Court File and Parties

COURT FILE NO.: CV-22-0349-00 DATE: 2023-01-24

SUPERIOR COURT OF JUSTICE – ONTARIO

RE: Kimmberley White, Applicant v. Ernest Vaillancourt, Respondent

HEARD: January 19, 2023

BEFORE: Nieckarz J.

COUNSEL: Eric Zablotny, for the Applicant Self Represented Respondent

Amended Endorsement

Overview

1This Application for partition and sale of the home municipally known as 1612 Crawford Avenue, Thunder Bay, ON (the “Home”), was heard by me in motions court by Zoom. The Respondent, Mr. Vaillancourt, participated by telephone.

2The parties are former romantic partners who were in a short-term relationship with a maximum duration of two years, ending in approximately 2008. During their relationship they acquired a joint interest in Mr. Vaillancourt’s family home. They differ as to how they became owners of the home. Upon their separation Mr. Vaillancourt remained in the home, where he continues to live. The Applicant, Ms. White, would now like to realize her interest in the home. Mr. Vaillancourt does not wish to sell the home but does not have the ability to finance a purchase of Ms. White’s interest.

3For reasons set out below, partition and sale are ordered on the terms set out herein.

Background

4In 1972, the Home was acquired by the Respondent’s grandparents, Margaret and Henry Vaillancourt. The last of his grandparents passed away in 1987, at which time ownership of the home passed to the Respondent’s mother, Carolyn Vaillancourt (“Carolyn”) and his step-father Gary DeRuiter (“Gary”).

5Carolyn and Gary did not live in the home. They used it as a rental property. In approximately 2000, the Respondent moved into the property and rented it from Carolyn and Gary.

6The Applicant and the Respondent became engaged. The Applicant had her own home and sold it. She moved in with the Respondent.

7The Respondent states that the home was gifted to him and the Applicant by his mother, in contemplation of their marriage. Title was transferred in September 2007 to the parties as joint tenants. The Respondent says there was no consideration at all paid. He says they continued to live in the home briefly together until he had to attend a 2-year jail sentence, at which point the Applicant rented the home to a friend. They separated shortly before he went to jail. They never did marry, and the property did not become a matrimonial home. The Respondent says that when he was released from jail the Applicant told him that she wanted nothing to do with the house, and she moved on with her life, as did he. He has continued to live in the home for the past 14 years after she left. He has paid all the taxes, utilities and maintenance associated with the home, including all renovations and repairs. He is in poor health. He has limited ability to work. He has a labourer business he operates from his garage. He has rented a room in the home to another male to assist him with payment of the bills since 2009. He says that forcing him to leave the home that he loves, would result in a significant hardship for him and his tenant.

8The Applicant states that the property was sold to them by Carolyn and Gary for the sum of $46,000. She states that she paid $28,000 towards the purchase price, without contribution from the Respondent. A promissory note was signed for the remaining $18,000. It was intended that the Respondent would pay the promissory note in full and then pay for some early renovations to the property to ensure that their initial contributions were equal. She states that the promissory note was not paid and renovations in the amount of $15,000 – 20,000 were paid for exclusively by her. Furthermore, after the Respondent went to jail and she was renting the property, the rent was insufficient to pay all expenses and she was required to pay any shortfall. She acknowledges that upon the Respondent’s release from jail he returned to the property and has been paying all expenses ever since. She denies have released any claim to the home. She takes the position that she has been content to allow the Respondent to remain in the home, hoping he would be able to purchase her interest at some point. Unfortunately circumstances have arisen lately that necessitate sale.

9The Applicant further alleges that she paid approximately $10,500 towards the promissory note on the understanding that the parties would “square up” at a later date. The Respondent adamantly denies that the Applicant paid any money towards the acquisition of the home or the maintenance of it.

10Gary confirms that $46,000 was the purchase price for the home. What the actual value of the home was on the date of transfer is not known. Therefore, it is not known whether the purchase price represented the fair market value of the home and whether any portion of the value of the home represented a gift. Messages from the Applicant to the Respondent talk about her contribution of $28,000 to “expenses” and the promissory note. What was paid by either party and what portion of the value of the home was a gift is not germane to the issue I must decide today.

11Gary further says that the Respondent did not make any further payments towards the promissory note in the period from 2009 to 2018. Carolyn passed away in 2013. Gary and the Respondent agreed that the Respondent would work off the balance of the promissory note by performing labour for Gary. The balance owing on the note was forgiven. The Respondent denies that he ever signed the promissory note. He maintains that there was absolutely no consideration for the transfer of the home to him and the Applicant.

12The parcel register attached to the Applicant’s affidavit confirms the transfer to the parties in September 2007 as joint tenants but is incomplete and does not show the consideration. Due to the passage of time, original or copies of original transfer documents and the promissory note do not appear to have been retained.

[13] The Applicant states that she now wishes to realize her interest in the home for the following reasons: a) In 2019 the City of Thunder Bay contacted her, as an owner of the home, requiring the immediate removal of a structure on the property. The structure was alleged to be in violation of The Building Code Act. Apparently, the Respondent was refusing to do so, which exposed both owners to fines and/or charges. Prior to this she did not appreciate her potential liability for any unlawful activities undertaken on the property by the Respondent. Ultimately the Respondent did remove the structure and there were no fines. b) After seeking legal advice, she was advised that as a joint owner she was jointly liable for any injuries suffered by any person on the property. This became particularly concerning when she learned recently that the Respondent had not maintained the insurance on the property. c) She has contributed approximately $58,500 towards the purchase of the property and renovations to it, which she would now like to realize. The Respondent has lived in the home, mortgage free, and derived rental income from it without any accounting to her.

14The Respondent alleges that given the Applicant’s initial assertion 14 years ago that she wanted nothing to do with the house, her actions are malicious and oppressive. While it is unclear specifically how, the Respondent alleges that the Applicant is using her position as a tax auditor to threaten him. I take from this that he alleges some threats given the cash nature of his business, but I do not know this for certain. The Applicant denies having acted in anything other than a compassionate manner towards the Respondent with respect to her attempts to resolve this issue and address her concerns. She attaches various messages between the parties. She feels she has been more than patient over the years in waiting to recover her investment into the property.

Analysis

The Legal Framework

15Section 2 of the Partition Act, R.S.O. 1990, c. P.4, gives the court the jurisdiction to order the partition and sale of jointly owned property.

16A joint tenant has a prima facie right to the partition or sale of jointly owned lands: Mammoliti v. Smutniak, 2022 ONSC 6461, at paras. 25-27; Latcham v. Latcham, at para. 2.

17Judicial discretion to refuse an order for partition is limited to instances where there is evidence that the Applicant has acted maliciously, vexatiously, or oppressed the Respondent: Latcham, at paras. 1-3.

18Allegations of malicious, vexatious or oppressive conduct and evidence relating thereto must relate to the partition and sale issue itself, and not the general conduct of a joint owner: Kaphalakos v. Dayal, 2016 ONSC 3559, at para. 17.

19It is up to the party opposing the sale to establish evidence of sufficient reasons to require the court to exercise its discretion to refuse partition and sale: Afolabi v. Fala, 2014 ONSC 1713, [2014] O.J. No. 2429.

20The court must consider potential prejudice to realistic claims yet to be determined on a final basis if a sale is to occur in the meantime: Dhaliwal v. Dhaliwal, 2020 ONSC 3971, at para. 16.

Discussion

21The Applicant is a joint owner of the property. This is not disputed. She is registered on title as a joint tenant with the Respondent.

22The Respondent argues that the Applicant’s ownership of the property was contingent on her marrying the Respondent, which she did not do. There is no evidence of this. Again, the Applicant is a registered joint owner of the property.

23The Respondent further argues that the Applicant relinquished her interest in the property 14 years ago when she chose to walk away and told him that she no longer wanted anything to do with the property. The Applicant denies this was the case. She also cites s. 4 of the Statute of Frauds, R.S.O. 1990, c. s. 19, which requires contracts (agreements) pertaining to land to be in writing. There is no such contract. It is also noted that the parties did not change the registered ownership of the property.

24The Respondent is self-represented but requires legal advice with respect to the home and the claims he should be advancing. He has made arguments that he has paid everything for the home since it was acquired as a gift to the parties, and it would be unfair for the Applicant to force the sale and receive any portion of the equity. He denies she has made any contribution to the acquisition or maintenance of the home whatsoever.

25While not framed as such, the Respondent advances unjust enrichment and constructive trust arguments. I must consider the potential prejudice to the Respondent’s claims if a sale is ordered.

26In the circumstances of this case, and while I am sympathetic to the Respondent’s desire to keep his family home, I do not find a prejudice to realistic claims of the Respondent if the property is sold. While the Respondent denies any contribution by the Applicant to the acquisition or maintenance of the home, the evidence of one of the vendors (Gary) confirms that she did pay money both at the time of purchase and on the promissory note. It is extremely unlikely that a court will find that the Applicant is not entitled to any money on account of her interest in the home. There is nothing that suggests to me a resulting trust on the circumstances of this case, although I appreciate that the evidentiary record may not be complete.

27Unfortunately, the Respondent is unable to pay anything unless the property is sold. An order for the sale of the property with funds held in trust or paid into court pursuant to Rule 66.03 of the Rules of Civil Procedure will allow for the claims of the parties to be determined (assuming the Respondent chooses to advance them) and the claims of the Respondent to be safeguarded. Some funds will be needed so that the Respondent can secure alternate accommodations and perhaps to assist with the cost of litigation of these issues. It is hoped that the parties can agree on something reasonable, but if not, they are free to re-attend. I am not seized.

28With respect to malice, vexatious or oppressive conduct, I find there has been none committed by the Applicant. There is no reason not to order partition and sale.

29It is appropriate in the circumstances to give the Respondent some time to search for alternate accommodations, obtain legal advice and organize his business and other affairs. A short delay in the sale of the home, given the time that has already elapsed, should not significantly prejudice the Applicant.

Order

[30] Partition and sale of the property located at 1612 Crawford Street, Thunder Bay, Ontario is ordered subject to the following: a) The property shall not be listed for sale prior to May 1, 2023. b) If the parties cannot agree as to the conduct of the sale, they shall apply to the court for directions. c) Until such times as the parties agree upon the distribution of the net sale proceeds, they shall either be held in trust by a mutually agreeable lawyer, or paid into court pursuant to Rule 66.03, subject to agreement between the parties or the right of either party to apply to have some of the funds released to them prior to a final determination of any issues pertaining to the property. d) If the parties cannot agree as to costs of this application, they shall schedule a 1-hour appearance with the trial co-ordinator.

31The Respondent is strongly urged to seek legal advice and to advance any necessary claims with respect to the property as soon as possible. Nothing in this decision precludes the parties from continuing to have settlement discussions about the value of their respective interests in the home and exploring possibilities for the Respondent to retain the home. If, however, those discussions are not fruitful, to be clear, the home must be listed for sale on or after May 1st.