Yue Sun v. Dapeng Quan

Court File No.: FC-19-60039-00 Date: 2022-12-13 Ontario Superior Court of Justice

Between: Yue Sun (Applicant) – and – Dapeng Quan (Respondent)

Counsel: G. Acosta, Counsel for the Applicant R. Tao, Counsel for the Respondent

Heard: November 23, 24, 28, 29, Dec 1, 2 and 5, 2022

Reasons for Decision

A. HIMEL J.:

I. OVERVIEW

[1] In her trial opening statement the applicant (“the mother”) described this trial “as a case about unjust enrichment where married spouses divorced and then reconciled.” At the end of the trial the mother argued that this case is about parties who jointly contributed to the family home and wealth, yet that she had left the relationship with nothing.

[2] The mother seeks an order for a 50% trust interest in the residential property that is held in the respondent’s (“the father”) name alone, given the financial gifts made by the maternal grandmother (“MGM”), and her own monetary and non-monetary contributions.

[3] In contrast, the father initially described this trial as being about “whether the parties should be held accountable for their actions, promises, and voluntary donations or gifts. It is about whether (and when) the parties can freely recant on promises, either delivered or vested, or not. This trial concerns choices made by the parties and non-parties. These are choices made after domestic turmoil, after having gone through many events. These choices were made after the parties had experienced extremely complex emotions: gratitude and grievance, love and hatred, and after the parties were feeling the weight of their entwined fate.” At the end of the trial the father submitted that this was challenging litigation with complicated facts about agreements, promises and gifts.

[4] The father seeks an order that I decline to award a 50% interest in the home to the mother, and that I decline to order any re-payment of funds. In the alternative that I make one of the above orders, he seeks leave to proceed with a claim for the equalization of net family property.

[5] The outstanding issues that I must determine are as follows:

(a) did the MGM gift funds to the father, the mother or to the parties jointly?

(b) does the mother have an unjust enrichment/constructive trust interest in the property situated at 20 Camelia Drive, Richmond Hill (the “family home”)?

(c) does the mother have a resulting trust interest in the family home?

(d) what is the quantification of (and remedy in respect of) the mother’s trust interest, if any?

(e) if I find that the mother holds a trust interest in the family home, is the father permitted to proceed with a claim for an equalization of net family property?

[6] For reasons that follow, I find that the mother holds a 50% trust interest in the family home by way of constructive trust or, in the alternative, by resulting trust. The father’s request for an extension of time to pursue a claim for an equalization of net family property is dismissed.

II. BACKGROUND FACTS

[7] The facts as I find them are set out below and will provide context for the analysis. Further facts will be referred to as required.

[8] The mother and the father met in China and were married on January 24, 2011.

[9] After immigrating to Canada in 2011, the parties had two children, B. (age 11.5) and A. (age 9.5).

[10] Initially, the mother was the sole financial provider with an annual income of approximately $35,000,[^1] and the father held a visitor’s visa. He commenced regular employment in 2014, when he obtained a position as a plumber. The parties were of limited financial means.

[11] In March 2012, with the support of the MGM, the mother purchased a condominium in her name alone for $340,000 (the “former matrimonial home”).

[12] The parties’ relationship broke down, and the father left the condominium, initially without the children.

[13] In November 2014, the parties (and the MGM) met with Bing Ding, a paralegal. At the second meeting, on November 17, 2014, the parties executed a Joint Application for Divorce stating that they had lived separate and apart since January 4, 2013. The mother testified that the paralegal explained the factors that define “separate and apart” (including a lack of intimacy), and the parties agreed that this was an appropriate date.

[14] The father recalls that the paralegal explained that they must live separate and apart for one year prior to obtaining a divorce. The father does not remember anything else. However, the father ultimately used the January 4, 2013 date in his sworn 35.1 Affidavit and in the documentation respecting the divorce.

[15] The mother recalls that the paralegal explained various aspects of family law including custody, access, child and spousal support and property.

[16] The Application for Divorce requested the following orders: (a) the father shall have sole custody of the children; (b) the mother shall have reasonable access to the children; and (c) the mother shall pay child support in the amount of $579 per month until each child attains the age of 20. No property or support claims were included.

[17] The father and children moved to rental accommodations in December 2014.

[18] An incident of family violence took place on December 8, 2014, which was never reported to the police.[^2]

[19] The parties engaged in discussions about reconciliation, commencing in December 2014.

[20] The parties were divorced pursuant to the order of Paisley J. dated February 12, 2015.

[21] Between at least November 2014 and early 2016, the mother was also involved in an on and off relationship with Qinlong Xue (“Xue”). He was financially, emotionally and physically violent (to her and to other victims). In summer 2015, Xue lit himself on fire and was hospitalized for weeks. He did so in an attempt to prevent the mother from permanently ending the relationship (and she did re-commence contact with him after that incident). Xue used crystal meth (as did the mother on at least one occasion) and he was unstable. The mother believes that Xue defrauded her of thousands of dollars. There are many unexplained charges and withdrawals in her credit card and bank statements from 2015 to 2016. The mother reported Xue to the police and he was charged with various criminal offences. Xue was convicted of serious criminal charges and passed away while incarcerated.

[22] From 2015 to 2016, the mother made repeated reconciliation requests to the father.

[23] The father was only prepared to talk about reconciliation or to reconcile[^3] if his demands for money were met. From September 2015 through May 2016, the father made repeated demands for “compensation” as confirmed by both parties’ testimony and the voluminous texts that were entered into evidence. The stated purposes changed over time and included that the payment was: (a) a pre-condition to reconcile; (b) a pre-condition to start any discussions about reconciliation; (c) to punish the mother; (d) so that he would feel balanced in his heart; (e) to ensure that the children have a home; and/or (f) to mitigate the financial pressure when they live together. I will address my findings in respect of these demands later in my reasons.

[24] In March 2016, the father was interested in buying a home for himself and the children (and the paternal grandparents (“PGP”)). His budget was $600,000 to $700,000. None of the properties proposed by the real estate agent were suitable as the paternal grandmother (“PGM”) needed to be close to a grocery store and school (as she does not drive).

[25] The parties’ relationship improved, and the mother moved into the father’s home in April 2016. The parties discussed purchasing a family home.

[26] The parties could not afford the required down payment on the type of home that they desired without financial assistance from their families. The paternal grandfather (“PGF”) gifted the father the sum of $123,000, from the sale of his property in China.[^4] These funds formed the basis of the initial budget of $600,000 to $700,000. In June 2016, the MGM agreed to contribute the sum of $190,105 towards the down payment on a home for the family. Consequently, in June/July 2016, the budget increased to $900,000 to $1,000,000.

[27] On July 7, 2022, the mother issued a cheque to the father for $30,000, from the net proceeds of sale of the former matrimonial home[^5].

[28] On July 30, 2016, the father made a bully offer on the family home which he purchased for $1,180,000. They had been unable to purchase a less expensive home due to the competitive market conditions.

[29] On August 2, 2016, the MGM forwarded the second sum of $100,000 to assist in securing financing.

[30] Title to the home was held in the father’s name alone. The mother testified that she could not qualify for a mortgage given that her bank account and credit card had been defrauded in 2015 and 2016.

[31] The parties, the children and the PGP moved into the family home in September 2016. The MGM visited the home at various times until the parties’ separation.

[32] During the period of reconciliation, the mother continued to pay the sum of $579 per month through the FRO. She also shopped and paid for some of the family’s grocery and household expenses, clothing, excursions and incidental expenses. She paid approximately $600 to $1,000 per month, as per her Visa credit card and bank records. The father was responsible for paying the mortgage, utilities, taxes, daycare and other house-related expenses.

[33] On January 4, 2017, the father made further requests that the mother ask the MGM for funds, which upset her. The reasons for the requested funds included: (a) to avoid upcoming policies further restricting the removal of funds from China; (b) to provide them with money to invest (such as the purchase of a fixer-up property in the mother’s name); and (c) the family’s need for funds because they were financially strained. He denied that the requests were a form of “debt collection” and berated the mother for not trusting him.

[34] At various times the mother was worried about the parties’ relationship, and the lack of intimacy. She was also worried that her name was not on title of the home (as confirmed in her text dated January 20, 2017), particularly given her experience with Xue and the defrauding of her accounts. The father responded that she should not worry as they were in a common law relationship.

[35] No further funds were advanced by the MGM to either party.

[36] The parties separated on February 15, 2019. The father subsequently declined the mother’s request for the re-payment of the MGM’s contributions to the family home.

III. RELEVANT LITIGATION HISTORY

[37] On December 12, 2019, the mother commenced an Application seeking a trust interest in the family home by way of resulting trust, unjust enrichment and constructive trust (as well as other relief).

[38] On September 20, 2020, the father signed an Answer requesting that the mother’s trust claims be dismissed and seeking a declaration that his equalization claim is not statute-barred and for an equalization of net family property (as well as other relief).

[39] The parties attended before Bruhn J. for a Case Conference on January 26, 2021. The mother obtained leave to arrange a second Case Conference when the father was unwilling to consent to a reasonable parenting time plan. On April 22, 2021, the parties consented to a parenting plan that provides the mother with care of the children on two Wednesday evenings per month, every Saturday and one overnight per month. At the commencement of the trial, the parties agreed to a final order on similar terms.

[40] On August 23, 2021, Bruhn J. convened a Settlement Conference and the following orders were made: (1) directions in respect of Requests for Information; (2) leave for questioning; (3) leave to bring disclosure motions; (4) the father may bring a motion for questioning of third parties and/or to amend his pleadings to add parties; and (5) the father was granted leave to amend his pleadings to make a claim for retroactive child support.

[41] The mother served her Request for Information and an Amended Application dated September 21, 2021.

[42] The father failed to respond to the mother’s Request for Information and failed to serve his Request for Information in the required timelines, although he did serve his Amended Answer dated November 2, 2021. The father’s request to adjourn the April 2022 TSC/TSEF was denied.

[43] Bruhn J. convened a combined Settlement Conference/Combined Conference on April 13, 2022. Her Honour made various orders with directions and once again granted leave for disclosure motions (including the father’s Wagg motion). Bruhn J. adjourned the trial to the November 2022 trial sittings.

[44] On October 5, 2022, Jarvis J. heard the father’s motion for disclosure in respect of the mother, the MGM and third parties. He dismissed most of the relief sought on the basis that the father was engaging in a fishing expedition and that the non-party requests (aside from the MGM) were broad and non-specific. He denied the father’s request to add the MGM as a party, or to require her to swear a 13.1 Financial Statement. He dismissed most of the requests made of the mother. Jarvis J. ordered the father to pay costs in the amount of $8,500.

[45] On November 23, 2022, with the assistance of Jarvis J., the parties resolved all child and spousal support issues (in addition to the parenting issues).

[46] As there were unresolved property issues the trial proceeded as planned. While the father has limited English-speaking capabilities, he was supported at trial through the provision of simultaneous translation.[^6]

[47] At the commencement of the trial the father requested leave to file a proposed Amended Amended Answer (i.e., a second amendment), which he served on or about October 28, 2022. The mother objected on the basis that she had a right to know the case she was required to meet at trial. She also argued that the proposed Amended Amended Answer included new claims including a request that the mother and/or the MGM (a non-party) pay the father the sum of $500,000 on account of the debt allegedly owed to him.

[48] For oral reasons given I found that the proposed second amendment, which was served on the eve of trial and in a matter that has been outstanding since 2019, would disadvantage the mother in a way for which costs or an adjournment could not compensate. As stated above, in April 2022 the trial was adjourned and scheduled to be heard at this time.

[49] Notwithstanding that the parenting and support issues were resolved on consent, the trial, which was originally set for five days (on all issues), did not decrease in duration. Instead, the trial lasted for almost seven days, which is neither proportionate to the limited issues before the court, nor to the costs associated with a seven-day trial. I note that the Supreme Court of Canada has clearly articulated the need for proportionality in matters that come before the court.[^7] I have considered same in my determination on costs, as set out at the end of these reasons.

[50] The excessive amount of trial time related, in part, to the father’s desire to litigate the entirety of the parties’ relationship (and the mother’s “bad” behaviour). The father aimed to persuade me that his demands for funds were the legitimate reason why the MGM and/or the mother intended to gift him $290,105 plus an additional $10,000 from the mother (as part of the $500,000 that he is owed). A substantial amount of time was also spent addressing various objections and concerns respecting the relevance, materiality and admissibility of the evidence.

[51] Considerable evidence tendered at this trial had little or no relevance to the issues to be determined and, as such, I make little or no reference to that evidence in my analysis.

IV. CREDIBILITY AND RELIABILITY

[52] Both parties allege that the other is untrustworthy, not credible and a liar. I find that there are serious credibility and reliability issues with each party’s evidence.

[53] Jarvis J. summarizes the relevant considerations when assessing credibility and reliability as follows:[^8]

[28] As has been frequently observed, the assessment of witness credibility is an inexact science, impossible to articulate with precision. For example, a witness may impress the court with the coherence and logic, or common sense, of their narrative but be unreliable due to their interest in the outcome of the case or the lack of probative information. Or a witness may be so interested in a case that they are incapable of making an admission or facilitating the disclosure of information that they perceive as helpful to the other party and harmful to their case. These affect the weight to be given to that evidence. There is, quite simply, no one-size-fits-all template. Several of the many considerations relevant to the weighing and assessment of witness credibility and reliability, and relevant to his case, were comprehensively reviewed in Al-Sajee by Chappel J. who aptly observed that,

…the judge is not required by law to believe or disbelieve a witness’s testimony in its entirety. On the contrary, they may accept none, part or all of a witness’s evidence, and may also attach different weight to different parts of a witness’s evidence (see R. v. D.R., 1996 CanLII 207 (SCC), [1996] 2 S.C.R. 291 (S.C.C.), at paragraph 93; R. v. J.H., 2005 CanLII 253 (ON CA), [2005] O.J. No. 39 (Ont. C.A.) at paragraphs 51-56; McIntyre v. Veinot, 2016 NSSC 8 (S.C.), at para. 22).[14]

[54] Both parties request that I accept their version of the facts wholeheartedly when, if fact, the truth is somewhere in between. I note that they each (and the MGM) remember details that are helpful to their case but tend to forget, deny or be confused about details that hurt their positions.

[55] I prefer the mother’s evidence in respect of the joint decision to identify January 4, 2013 as the date of separation, as well as her recollection about the information provided by the paralegal about the parties’ rights and obligations on separation. The father’s evidence that the marriage was perfect until November 2014 is not credible, given the statements that he made in his affidavit sworn September 6, 2022, alleging that the mother was flirting with another man in spring 2013, and bringing home drugs. He also acknowledged that shortly after the daughter’s birth in June 2013, the parties moved to separate bedrooms. Moreover, the father agreed to the January 4, 2013 valuation date and swore a 35.1 Affidavit (and presumably the affidavit of divorce) to that effect.

[56] I decline to accept the father’s proposed date of separation being November 2014, as it lacks an air of reality. According to the father from November 1 to 17, 2014: (a) he learned about the mother’s involvement with Xue over the course of several weeks;[^9] (b) he left the matrimonial home (although the mother, the MGM and the PGM all testified that he left in in October); and (c) he had two meetings with the paralegal, did all of the paperwork and arrived at a final resolution on all parenting and child support matters.

[57] It is evident from the father’s evidence that he understands limitation periods and the impact on a claim for equalization. I note that January 4, 2013 is more than six years before the date of the father’s Answer (September 20, 2020), but November 2014 is not. This may be the incentive for the father to lie.

[58] I also prefer the mother’s evidence that the parties reconciled in April 2016. At that time the mother moved into the father’s home (and bedroom) and changed her address to that residence. Moreover, that is the date listed in the father’s Answer, Amended Answer and proposed Amended Amended Answer. The father’s oral evidence, being that the mother forced her way into his home in April 2016, and that they only reconciled in September 2022 is not credible. While there were ongoing communications on May 2, 2016 about the father’s demand for compensation, and his threat to end the relationship if the mother refused to provide same, the reconciliation itself took place in April 2016. The father is motivated to be untruthful on this important issue as the April date conflicts with his position. He repeatedly testified that he would only discuss reconciliation, or reconcile, after the demanded payment of $500,000 was made. The disputed sums that are the subject of this case ($300,000) were advanced by the MGM in late June and August 2016.

[59] Moreover, I find that the father was often evasive and unresponsive under cross-examination. It took several attempts for the father to admit that his September 6, 2022 affidavit and his proposed Amended Amended Answer were his documents. He refused to acknowledge inconsistencies between the oral evidence provided at trial, the affidavit, the Answer, the Amended Answer and the proposed Amended Amended Answer. He accused the mother’s counsel of playing games and trying to confuse him. The father attributed some of the differences to mistakes made in his materials (rather than to mistakes in his oral evidence). He refused to answer (or was evasive) when asked questions by his counsel in re-direct about an email dated December 14, 2014 outlining his desire to reconcile.

[60] However, there are also credibility issues in respect of the evidence provided by the mother and the MGM. This includes their denial of any knowledge that the father demanded compensation of $400,000, and later $500,000. Both the mother and the MGM attended two meetings with the father that included discussions about the requested compensation. The mother and the MGM are motivated to lie on this important issue as the demand forms the basis of the father’s arguments. I find that the father did demand compensation.

[61] Another problematic aspect of the mother’s credibility relates to the bald assertions that she often made while testifying, without corroborating evidence. For example, the mother repeatedly testified that the parties each initiated attempts at reconciliation, as one was more motivated than the other at various times. The text messages do not support such a finding (aside from the father’s December 14, 2014 text). It is the mother who initiated the reconciliation attempts, and the father who was only willing to entertain same if his conditions were met. Once again this supports the father’s position that he was making financial demands.

[62] Both parties are not credible in their assertions that they were each the primary caregiver of the children. They both conceded that the PGM was a stay-at-home caregiver who cooked, cleaned and often picked up the children from school. Both parents worked during the parties’ cohabitation.

[63] There are also problems with the PGM’s evidence. While I accept that she was actively involved in caring for the children during the reconciliation, it is not credible that the mother was not also actively involved. For example, the PGM’s evidence that the father was primarily responsible for communications with the children’s school by phone, in-person and for parenting teacher conferences is not believable since he has limited English-speaking skills. The father failed to provide evidence as to how he dealt with the language barrier in his interactions with the teachers or the school. I find that both parties were involved parents who were supported by the PGM (whose role was limited to the home and the surrounding neighbourhood). The PGM is also motivated to be untruthful, given that she resides in the home that is the subject of this dispute.

[64] I have no significant concerns about the reliability or credibility of the real estate agent’s evidence, although her recollection is imperfect about her contact with the mother. In any event, I attribute very little weight to the evidence that she only dealt with the father in the search for a new family home, or that she only recalls taking the mother to the family home once.

[65] Given the credibility and reliability issues detailed above, I have carefully reviewed and considered the evidence before the court. To that end, I have assessed the oral evidence and the substantial corroborating (or conflicting) documentary evidence (including text messages between the parties) in my analysis.

V. PROPERTY ISSUES

The MGM’s Gifts

[66] The Ontario Court of Appeal sets out the required elements of a gift as follows in McNamee v. McNamee:[^10]

Although the term “gift” is not defined in the Family Law Act, a gift, generally speaking, is a voluntary transfer of property to another without consideration: Black’s Law Dictionary, 7th ed. (St. Paul, MN: West Group, 1999), at p. 696; Birce v. Birce (2001), 2001 CanLII 8607 (ON CA), 56 O.R. (3d) 226, [2001] O.J. No. 3910 (C.A.), at para. 17. A transfer of property by contractual agreement involves a mutual exchange of obligations (“consideration”), but a transfer by way of gift involves a gratuitous, unilateral transaction: Mary Jane Mossman and William Flanagan, Property Law: Cases and Commentary, 2nd ed. (Toronto: Emond Montgomery Publications, 2004), at p. 439. As McLachlin J. observed in Peter v. Beblow, 1993 CanLII 126 (SCC), [1993] 1 S.C.R. 980, [1993] S.C.J. No. 36, at p. 991-92 S.C.R., “[t]he central element of a gift [is the] intentional giving to another without expectation of remuneration”.

The essential ingredients of a legally valid gift are not in dispute. There must be (1) an intention to make a gift on the part of the donor, without consideration or expectation of remuneration, (2) an acceptance of the gift by the donee and (3) a sufficient act of delivery or transfer of the property to complete the transaction: Cochrane v. Moore (1890), 25 Q.B.D. 57 (C.A.), at pp. 72-73 Q.B.D.; Mossman and Flanagan, supra, at p. 441, Bruce Ziff, Principles of Property Law, 5th ed. (Toronto: Carswell, 2010), at p. 157.

[67] I recognize that certain evidence, such as the acts and declarations of the parties subsequent to a transfer, is admissible only against the party who made them. Otherwise, I must assess the reliability of this evidence and determine what weight it should be given, guarding against evidence that is self-serving or tends to reflect a change of intention.[^11]

[68] It is the father’s position that the $290,105 contributed by the MGM and/or the mother and an additional sum of $10,000 (as part of a $30,000 cheque issued by the mother) were gifts that were made as a pre-condition to the parties engaging in reconciliation discussions, or to reconciliation.

[69] The mother’s position (as well as that of the MGM) is that the funds provided by the MGM were gifts to enable the mother to contribute to the down payment on the family home, and the cheque was the mother’s contribution to the household/furniture expenses and the mortgage.

The MGM’s Intention, if Any, to Make a Gift Without Consideration or Expectation of Renumeration

[70] The father submits that the MGM (and/or the mother) intended to gift him the sum of $290,105, as they accepted that he deserved the sum of $500,000 as “compensation”, and to support the mother’s desire to reconcile. The relevant evidence is set out below.

[71] In September 2015, during a discussion with the mother and the MGM, the father made his first request for “compensation.” He demanded receipt of this payment as a pre-condition to speaking with the mother about reconciliation. The father initially demanded compensation of $400,000 for the following reasons:

(a) he received nothing (in terms of property) after the breakdown of the marriage. He wanted a more balanced and fair financial circumstance (as he was poor);

(b) the father had made it through a difficult time (due to his alleged trauma, the mother’s betrayal of engaging in the relationship with Xue and the harassment following the marriage breakdown),[^12] and he did not want to reconcile; and

(c) the MGM could afford to make the requested payment as she is wealthy.

[72] The father increased his demand to $500,000 during a meeting that took place in late December 2015, shortly after the parties, the children, the MGM and the PGP returned from a vacation together in Blue Mountain. He required more damages as the mother and Xue had continued to play games with his emotions in Fall 2015.

[73] The father testified that the mother repeatedly requested that the parties reconcile (in 2015 and 2016), and that she attempted to use his emotions and the children to persuade him. He also testified that while the mother was nice and loving during the day, at night she would become “devilish” and insulting in her communications (texts and calls). The father stated that her boyfriend, Xue, harassed him (as alleged in his affidavit and oral evidence). The father also testified that the mother harassed him, although he eventually conceded in cross-examination that this was only a few times. There is no such allegation in his September 2022 affidavits, or the text messages. I decline to find that the mother harassed the father or that such an allegation formed the basis of any intention by the MGM or the mother to compensate the father for trauma, betrayal or harassment.

[74] Under both direct and cross-examination the father admitted that there was never an agreement made by the MGM to provide the demanded compensation. However, he testified that this was understood as “they did not say yes but they did not say no.” This contradicts the father’s affidavit sworn September 6, 2022, that the mother and MGM expressly agreed to pay the sum of $500,000 (in 2016). The father also testified that it never occurred to him to obtain a written agreement even though he did not trust the mother (and the text messages do not support such a finding).

[75] The father contradicted himself further in cross-examination when he once again admitted that there was no agreement and that he never expected to be paid in May/June 2016. He explained that the non-payment of the funds made him happy as the father did not want to reconcile with the mother (although they had already reconciled). The father’s testimony in re-direct that, in fact, there was an agreement in May/June 2015 (or 2016 if the year is an error), is contradictory and not credible. I find that this testimony was a last-ditch attempt to change his problematic evidence. I am not persuaded, on the balance of probabilities, that there was ever an agreement that the MGM would comply with the father’s demands for the payment of $500,000 (or any funds). Furthermore, the MGM never promised to make such a gift.

[76] I prefer the mother’s evidence that the MGM refused (and did not) advance any funds from September 2015 and until after the parties reconciled. It is not disputed that the mother persuaded the MGM to contribute approximately $190,105 in June 2016, towards the purchase of a family residence. By that time the parties resided as a family and the relationship between the parties had stabilized. I reject the father’s arguments that the MGM intended that the funds be used for his sole benefit and for whatever purpose that he wanted. That was not the MGM (or the mother’s) evidence, nor are there any text messages that confirm same. The MGM’s commitment to advance funds in June 2016, took place in the context of the purchase of a family home. Once the commitment was made the budget increased to $900,000 or $1,000,000.

[77] The father made a bully offer to purchase the family home in late July 2016. The purchase price of $1,180,000 was above their budget. Consequently, the mother requested that the MGM provide additional funds of approximately $100,000 to enable the parties to secure financing.

[78] The father’s evidence was inconsistent as to whether he made the offer assuming that the MGM would pay the additional $200,000 that he was owed (as per his September 6, 2022 affidavit), or whether he/the mother made a specific verbal request to the MGM for additional funds prior to issuing the bully offer (as per his testimony).

[79] Ultimately, on or about July 31, 2016, the MGM agreed to provide $90,000 on the condition that this amount was a joint loan and that both parties sign an “IOU.” The father testified that he signed a promissory note produced by the mother under duress, as the additional funds were needed. The mother and MGM deny the existence of a signed promissory note. In any event, the MGM forwarded $100,000 the next day as she was concerned the parties would have difficulty securing financing.

[80] It is the father’s position that the sum of $190,105, the second sum of $100,000 and the mother’s payment of $10,000 (as part of the $30,000 cheque), collectively amount to $300,000 that the MGM and/or the mother paid to him as a gift, on account of his demand for $500,000 in compensation.

[81] While the father’s evidence and arguments are inconsistent, complicated and contrived, the MGM’s narrative about her intentions with respect to the gifts is much simpler. The grandmother testified that when she travelled to Canada in 2015, she felt sad that the children did not have both parents. The MGM offered to assist the parties to purchase a home together. She recalls attending a meeting in late 2015 when they discussed the purchase of a home. After the parties reconciled, the MGM agreed to advance funds which she intended as a gift to her daughter. The MGM was aware that the PGF had gifted funds to the father which would also be used towards the purchase of a home.

[82] The MGM explained that she sold a recreational property in China and advanced the sum of $190,105. In June 2016, various individuals in China transferred various amounts to the father, to each of the children and to the PGM due to restrictions on the removal of funds from China. The MGM did not forward any funds to the mother due to her inability to apply for a mortgage.

[83] The MGM testified that when the mother requested the additional $100,000 on or about July 31, 2022, the MGM agreed to forward $90,000 on the condition that the parties sign a promissory note. She borrowed money from her sister and transferred the sum of $100,000 to Canada. When the MGM visited the family home in October 2016, she determined that the mother could not afford to re-pay the loan. She advised the mother that the funds need not be repaid. I accept this declaration as it is an admission against the MGM’s interests.

[84] For the reasons set out above, there is no basis to conclude that the MGM intended to gift the sum of $290,105 to the father as compensation and/or as a pre-condition for discussions about reconciliation, or reconciliation. The MGM never agreed to make that gift, she never promised such a gift, nor did she make such a gift. When the second sum of $100,000 was advanced it was understood by all parties to be a joint loan.

[85] Frankly, if a gift had been made by the MGM to the father, I would have to consider whether the gift was made under duress. A gift tendered with the hope that the mother and father will reconcile is offensive to public policy. The father’s texts are more akin to an attempt to negotiate a contract with the mother (in which she must arrange for him to be paid $500,000 for the possible chance to reconcile; and, in which he states that she can accept his terms or there is no deal). This “negotiation” is also offensive to public policy, as one party ought not be expected to make a significant payment to the other as a pre-condition to a possible reconciliation.

[86] At this juncture the only issue to be determined is whether the gifts made by the MGM of $190,105 and $100,000 (which she converted from a loan to a gift in October 2016) were to the mother alone or to the mother and father jointly, since the advances were clearly intended to be towards the down payment on the family home. I note that neither party provided evidence to support the notion of joint gifts, nor did they argue that the gifts were intended to be shared.[^13]

[87] There are a few references in the mother’s texts that the MGM was giving or loaning “us” money, in communications about “our house” and “our purchase.” Moreover, the MGM testified that she had spoken with the father in 2014 or 2015 about her willingness to help him and the mother purchase a home together. However, neither of these examples clarify the MGM’s intentions as to whom she intended to direct any gifts.

[88] I accept the MGM’s evidence that she intended to gift the funds to the mother alone, for her share of the purchase of the family home, for the following reasons:

(a) the MGM testified that while she had no bad feelings towards the father, they did not speak much (although the father’s text implies that the MGM did not like him. He states that the MGM used to look down on him and that she preferred Xue);

(b) prior to the closing of the sale the mother informed the MGM that her half interest in the family home was protected as the parties were common law, such that the plan for the property to be held in the father’s name alone was not of concern. This may explain why the MGM never raised the issue of title;

(c) the MGM had a pattern of gifting funds for property (and property) to the mother, her only child. This includes the MGM’s primary residence in China (which was transferred for estate-planning purposes) and the contribution towards the former matrimonial home (which was purchased shortly after the parties immigrated to Canada and when the father was unemployed); and

(d) the MGM was aware that the PGF had also sold a property. She knew that the PGF gifted funds to the father that were to be used to purchase the family home. I note that neither the MGM nor the mother claim that this contribution was intended to be a joint gift to the parties.

The Mother’s Intention, if Any, to Make a Gift Without Consideration or Expectation of Renumeration

[89] The father referred to the MGM and the mother interchangeably as the donor of the gifts throughout the trial. However, to the extent that this argument is founded on the premise that the MGM gifted funds to the mother, who subsequently gifted the funds to the father, I reject same.

[90] The mother testified that from 2015 to 2017, she was concerned that the father was attempting to use her for money like her ex-boyfriend Xue (the individual she believes defrauded her of thousands of dollars). While the mother texted the father on May 2, 2016 that she would pay the father funds but could not afford to do so, I decline to find that this was an intention or promise to gift the father money. This text also includes the mother’s offer to give him $50 million if she had it (which is clearly unreliable). I prefer the mother’s evidence that this text was one of several communications whereby the mother wanted to stop the father from demanding funds.

[91] The father was well-aware of the mother’s concern that she was being used as a means to access money. The father testified that she “really only cared about money.” Several text exchanges (including May 2, 2016 and January 4, 2017) confirm the mother’s worries about the father’s requests for funds. The January 4, 2017 exchange includes a specific denial of any intention to defraud the mother (unlike Xue), or to take her/the MGM’s money. He attempts to make her feel secure by reminding the mother that she has a right to share property as they are common law, whether or not it is marriage.

[92] I find that the mother did not intend to gift her contribution to the father even though title was held in his name alone for the following reasons:

(a) I accept the mother’s evidence that the family home was held in the father’s name alone due to her inability to obtain a mortgage due to her credit rating. The mother testified that she had serious credit issues, due to the defrauding of her bank account and credit card in 2015 and 2016, and she tendered records to confirm same. I decline to accept the father’s evidence that he had no knowledge of same, as the text messages state otherwise. There are several references to Xue being a fraud, a criminal and taking the mother’s money. In a text dated July 26, 2016, the mother specifically states that her credit is ruined;

(b) the mother believed that the parties would share the equity as common law spouses, and she provided this information to the MGM. The mother testified that the father explained how common law spouses share the value of property. By text dated January 2017, the father confirmed that this was his belief as well; and

(c) while the father denies any discussions about title, the parties communicated about same on August 20, 2016. Their text exchange describes the tax benefits of having the father hold sole title to the home, being tax savings as a first-time homeowner. The mother was pleased and the parties agreed that the father will speak with the lawyer.

[93] It would be illogical to conclude that the mother gifted funds to the father, or made a promise to do so, and I decline to make such a finding.

Acceptance of the Gift by the Donee

[94] The funds that were gifted by the MGM were used, as planned, towards the down payment of the family home.

[95] There is no dispute that the mother (and other family members) moved into the family home in September 2022.

[96] I find that the mother accepted the MGM’s gifts.

A Sufficient Act of Delivery or Transfer of the Property to Complete the Transaction

[97] Given the restrictions on the removal of funds from China, the gifts from the MGM to the mother were imperfect in the sense that there were no direct transfer of funds from the donor to the donee.

[98] Instead, the funds were advanced from various third parties in China to various individuals’ accounts in Canada (the PGF, the father and each of the children).

[99] However, it is undisputed that the funds came from the MGM. As per my findings as set out above, they were gifted to the mother.

[100] The funds are traceable to various bank accounts, and later to the down payment in September 2016.

[101] I find that the transaction was completed.

The Mother’s Claims in Respect of a Trust Interest in the Family Home

[102] In his case book,[^14] the father raises a preliminary issue in response to the mother’s trust claims, being that such claims are barred by the Real Property Limitations Act.[^15] However, the Ontario Court of Appeal has determined that there is a 10-year limitation period in respect of equitable claims for property based on the remedy of constructive trust, even if the claimant seeks a monetary award in the alternative.[^16] Moreover, in the very recent decision Studley v. Studley,[^17] the Ontario Court of Appeal re-confirmed the above and concluded that constructive trust may be found even where the property upon which the claim is made has been sold. I find that the mother’s claim was brought well before the limitation period will expire.

Unjust Enrichment & Constructive Trust

The Unjust Enrichment Test

[103] The Supreme Court of Canada considered the use of unjust enrichment within the family law context in Kerr v. Baranow.[^18] Justice Cromwell outlined the following three elements that must be satisfied in order for a claim of unjust enrichment to be successful:

1. An enrichment of or benefit to the defendant;

2. Corresponding deprivation of the plaintiff; and

3. The absence of a juristic reason for the enrichment.

[104] Kerr v. Baranow provides further guidance when addressing the test and appropriate remedies in respect of a claim for unjust enrichment.

[105] The absence of a juristic reason means that there is no reason in law or justice for the defendant’s retention of the benefit, making the retention “unjust”. This is a two-step analysis. First, the plaintiff must show that no juristic reason from an established category exists. If there is no juristic reason from an established category, then the plaintiff has made out a prima facie case. The prima facie case is rebuttable where the defendant can show that there is another reason to deny recovery.[^19]

The Father’s Enrichment, if Any

[106] Prior to the MGM’s commitment to advance the sum of $190,105, the father’s budget was $600,000 to $700,000. After reviewing listings provided by the real estate agent, the father advised that none of the properties were suitable for the PGM.

[107] The father’s budget then increased to $900,000 to $1,000,000. As stated above, the family home, which was a better property than others, and in Richmond Hill (a more desirable location), was ultimately purchased for the sum of $1,180,000 following the father’s bully offer. It was only attainable because of the MGM’s further advance of $100,000.

[108] As stated above, the purchase price for the family home was $1,180,000. The father did not qualify for a regular mortgage and the mother could not obtain a mortgage. Consequently, the parties required a down payment of 35% as per the new immigration mortgage requirements. The parties came up with the required funds as: (a) the MGM funded $290,105; (b) the PGF gifted the father $123,000; and (c) the father obtained a mortgage for the balance of approximately $767,000.

[109] The residential appraisal report submitted by the mother provides a current value of $1,590,000 as of August 16, 2022. The father utilized that value in his sworn Financial Statement dated October 25, 2022. I accept that this is the current value.

[110] According to the father’s Financial Statement, the current line of credit is a debt of $614,785, and there is no mortgage.

[111] Therefore, the equity in the family home has increased by $565,215, (not accounting for notional disposition costs) from when the offer was accepted in July 2016 and through October 2022 (approximately six years).

[112] From 2016 to present the father has had the opportunity to reside in the family home, a detached relatively new (20 years old) four-bedroom home, with the children and the paternal grandparents.

[113] As set out in greater detail below, the father was also enriched by the mother’s contributions during the parties’ cohabitation (April 2016 to February 2019). At a minimum, the mother regularly went grocery, household, cosmetic and clothing shopping for the family (including the PGP). She paid for these expenses from her income. The mother continued to pay the sum of $579 per month to the FRO, which the father deposited into his bank account from which the mortgage and other family expenses were paid.

[114] I prefer the mother’s evidence, that she was involved in the children’s care, to the bald statements made by the PGM and the father that she was not. I do not accept that the mother, the sole fluent English-speaking adult in the home, was not involved in the children’s schooling, appointments or activities. While I accept that the PGM was actively involved in the children’s care within the home (as well as cooking and cleaning), she speaks no English and does not drive.

[115] I find that the father was enriched as articulated in the test set out by the Supreme Court of Canada.

The Mother’s Corresponding Deprivation, if Any

[116] The mother’s current net worth is $17,883 (investments) as per her sworn Financial Statement dated October 19, 2022. In contrast, the father’s current net worth is approximately $1,049,473 ($975,215 equity in the home + $74,258: investments).

[117] Most of the father’s increased net worth arises from improved market conditions in the real estate market.

[118] Shortly after the parties’ reconciliation in April 2016, the mother sold the former matrimonial home. She sold the property at a slight loss, and gave the father the sum of $30,000 from the $42,000 of net proceeds of sale. It is unclear what part of this amount was used to pay the family’s mortgage (as some funds were used to re-pay loans from the father and some were for household/new furnishing expenses). However, some amount (perhaps 33%) and the child support paid to the FRO during the cohabitation in the approximate amount of $20,000, are further amounts that the mother was deprived access to following the separation.

[119] The father refused to re-pay the sum of $290,105, any amount from the mother’s initial contribution or the child support. The mother now resides in rental accommodations, which does not afford any of the benefits of home ownership.

[120] Notwithstanding his earlier reassurances, the father has now done exactly what the mother feared he would do. He refuses to return funds that she believes rightfully belong to her.

[121] I find the required corresponding deprivation to the father’s enrichment.

The Absence of Juristic Reason for the Mother’s Deprivation

[122] The mother submits that there is no juristic reason for her deprivation. The funds were not a gift, nor a promise made to the father. To the extent that the requests were a demand, that finding vitiates the required elements of a gift. A gift must be made voluntarily, and with no expectation of consideration. I agree that the mother has made a prima facie case, as required by part of this analysis.

[123] The onus now shifts to the father to rebut the presumption if he can demonstrate that there is another reason to deny recovery. The father has several arguments.

[124] The first, that the MGM and/or the mother gifted him the funds. I have already dismissed that claim.

[125] The second, that the father had a reasonable expectation that the funds would be for his benefit alone. While the father demanded the payment of $500,000 before he would talk about reconciliation, the parties had already reconciled before any funds were paid. While the father demanded that the funds would not be re-payable to the MGM, the second sum was clearly forwarded on the basis it was a loan and not a gift. The funds were used towards the down payment on a family home (which they refer to as “our decision”). Both parties referred to the process of buying a home as “our purchase” of “our house.” Shortly after the offer was accepted the father expressed worries that “we overpaid”, and then was happy to report “we’re making money on our purchase.” This argument fails to rebut the presumption.

[126] The third, that there was an implied agreement and/or a promise to make a gift in contemplation of marriage. As I have explained previously, there was no implied agreement. Moreover, the advancing of funds by the MGM is in no way akin to the right of a donor to recover a gift as contemplated by the Marriage Act.[^20] This argument fails to rebut the presumption.

[127] The fourth, that the father is an “innocent” who has materially changed his position as a result of an enrichment, such that it would be inequitable to require that the benefit be returned.[^21] The father argues that he did not need the mother’s help to purchase a property, and it would be unfair to require him to re-pay funds. On the contrary, the father’s material change in position (being that his budget increased to $900,000 and then to $1,180,000) was solely because of the MGM’s contributions. The property has a current value of $1,590,000. It would not be inequitable to require that the benefit be returned. This argument fails to rebut the presumption.

[128] The fifth, that the mother should be estopped from any recovery, either on the basis of representation or convention (as there was a shared assumption of fact or law) estoppel. The father argues that he relied on the representation (or shared assumption) that the funds were being gifted to him. This led to the change of his legal position, being that he purchased a home for $1,180,000 rather than $600,000 to $700,000. He submits that it would be unfair to allow the mother to resile from the representation (or common assumption). I find that there was no representation or shared assumption that the funds were gifts or that the home was purchased for his sole benefit. This argument fails to rebut the presumption.

[129] I reject the father’s assertions that the funds and/or the family home were intended to be for his sole use or for his benefit alone. There is no juristic reason for the mother’s deprivation.

The Appropriate Remedy: A Monetary Payment or a Constructive Trust Interest

[130] Where all three elements of unjust enrichment are found, Kerr v. Baranow directs a judge to consider whether the remedy for unjust enrichment is either: (1) a monetary award or, only where that remedy is insufficient, (2) a constructive trust.[^22]

[131] The first remedy to consider is always a monetary award. In most cases, it will be sufficient to remedy the unjust enrichment.[^23]

[132] When the parties have been engaged in a joint family venture, and the claimant’s contributions to it are linked to the generation of wealth, a monetary award for unjust enrichment should be calculated according to the share of the accumulated wealth proportionate to the claimant’s contributions. To apply this approach, it is first necessary to identify whether the parties have been engaged in a joint family venture.[^24]

[133] In undertaking this analysis, the court may consider:

(a) whether the parties worked collaboratively towards common goals;

(b) the degree of economic interdependence;

(c) the parties’ actual intentions; and

(d) whether the parties gave priority to the family in their decision-making.[^25]

[134] When a monetary award is inappropriate or insufficient, a proprietary remedy may be required. Where the plaintiff can demonstrate a link or causal connection between his or her contributions and the acquisition, preservation, maintenance or improvement of the disputed property, a share of the property proportionate to the unjust enrichment can be impressed with a constructive trust in his or her favour.[^26]

[135] Indirect contributions of money and direct contributions of labour may suffice to show a “causal connection”, provided that a connection is established between the plaintiff’s deprivation and the acquisition, preservation, maintenance or improvement of the property.[^27]

[136] For the reasons that follow a monetary award is not sufficient.

[137] I find that the parties were engaged in a joint family venture from April 2016 through February 2019:

(a) the mother moved into the father’s rental home in April 2016, sold her condominium (the former matrimonial home) in June 2016, and issued a cheque to the father in the amount of $30,000 (from the $42,000 net proceeds of sale) in early July 2016;

(b) while the father took the lead on the purchase of the family home, the parties had many communications about this endeavor. They had a common goal of home ownership and referred to the process and the property as “our house”, “our decision” and “we are the one paying”;

(c) in September 2016, the parties moved from the father’s rental home, and into the residence purchased with both parties’ agreement and with the support of both extended families;

(d) the mother, the father and the PGM cared for two young children with the common goal of raising a family together;

(e) the mother and the father worked outside of the home and used their incomes to support the family;

(f) while the parties did not share bank accounts, the mother’s monthly contributions of $579 were deposited into the father’s account from which the mortgage, taxes, insurance and other household and child-related expenses were paid;

(g) the mother contributed an additional $600 to $1,000 per month (as per her credit card and bank statements) towards groceries, clothing, child-related expenses (for example, Canada’s Wonderland passes, birthday party gifts and decorations); and

(h) the parties prioritized the family in their decision-making.

[138] There is clearly a nexus between the mother’s contributions and the property in dispute. There is also a good explanation as to why the mother was not on title of the home,[^28] being that she could not qualify for a mortgage. I adopt the reasoning in Jama v. Basdeo, where the court found that the non-titled party’s belief that their credit score is too low and that their name cannot be on the mortgage may support (rather than refute) a finding that the non-titled party holds a 50% trust interest in the property.[^29]

[139] I adopt the approach taken by Mandhane, J. in Pimenta v. Jaggernauth, and with her conclusion as to why a 50% trust interest (the “value survived”) is appropriate in a case with similar considerations.

A monetary award based on value received would be unfair because it would give Jaggernauth the exclusive benefit of the parties’ joint investment in the Home: Moore v. Sweet, 2018 SCC 52, [2018] 3 S.C.R. 303 (S.C.C.) at para. 91. It would not, for example, adequately compensate Pimenta for the lost opportunity of investing her money in GTA real estate which would surely have increased in value post-separation.[^30]

[140] I find a direct link between the payments of $290,105 by the MGM, and the payments by the mother of $30,000 (partially towards the mortgage) and the approximate amount of $20,000 (paid to the FRO) to the family home.

[141] As stated previously, the family home has dramatically increased in value from the purchase price of $1,180,000 to the current value of $1,590,000. The mother’s contributions during the cohabitation were meaningful. A monetary award based on her financial payments (and those made by the MGM on her behalf) would be unfair.

[142] The current equity in the home is approximately $565,215. The mother contributed more than 50% of the equity, however, the father contributed to the line of credit, realty taxes, home insurance and repairs maintenance (and had the benefit of living in the family home with his parents and the children). I award the mother a 50% interest in the family residence.

[143] As a beneficial owner of one-half interest in the family home, she is entitled to share the post-separation increases.[^31] Consequently, the wife is entitled to one-half of the current value (after deducting the line of credit in the amount of $614,785).

[144] By January 31, 2023, the father shall pay to the mother the sum of $487,608.[^32] If the father is unable or unwilling to make this payment, the family home shall be immediately listed for sale and the mother shall receive 50% of the proceeds of sale (after the re-payment of $614,785 and disposition costs). The mother may file the order on title pending the required payment or sale. Directions respecting the sale are set out below.

Resulting Trust

[145] The Supreme Court of Canada, the Ontario Court of Appeal and the Superior Court of Ontario have considered the required elements of a resulting trust claim on many occasions. A summary of the caselaw as it applies to common law spouses is below.

[146] In Kerr v. Baranow,[^33] the Supreme Court confirmed that a traditional resulting trust may arise in the domestic context where, as here, there has been financial contribution to the initial acquisition of a property and a subsequent gratuitous transfer of title to the property. In these circumstances, the actual intention of the transferor is the governing consideration.[^34] Further, the intention of the transferor to make a voluntary and gratuitous transfer is an essential ingredient of a legally valid gift.[^35]

[147] In MacIntyre v. Winter,[^36] the court reviewed the relevant factors to consider in respect of a resulting trust claim:

(a) a presumption of resulting trust applies in disputes over gratuitous transfers between common law spouses;

(b) it is the transferor’s actual intention that governs whether a resulting trust or a gift was intended;

(c) the nature of the burden that is needed to rebut the presumption is the civil standard of a balance of probabilities, which requires “clear, convincing and cogent” evidence;

(d) the absence of contemporaneous documentation by itself is not necessarily sufficient to conclude that a gift was intended. Where the evidence establishes that the issue was simply not discussed – an understandable result in a domestic relationship – the evidence is insufficient, and the presumption of a resulting trust determines the result; and,

(e) evidence that a significant portion of monies come from a third party (in this case the transferor’s mother) to the transferor alone supports that party’s stated intention that he expects to receive back the gift (in this case the down payment).

[148] Given my finding that the mother holds a 50% constructive trust interest in the family home, I need not address her claim for a resulting trust interest.

[149] However, if I have erred then my alternate finding is that the mother holds a 50% resulting interest for the following reasons:

(a) the transfers made by the MGM on the mother’s behalf, and by the mother, were gratuitous, and the presumption of resulting trust applies as the parties were common law spouses;

(b) as set out in great detail throughout these reasons, the mother did not intend to gift funds to the father. There were many discussions about money and no agreement by the mother (or the MGM) to treat her significant contributions as gifts;

(c) the father’s evidence (including his oral testimony and the documentation submitted at trial) does not rebut the presumption and is not “clear, convincing or cogent”;

(d) evidence of the MGM’s contributions support the mother’s intent of continued ownership in “our house”;

(e) the fact that the funds were transferred by the MGM and third parties on her behalf to the mother via third parties (each child, the PGM and the father) is not inconsistent with the MGM’s intention to gift the funds to the mother alone;[^37]

(f) the mother’s contributions to the purchase of the home, and the carrying costs are inconsistent with the father’s position that she did so in the form of gifts;[^38]

(g) title held in one party’s name alone does not rebut the presumption where the non-titled spouse believes or is unable to secure mortgage financing.[^39]

[150] Given my finding that the mother’s financial contributions account for approximately 50% of the current equity in the home, I would award her a 50% interest in the family residence by way of resulting trust.

The Father’s Claims in Respect of an Equalization of Net Family Property and the Limitation Period

[151] Section 5(1) of the Family Law Act (the “FLA” or the “Act”),[^40] provides that when a divorce is granted or a marriage is declared a nullity, or when the spouses are separated and there is no reasonable prospect that they will resume cohabitation, the spouse whose net family property is the lesser of the two net family properties is entitled to one-half the difference between them.

[152] In respect of limitation periods, section 7(3) of the Act provides that an application based on 5(1) shall not be brought after the earliest of,

(a) two years after the day the marriage is terminated by

divorce or judgment of nullity;

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

(c) six months after the first spouse’s death.

[153] The issue of discoverability is addressed in section 5(1) of the Limitations Act,[^41] which provides that: A claim is discovered on the earlier of,

(a) the day on which the person with the claim first knew,

(i) that the injury, loss or damage had occurred,

(ii) that the injury, loss or damage was caused by or contributed to by an act or omission,

(iii) that the act or omission was that of the person against whom the claim is made, and

(iv) that, having regard to the nature of the injury, loss or damage, a proceeding would be an appropriate means to seek to remedy it; and

(b) the day on which a reasonable person with the abilities and in the circumstances of the person with the claim first ought to have known of the matters referred to in clause (a).

(2) A person with a claim shall be presumed to have known of the matters referred to in clause (1) (a) on the day the act or omission on which the claim is based took place, unless the contrary is proved.

[154] A limitation period can be extended under section 2(8) of the FLA, if on a motion, the Court is satisfied that,

(a) there are apparent grounds for relief;

(b) relief is unavailable because of delay that has been incurred in good faith; and

(c) no person will suffer substantial prejudice by reason of the delay.

[155] The father asserted a Limitations Act extension claim in his pleadings and his proposed draft order. However, at trial he provided no evidence to support this claim, nor did his counsel make any submissions during his closing argument. The father did refer to this issue in his case book.

[156] However, the mother made a brief submission in her closing argument, being that the claim for equalization is statute barred. Her case book refers to Okmyansky v. Okmyansky, where the Ontario Court of Appeal held such a claim cannot be brought more than two years after a divorce.[^42]

[157] Finally, the mother asserts that the father has failed to provide the required financial disclosure to enable an equalization claim to proceed. She asserts that the Ontario Court of Appeal determined in Segat v. Segat, that it is an error to order an equalization payment to a party who refuses to provide disclosure.[^43]

[158] The father’s case book refers to the discoverability principle. The father seeks a declaration that he may proceed with his equalization claim in his proposed order.[^44] The father submits that he meets the test for an extension of time, as set out in section 2(8).

[159] I decline to grant the father’s request for an extension of time to pursue his claim for an equalization of net family property for the following reasons:

(a) although the father included this claim in his Answer dated September 20, 2020, (over two years ago), he failed to bring the required motion;

(b) the father provided no evidence at the trial to support his claim that he only discovered the equalization claim when the MGM paid the sum in June 2016. He admitted that he could not remember the information provided to him in November 2014, other than the need for the parties to live separate and apart for one year prior to obtaining a divorce;

(c) I prefer the mother’s evidence that the paralegal explained the law or property and support in November 2014. I accept her evidence that they consciously decided to include custody, access and child support provisions in the Joint Application for Divorce, but not spousal support or the equalization of net family property. I note that by November 2014, both parties were working full-time, the mother’s income was approximately $35,000. The mother testified that her only assets were a used car, the condominium that was purchased with a $10,000 down payment from the MGM, as well the MGM’s residence in China that had been placed in her name for estate-planning purposes;

(d) the mother will suffer substantial prejudice by the delay in obtaining a final resolution to the family law issues as follows:

i. this matter has been ongoing since December 5, 2019. Both parties have incurred significant legal fees that they cannot afford. Family law litigation takes an emotional toll on litigants, their children and their extended family members. A final resolution is needed now, and a trial about equalization would likely be at least 12 months from now;

ii. the parties’ sworn Financial Statements and Net Family Property Statements have significant gaps. The mother attached responses from banks stating that the requested documentation is no longer available (and the father conceded same). On October 5, 2022, Jarvis J. dismissed most of the father’s disclosure requests having found that they are a fishing expedition;

iii. the available evidence is limited and it is prejudicial to the mother to have to incur legal costs to defend against such a claim. The mother has already paid the sum of $30,000 to the father out of the net proceeds of sale of the former matrimonial home (in July 2016); and

iv. I am concerned that once the father pays the amounts owed pursuant to this order, and the fees to prepare for a second trial, he will have insufficient funds to pay costs if the court finds that the mother has already paid what may have otherwise been owing on account of equalization.

VI. COSTS

[160] At the conclusion of the trial, both parties filed Bills of Costs, Offers to Settle (including charts) and costs submissions. The mother’s full indemnity costs amount to $91,146 and the father’s amount to $116,992, inclusive of HST and disbursements. As per my directions, the parties did not claim costs for attendances at motions of conferences (as costs were not deferred to the trial judge).

[161] Family Law litigants are encouraged to settle their disputes without resorting to the courts and to seek reasonable compromise whenever possible. Rule 18(14) paragraphs 1, 3-5 and Rules 24(1), (5) and (12)(a) and (b) of the Family Law Rules (“the Rules” or “Rule”) deal, respectively, with the exchange and non-acceptance of Offers to Settle and frame the exercise of the court’s discretion when awarding costs.

[162] The principles guiding the court’s exercise of its discretion pursuant to the Rules are well-established. The primary objective, of course, is to enable the court to deal with cases in a fair and timely manner. Four fundamental purposes are served: (1) to partially indemnify successful litigants for the cost of litigation; (2) to encourage settlement; (3) to discourage and sanction inappropriate behaviour by litigants;[^45] and (4) to ensure that cases are dealt with justly.[^46]

[163] Family law litigants must act in a reasonable and cost-effective way: they should, and will, be held accountable for the positions they take in their litigation.[^47] As observed by the Court of Appeal in Beaver v. Hill,[^48] reasonableness and proportionality frame the exercise of the court’s discretion; the amount to be awarded is what the “court views as a fair and reasonable amount that should be paid by the unsuccessful [party]”.[^49]

[164] As plainly stated by Pazaratz J. in Scipione v. Del Sordo,[^50] “Who got what they asked for?”

[165] The mother has been wholly successful at this trial. She made a variety of Offers to Settle. I find that she has effectively met or beat her April 4, 2022, offer for the following reasons:

(a) the major decision-making and parenting terms are effectively the same (or very similar) as the terms accepted by the father on October 19, 2022;

(b) the mother agreed to pay child support on her prior year’s income as well as arrears of $16,658. A similar agreement was reached on the first day of trial, although with an additional amount of arrears of approximately $3,000;

(c) the mother offered to accept the sum of $290,105 in full satisfaction of the funds that she contributed to the family residence, and I have made an order for a 50% trust interest (with a value of $487,608);

(d) the mother offered to pay the sum of $40,000 to the father on account of his property claims, and I have determined that the father’s property claims are statute-barred; and

(e) it is irrelevant that the terms were not severable, as she met or beat the terms.

[166] I find that the father’s position throughout this litigation has been patently unreasonable, both in terms of his substantive claims, his legal arguments and his refusal to settle this case amicably. The father’s delay in respect of his responses to the mother’s Request for Information, the delay of his Request for information and the delay of his largely unsuccessful motion for disclosure (and to add the MGM as a party), required that the matter be adjourned to the November 2022 trial sittings (rather than be heard in May 2022). The father’s refusal to consent to a parenting time schedule until April 2021 was unreasonable (and not child-focused). The father’s proposed second Amended Answer delivered on the eve of trial was also highly problematic. The mother has incurred significant legal fees in her attempts to bring this matter to conclusion.

[167] The mother’s counsel’s is a 2015 year of call. Her hourly rate was $275 and $325, during the three years that this matter was before the court. The fees and hours billed are entirely reasonable. The mother’s counsel and a legal assistant did the bulk of the work.

[168] I note that approximately half of the fees payable by the mother were incurred for this seven-day trial, which ought not to have been needed. To be very clear, it is the father’s unreasonable behaviour that caused the mother to incur most of the fees and disbursements from at least April 4, 2022 (the date of the Offer to Settle described above) onwards.

[169] This is an appropriate case for close to full indemnity, in large part due to the father’s unreasonable behaviour. I impose a small discount to the fees requested by the mother as I recognize that the parties ultimately settled the parenting and support issues. Consequently, additional trial days were not needed to address those issues.

[170] I find that costs in the amount of $88,000 inclusive of disbursements and HST is reasonable and proportionate. That amount will: (a) significantly indemnify the mother for the cost of litigation; (b) encourage settlement in other similar cases; (c) discourage and sanction inappropriate positions taken by the father; and (d) is just, particularly since she has had no access to her funds since the parties’ separation in February 2019.

VII. DISPOSITION

[171] Order to go as signed by me this day, as follows:

1. The Respondent, Dapeng Quan has been unjustly enriched by the financial contributions made by the Applicant, Yue Sun, towards the property located at 20 Camellia Drive, Richmond Hill, Ontario (the “Property”).

2. The Applicant is a beneficial owner of the Property, and the Respondent holds a 50% interest in the Property in trust for the Applicant.

3. The Applicant is entitled to receive 50% of the post separation increase in value of the Property.

4. The Respondent is restrained from dissipating, encumbering or otherwise disposing of the Property, other than as may be required to facilitate the sale of the Property pursuant to the terms below. This provision shall remain in effect until the Applicant receives the payments set out in paragraph 9, or the Property is sold.

5. The Applicant has leave to file a copy of this order on title, which shall be removed once the Applicant receives the payments set out in paragraph 9, or the Property is sold.

6. By January 16, 2023, the Respondent shall confirm, in writing, that he anticipates obtaining satisfactory refinancing to pay the amounts of $487,608 and $88,000 to the Applicant by January 31, 2023.

7. If the Applicant does not receive the confirmation by January 16, 2023, the Respondent shall provide the Applicant with a draft and completed agreement for the listing and sale of the home by January 20, 2023, including the name and contact information for the proposed real estate agent, the proposed listing price and terms and the proposed real estate solicitor.

8. If the Applicant does not consent to the terms of the agreement by January 26, 2023, she shall submit an urgent 14B to my attention and both parties shall file their respective proposed completed agreements for the listing and sale of the Property. This includes the name of the propose real estate agent, a one-page summary of their experience selling homes in Richmond Hill, the proposed listing price and terms and the proposed real estate solicitor.

9. If the Respondent fails to pay the amount of $487,608 and costs of $88,000 to the Applicant by January 31, 2023, the Property will be listed for sale by February 10, 2023, on terms agreed to by the parties or as directed by this Court.

10. The Respondent shall obtain the Applicant’s written consent prior to accepting an offer.

11. The parties shall accept the first reasonable offer.

12. The Property sale shall close not more than 90 days after the of acceptance of the offer.

13. The proceeds of sale shall be held in trust by the real estate solicitor who shall make the following payments:

(a) first, to the Applicant, 50% of the proceeds of sale after deducting the sum of $614,785 (on account of the line of credit) and after deducting 50% of the disbursements relating to the sale of the home;

(b) second, to the Applicant, her costs of this proceeding in the amount of $88,000, inclusive of HST;

(c) next, to third parties, any other amounts owed on account of the line of credit, property taxes, home insurance, utilities, maintenance and repairs; and

(d) finally, once (a) – (c) have been completed, the balance of the funds shall be released to the Respondent.

14. Any issue respecting the sale of the home shall be directed to my attention by 14B on an urgent basis.

15. The Respondent’s equalization claim is statute barred and dismissed.

16. All other claims made in the Amended Application and the Amended Answer are hereby dismissed, with prejudice.

Justice A. Himel

Date: December 13, 2022

[^1]: The mother studied at Canadian universities before meeting the father in China. [^2]: Both parties deny perpetrating any family violence. However, an email exchange on that date describes an incident whereby the father punched his hand through the mother’s car window (requiring stitches) and the mother injured the father’s foot (impacting his ability to work). [^3]: The father’s evidence was contradictory on this point. [^4]: He gifted other funds that were used by the father to purchase a car. [^5]: The net proceeds of sale were approximately $42,000. [^6]: Throughout these proceedings the father had legal representation from a Mandarin-speaking lawyer. [^7]: Hryniak v. Mauldin, 2014 SCC 7, [2014] 1 S.C.R. 87. [^8]: Jayawickrema v. Jayawickrema, 2020 ONSC 2492, at para. 28. [^9]: I find that several weeks is more than 17 days. [^10]: 2011 ONCA 533, 472 D.L.R. (4th) 215, at paras. 23-24. [^11]: Pecore v. Pecore, 2007 SCC 17, [2007] 1 S.C.R. 795, at paras. 56-59; see also Holtby v. Draper, 2017 ONCA 932, 138 O.R. (3d) 481, at paras. 31-32. [^12]: The father produced no expert report or other documentary evidence to support his bald assertions that the mother’s actions caused him trauma or other emotional harm. [^13]: In his closing submissions the father’s counsel pointed out that it was possible that the MGM made a joint gift to both parties. [^14]: Akin to a statement of law. [^15]: R.S.O. 1990, c. L.15, s. 4. [^16]: McConnell v. Huxtable, 2014 ONCA 86, 118 O.R. (3d) 561, at paras. 38-40. [^17]: 2022 ONCA 810. [^18]: 2011 SCC 10, [2011] 1 S.C.R. 269, at para. 32. [^19]: Kerr v. Baranow, at paras. 40, 43. [^20]: R.S.O. 1990, c. M.3. [^21]: Garland v. Consumers’ Gas Co, 2004 SCC 25, [2004] 1 S.C.R. 629, at para. 63. [^22]: Kerr v. Baranow, at paras. 46-52. [^23]: Kerr v. Baranow, at para. 47. [^24]: Kerr v. Baranow, at para. 87. [^25]: Kerr v. Baranow, at paras. 89-99. [^26]: Kerr v. Baranow, at para. 50. [^27]: Kerr v. Baranow, at para. 51. [^28]: I note that there need not be a “good explanation” to make the required findings in any event. [^29]: 2020 ONSC 2922, at para 90. [^30]: 2021 ONSC 6810, at para. 50. [^31]: Korman v. Korman, 2015 ONCA 578, 126 O.R. (3d) 561, at para. 40. [^32]: ($1,590,000 - $614,785) / 2. [^33]: Kerr v. Baranow, at paras. 16-19. [^34]: See also Pecore v. Pecore, at paras. 43-44; Schwartz v. Schwartz, 2012 ONCA 239, 349 D.L.R. (4th) 326, at paras. 41-42. [^35]: See McNamee v. McNamee, at para. 24. [^36]: 2021 ONCA 516, 158 O.R. (3d) 321, at paras. 18, 24-25, 28, 38, 40-41. [^37]: Lin v. Wen, 2022 ONSC 3078, at paras. 21, 59, 61, 71. [^38]: Kerr v. Barrow, at para. 61, 71-72. [^39]: Kerr v. Barrow and Sorel v. Crane, 2018 ONSC 3460 at para. 83, 84 and 90. [^40]: R.S.O. 1990, c. F.3, s. 5(1). [^41]: S.O. 2002, c.24 Sched. B. [^42]: 2007 ONCA 427, 86 O.R. (3d) 587, at para. 21. [^43]: 2015 ONCA 16, at para. 4. [^44]: The father effectively requests a second trial on the equalization issue. [^45]: Serra v. Serra, 2009 ONCA 395. [^46]: Mattina v. Mattina, 2018 ONCA 867 at para. 10. [^47]: Heuss v. Sarkos, 2004 ONCJ 141; Peers v. Poupore, 2008 ONCJ 615. [^48]: 2018 ONCA 840, at para. 4. [^49]: Boucher v. Public Accountants Council for the Province of Ontario (2004), 2004 CanLII 14579 (ON CA), 71 O.R. (3d) 291 (C.A.). [^50]: 2015 ONSC 5982, at para 6.