual expenses to be approximately $72,000.00. The applicant is self-employed. In 2018, he reported on his tax return that he had no net business income and net commission income of $19,958.73 (after expenses). As of the trial, he had not disclosed his tax returns or earnings information for 2019 or 2020 (the support issues having been settled by the parties). Neither party has significant financial resources at their disposal. Both are in their 60s and hope to retire in the foreseeable future. The applicant continues to live in the matrimonial home (which was his parents’ house before the parties married). The respondent lives in a rented apartment.

8The court’s decision regarding the disputes about the two significant properties will determine which spouse owes an equalization payment to the other. Accounting for all disputed items, on the applicant’s theory, the respondent would owe him an equalization payment of $203,136.19. On the respondent’s theory, the applicant would owe her an equalization payment of $230,428.15. Given the limited means and resources of the parties, whichever of them is required to make a payment to the other will likely have to sell or refinance their interest in the property they now own to make the equalization payment.

Summary of Outcome

9For the reasons that follow, I have concluded that the respondent is not required to include in her net family property as of the date of separation the value of the 50% interest in 705 Hillsdale, her mother’s home, that the respondent held in a resulting trust for her mother until after the parties separated. I have concluded that the applicant is not entitled to deduct from his net family property on the date of separation anything more than a nominal amount of $25,000.00 on account of the claim by his mother’s estate in relation to the matrimonial home at 106 Blaisdale. The applicant may deduct notional costs of disposing of, or refinancing, the matrimonial home at the rate of 2.5%.

10The applicant is not entitled to deduct the disputed assets as of the date of marriage as their existence and/or value have not been proven. The respondent may deduct her 1984 Honda Civic, which she has established was acquired prior to the date of marriage. The Chevrolet Equinox, owned by the respondent at the valuation date, should be valued at $12,000.00.

11Interest is payable by the applicant to the respondent at the prejudgment interest rate prescribed by the Courts of Justice Act, R.S.O. 1990, c. C.43, of 1.8% from and after March 9, 2020. Once the equalization payment is made (or earlier if required for the disposition or refinancing to finance the equalization payment), the respondent shall remove the registered designation of 106 Blaisdale as the matrimonial home, but she is not required to maintain the applicant on her health benefits.

The Issues to be Decided

12The closing submissions of the parties identified the following remaining issues for the court’s determination:

a. What value, if any, should be included in the respondent’s net family property as a result of her being registered on title to her mother's home at 705 Hillsdale?

b. Is the applicant entitled to include a contingent liability of $250,000.00 as at valuation date related to an estate litigation claim dating back to 2010 arising from a claim by his siblings to an interest in the matrimonial home at 106 Blaisdale?

c. Is the applicant entitled to claim notional costs of disposition of the matrimonial home as a liability at as valuation date? If so, at what rate should they be calculated?

d. Is the applicant entitled to date of marriage deductions totalling over $17,000.00 for claimed household items and cars, and is the respondent entitled to a date of marriage deduction for her Honda Civic?

e. What value should be attributed as at the date of separation to the respondent’s car, a Chevrolet Equinox, which the respondent values at $12,000.00 and the applicant values at $15,500.00?

f. What equalization amount is owing, to whom?

g. Is interest payable on the equalization payment and, if so, at what rate and from what date?

h. Should the court grant other corollary orders and relief requested by the applicant?

i. Requiring the respondent to remove her registration of the designation of 106 Blaisdale as a matrimonial home from title; and

ii. Requiring the respondent to maintain the applicant on her medical benefits.

i. The determination of costs of the trial and of the action, including previous orders of costs 'payable in the cause', in the amount of $1,500.00 pursuant to the Order of Justice Paisley, dated December 19, 2019 and the further costs Order of Justice Hood, dated October 27, 2020, in the amount of $2,500.00.

13I will consider and decide each of these issues in turn.

(a) 705 Hillsdale

14In or about 1986, the respondent’s mother, Ms. Patricia Ann Prior (“Patricia”), inherited a 1/2 interest in the property known as 705 Hillsdale Avenue East in Toronto, Ontario ("705 Hillsdale") from her mother. The respondent’s aunt (Patricia’s sister), Ms. Nora Agnes Frances Masson (“Nora”), inherited the other 1/2 interest in 705 Hillsdale. Patricia lived in the house and Nora did not. Nora sold her interest in 1986. Patricia continued to live at 705 Hillsdale until she died on April 3, 2020.

15The question to be decided in relation to the 705 Hillsdale property is what value, if any, should be included in the respondent’s net family property as a result of her having been registered on title to her mother's home in 1986 when her aunt Nora’s interest was bought out. In the context of that transaction, title to a 50% interest in 705 Hillsdale was put in the respondent’s name and she was registered as a tenant in common, together with her mother Patricia, each as to a 50% interest. This occurred before the respondent married the applicant. The respondent remained registered on title as a 50% tenant in common with her mother on the date separation (and thereafter). The issue is whether the respondent was holding the 50% share of this property registered in her name in trust for the benefit of her mother by virtue of a resulting trust.

16The applicant points to various definitions under s. 4 of the Family Law Act, R.S.O. 1990, c. F.3 (the “FLA”) that he says require the respondent to include in her net family property on the date of separation the value of the 50% titled interest that she holds in 705 Hillsdale (less a deduction for its value on the date of marriage).

17“Property” is defined under s. 4(1) of the FLA, to include any interest, present or future, vested or contingent, in real or personal property, including property over which a spouse exercises powers of appointment and disposition.

18“Net family property” is defined under s. 4(1) of the FLA to mean the value of all property, except property excluded under s. 4(2), that a spouse owns on the valuation date, after deducting,

a. The spouse’s debts and liabilities, and

b. The value of property, other than the matrimonial home, that the spouse owned on the date of the marriage, after deducting the spouse’s debts and other liabilities calculated as of the date of the marriage.

19Exclusions under s. 4(2) of the FLA cover property acquired by gift or inheritance from a third person after the date of marriage. Section 4(3) of the FLA provides that the onus of proving a deduction under the definition of "net family property" or an exclusion under subsection 4(2) is on the person claiming it.

20Title to 705 Hillsdale was held by the respondent and her mother as tenants in common, both on the date of marriage and on the valuation date. The respondent maintains, however, that she was not the direct or contingent beneficial owner of that 50% interest while her mother was alive (Patricia did not die until April 3, 2020, long after the valuation date), and that it falls outside of the definition of net family property. The respondent contends that her titled interest was not absolute until her mother passed away and should be viewed no differently than an inheritance under a will, which the applicant concedes would not fall within the definition of a spouse’s property under the FLA as long as it remained under Patricia’s control to make all decisions incidental to ownership.

21Equity recognizes a distinction between legal and beneficial ownership. The beneficial owner of property has been described as "[t]he real owner of property even though it is in someone else's name": Pecore v. Pecore, 2007 SCC 17, [2007] 1 S.C.R. 795, at para. 4, quoting Csak v. Aumon (1990), 1990 CanLII 8070 (ON SC), 69 D.L.R. (4th) 567 (Ont. H.C.J.), at p. 570. Where a party holds title to a property but does not have a beneficial interest in that property, it does not form part of that party's net family property for equalization purposes. In Dhillon v. Dhillon, 2014 ONSC 5608, at para. 87, André J. refused to include real estate in India belonging to the husband's mother despite the husband being the sole person registered on title.

22In family law proceedings, courts have routinely imposed trusts where it would be inequitable to treat the registered owner of a property as the true owner just because it is held in their name. Generally, but not necessarily, this type of trust is in favour of another spouse: Durakovic v. Durakovic, 2008 CarswellOnt 5329, at para. 110.

23Resulting trusts have existed outside of the family law context under the common law for hundreds of years. Justice Cromwell wrote as follows, in Kerr v. Baranow, 2011 SCC 10, [2011] 1 S.C.R. 269, at para. 12:

[I]t had been settled law since at least 1788 in England (and likely long before) that the trust of a legal estate, whether in the names of the purchaser or others, "results" to the person who advances the purchase money: Dyer v. Dyer (1788), 2 Cox Eq. Cas. 92, 30 E.R. 42, at p. 43.

24A title holder to property who provided no consideration will be found to be holding title in trust for the person who advanced the funds. Title then 'results' back to the true/beneficial owner. The respondent relies, in particular, on the following descriptive example of a purchase money resulting trust contained in Donovan W.M. Waters, Mark R. Gillen & Lionel D. Smith, eds., Waters’ Law of Trusts in Canada, 4th ed., online, (Toronto: Carswell, 2012), ch. 10.II, at B. 2:

If A supplies the purchase money and conveyance is taken in the joint names of A and B, B during the joint lives will hold his interest for A, B will also hold his right of survivorship - again by way of resulting trust for A's estate, because that right is merely one aspect of B's interest. In other words, the starting point is that B holds all of his interest on resulting trust for A, or A's estate. However, evidence may show that, while A intended B to hold his interest for A during the joint lives, it was also A's intention that, should he (A) predecease, B should take the benefit of the property. The presumption of resulting trust would then be partially rebutted, in relation to the situation that has arisen, so that B would not hold his interest (now a sole interest and not a joint tenancy) on resulting trust. He would hold it for his own benefit.

25A resulting trust arises when title to property is in one party's name, but that party, because he or she is a fiduciary or gave no value for the property, is under an obligation to return it to the original title owner and does not exercise the incidents of ownership over the property: Pecore, at para. 20.

26Pecore remains the leading case on the presumption of resulting trust. In that case, the Supreme Court decided that the presumption of resulting trust applies to transfers between a parent and adult child. As explained by the Supreme Court, at para. 24, the presumption places the onus, where a transfer is made for no consideration, on the transferee to demonstrate that a gift was intended. This presumption will be determinative in the absence of evidence of the transferor’s intent to rebut the presumption on a balance of probabilities: at para. 44. It is the intention of the transferor at the time of the transfer that is relevant, although evidence of intention arising subsequent to the transfer that informs the intention at the time of the transfer may be relevant but must be evaluated in a manner that guards against after-the-fact evidence that may appear to be self-serving or to reflect a change in intention after the transfer: at para. 59.

27Pecore was concerned with resulting trusts in bank accounts. In the family law context, the presumption of resulting trusts has been held to apply to real property in Ontario. This was considered in the case of Kent v. Kent, 2019 ONSC 6873, dealing with a gratuitous transfer of title from a mother to herself and her daughter as joint tenants. At the time of the transfer the mother lived in the house alone. Her daughter and son-in-law moved into the house with the mother years later, and when her daughter died, her son-in-law continued to reside in the house with the mother until she moved into a long-term care home. The mother paid all the expenses for the home at all times.

28After the mother’s death, the son-in-law in Kent argued that the house became the matrimonial home of himself and the daughter when they lived in it and that the joint tenancy (of the mother and daughter) was therefore deemed to be severed immediately before the daughter’s death such that he became a one-half owner of the property. The mother’s grandchildren argued that there was a resulting trust and therefore the daughter never had a beneficial interest and so the severing of the joint tenancy under the Family Law Act could not occur. The reasons in this case are brief, but the court finds that the transfer by the mother to her daughter was a gratuitous transfer between a parent and adult child, giving rise to a presumption of resulting trust, and that there was no evidence to rebut the presumption, in particular since both the mother and daughter were deceased by the time this issue came before the court.

29This decision was upheld by the Court of Appeal in Kent v. Kent, 2020 ONCA 390, in which the court approved of the lower court’s approach to the analysis, at paras. 30-31, as follows:

In submitting that the 1996 Transfer was a gift from Marian to Janice, Gordon asks this court to apply the legal principles relating to the making of inter vivos gifts. This submission cannot stand in the face of Pecore. Although Pecore concerned the gratuitous transfer of title to a bank account into the joint names of the parent and child, it is clear that its dictates are intended to encompass the gratuitous transfer of title to other forms of property from parent to adult capacitated child. The fact that Janice was Marian’s only child and Marian was a widow does not change the applicability of the legal principles in Pecore.

Consequently, the application judge was correct when he determined that the legal principles in Pecore applied and that the presumption of resulting trust arose in respect of the 1996 Transfer. And, as I explain below, I see no error in his determination that the presumption had not been rebutted. Therefore, the 1996 Transfer was not a gift of an interest in the Property to Janice.

30The resulting trust analysis requires the court to consider the following issues:

a. Was there consideration given by the respondent when title to a 50% interest in 705 Hillsdale was put in her name?

b. Does a presumption of resulting trust arise?

c. Is there sufficient evidence to establish on a balance of probabilities that Patricia Prior intended to gift a 50% interest in 705 Hillsdale to the respondent at the time that title was put in the respondent’s name to rebut the presumption of resulting trust?

31If there was no resulting trust in favour of the respondent’s mother and she does have to include the value of a 50% interest in 705 Hillsdale as at the valuation date, the following further questions must be addressed for purposes of calculating the respondent’s net family property as at the valuation date (which will then inform the equalization calculation):

a. What value should be attributed to the respondent’s 50% interest in this property as at the valuation date?

b. What amount should be deducted for the value of this 50% interest as at the date of marriage?

c. Should any notional sale or refinancing costs be deducted as expenses or liabilities associated with this property?

(i) The Evidence About the 1986 Purchase of Nora’s 50% interest in 705 Hillsdale

32705 Hillsdale was originally purchased by the respondent’s grandfather and great-aunt in the late 1930s. The respondent’s mother's family lived there. When her grandfather, grandmother and great-aunt died (the latter two dying within weeks of each other in 1986) 705 Hillsdale was inherited by the respondent’s mother (Patricia) and Aunt Nora, each as to a 50% interest.

33Patricia was living at 705 Hillsdale at the time. Nora already owned a home and so she sold her one-half interest in 705 Hillsdale to Patricia. The respondent (“Colleen”), her mother Patricia and her sister Maureen (collectively, the “Priors”) all testified that Patricia decided to purchase her sister Nora’s 50% interest in 705 Hillsdale. The purchase price was comprised of $5,000.00 cash, a demand promissory note for $7,500.00 payable by Patricia to Nora, as well as the mortgage proceeds from a CIBC mortgage for $70,000.00 that was registered on title in June 1986.

34The respondent is not named as the borrower on the demand promissory note for $7,500.00 payable to Nora. Patricia testified that she alone repaid the majority of the amounts owing under this note, and that the remainder was forgiven by her sister Nora.¹ Patricia also testified that she paid the cash portion of the purchase price to her sister for her 50% interest in 705 Hillsdale and that she was solely responsible for all payments made to CIBC under the mortgage. It was her testimony that the respondent did not make any contributions towards the purchase price paid to Nora or towards any of the carrying costs to service the mortgage debt or for any other expenses or improvements to the property over the years.

35The respondent testified that she had not been able to obtain her bank records dating back to 1986 to demonstrate that funds were not withdrawn from her account in or around the time of this purchase, but she maintains that she made no financial contribution towards the purchase of the 50% interest from her aunt Nora at the time or at any time thereafter.

36The lawyer (Mr. Stainton) retained on the transaction by which Nora’s 50% interest in 705 Hillsdale was purchased sent a reporting letter addressed to both Patricia and her daughter Colleen dated July 9, 1986, in which:

a. He stated that: By a Transfer/Deed of Land registered in the Land Registry Office for the City of Toronto on June 26 1986 as No. CT 796328 title to the premises, being part of Lot 229, Plan 866, was registered in the names of Patricia Ann Prior and Colleen Patricia Prior as tenants in common, by direction.

b. He attached a Direction signed by Patricia and Colleen Prior dated June 19, 1986 that stated that: This is to authorize and direct you and shall constitute Your good, valid and irrevocable authority to prepare the conveyance in the above transaction in the following manner:

Prior, Patricia Ann 1933 09 20

Prior, Colleen Patricia 1960 01 26

Tenants in common

c. He refers to the source of funds for the transaction on a ledger statement as having been received from CIBC and Patricia Prior.

37Colleen testified that she has no recollection of receiving this July 9, 1986 letter at the time and that she assumes it was only sent to her mother, even though it is addressed to both of them. When asked in direct, cross, and re-examination, about this letter, she consistently confirmed that the first time she saw it was when she was looking for documents as a part of her disclosure obligations in these proceedings. She gave evidence that she did not consider Mr. Stainton to be her lawyer and that she never sought or received legal advice from him. The respondent also identified that from the ledger attached to the letter, it is clear that it was her mother who paid and retained Mr. Stainton.

38Colleen was steadfast in her testimony that she was not aware that title to a 50% interest in 705 Hillsdale was put in her name in 1986 and that she only became aware of this after the parties separated, in the context of this litigation. Patricia must have had the letter and it was appended as an exhibit to one of her pre-trial affidavits. The evidence of the respondent’s sister Maureen about their mother’s estate planning documentation prepared by the same lawyer ten years later, in 1996, supports the inference that Patricia did receive this letter from Mr. Stainton, or was at least aware in 1996 of its contents and was aware that 705 Hillsdale was held by herself and the respondent as tenants in common, since her last will and testament dated May 9, 1996 (the “1996 will”) leaves her interest in 705 Hillsdale to Maureen only.

(ii) The Evidence About the Carrying Costs Associated with 705 Hillsdale

39A presumption of resulting trust applies not only to purchase or transfer of property but can also apply to post-purchase reduction of liabilities associated with the purchase or transfer of the property, such as paying down mortgages or lines of credit: see Nanton v. Julien, 2019 ONSC 68, at para. 26.

40The Priors all testified that Patricia took responsibility for the carrying costs for 705 Hillsdale throughout the entire time that she lived at 705 Hillsdale, from the time of the 1986 purchase of Nora’s interest until she died in April 2020.

41Patricia testified in her affidavits that:

a. From the time that I obtained the mortgage in 1986 until it was discharged in or around 2006, I was solely responsible for servicing the mortgage, maintaining the home and meeting all of the expenses and carrying costs associated with 705 Hillsdale.

b. Colleen did not contribute at all to the funds used to acquire the home, service the mortgage or toward any expenses associated with 705 Hillsdale. Colleen has never lived in 705 Hillsdale. Since 1986, only I have lived in the home with my other daughter, Maureen Prior.

c. I reiterate my earlier statement that I was the person solely responsible for servicing the debt associated with 705 Hillsdale. Colleen did not put money toward the initial payment of $5,000, nor did she make mortgage payments or payments toward the promissory note. I used my employment income, pension income, and occasionally money from my savings account to cover my house expenses.

42The available records from Patricia’s bank accounts (the authenticity of which is admitted) corroborate that she was making the monthly mortgage payments and paying for utilities and other upkeep costs for 705 Hillsdale. These records were only available dating back to September 30, 1987.

43Maureen testified that Patricia funded all of the mortgage, tax and insurance payments and made all major decisions about this property. Prior to her mother’s death, Maureen contributed to some of their day-to-day living expenses and also paid for some specific renovations and improvements to the property. She confirmed that she was not aware of any financial contributions to any costs associated with 705 Hillsdale having been made by Colleen prior to their mother’s death in 2020.

(iii) The Evidence About Patricia Prior’s Intentions

44The next question to consider is whether Patricia intended to gift a 50% beneficial interest in 705 Hillsdale to Colleen at the time of the transfer of title into her name, in June 1986.

45The respondent testified that she was not aware that she had been put on title as a 50% owner of 705 Hillsdale until after the parties separated. She was 26 years old at the time and says that all she understood was that she had signed legal documents to enable her mother to get a mortgage to pay the balance of the purchase price to her aunt. The respondent was working at the time. Her sister Maureen was in university and did not have an income.

46A resulting trust does not depend upon the knowledge or intention of the trustee. In circumstances where a mother purchased a house and paid the mortgages but put title to her house in the names of her two sons and was never herself on title, the Court of Appeal considered the only relevant intention to be that of the mother at the time of the purchase of the house and payment of the mortgages: Andrade v. Andrade, 2016 ONCA 368, 131 O.R. (3d) 532. The relevant question was whether she intended, in these circumstances, for her sons to have beneficial title, not whether they intended to hold the property in trust for their mother: Andrade, at para. 67.

47In Andrade, the Court of Appeal considered various circumstances, including those listed below that correspond with similar circumstances in this case, in reaching its conclusion that the mother did not intend to give a gift of beneficial ownership to her two sons who were on title:

a. It was the mother who decided to buy the house, and the evidence of all the children was that they were on title because they were the only adults at the time with sufficient income to qualify for a mortgage: at para. 69.

b. None of the children who held title saw themselves as having a beneficial interest (the conflict here was because one of the children on title had died, and his widow was attempting to claim his interest in the house): at para. 69.

c. The evidence of the mother was clear that she intended herself to be the owner of the house: at para. 70.

d. There was no indication that the mother intended to favour the sons on title over her other children – and there was therefore no rationale for a gift: at para. 76.

e. The mother paid all the bills in relation to the house including mortgages, taxes, insurance and repairs: at paras. 79-80.

f. The mother was responsible for renting out apartments in the home and collecting rent from tenants: at paras. 50, 79.

48The overarching consideration was that everyone behaved as if it was the mother’s house during her lifetime. The same can be said of Patricia Prior in relation to 705 Hillsdale.

49In Bouffard v. Bouffard, 2020 ONSC 3079, Kumaranayake J. wrote the following, at para. 163:

A gift of a beneficial interest in a property is not established where a party is on title for the purpose of obtaining financing and remains liable on the mortgage with no contribution to the mortgage payments or the upkeep of the property: see, for example, Zajko v. Knight, [2006] O.J. No. 3220 (S.C.), at paras. 22, 23; Gulf Oil Canada Ltd. v. O'Rourke (1978), 1978 CanLII 1291 (ON CA), 21 O.R. (2d) 30 (C.A.); Gaunt v. Woudenbert, 2005 CanLII 63804 (ON SC), [2005] O.J. No. 2413 (S.C.), at para. 92.

50The circumstances of this case are similar, in that the respondent’s involvement in the arrangements at the time of the purchase of Nora’s 50% interest in 705 Hillsdale were understood by her to be for the purpose of obtaining financing for that purchase. Following the logic of these earlier cases, the fact that Colleen was put on title to 705 Hillsdale does not establish that there was an intention on Patricia’s part to gift a 50% interest to her. The affirmative evidence, consistent with this, is that during her lifetime, Patricia considered 705 Hillsdale to be her home and not Colleen's.

51Patricia testified directly that she did not intend to give the respondent a beneficial interest in 705 Hillsdale. She testified variously on this topic, as follows:

a. “[a]t no time did I intend to give Colleen an interest in 705 Hillsdale. As far as I am concerned, Colleen does not have a beneficial interest in 705 Hillsdale.” [para. 8, June 12, 2019 affidavit]

b. “[a]t the time of the transfer of legal title to 705 Hillsdale to me and Colleen, it was never my intention to give Colleen a beneficial interest in the home. It was my intention to retain control of 705 Hillsdale for my use. Colleen was not invited to live with me at 705 Hillsdale at that time or any other time since I acquired the home.” [para. 3, March 9, 2020 affidavit]

c. “When I purchased my sister Nora's interest in 705 Hillsdale, it was always my intention to retain the benefit of using the home for myself (and whomever I invited to live with me).” [para. 7, March 9, 2020 affidavit]

d. “At the time of the transfer, and indeed still, my intention was that the home belonged to me and that I decided all matters related to the home.” [para, 8. March 9, 2020 affidavit]

52While she was alive, Patricia did not believe the respondent had a beneficial interest in 705 Hillsdale. She understood that, as the sole beneficial owner, she alone would exercise all of the rights and responsibilities in respect of the property, including any decisions about the property. In the event of a sale, she understood she would be entitled to all of the sale proceeds.

53Maureen's testimony on the issue of Patricia's intention for 705 Hillsdale was as follows:

a. Although she was not present when the legal documents were signed in 1986, after her mother Patricia bought out her sister Nora’s interest in 1986, Maureen understood that Patricia considered herself to be the owner of her home at 705 Hillsdale based on discussions she had while living in the home with Patricia from 1986 until Patricia died.

b. While Maureen lived with Patricia in the home, Patricia paid for vastly all the expenses of the home and Colleen paid for none.

c. It was never discussed that Colleen was a co-owner of this property.

d. Patricia's expressed intention was that the house would pass to Maureen and Colleen upon her Patricia's death and not sooner.

54The evidence disclosed that Maureen, who lived with their mother, was the daughter who was more closely involved with Patricia and 705 Hillsdale during the latter part of her life, which may explain why Colleen was not aware of all the details surrounding Patricia's planning and finances. While she was not aware of the legal mechanics of how this would be accomplished, Colleen also testified that she understood that her mother’s intention was that her two daughters would each have an equal share of the house after she died.

55The evidence overwhelmingly indicates that Patricia did not intend to gift a 50% interest in 705 Hillsdale to Colleen in 1986 (or at any time prior to her death). Even if I were to disregard Patricia’s affidavits as the applicant asks me to do (discussed below), there is still no evidence of an intention on Patricia’s part to gift 50% of her home to Colleen in 1986 when Colleen was put on title.

(iv) Challenges to the Court’s Reliance on Patricia Prior’s Affidavits

56Patricia swore three affidavits in this litigation before she died. By late 2019, it was known that her health was failing. A pre-trial order was made that allowed for her trial evidence to be submitted by way of affidavit. Her affidavits were entered as exhibits at trial. The applicant asks the court to give little or no weight to her testimony.

57In the pre-trial order made in December 2019, provision was also made to allow the applicant’s lawyer to question Patricia on her affidavits in advance of trial. The evidence at trial was that the respondent's counsel sent two letters to the applicant's counsel trying to arrange questioning. While Patricia would not have been enthusiastic about being questioned, the respondent testified that she was willing to attend if asked to and that she understood that it was her obligation to do so. The applicant claimed that the COVID-19 pandemic prevented him from scheduling the cross-examination. However, even accounting for that, there would have been nothing that prevented questioning of Patricia prior to March 2020.

58As a result of a series of events and other matters that the parties were dealing with in the litigation, this cross-examination was not arranged before Patricia died on April 3, 2020. The applicant’s explanation for why the questioning was not arranged was that his new counsel was focused on getting up to speed and on a mediation that the parties had agreed to attend. There can be no suggestion that the respondent is at fault for the applicant not having questioned Patricia before she died.

59The respondent submits that a party's failure to avail themself of an opportunity to cross-examine a witness on their affidavit is not a reason for the court to question its admissibility or weight. This is especially so where the challenging party has led no evidence to contradict the affiant. In Reisman v. Reisman, 2014 ONCA 109, 118 O.R. (3d) 721, at paras. 62-69, Laskin J.A. found that a trial judge made no error by admitting affidavit evidence at trial where the challenging party:

a. had several opportunities to cross-examine the affiant, but did not do so; and

b. had notice that the affiant was not going to be called as a witness at trial.

60It is unfortunate that Patricia died before trial, but it was not entirely unexpected. The pre-trial order of Akbarali J. clearly contemplated that questioning of Patricia should be done prior to the trial. Leave was granted for the applicant to do so in December 2019 and Patricia did not pass away until the beginning of April 2020. Patricia’s three affidavits were properly admitted into the evidentiary record at trial and I am not prepared to disregard them or give them little or no weight just because the applicant did not cross-examine or question her on them. He had the opportunity to do so over several months and he was aware that she was not going to be called as a witness to give viva voce evidence at trial.

61This affidavit evidence from Patricia is necessary because she died prior to the trial and it was tendered under oath and with the expectation that she would be cross-examined upon it, which renders the evidence reliable.

62That said, I have considered the applicant’s challenges to the credibility of the totality of the evidence of Colleen, Patricia and Maureen in the next section. I have not treated Patricia’s testimony in her affidavits as “unchallenged” just because she was not cross-examined.

(v) Challenges to the Priors’ Evidence

63The applicant challenges the credibility of the testimony of the respondent Colleen and that of her mother Patricia and her sister Maureen on the basis of various alleged inconsistencies and gaps in their evidence:

a. Both Colleen and Patricia testified that they only understood that title to 50% of 705 Hillsdale was in Colleen’s name after this litigation began and both speculated that it may have been a condition of the CIBC mortgage that Colleen be on title.

b. Whereas Maureen testified that she learned that Colleen was on title for 50%, and that this was discussed among Maureen, Patricia and Patricia’s lawyer, when Patricia made her 1996 will, which suggests that at least Patricia and Maureen knew that Colleen was on title at that time.

c. Each of Colleen, Patricia and Maureen testified that it was always understood that Colleen and Maureen would each have half of the house at 705 Hillsdale when Patricia died, but Patricia’s 1996 will leaves Patricia’s interest entirely to Maureen, suggesting that it was understood by Patricia that 50% was already held by Colleen.

d. Patricia did not mention her 1996 will in any of her affidavits, and it was not produced in this litigation until after Patricia died (and, therefore, could not be asked about it).

e. There are no bank records available for either Colleen or Patricia dating back to 1986 when Colleen went on title that could confirm whether or not there was a transfer of funds from Colleen to Patricia at that time and Colleen only denied that there had been a transfer of funds between them in her re-direct testimony after having been cross-examined about the absence of bank records.

f. In her first sworn financial statement in this proceeding, Colleen herself identified her 50% interest in 705 Hillsdale as a gift from her mother (at a time when her mother Patricia was still alive), but then later re-characterized it after she retained her current trial counsel.

64It is suggested by the applicant that these inconsistencies and gaps should lead the court to generally disbelieve the respondent and her mother and sister when they say that Colleen did not provide any consideration at the time that title to 50% of 705 Hillsdale was put in her name and did not contribute to the expenses, or when they say that Patricia did not intend to gift a 50% interest to Colleen in 1986 when Colleen went on title. The applicant wants me to find, instead, that it was known by all of them all along that Colleen owned 50% of 705 Hillsdale and that this fact was intentionally kept a secret from him. He contends that the resulting trust theory is just an afterthought to perpetuate this conspiracy and avoid the respondent having to account for this asset as part of her net family property on the date of separation.

65I found both Colleen and Maureen to be generally forthright in their testimony at trial. Just because they do not have identical recollections of all of the events surrounding the purchase transaction and Patricia’s 1996 will does not lead me to conclude that they are lying. They had involvement in different aspects of these transactions and their memories may, understandably, be imperfect and not identical with the passage of time.

66All three of Colleen, Patricia and Maureen were asked for details about a transaction that occurred in 1986, over thirty years ago and Patricia’s subsequent estate planning and her 1996 will. I am satisfied with the explanations that have been provided:

a. Colleen testified that she attempted to obtain her and her mother’s banking records dating back to the transaction and that she was unable to do so. She says all records available have been produced. It is not surprising that the records might not be available that far back. There is no evidence to suggest that records going further back were available and were either not requested or not produced by the respondent and/or her mother.

b. There is documentation starting in 1987 (shortly after the purchase of Nora’s interest) to corroborate the evidence of the Priors that Patricia, not Colleen, paid for the mortgage and other carrying costs for the house.

c. In light of the affirmative evidence from each of Colleen and Patricia that it was Patricia who paid the cash portion of the purchase price to Nora and paid the promissory note until it was forgiven, and Patricia who serviced the mortgage that was used to finance the remainder of the purchase price, there would not be an obvious need for Colleen to affirmatively deny that there had been a transfer of funds between herself and Patricia. That she did deny this when it was put to her in re-direct (as opposed to offering this denial up in her evidence in chief) is not a reason to conclude that it is not true.

d. It is not surprising that Colleen and her mother did not recall the precise details of the transaction in 1986, or that they might have forgotten (or not fully appreciated at the time) that title to 50% of 705 Hillsdale was put into Colleen’s name. Each of Colleen, Patricia and Maureen understood that Colleen was being asked to support the mortgage for the acquisition of Nora’s 50% interest in this property and she was a signatory to the mortgage. While they may not have understood at the time that a mortgagor would be on title, whereas a guarantor of a mortgage would not be, there is no reason to doubt their consistent testimony that the reason that Colleen became involved at all in the transfer of Nora’s 50% interest was to assist her mother in obtaining the mortgage. Not do I consider it to be surprising or suspicious that Colleen and Patricia did not retain the mortgage application documents from 1986 to corroborate this.

e. Colleen did not deny signing transaction documents, she simply did not recall doing so and did not appreciate that the legal effect of the documents that were signed at the time was to put her on title to the house.

f. Colleen did not attempt to hide from the court the fact that she was registered as a 50% owner on title. Documents reflecting this were produced in this litigation when she became aware of them, including the title abstract and the lawyer’s reporting letter from July of 1986 that was appended as an exhibit to one of Patricia’s pre-trial affidavits. Disclosing the documents in this context is not consistent with the applicant’s theory that she had been aware all along that she owned half of her mother’s house and had been actively concealing that fact from the applicant for more than thirty years.

g. Patricia’s 1996 will was only produced after she died. Colleen testified that she had not seen it before her mother’s death. Both Colleen and Maureen testified that Maureen was the one who had possession of the 1996 will and who attended with their mother when the will was prepared in 1996. Although the applicant argues that this is implausible and that both daughters must have had the will and/or been aware of it, that is an assumption that I am not prepared to make. It is not implausible to me that the daughter who was living with Patricia in the house would be the one to accompany her to the lawyer’s office in 1996 and to maintain possession of the will.

h. All three of Colleen, Patricia and Maureen testified that Patricia considered the house to be hers to do what she wanted with during her lifetime, but that it was Patricia’s ultimate intention that her two daughters would own the house after she died. Assuming the house had not been sold at the time Patricia died, this result was effected through the arrangements that the lawyer put in place in 1996, with 50% already being in Colleen’s name and the other 50% passing to Maureen under the 1996 will.

i. There is no evidence to suggest that Patricia intended to treat her daughters differently, and to gift to Colleen a 50% beneficial interest in the house before she died, leaving Maureen to wait to inherit her 50% share only upon Patricia’s death. If Patricia had intended to vest a beneficial interest in 50% of her house in one of her daughters during her lifetime, common sense would suggest that she would have chosen Maureen, who lived in the house with her at the time and until she died and who had made some contributions towards renovations, rather than Colleen who was not living there and had never contributed anything towards the house.

j. Maureen understood this to be the legal mechanic of the arrangements at the time Patricia’s 1996 will was signed. Patricia was not questioned but appears from her evidence to have forgotten that title was already in Colleen’s name. Colleen testified that she did not understand this to be the mechanic of the arrangements but there is no evidence to indicate that she was involved in the discussions in 1996 about Patricia’s will; the evidence is to the contrary, that she was not involved.

k. That unsophisticated persons might not fully appreciate the legal nuances of a purchase and mortgage transaction dating back almost thirty-five years and estate planning dating back almost twenty-five years is not surprising, nor do I consider it to be a reason to find that the testimony of the Priors is not credible overall.

l. The applicant also points to various discrepancies in the respondent’s financial statements and disclosure over the course of this litigation, leading to updated and corrected financial disclosure and suggesting a pattern of dishonesty. However, similar types of financial discrepancies and updates were also identified in the applicant’s financial disclosures. Both parties attribute this to their inexperience in litigation and periods of self-representation or perhaps inadequate representation by their previous counsel. Financial disclosure is important and is expected by the court to be accurate and complete, but it is very common for parties to update their financial disclosure and their financial statements in the course of family law proceedings, as both parties have done in this case. This is not a reason for me to find the respondent to be untruthful or her evidence to be unreliable.

67The applicant’s conspiracy theory that the respondent, her mother and sister understood and discussed throughout the parties’ marriage that Colleen beneficially owned 50% of Patricia’s house and actively concealed this from the applicant is not borne out on the evidentiary record. While I do not need to rely upon deemed admissions by the applicant to reach this conclusion, the respondent has argued that the applicant cannot establish an evidentiary foundation for this theory in the face of facts that he is deemed to have admitted by virtue of his failure to respond to a request to admit that was delivered by the respondent pursuant to r. 22 of the Family Law Rules, O. Reg. 114/99. A request to admit was served on September 26, 2019, which included the following facts:

a. Given her modest income, Ms. Patricia Ann Prior did not qualify for a mortgage on her own.

b. Ms. Patricia Ann Prior asked Ms. Prior-Oudeh to co-sign the CIBC mortgage.

c. Ms. Prior-Oudeh co-signed the CIBC mortgage as requested by Ms. Patricia Ann Prior.

d. Ms. Prior-Oudeh did not realize that she was named on title to 705 Hillsdale until she conducted a title search in the course of this family litigation.

68The applicant did not respond to this request to admit by either by the original 21-day deadline or the judicially extended deadline to 21-days after December 4, 2019. Where a party fails to respond to a request to admit prior to trial and prior to trial fails to seek leave to withdraw his deemed admissions, the party should not be permitted to withdraw them: see Jama v. Basdeo, 2020 ONSC 2922, at paras. 16-21. These deemed admissions are consistent with Colleen’s testimony that she thought she was co-signing a mortgage to help her mother and that she did not realize she was on title to 705 Hillsdale until it came to light in the course of this proceeding.

69I accept as credible and reliable the evidence of Colleen, Patricia and Maureen about: (i) the reason for title to 50% of 705 Hillsdale being put in Colleen’s name in 1986 in order to assist her mother in obtaining a mortgage for the purchase price that she paid to Nora, (ii) the fact that Colleen did not make any financial contribution towards the purchase of this interest or towards the upkeep and carrying costs of this property during Patricia’s lifetime, and (iii) their common understanding that it was not intended by Patricia that Colleen would have a beneficial interest in this property until Patricia died.

(vi) Conclusion: Was there Consideration for the Transfer of a 50% Interest to the Respondent?

70The evidence in this case establishes that there was no consideration provided by Colleen at the time that she was put on title as a 50% tenant in common of Patricia’s house in 1986. It has been established through the testimony of Colleen, Patricia and Maureen that Colleen did not make any financial contribution towards the purchase price paid by Patricia to her sister Nora for that 50% interest or towards any of the carrying costs or upkeep of the house thereafter. I accept their evidence on this point, which establishes on the civil standard of proof that the respondent did not give any consideration for the 50% titled interest as a tenant in common that she held in her mother’s house at 705 Hillsdale as at the date of separation.

(vii) Is there a Presumption of a Resulting Trust?

71The circumstances of this case, in which Patricia funded the purchase of the 50% interest in 705 Hillsdale from Nora and funded substantially all carrying costs associated with the house thereafter (with a few exceptions for expenses paid for by Maureen, not Colleen), give rise to a presumption that Colleen held her 50% titled interest in this property in a resulting trust in favour of Patricia.

72A resulting trust arises when title to property is in one party's name, but that party, because she gave no value for the property to which 50% title was put in her name at the expense of her mother, is under an obligation to return it to the original title owner and does not exercise the incidents of ownership over the property: Pecore, at paras. 20, 24 and 34. As at the date of separation, while Patricia was still alive, that was the position that Colleen was in based on the preponderance of the evidence.

73The affirmative evidence in this case from the respondent, her mother and her sister was that the registered title to 705 Hillsdale was not reflective of the beneficial ownership and that the respondent did not have a beneficial ownership interest in this property during Patricia’s lifetime. In Chao v Chao, 2016 ONSC 7911, at para. 88, the court explained that legal title does not determine beneficial ownership for equalization purposes where:

a. A party deposed they had no interest in the property since 1990; and

b. The opposing party had no evidence to refute the respondent's evidence and only relied only on the registered title, which the court held "is not determinative of beneficial ownership for the purposes of the equalization determination”.

(viii) Was the Transfer of a 50% Interest to the Respondent a Gift that Rebuts the Presumption of Resulting Trust?

74A presumption of a resulting trust where a transfer is made for no consideration will be determinative in the absence of evidence that a gift was intended, to rebut the presumption on a balance of probabilities: Pecore, at para. 44. It is the intention of the transferor at the time of the transfer that is relevant, although evidence of intention arising subsequent to the transfer that informs the intention at the time of the transfer may be relevant but must be evaluated in a manner that guards against after-the-fact evidence that may appear to be self-serving or to reflect a change in intention after the transfer: Pecore, at para. 59.

75The onus of establishing that the transferor intended to gift the property to the titleholder is on the party seeking to rebut the presumption. For example, the presumption of resulting trust will be rebutted where the evidence supports a conclusion that the intention at the time of the transfer of title was to provide financial security to the titleholder, such as was found to be the case in Pecore: see also Zacher v. Zacher, 2019 ONSC 1450; Johnston v. Song, 2018 ONSC 1005; and Fias v. Souto, 2015 ONSC 880.

76There is no such evidence in this case that Patricia intended to gift a beneficial 50% interest in her house to Colleen at that time (or at any time before she died), nor that she was intending that having title to 50% of this property would provide financial support or security for Colleen. Although the applicant contends that the Priors have fabricated, after-the-fact, a story that Colleen was only on title to assist her mother in getting the mortgage financing, that is the most plausible explanation for what transpired in 1986. At the time of the transfer of title in 1986, before Colleen was married, and while she was gainfully employed, supporting herself and in a relationship, no theory has been suggested for why Patricia would have wanted to pay for and then gift a beneficial ownership interest of half of her house to one of her daughters, Colleen, and not to her other daughter Maureen who was actually living in the house and who continued to live there afterwards.

77The applicant suggests that the court should infer that, because Patricia bequeathed to Maureen her interest in the house at 705 Hillsdale in her will, she must have intended to gift to the respondent the other 50% interest during her lifetime so that each of her daughters would own 50% of that house upon her death. The applicant argues that this rebuts the presumption of resulting trust. This court recently concluded otherwise in a case involving similar circumstances: Malkov v. Stovichek-Malkov, 2017 ONSC 6822.

78In Malkov, the court found that an intention by a parent for beneficial title to eventually pass to children in whose name title was held did not rebut the presumption that title was held by the children in a resulting trust for him during his lifetime. In circumstances where the father retained control of the property and all decisions about it, and remained free to deal with it (including to sell it) as he saw fit, so long as he was alive, the court found that all that the father had intended to gift to his son and daughter-in-law by placing title to the house in their names was a conditional right of survivorship: Malkov, at paras. 95-99. The fact that he considered that the property would end up with his son and daughter-in-law if and when he died and they still had legal title, and that at that point they would have beneficial title, was not an impediment to finding the resulting trust.

79In considering whether the existence of wills that pre-dated and post-dated the transfer of title from mother to daughter rebutted the presumption of resulting trust, the Court of Appeal offered further observations in Kent, at paras. 30 and 32-41. The court said the following about the guidance found in Pecore about subsequent evidence of intention, at para. 36:

Paragraphs 55 - 59 of Pecore provide guidance on what evidence was to be considered in determining Marian’s intention in making the 1996 Transfer. At para. 56, the Supreme Court reiterates the traditional rule that evidence adduced to show the transferor’s intention at the time of the transfer ought to be “contemporaneous, or nearly so” to the transaction. In paras. 57-59, the Court explains that evidence of intention arising subsequent to the transfer and which is relevant to intention at the time of the transfer is also admissible. However, the Court cautions judges to assess the reliability of such evidence and to determine what weight it should be given, guarding against evidence that is self-serving or that tends to reflect a change in intention.

80Patricia’s 1996 will left Patricia’s interest in 705 Hillsdale to Maureen Prior. Maureen testified that this was discussed with Patricia and understood by both of them to accomplish Patricia’s intention that Colleen would beneficially own the 50% interest in her name and Maureen would own the 50% interest that was in Patricia’s name after Patricia died. Although not aware of the will, Colleen also testified to the same understanding, that, upon their mother’s death, each of her daughters would beneficially own half of 705 Hillsdale.

81The applicant has not established that Patricia intended to gift a 50% beneficial interest to Colleen in 1986. The 1996 will does not change this conclusion. The arrangements under the 1996 will, in conjunction with the arrangements put in place at the time of the purchase of Nora’s 50% interest, gave effect to Patricia’s intentions upon her death. They are consistent with her having intended to retain beneficial ownership of her home throughout her lifetime, notwithstanding that Colleen was put on title as a 50% tenant in common in 1986.

(ix) Findings Regarding 705 Hillsdale

82Based on the facts as I have found them and the legal analysis of the resulting trust in favour of Patricia, all as set out above, I find that the value of the respondent’s 50% interest in 705 Hillsdale should not be included in her net family property as of the date of separation on December 1, 2015 as she did not have a beneficial ownership interest in this property at that time. Her beneficial 50% ownership interest in this property only crystalized upon Patricia’s death in April 2020, long after the valuation date for purposes of determining the respondent’s net family property.

83Because I have found that this property need not be included in the respondent’s net family property, I do not need to attribute a value to 705 Hillsdale. In the absence of any admissible valuation evidence, I would have attributed the value to her 50% interest to be at the mid-point between the value that the respondent says she conservatively estimated (of $650,000.00) in her financial statement dated October 22, 2018 and the value contained in the opinion letter the applicant says he obtained, and that he was contending should be ascribed to this property of $660,000.00. Although not admissible because the author of the opinion was not qualified as an expert at trial and did not testify and his statements to the applicant are hearsay, in the absence of any other evidence as to value, the mid-point between the positions of the parties (applicant at $660,000.00 and respondent at $650,000.00) is the best evidence available. Since the difference in estimates between the parties is not significant, I would have been content to make a finding of value at the mid-point of $655,000.00 if that had been necessary.

84I also do not need to decide the other deductions that might have applied against the value of this property. If it had been included in the respondent’s net family property, I would have allowed for a deduction of value as at the date of marriage equal to the purchase price of the 50% interest in 705 Hillsdale from Nora, of $82,500.00. I also would have allowed for a deduction for notional disposition or refinancing costs, equivalent to those that I am allowing the applicant to deduct in relation to 106 Blaisdale (as detailed later in these reasons).

(b) 106 Blaisdale

85The question for the court to decide in relation to this property is whether the applicant is entitled to include a contingent liability of $250,000.00 (or some other amount) as at the valuation date in respect of an estate litigation claim dating back to 2010 by which his siblings (through his mother’s estate) claim to have an interest in the share of the matrimonial home at 106 Blaisdale that their mother owned prior to her death in 2009.

86The following facts are agreed to by the parties in relation to 106 Blaisdale:

a. At the time of the death of the applicant’s mother (Nawal Oudeh) on May 14, 2009, the applicant and his mother held title to the matrimonial home as joint tenants.

b. On or about May 7, 2010, the estate of Nawal Oudeh (the “estate”) brought an action against the applicant claiming entitlement in respect of the mother’s interest in the matrimonial home.

c. The claim was brought in the Superior Court of Justice under court file number 05- 39/10. 41 (the “estate litigation”). The estate filed a certificate of pending litigation ("CPL") on the property on or about May 17, 2010.

d. In or about December 16, 2010, the applicant served and filed a statement of defence in the estate litigation.

e. As at the date of separation (valuation date), on December 1, 2015, no judicial determination had been made with respect to claims advanced by the estate in the estate litigation.

f. As at valuation date, the applicant was the sole owner of the matrimonial home.

g. As at the current date, no judicial determination has been made with respect to claims advanced by the estate in the estate litigation.

h. On November 7, 2019, counsel for the respondent sent a letter to then counsel for the applicant asking for information as to what steps the applicant had taken to have the action (Court File No.: 05-39/10) dismissed for delay and what steps the applicant had taken to remove the CPL from title on the matrimonial home. On December 12, 2019, counsel for the respondent sent a follow-up letter asking for information about what steps the applicant had taken to have the action dismissed and the CPL removed from title.

87The applicant acknowledged that he had not taken any steps as of the trial of this action to have the estate litigation action dismissed or to remove the CPL from title on the matrimonial home. Section 103(6) of the Courts of Justice Act does allow a court to make an order discharging a certificate of pending litigation where the party at whose instance it was issued does not prosecute the proceeding with reasonable diligence. This is an unproven ten-year old contingent claim that arose during the marriage but has not moved beyond the pleadings stage. These circumstances are relevant to consider when valuing this debt for purposes of the applicant’s net family property calculation.

88The court of appeal dealt with contingent liabilities in Greenglass v. Greenglass, 2010 ONCA 675, 99 R.F.L. (6th) 271. In Greenglass, at the valuation date, the husband faced contingent legal costs associated with litigation that had begun during the marriage. In determining how to value this contingent liability, Epstein J.A., writing for the court, made the following observations, at paras. 26-27:

[C]ontingent liabilities are to be taken into account so long as they are reasonably foreseeable. See Leslie v. Leslie (1987), 1987 CanLII 8321 (ON SC), 9 R.F.L. (3d) 82 (Ont. H.C.); Nicol v. Nicol (1989), 1989 CanLII 8825 (ON SC), 21 R.F.L. (3d) 236 (Ont. H.C.); Crutchfield v. Crutchfield (1987), 1987 CanLII 8303 (ON SC), 10 R.F.L. (3d) 247 (Ont. H.C.); and Drysdale v. Drysdale (1994), 1994 CanLII 7453 (ON SC), 9 R.F.L. (4th) 20 (Ont. U.F.C.J.).

In determining the present value of a contingent liability, courts have looked at what was reasonably foreseeable on the valuation date: Johnston v. Johnston, [1998] O.J. No. 5495 (Gen. Div.), at para. 59, aff’d on other grounds 2000 CanLII 14718 (ON C.A.), leave to appeal to S.C.C. refused [2000] S.C.C.A. No. 234. In Drysdale, at paras. 14-17, Beckett J. noted that where courts have found no or a very low risk that a guarantee would be called at the valuation date, the value of the contingent liability has been determined to be nil. However, in Drysdale it was found that there was a real possibility that the guarantee would be called upon, though the amount could not be predicted with any certainty. Finding it unrealistic to value the liability at either zero or the full amount of $200,000, Beckett J. valued the liability at 50 percent of the amount in question: see also Salamon v. Salamon, [1997] O.J. No. 852 (S.C.J.). This approach was approved by this Court in Cade v. Rotstein (2002), 2004 CanLII 24269 (ON CA), 181 O.A.C. 226 (C.A.). [Emphasis added].

89For equalization purposes, the court is to value a contingent debt based on the probability that it would be collected. Courts are frequently called upon to assess the actual worth of a claim, asset or liability, by discounting its face value where the evidence indicates it is unlikely that the debtor will ever be called upon to pay: see Zavarella v. Zavarella, 2013 ONCA 720, 117 O.R. (3d) 641, at para. 38. To fairly calculate equalization, the court must make a realistic determination of the value of debt in a net family property calculation, and that determination is based on the reasonable likelihood that the debt will ever be paid: Zavarella, at para. 39.

90This court has observed that it may be necessary to have expert opinion evidence to arrive at the present value of a future judgment on the valuation date: see Sheikh v. Sheikh, 2010 ONSC 1407, at para 47. While hindsight evidence may not be permissible under any circumstances, it does not even arise in this case since the estate litigation was no further ahead at trial than it was on the valuation date. This lack of progress may inform the assessment of the foreseeability or probability of the applicant being found liable to pay anything in the estate litigation.

91The applicant says that his failure to seek to have the estate litigation dismissed and the CPL removed is attributable to his lack of resources to be fighting litigation on two fronts. That explanation begs the more important question in this context, which is why the estate has not pursued the estate litigation for over ten years if it has any merit.

92The respondent argues that the court can infer that the reason the estate litigation has not been pursued is because it has no merit. On that basis, there would be a very low, if any, risk that the applicant would be liable to pay anything to the estate. The applicant’s defence to the estate litigation (which the respondent contends has good grounding in the law) is based on the most important feature of a joint tenancy: the right of survivorship. When a joint tenant dies, unless he or she is the last surviving owner, his or her share accrues to the other co-owners: see Royal & SunAlliance Insurance Co. v. Muir, 2011 ONSC 2273, 9 R.P.R. (5th) 104, at para. 25. If only one owner survives, the entire interest in the property passes to the survivor: see Hansen Estate v. Hansen, 2012 ONCA 112, 109 O.R. (3d) 241, at paras. 29-31.

93The estate’s claim is based on a will signed by the applicant’s mother after title to the matrimonial home was put into the names of the applicant and his mother as joint tenants, by which she purported to bequeath her interest in 106 Blaisdale to all of her children. The existence of a will by which one joint tenant purports to bequeath their interest in a property under joint tenancy to a third party or parties cannot, in itself, sever a joint tenancy. In Hansen Estate, at para. 63, Winkler C.J.O. (Doherty and Goudge JJ.A. concurring) concluded that:

I recognize that a testamentary disposition cannot, in itself, sever a joint tenancy: "[t]he right of survivorship takes precedence over any disposition made by a joint tenant's will": Sorensen's Estate, at p. 35 D.L.R., citing Megarry and Wade, The Law of Real Property (London: Stevens & Sons Ltd, 1957), at p. 369. A declared intention not communicated to a co-owner is, on its own, insufficient, on its own, to establish a mutual intention to sever a joint tenancy. And I accept that no greater weight should be given to such a unilateral expression simply because it is found in a testamentary document.

94Thus, the fact that the applicant’s mother signed a will that is inconsistent with the right of survivorship does not extinguish that right. The applicant did not give any evidence to support a suggestion that he and/or his mother ever held the mutual intention to sever their joint tenancy in the matrimonial home. There was no evidence to indicate that such an intention had been formed and the Court of Appeal in Hansen Estate makes it clear that the subsequent will of Nawal Oudeh itself is not enough. The applicant’s affirmative evidence was, to the contrary, that he made significant financial contributions to this property, by servicing its mortgage and saving it from foreclosure and that he provided valuable consideration for the interest that he held, which was from the outset held in a joint tenancy.

95The applicant did not call any expert or other evidence to suggest that there is any reason to believe that he can be expected to be ordered to pay anything in the estate litigation. Taking into account that:

a. the applicant provided consideration for the interest that he acquired in the matrimonial home when he was placed on title,

b. the applicant continued to make financial contributions thereafter consistent with him holding a beneficial interest in that property,

c. title was, from and after the point at which he began to make financial contributions to the matrimonial home, always held by the applicant and his mother as joint tenants,

d. under a joint tenancy, the applicant had a prima facie right of survivorship by operation of law,

e. the estate has not pursued its claim in and to the matrimonial property for over ten years,

f. no affirmative evidence has been proffered by the applicant as to any merit or value that might be attributed to the estate litigation, and

g. the absence of any evidence, other than the applicant’s mother’s will, to suggest that the applicant and his mother may have at any time after taking title as joint tenants intended to sever that joint tenancy,

I find that there is a very low risk of the applicant being held liable in respect of the estate’s claim against him for an interest in the matrimonial home. In these circumstances, I am unable to place anything other than a nominal value on this contingent claim by the estate against the applicant as at the valuation date for purposes of valuing the applicant’s net family property as at the valuation date.

96What constitutes a nominal value is a matter of discretion. It could be nil. Even if I were to be generous, any amount that I might come up with to attribute to this contingent liability would be arbitrary and speculative beyond a nominal settlement value or value for unrecoverable litigation costs. In the absence of any specific evidence on this, and recognizing that it is an arbitrary but nominal amount, I am prepared to allow the applicant to deduct $25,000.00 as a contingent liability against his net family property as at the valuation date in respect of the estate litigation.

(c) The Notional Cost of Disposition of Property

97The applicant also seeks to deduct as a contingent liability against his net family property on the valuation date the notional cost of disposition of the matrimonial home. The court must decide whether that is an appropriate liability and, if so, the basis on which it should be calculated.

98For a party to obtain a deduction for notional costs of sale the court expects to receive some evidence of the likelihood that the asset will be sold: Knight v. Knight, 2018 ONSC 3294, at para. 56.

99The applicant has not provided any evidence about what it will cost for him to sell the matrimonial home. He is asking the court to find that the cost will be 5% of the value of the home plus $2,000.00 for legal fees, presumably on the basis that the court can take judicial notice that a typical real estate commission for a vendor to pay in Toronto is 5% and presumably he would like the court to infer that there will be some modest real estate transactional legal fees. The applicant says that he will have to sell the home to pay the respondent if he is ordered to make an equalization payment.

100The record reflects that the applicant is a man of modest means and the source of funds for any equalization payment would likely have to come from the matrimonial home. However, it is acknowledged by the applicant that the value of the matrimonial home now is likely significantly higher than the $555,000.00 value on the date of separation now and there is currently no mortgage on the home. The court could speculate that the applicant might be able to finance the property to fund the equalization payment rather than having to sell it. The cost of that was not fully developed in the evidence, but there would be a cost associated with that source of funds as well.

101Where there is only speculative evidence of a sale, it may be appropriate to discount the notional costs of a sale of property: see Baiu v. Baiu, 2014 ONSC 216, at para. 132. In that case, the speculative nature of the claim for disposition costs led to a reduced disposition cost for the matrimonial home at the rate of 2.5%.

102There will likely be some cost associated with financing the equalization payment from the sale or mortgage of the matrimonial home. At this point it is entirely speculative as to whether the applicant will sell the matrimonial home or find some other means of financing the equalization payment that he owes. In these circumstances, it is fair and equitable to allow the respondent to deduct some notional disposition or financing cost. The precise cost need not be determined. In the exercise of my discretion, I am setting this notional cost to the applicant at 2.5% of the separation date value of the matrimonial home, which is $13,875.00 (2.5% of $555,000.00²).

103While I have not found that the respondent is required to include the house at 705 Hillsdale in her net family property, if she was required to do so, the same level of speculation would apply to her in terms of whether the home would have to be sold to fund an equalization payment if it was owing, and therefore I would have afforded her the opportunity to deduct the same notional disposition or financing costs at a rate of 2.5% of the value of that property on the date of separation.³ However, that is not necessary in light of my earlier finding that 705 Hillsdale need not be included in the respondent’s net family property.

(d) Value to be Attributed to Disputed Date of Marriage Deductions Claimed by the Applicant and the Respondent

104The court is being asked to determine the value to be attributed to certain assets that the applicant claims to have owned on the date of marriage. He estimates the value of these claimed household items and cars to be in excess of $17,000.00. The respondent maintains that the applicant has not proven these values and that other evidence calls them into question.

105The respondent also asks for an adverse inference arising from the applicant’s failure to provide the disclosure ordered by Shore J. on May 17, 2019 in relation to certain of these claims. Pursuant to paragraph 1(I)(k) of that order, the applicant was to provide a "list of and value of the household goods & furniture as at the date of marriage." He did not do so, and this was confirmed in his testimony at trial. He indicated that he thought he had produced some bank books from the period around the date of marriage, but no such documents were referred to or made exhibits at trial. The respondent testified that the parties jointly furnished the matrimonial home around the time they got married. Her evidence was that their home was relatively empty at the time that they were married. While the respondent had kept notes for herself of amounts and household items that she received after they separated, neither party had any records or detailed recollections to identify which household items were owned on the date of marriage or their value.

106The applicant has not proven on a balance of probabilities the value of household goods and furniture that is in dispute that he says he owned on the date of marriage. The amounts attributed to these items should not be deducted from his net family property.

107Pursuant to paragraph 1(I)(k)(ii) and (iii) of the Order of Shore J., the applicant was also to provide proof of ownership of a 1988 Dodge Ram and a Dune buggy as at the date of marriage, but he acknowledged at trial that he did not do so. When asked why he was still seeking to include these cars as date of marriage assets, notwithstanding his previous lawyer’s advice that they were included in his financial statement in error, the applicant suggested that these items were removed to 'get the parties' closer. However, when pressed on cross-examination, the applicant confirmed that he was not sure he owned the cars on the date of marriage. The respondent was also not certain that the applicant owned a car on the date of marriage. The applicant has not proven on a balance of probabilities that he owned these two vehicles that he is seeking to deduct from his net family property, nor is there any evidence from which the court could determine their value.

108Pursuant to paragraph 1(I)(k)(ii) and (iii) of the Order of Shore J., the applicant was also to provide a "list of and value of the rings and other jewellery as at the date of marriage." The applicant acknowledges that he did not provide such a list. The applicant has not proven on a balance of probabilities that he owned the rings or other jewellery that he is seeking to deduct from his net family property, nor is there any evidence from which the court could determine their value.

109Conversely, the respondent testified that she owned a 1984 Honda Civic on the date of marriage that she had purchased from the applicant's brother. She explained that she knew it was purchased by her before the date of marriage because she purchased it when the applicant's brother went 'back home to Jordan'. The respondent introduced into evidence a copy of an excerpt from the Canadian Redbook from the period of July 1987 to substantiate the value of this car, which she claims to be $5,500.00. The respondent was not asked on cross-examination about her ownership of this car or the value that she attributed to it in her net family property calculation. I accept her evidence about this deduction from her net family property.

(e) Value to be attributed to the Respondent’s Chevrolet Equinox on the Date of Separation

110The applicant purchased a Chevrolet Equinox for the respondent as an anniversary gift. The applicant claims that when he attended at the bank to purchase this car from a distressed seller, the repurchase cost for that seller was indicated to be $15,500.00. Even though he was able to pay less for it because it was about to be repossessed, it was his understanding that the seller still had to pay an additional amount based upon the full amount still owing on the vehicle. On this basis, the applicant says that the respondent’s net family property on separation should include the repurchase cost of $15,500.00 for this vehicle, rather than the actual price that was paid for this vehicle of $12,000.00.

111The respondent testified that she owned a 2012 Chevrolet Equinox on valuation date with an approximate value of $12,000.00. The respondent has no information about the repurchase cost that the applicant speaks to. She maintains that the price that was paid for the vehicle is the correct price to include for it in her net family property on the valuation date.

112The respondent also relies upon deemed admissions by the applicant arising from his failure to respond to the Respondent's Request to Admit dated September 26, 2019 within the prescribed time and his failure to seek leave to withdraw those deemed admissions, from which the court can conclude that there would be no basis for granting such leave. It has not been suggested by the applicant that he did not have notice of this Request to Admit or that he made any attempts to advise the respondent that he thought he had responded. As such, the Respondent submits that the following are deemed admissions.

a. As at valuation date, Ms. Prior-Oudeh owned a 2012 Chevrolet Equinox.

b. The value of the 2012 Chevrolet Equinox was approximately $12,000 as at valuation date.

113I find that $12,000.00 is the appropriate value to attribute to the respondent’s Chevrolet Equinox as at the date of separation. This is not only based on the applicant’s deemed admission of this value, but because there is no evidence, aside from the hearsay evidence from the applicant about the repurchase cost that the unnamed seller told him about, to establish a higher value, nor any evidence that an indicated repurchase cost can be equated with a vehicle’s value.

(f) Equalization of Net Family Property

114Having determined the disputed items, the parties should now be in a position to calculate the equalization payment owing by the applicant to the respondent. It will be close, but not identical, to the amount of the respondent’s position on the joint net family property statement that was marked as an exhibit at trial.

115The applicant argues that to order him to pay this mathematically calculated amount, based on the inclusion in his net family property of the value of the matrimonial home on the date of separation, would be inequitable, for a number of reasons:

a. He suggests that the matrimonial home should be viewed similarly to the beneficial 50% interest that the respondent now has in her mother’s home at 705 Hillsdale. The applicant seems to be suggesting that, because each party ended up with an interest in their parents’ home, it is unfair that he has to pay something to the respondent, especially when the value of the interest he held in the matrimonial home on the date of separation was lower than the value of the respondent’s half interest in her mother’s home. He argues for “rough justice” that would allow each party to retain the interest in their parents’ home that they now have.

b. The applicant also seems to be suggesting that he suffered a timing disadvantage, because his interest in 106 Blaisdale would have been valued at 50% less if his mother had not died before the parties separated. Conversely, if Patricia Prior had died before the parties separated, the respondent might have had to include some value in her net family property for her then acquired beneficial interest in 705 Hillsdale, even on the resulting trust theory, subject to Colleen being able to demonstrate some basis for its exclusion as an inheritance.

c. The applicant also points out that, going forward, the respondent has a fixed salary T4 job and a pension and, with the interest in her mother’s home now excluded, she is comfortably provided for in her retirement. Conversely, the applicant is self-employed, and/or dependent upon commissions and claims to earn far less than the respondent and have no pension or RSP, aside from his Canada Pension Plan (which was only disclosed at trial).

116It is also suggested that the respondent is getting a windfall because the applicant says that she contributed little, if anything, to the maintenance, upkeep, carrying costs, improvements and the like of the matrimonial home. The respondent testified that she did contribute to the household on a monthly basis the entire time she was working and that she was expected to provide a set monthly amount to the applicant for this purpose, in addition to specific items that she purchased or contributed to and the help that she afforded in, for example, furnishing, painting and gardening in and around the home.

117The parties gave different accounts in their testimony about the nature and extent of the respondent’s financial and other contributions towards the matrimonial home. I find the applicant’s account, which is at some level tied into his conspiracy theory that the respondent was funneling money into her mother’s home or some other enterprise, is not supported on the evidentiary record. The respondent’s account that she did make regular and continuing financial and other contributions to the home is more plausible and I accept her evidence about this where the parties’ testimony is in conflict. I have outlined earlier my reasons for believing the respondent (and her mother and sister) that she did not financially contribute to 705 Hillsdale.

118The parties were married for over thirty years. They lived and raised their children in the matrimonial home. They both worked outside the home to provide for their family, except when the respondent took time off for maternity leaves and to be with their young children. I accept the respondent’s testimony that she contributed what she earned to the household and the family. I do not consider it to be a “windfall” to the respondent that the applicant be required to include the value of the matrimonial home in his net family property on the valuation date. I note that the respondent is not claiming a constructive trust or an interest in the increase in the value of that property since the date of separation, which is likely significant given the Toronto real estate market.

119There may be an imbalance in the parties’ financial positions going forward. However, the goal of the equalization of net family property is not to ensure that both parties are in the same position financially during their post-married life, but rather that they share equally in the wealth that was accumulated during their marriage.

120I do not have any discretion with respect to the inclusion of the matrimonial home in the applicant’s net family property. In terms of the CPL and estate litigation against the applicant by his mother’s estate (his siblings), I stretched as far as I could by attributing even $25,000.00 as a nominal value to that contingent claim.

121After considering the evidence, making findings of fact and applying the law, I found that there was a resulting trust over the 50% titled interest in 705 Hillsdale held by the respondent in favour of her mother during the marriage. The legal result of this is that she does not have to include it in her net family property on the valuation date.

122Equity is not a tool to adjust the legal outcomes that have been determined by my findings in this case, even though I do have some sympathy for the situation that the applicant finds himself in. I have not been presented with any basis on which I could adjust the mathematical outcome of the values that I have determined for purposes of calculating the equalization payment owing by the applicant to the respondent.

(g) Interest on the Equalization Payment

123Section 130 of the Courts of Justice Act gives the court the discretion to award prejudgment interest from the date of the cause of action.

124The respondent relies on the principles set out by the Court of Appeal in Burgess v. Burgess (1995), 1995 CanLII 8950 (ON CA), 24 O.R. (3d) 547 (C.A.), to support her contention that prejudgment interest should be awarded on any equalization payment to which she may be found to be entitled. Those principles begin with the “…general rule, [a] payor spouse is required to pay prejudgment interest on an equalization payment owing to the payee spouse." The court in Burke v. Poitras, 2020 ONSC 3162, at para. 235, elaborates on this point to say that prejudgment interest is appropriately ordered where a party who owes an equalization payment has:

a. failed to pay child support despite the recipient's entitlement;

b. had exclusive possession of the matrimonial home and its contents;

c. made no effort to satisfy or partially satisfy the equalization payment.

125The respondent contends that these circumstances persisted in this case and favour the court’s exercise in her favour and for interest to be awarded. She seeks prejudgment interest on the equalization payment that she claims to be entitled to ($230,638.32) based on an annual rate of 1.8%, calculated from October 24, 2018⁴ to the date of her closing submissions (April 23, 2021) for 1946 days, days totalling $22,133.70.

126Prejudgment interest is discretionary. The rate of interest is fixed at 1.8% should I decide to award it. Given the nature of the issues in this case and the financial circumstances of the parties, where there was an unexpected disclosure about the respondent’s 50% interest in 705 Hillsdale and the need to explore that before the net family properties and equalization payment could be determined, I am awarding prejudgment interest in favour of the respondent, but not from October 24, 2018.

127I am awarding interest from and after the date of the last affidavit from Patricia Prior, after which the applicant should have either been satisfied with the explanation provided, or questioned her, but could no longer say that there was outstanding information needed to satisfy himself. In the exercise of my discretion, I am awarding prejudgment interest on the equalization payment to be made by the applicant to the respondent commencing on March 9, 2020.

(h) Corollary Relief

128The applicant seeks the following additional corollary relief:

a. That the respondent be directed to remove her registration of the matrimonial home designation from title to Blaisdale; and

b. That the respondent be directed to maintain the applicant on her medical benefits.

129The removal of the respondent’s registration of the matrimonial home designation should follow from the result of this proceeding. It may not be necessary to order it, but I will for the sake of clarity. Once the equalization payment has been made to the respondent, the registration designating 106 Blaisdale as the matrimonial home should be removed by the respondent⁵.

130I heard no evidence and received no oral submissions about the respondent maintaining her health benefits in favour of the applicant. The fact that it is pleaded is not reason enough to make an order about this. I am not even aware of whether the benefits provider would allow the medical benefits to be maintained after the parties are divorced, which presumably will follow if a divorce order has not already been made. I am not prepared to make any order or direction regarding the respondent’s medical benefits as the applicant has not established any factual or legal basis on which I should do so.

(i) Costs

131At the conclusion of the hearing the parties agreed that it would be proportionate and efficient for them to exchange their bills of costs and make written costs submissions within close proximity to the conclusion of the trial. There was, however, a concern about the possibility that they might wish to refer to without prejudice settlement offers in the course of their cost submissions. The parties agreed, and the court adopted, the following procedure to enable a final decision to be released on both the outcome of the trial and on costs at the same time⁶:

It was determined at the conclusion of oral argument that the parties would exchange their cost outlines, submissions and any offers that they rely upon and provide same by email to Her Honour’s judicial assistant, on the understanding that Her Honour will not review these until she has made her decision in this matter. At that point, Her Honour will then review these materials and decide costs (in advance of releasing her decision in this matter) so that the cost decision can be included in the reasons for decision that are released to the parties.

Costs of the Trial

The Applicant’s Costs Position

132As I indicated I would do, I first wrote my reasons for judgment deciding the outcome of this trial. Having now done so, I turn to the question of costs and have, for that purpose, now reviewed the materials filed by both parties regarding costs.

133The applicant’s costs detailed in his counsel’s bill of costs are $50,829.60 for full recovery and $20,331.92 on a partial indemnity scale (calculated at 40%), inclusive of taxes and disbursements. These amounts include the two pre-trial costs orders ($4,000.00 in the aggregate) that were ordered payable in the cause, with appropriate deductions on account of steps associated with those orders. The applicant wants full indemnity costs if he is the successful party at the trial, but argues that, if the respondent is the successful party, she should be awarded no costs, or only partial indemnity costs calculated at 30%. The applicant’s justification for this position is dependent on arguments made in respect of the respondent’s credibility (which were not accepted, as detailed earlier in these reasons) and due to alleged late disclosure and an alleged unwillingness to compromise.

134The applicant’s position on costs relies primarily on his theory of “rough justice” and offers that he made for each party to keep the interest in their respective parents’ houses that they now have. This was not, however, the outcome of this trial.

The Respondent’s Costs Position

135The respondent seeks costs of $62,000.00, inclusive of HST and disbursements on a full indemnity basis. This is reflected in her bill of costs which discloses total costs of $62,695.38, inclusive of all fees, disbursements and taxes on a full indemnity basis. This includes approximately $11,000.00 in costs associated with support claims that were settled before the trial, on the basis that the costs associated with the settled matters were not settled. This does not include the costs associated with the two previous motions for which costs were ordered in the cause, totalling an additional $4,000.00

136The respondent claims to be entitled to full indemnity costs because she made over twenty offers to settle (some of which related to issues that were settled before trial). Some were formal offers and others were informal, but all demonstrated a consistent willingness on the part of the respondent to compromise. In terms of the issues that remained to be addressed at trial, she formally offered to accept an equalization payment as low as $90,000.00, and informally offered to go as low as $50,000.00, both of which amounts are far less than what she will be entitled to as a result of my decision herein.

Costs Principles and Analysis

137The principles applicable to the exercise of the court’s discretion in awarding costs have been aptly summarized in the respondent’s cost submissions, as follows:

a. Modern costs rules are designed to foster four fundamental purposes (1) to partially indemnify successful litigants; (2) to encourage settlement, (3) to discourage and sanction inappropriate behaviour by litigants and; (4) to ensure that cases are dealt with justly under Rule 2(2) of the Family Law Rules: Mattina v. Mattina, 2018 ONCA 867.

b. Rule 24(1) of the Family Law Rules creates a presumption of costs in favour of the successful party, subject to the factors set out in r. 24: Beaver v. Hill, 2018 ONCA 840, at para. 10.

c. The touchstone considerations of costs awards are proportionality and reasonableness: Beaver, at para. 12. In Boucher v. Public Accountants Council (Ontario), 2004 CanLII 14579, at paras. 28-29, 37, the court held that costs must be fair and reasonable, and consistent with the reasonable expectations of the parties.

d. Full recovery of costs is warranted in certain circumstances, such as bad faith under r. 24(8), or beating an offer to settle under r. 18(14): Beaver, para. 13.

e. The factors to consider in setting the amount of costs are listed in r. 24(12). The court must consider the reasonableness and proportionality of a number of factors as they relate to the importance and complexity of the issues. These factors include each party’s behaviour, the time spent by each party, any written offers to settle, including those that do not meet the requirements of r. 18, any legal fees and any other expenses, and any other relevant matter. In particular, an award of costs is subject to: the factors listed in Rule 24 (12), Rule 24(4) (unreasonable conduct of a successful party), Rule 24(8)(bad faith), Rule 18(14) (offers to settle), and the reasonableness of the costs sought by the successful party: Berta v. Berta, 2015 ONCA 918 at para. 94.

138The respondent did beat her pre-trial offers to settle. She is presumptively entitled to costs, and arguably on a full indemnity basis because of the settlement offers that she made. The issues were important, given the parties’ financial circumstances. The legal issues were relatively complex, at least on the main issue that turned on the resulting trust analysis, and there were allegations of bad faith that necessitated a response. I ultimately did not find the respondent to have acted in bad faith or to have intentionally misled the applicant or the court. I do not consider the amounts of costs claimed by either party to be disproportionate, having regard to what was at stake and the nature of the issues.

139In terms of the applicant’s expectations, his own costs were only approximately $10,000.00 less than what the respondent has claimed, on a full indemnity basis. Costs in that range would, thus, have been within his reasonable expectations.

140In the exercise of my discretion, I am not inclined to permit the respondent to include costs claimed for matters that were settled (fees estimated total $11,000.00). That reduces the amount of the respondent’s full indemnity costs to $51,000.00. While full indemnity is available in the family law context, I am going to award what is akin to substantial indemnity costs, calculated at 90% of that, which leads me to award the respondent her costs of this action in the amount of $45,900.00, inclusive of all fees, disbursements and taxes.

Previous Orders of Costs Payable “in the cause”

141On the understanding that the costs of the events that led to the two previous orders of costs that are “payable in the cause” were not included in the respondent’s Bill of Costs (from the narrative description, it does not appear that they have been), the respondent is entitled, as the successful party “in the cause” to the costs ordered payable in the cause in the amount of $1,500.00 pursuant to the Order of Justice Paisley dated December 19, 2019 and in the amount of $2,500.00 pursuant to a further costs Order of Justice Hood dated October 27, 2020.

Judgement and Final Disposition

142For the foregoing reasons, I make the following orders and declarations:

a. The respondent is not required to include any value for her mother’s home at 705 Hillsdale in her net family property. At the relevant times, up to and beyond the date of separation, the respondent held the 50% tenancy in common registered in her name in a resulting trust for her mother Patricia Prior and was not the beneficial owner of that interest on or before the valuation date.

b. The applicant may include a contingent liability in his net family property calculation in the nominal amount of $25,000.00 as at the valuation date, for the litigation dating back to 2010 commenced by his mother’s estate claiming an interest in the matrimonial home at 106 Blaisdale.

c. The applicant may deduct a notional cost for the disposition or financing of the matrimonial home in his net family property calculation, calculated at the rate of 2.5% of the value of the matrimonial home on the valuation date, which, for this purpose, has been deemed to be $555,000.00.

d. The applicant has not proven and is not entitled to any of the disputed date of marriage deductions from his net family property that he has claimed (in excess of $17,000.00) for household items and cars. The respondent has proven and is entitled to include the indicated value for her Honda Civic owned on the date of marriage.

e. The respondent’s Chevrolet Equinox is to be valued at $12,000.00 on the valuation date for purposes of her net family property calculation.

f. The applicant is ordered to pay an equalization amount to the respondent, to be calculated based on the findings, orders and directions above concerning the disputed inclusions, exclusions, deductions and liabilities.

g. Prejudgment interest at the Courts of Justice Act rate of 1.8% per annum is payable on the equalization payment owing by the applicant to the respondent, to be calculated from and after March 9, 2020.

h. Upon receipt of the equalization payment owing to her by the applicant, the respondent shall remove her registration of the designation of 106 Blaisdale as the matrimonial home from the title to that property. If the applicant requires that this designation and registration be removed in order to sell or re-finance the property at 106 Blaisdale to make the equalization payment owing, then the respondent shall co-operate as necessary for that purpose and for its earlier removal.

i. No order is made requiring the respondent to maintain the applicant on her medical benefits.

j. Costs of the trial and of the action, in total amount of $49,900.00, inclusive of all fees, disbursements and taxes, are payable by the applicant to the respondent. .

Kimmel J.

Footnotes

1. 1The applicant contends that the court should disregard or give little or no weight to Patricia’s trial testimony by affidavit because he did not cross-examine her on it. The court does not accept this contention, for reasons detailed below.
2. 2While the person who prepared the valuation of the matrimonial home as at the date of separation, indicating it to be $555,000.00 was not called as a witness at trial and that value was not “proven”, it is the value that the applicant asserts and it was not challenged by the respondent. I am, therefore, content that it is an appropriate value to use for purposes of determining notional costs of disposition/financing, in the absence of any better evidence on this point.
3. 3There is no evidence before the court as to the value of 705 Hillsdale as at the date of separation. Since I have not made any orders that are dependent upon that valuation, I am not ordering that the parties go to the expense of obtaining one.
4. 4This is the date specified by the respondent in her closing submissions.
5. 5If the applicant requires that this designation and registration be removed in order to sell or re-finance the property at 106 Blaisdale to make the equalization payment owing, then the respondent shall co-operate as necessary for that purpose.
6. 6This was confirmed on the record and also in a subsequent email with the court on March 25, 2021.