Avdeeva v. Khousehabeh, 2023 ONSC 775

COURT FILE NO.: CV-05-299825-0000

DATE: 20230531

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

MS. VALENTINA AVDEEVA

Plaintiff

– and –

CAROLINE

KHOUSEHABEH, Trustee

Defendant

Ray Thapar, for the Plaintiff

David Wagner, for the Defendant

HEARD: January 30, 31, 2023; February 1, 2, 3, 6, 7, 8, 2023

papageorgiou j.

A. NATURE OF THE CASE

B. DECISION

C. PROCEDURAL HISTORY

D. CONTEMPORANEOUS DOCUMENTS

E. SPOLIATION

F. BROWNE v. DUNN

G. THE WITNESSES

H. CREDIBILITY

I. BACKGROUND

J. THE WILKINSON PROPERTY

K. THE VICTORIA PARK CONDOMINIUM

L. BOWAN COURT

M. RESULTING TRUST/CONSTRUCTIVE TRUST

a) The Agreement to Purchase Bowan Court

b) The Deceased’s Assumption of Mortgage Debt

c) The Deceased’s Alleged Contribution to the Purchase Price

d) The Deceased’s Alleged Contribution to the Mortgage

e) The Deceased’s Alleged Payment of Expenses

N. THE LOANS

O. CONCLUSION

A. Nature of the case

[1] Ms. Valentina Avdeeva (“Ms. Avdeeva”) brings an action against Levon Khankaldiyan a.k.a. Khankaldiyan Haftvan who is now deceased (the “Deceased”) and who is represented in this proceeding by the Trustee of his Estate, Caroline Khousehabeh (the “Estate Trustee”). The relief sought is:

a) A declaration that she is the sole beneficial owner of 2721Victoria Park Ave, Suite 506 (the “Victoria Park Condominium”). She claims that the Deceased took steps which resulted in the transfer of this property to the Deceased without her knowledge or consent.

b) A declaration that she is the sole beneficial owner of property located at 43 Bowan Court, over which the Deceased held a one per cent interest in trust for her (“Bowan Court”). She seeks an Order removing the Deceased’s one per cent interest from title.

c) Judgment for damages in respect of three unpaid promissory notes in the amount of CDN $24,000, CDN $60,000 and USD $31,500 plus interest (the “Promissory Notes”).

[2] The Deceased brings an Application against Ms. Avdeeva claiming a 50 per cent interest in Bowan Court; this Application has been joined to this proceeding.

[3] Ms. Avdeeva’s position is that she was a Russian immigrant, spoke little or no English, that the Deceased was a good friend of her daughter, Ms. Elena Klevstova (“Ms. Klevstova”) and that he assisted her with some of her affairs. She says that she placed trust in him and that he took advantage of her by engineering the transfer of the Victoria Park Condominium to him without her consent and by obtaining loans which he never repaid. She says he had a one per cent interest in Bowan Court, which he held in trust for her, and he has no basis for a 50 per cent resulting or constructive trust.

[4] The Deceased’s position is that Ms. Avdeeva was sophisticated in financial affairs, and that it was actually him who reposed trust in her. He claims that he was in a romantic relationship with, and even a common law spouse, of Ms. Avdeeva’s daughter, Ms. Klevstova. He denies that he ever received any loans from Ms. Avdeeva even though he signed four promissory notes confirming that he had. He denies that the Victoria Park Condominium was improperly transferred to him. He further states that Bowan Court was purchased by Ms. Avdeeva and intended to be a matrimonial home for him and Ms. Klevstova. He claims he made various financial contributions to Bowan Court.

B. DECISION

[5] For the reasons that follow, I am dismissing Ms. Avdeeva’s claims relating to the Victoria Park Condominium and the Promissory Notes. I am declaring that she is the sole owner of Bowan Court and directing that the Deceased’s name be removed from title.

C. PROCEDURAL HISTORY

[6] This matter has a long procedural history as follows:

• On November 7, 2005, Ms. Avdeeva issued her Statement of Claim.

• On November 7, 2005, Ms. Avdeeva obtained a certificate of pending litigation in respect of the Victoria Park Condominium.

• On December 9, 2005, the Deceased filed a Statement of Defence.

• On May 14, 2008, the Bank of Montreal, who was exercising a power of sale, obtained an Order vacating the certification of pending litigation on the Victoria Park Condominium.

• On March 6, 2009, Ms. Avdeeva obtained a default judgment in respect of Bowan Court (the “Default Judgment”)

• On February 1, 2012, the Deceased brought an Application for partition and sale in respect of Bowan Court claiming a 50 per cent beneficial interest.

• On March 26, 2014, the Default Judgment was set aside.

• In 2014, the Deceased brought his first motion to dismiss for delay. It was dismissed.

• On August 8, 2017, the Deceased brought a second motion to dismiss for delay. It was dismissed.

• The Deceased delivered his Affidavit of Documents on May 31, 2016 and Ms. Avdeeva delivered hers on September 8, 2017. Both parties were examined for discovery in 2017.

• On March 10, 2018, the Deceased passed away.

• On February 21, 2019, the Estate Trustee obtained an Order to Continue.

• In 2020, the Estate Trustee brought another motion to dismiss. By reasons dated April 9, 2021, Associate Judge McGraw dismissed the motion writing “the difficulty with the Defendant’s argument in the circumstances is that the Estate is still pursuing the Application”, and that even if Ms. Avdeeva’s action was dismissed, that Application involving all the same issues with respect to Bowan Court will still proceed. He noted that although this was not an entirely document driven case, this matter still remained “document heavy litigation for which many material documents were still available”, that there were transcripts of discovery available, and that all effort have been exhausted by the parties to locate relevant documents. He concluded any delay by Ms. Avdeeva was not inordinate or inexcusable and that any delay has not resulted in a substantial risk that a fair trial was no longer possible.

• On June 10, 2021, the Estate Trustee’s appeal of Associate Judge McGraw’s decision was dismissed by Akbarali J.

• The trial was originally scheduled to commence on January 9, 2023. The Estate Trustee delivered 147 additional documents on December 7, 2022. Justice Chalmers did not accept the Estate Trustee’s explanation at the time that the documents had not been produced earlier because she could not determine relevancy. Justice Chalmers adjourned the trial to permit cross examination on these additional documents.

D. CONTEMPORANEOUS DOCUMENTS

[7] One of the arguments raised by the Estate Trustee relates to their alleged inability to produce sufficient documents which support the Deceased’s claims, again raising prejudice and delay by Ms. Avdeeva. First, I note that this issue has been exhaustively considered by three motion judges who rejected the Deceased’s and Estate Trustee’s motions to dismiss for delay as well as by Akbarali J. who dismissed the appeal of the most recent decision.

[8] While there has been criticism of Ms. Avdeeva’s delay in past decisions, courts have concluded that there was no substantial risk that a fair trial was not possible; this finding is res judicata.

[9] As found by Justice McGraw, and noted above, this matter is a document heavy case.

[10] The Deceased knew the case he had to meet when Ms. Avdeeva delivered her Statement of Claim in November 2005, and he knew the case he had to make when he delivered his own Application in 2012. The Deceased is also responsible in part for the delay. He commenced his own proceeding in 2012 and also did not take sufficient steps to advance it while he was alive or to obtain documents which would have supported his claim.

[11] I add that in 2012, when the Deceased brought his motion to set aside the Default Judgment, he stated that he still had cheques showing his payments to Ms. Avdeeva made towards the properties in question, and Bowan Court in particular. He did not assert that any of these documents had been lost due to delay. This was the reason why Myers J. set aside the Default Judgment, but in the end there was no significant production of such documents before or after this motion or at trial.

[12] I ask the rhetorical question, what happened to these documents?

[13] In Schedule “C” of the Deceased’s affidavit of documents sworn in 2017, the Deceased did list some limited documents which he indicated he had lost control or possession of but he did not indicate how as required.

[14] He was asked to provide an updated Schedule C, took it under advisement, and then refused to provide one.

[15] One example of the Deceased’s missing documents are bank records for the relevant period.

[16] When examined for discovery in 2017, the Deceased demonstrated that he did not take any significant steps to obtain bank records. This was the exchange:

A. Once I went to the bank and they told me, if you want records over five years, you want to go to the central, where I paid these funds, I said “Okay, by now.”

Q. And did you go to the central place they were telling you?

A. No, I told…it was on record, like, “Fuck it, I don’t want it.”

[17] Although the Estate Trustee was able to locate some additional documents in December 2022, and a supplementary affidavit of documents was provided, even these documents do not persuasively support the variety of claims which had been made by the Deceased.

[18] In contrast, as I will set out, Ms. Avdeeva’s claims were more supported by the documentary record, although there were also some missing documents on her part. This was because of a flood which took place after a break-in at Bowan Court which destroyed some of Ms. Avdeeva’s records during the material time. There is no evidence contradicting the fact that this flood occurred and destroyed documents. In fact, there were blueprints produced of a renovation of the basement after the flood which support its existence. Further, the affidavit of documents provided by Ms. Avdeeva made specific reference to the flood which had resulted in the destruction of documents and is thus consistent with this evidence. The Estate Trustee lead no evidence contradicting this. Ms. Avdeeva was examined for discovery and the Deceased could have pursued this issue if it was thought relevant.

E. SPOILIATION

[19] The issue of spoliation was raised but, in my view, it is not applicable to either side. While there is missing evidence that may be relevant, there is no evidence of intentional destruction: Catalyst Capital Group Inc. v. Moyse, 2016 ONSC 5271, 35 C.C.E.L. (4th) 242, at para. 136.

F. BROWNE v. DUNN

[20] At the outset, the Estate Trustee raised an issue regarding Browne v. Dunn (1893), 1893 CanLII 65 (FOREP), 6 R. 67 (H.L.) with respect to the Deceased’s evidence.

[21] The rule in Browne v. Dunn is a rule of procedural fairness. It requires that a party intending to challenge the credibility of a witness through contradictory evidence first give the witness an opportunity to address it while on the stand.

[22] As a rule of fairness, the rule in Browne v. Dunn is not a fixed rule. The extent of its application lies with the sound discretion of the trial judge and depends on the circumstances of each case: R. v. Quanash, 2015 ONCA 237, 125 O.R. (3d) 81, at para. 80.

[23] The Estate Trustee argued that Ms. Avdeeva could not lead any evidence of any fact if the Deceased had not been asked about that fact in connection with his examination for discovery or cross examination in respect of affidavits filed. Counsel was unable to provide any direct authority for this proposition and rested on the general argument that Browne v. Dunn is based upon fairness. The Estate Trustee argued that in this case, it would be unfair to allow Ms. Avdeeva to lead evidence that the Deceased had not had a chance to respond to.

[24] This argument mostly related to evidence given by Ms. Klevstova and a witness, Edward Hambrachian, about their romantic relationship from 1997 to 2000, and Ms. Klevstova’s evidence about whether she had pursued romantic relationships with persons other than the Deceased. As will be seen, although there was a tremendous amount of evidence on the nature of Ms. Klevstova’s and the Deceased’s relationship, I have not found it particularly helpful in determining this matter.

[25] In any event, I disagree that Browne v. Dunn is applicable, and in any event, I would not exercise my discretion to apply it in the manner requested.

[26] First, the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 (the “Rules”), give the trial judge the discretion to order that the transcript of discovery evidence be read in where a party has died. The Rules do not direct that the trial judge should then also restrict, or even consider restricting the evidence in chief in the manner suggested when a party has died before trial.

[27] Rule 31.11(6) provides as follows:

Unavailability of Deponent

(6) Where a person examined for discovery,

(a) has died;

(b) is unable to testify because of infirmity or illness;

(c) for any other sufficient reason cannot be compelled to attend at the trial; or

(d) refuses to take an oath or make an affirmation or to answer any proper question,

any party may, with leave of the trial judge, read into evidence all or part of the evidence given on the examination for discovery as the evidence of the person examined, to the extent that it would be admissible if the person were testifying in court. R.R.O. 1990, Reg. 194, r. 31.11 (6).

(7) In deciding whether to grant leave under subrule (6), the trial judge shall consider,

(a) the extent to which the person was cross-examined on the examination for discovery;

(b) the importance of the evidence in the proceeding;

(c) the general principle that evidence should be presented orally in court; and

(d) any other relevant factor. R.R.O. 1990, Reg. 194, r. 31.11 (7).

[28] To my knowledge, Browne v. Dunn has never been applied in the manner advocated for by the Estate Trustee, although the caselaw is replete with many cases where a party has passed away and that party’s evidence is permitted to be read in at trial pursuant to r. 31.11(6).

[29] It would be impracticable to proceed in the manner suggested by the Estate Trustee. It would mean that actions against a deceased party’s estate could never proceed if they were not commenced prior to a person becoming deceased. This is not the law of Ontario.

[30] Section 13 of the Ontario Evidence Act, R.S.O., 1990, c. E23, has put the following rules in place to ensure fairness when a party is deceased.

Actions by or against heirs, etc.

In an action by or against the heirs, next of kin, executors, administrators or assigns of a deceased person, an opposite or interested party shall not obtain a verdict, judgment or decision on his or her own evidence in respect of any matter occurring before the death of the Deceased person, unless such evidence is corroborated by some other material evidence. R.S.O. 1990, c. E.23, s. 13.

[31] The requirement of corroboration is the way in which fairness is ensured after a party has passed away. There is no need to then superimpose the rule in Browne v. Dunn on top.

[32] I have had regard for s. 13 of the Evidence Act throughout these reasons. The corroboration required by s. 13 must be independent evidence that shows that a claimant’s evidence, on a material issue is true. It can be either direct or circumstantial. It can consist of a single piece of evidence, or several pieces considered cumulatively: Burns Estate v. Mellon (2000), 2000 CanLII 5739 (ON CA), 48 O.R. (3d) 641 (C.A.), at para. 29; Botnick et al. v. The Samuel and Bessie Orfus Family Foundation et al., 2011 ONSC 3043, 71 E.T.R. (3d) 210, at para. 16, aff’d 2013 ONCA 225, 86 E.T.R. (3d) 6.

[33] I have found that Ms. Avdeeva’s case with respect to Bowan Court has been sufficiently corroborated for the reasons set out below. I have found that the Estate Trustee’s case with respect to Bowan Court has not been sufficiently corroborated or persuasive for the reasons set out below.

G. THE WITNESSES

[34] The following witnesses testified:

a. Ms. Avdeeva. She was 83 years old when she testified and had two strokes in previous years. She did not speak English and was visibly frail. The trial occurred over zoom which permitted her to lie down for the bulk of her evidence and she had with an ice pack on her head for most of it. Although she is the plaintiff, she did not even attend the trial, apart from her testimony. Her ability to answer questions was hampered by her own physical and mental frailty as well as the passage of time. To a large extent, as is evidenced by Ms. Klevstova’s and Ms. Avdeeva’s evidence, Ms. Avdeeva relied upon Ms. Klevstova to assist her with the transactions at issue in this proceeding. As such, Ms. Klevstova was able to give direct evidence on the majority of the issues, which were corroborated in any event by a very strong independent witness, Mr. Donald Grant, as well as by the contemporaneous documents.

b. Ms. Klevstova. She is Ms. Avdeeva’s daughter, and assisted her mother, throughout the relevant period, with translations from Russian to English and vice versa, and also helped manage her mother’s affairs.

c. Stephanie Klevstova. She is Ms. Klevstova’s daughter and Ms. Avdeeva’s granddaughter. She testified about the relationship she had with the Deceased. She was a small child during the relevant time periods and as such did not have a great deal of relevant evidence to give apart from her memory of her relationship with the Deceased and what she could recall of the Deceased’s relationship with Ms. Klevstova.

d. Edward Hambrachian. He was the Deceased’s friend and testified that he was in a romantic relationship with Ms. Klevstova from 1997 to 2000.His testimony was offered principally to rebut the Deceased’s evidence that he was in a romantic or common relationship with Ms. Klevstova for 10 years which would have covered the period from approximately 1993 to 2003.

e. Donald Grant. He was Ms. Avdeeva’s solicitor in respect of the purchase of Bowan Court. He gave evidence regarding his understanding of the transaction and whether there was any intention, as claimed by the Deceased, that he would have a beneficial interest in it. As I will set out, I found him to be credible and reliable.

f. Caroline Khousehabeh. She is the Trustee of the Deceased’s estate. She was also his friend and is the sole beneficiary of his estate. If successful in this matter, she will obtain a one half interest in a home that is worth more than $2,000,000, and so has a strong financial interest in the outcome. She did not have any significant evidence to give relevant to the financial issues in this matter; most of what she attempted to testify as to was in respect of what the Deceased had told her about the relevant facts, and even that was purportedly relayed to her long after the events took place.

g. Saeid Sajadi. He was a friend of the Deceased and testified as to his observations of the Deceased’s relationship with Stephanie and Ms. Klevstova.

h. Anahid Nersessian. She was the Deceased’s friend and testified as to her observations of the nature of the Deceased and Ms. Klevstova’s relationship.

i. Nahid Shamshiri. She was the Deceased’s friend and testified as to her observations of the nature of the Deceased and Ms. Klevstova’s relationship.

j. Farhud Frud. He was the Deceased’s friend and testified as to his observations of the nature of the Deceased and Ms. Klevstova’s relationship.

k. Robert Adourian. He was the lawyer who prepared the documentation which resulted in the transfer of the Victoria Park Condominium from Ms. Avdeeva to the Deceased by way of gift.

[35] As well, the parties consented to the Deceased’s evidence being read in from his discovery, which was conducted on October 20, 2017, in accordance with r. 31.11(6), to the extent that this evidence would be admissible if he were testifying in court as well as the cross examination on his affidavits which occurred on February 26, 2013. They also agreed to his previous affidavits being read into evidence as follows: a) Affidavit dated January 30, 2012 in its entirety; b) Affidavit dated January 31, 2013 (para 3, first sentence only, paras 6-7, and paras 10-11); c) Affidavit dated August 8, 2017, (paras 6-8 and 11-12).

H. CREDIBILITY

[36] The Estate Trustee emphasized credibility findings against Ms. Avdeeva made by Myers J. when he set aside the Default Judgment in 2014; he concluded that she had been dishonest about having no information as to where the Deceased could be located. I first note that at the time of this motion, Ms. Avdeeva was an elderly self-represented litigant who did not speak English. She was assisted by her daughter, Ms. Klevstova, who prepared the materials and who assisted her in managing the litigation. While it is completely wrong to have alleged an inability to locate the Deceased, desperate people sometimes do desperate and foolish things. As will be seen, I have concluded that the Deceased improperly took money and/or assets from Ms. Avdeeva. Ms. Klevstova had brought him into their lives and in my view, she employed improper self-help when she prepared and brought the Default Judgment materials in the form filed. This does reflect on Ms. Klevstova’s credibility but I am not satisfied that Ms. Avdeeva was aware.

[37] At trial, when cross examined about this motion for Default Judgment, Ms. Avdeeva was confused. At first, she said that she recalled bringing the motion, then she said, “what judgment?” and “I don’t really know about it”.

[38] When questioned further she said:

Well, at the time, my son—grandson was hospitalized. He was lying in the hospital, and I was so much preoccupied with his condition going back and forth to the hospital.

[39] She maintained her disagreement that she was attempting to deceive anyone, and I believe her.

[40] Another argument the Estate Trustee made is that Ms. Avdeeva should not be believed about her financial claims against the Deceased, referencing mostly the witnesses who contradicted Ms. Klevstova’s evidence with respect to the nature of her relationship with the Deceased and her grand-daughter, Stephanie. If Ms. Klevstova’s evidence with respect to this relationship is not to be believed, I fail to see how that reflects on Ms. Avdeeva’s credibility, or her case.

[41] The only potential inconsistencies in Ms. Avdeeva’s evidence on this issue are:

• In an affidavit in 2005, Ms. Avdeeva stated that the Deceased and Ms. Klevstova had been boyfriend and girlfriend in Russia which was inconsistent with her trial evidence. Both Ms. Klevstova and Ms. Avdeeva explained at trial that in the Russian language this does not connote an intimate relationship, but a girl who is friends with a boy. There is no evidence to contradict this evidence and I am in no position to make any findings on this linguistic issue.

• When examined for discovery, Ms. Avdeeva gave evidence that she did not know if Ms. Klevstova had a romantic relationship with anyone else during some of the relevant years. It is said that this contradicted both Ms. Klevstova’s and Edward Hambrachian’s evidence that they were romantically involved from 1997 to 2000. Again, I fail to see how this reflects on Ms. Avdeeva’s credibility and in any event she was never asked about this during the trial and so she was not properly impeached. Rather, the Estate Trustee asked Ms. Klevstova about her mother’s statement in this regard. Ms. Klevstova testified that her mother was aware of this relationship and pointed out that Ms. Avdeeva had had a stroke just prior to her discovery. Although Ms. Avdeeva should have corrected this answer, she did provide Mr. Hambrachian’s witness statement on January 23, 2023, two months before the trial so there was no unfair surprise.

[42] As noted above, the Estate Trustee called a number of witnesses who testified that they spent time with the Deceased and Ms. Klevstova and considered them to be a couple or boyfriend and girlfriend. I note that for each, their evidence was quite short (between 15 to 30 minutes in duration), and they did not provide many details or even sufficient information about themselves that would assist the court with assessing their credibility and reliability. Although they believed Ms. Klevstova and the Deceased were a couple, this was largely based on what the Deceased told them and time they spent with the two at some social events. No one ever saw them embrace or kiss nor did they know where the Deceased resided in the residences at which he stayed at with Ms. Klevstova. They all said that he loved and treated Stephanie as if she was his own daughter and I accept this evidence with respect to his relationship with Stephanie.

[43] There were two facts alleged which were more significant. One witness, Mr. Sajadi, testified that he heard Ms. Klevstova say she wanted to marry the Deceased and that after the Deceased moved out, Ms. Klevstova would not let the Deceased see Stephanie if he did not pay child support. This certainly supports the conclusion that they were in a romantic relationship or a couple.

[44] As well, another witness, Ms. Shamshiri testified they went to a film festival in Montreal and that Ms. Klevstova and the Deceased shared a room. This could support the existence of a romantic relationship but is not conclusive. They were immigrants with financial issues and could have shared the same room because it was cheaper.

[45] It is noteworthy that Ms. Klevstova was not asked about any of what these witnesses testified about when she was cross-examined.

[46] Further, as noted above, Mr. Hambrachian, testified that he was Ms. Klevstova’s boyfriend from 1997 until 2000, and that the Deceased knew about this relationship because they often went out altogether; he also spent time at the residence Ms. Klevstova shared with the Deceased and would pick her up there. This conflicts with the other witness’ testimony. It also conflicts with the Deceased’s claim that they were romantically involved for 10 years which would have meant from approximately 1992 to approximately 2003 which is when he says the relationship ended.

[47] It is difficult to reconcile this evidence but the passage of time may explain some of it.

[48] The witnesses called by the Estate Trustee were testifying about events which took place almost 20 years ago. Apart from Mr. Hambrachian, the status of the Deceased’s and Ms. Klevstova’s relationship with the Deceased could not have been of prime importance to these witnesses given that all of them were recent immigrants and would have been facing very real struggles to establish themselves in a new country.

[49] Even though I have no evidence as to why these witnesses might be untruthful or unreliable, I also have no reason to believe their evidence over Mr. Hambrachian’s, Ms. Klevstova’s or Ms. Avdeeva’s on these issues. In fact, I have more reason to believe Mr. Hambrachian because his alleged romantic relationship lasted three years and was clearly important to him. I have more reason to believe Ms. Klevstova and Ms. Avdeeva because through the trial process I have been able to watch and listen and learn much more about them over their days of testimony. Their evidence about the financial transactions which are the subject of this proceeding was consistent throughout, as well as consistent with the contemporaneous documents, and reflects on their overall credibility and reliability.

[50] I add that the Deceased’s evidence about his relationship with Ms. Klevstova is problematic. As noted, he says they were in a relationship for 10 years. As will be seen, during two of those years, they were not in the same country and she had a relationship with another man who fathered her child who was born shortly after she arrived in Canada. Thereafter, Mr. Hambrachian states that he was in a relationship with her. I suppose she could have been in a relationship with both, in theory, but there was no evidence of such an open relationship. Further, the Deceased’s evidence with respect to Ms. Klevstova evolved over time. In his January 30, 2012 affidavit, he simply said that he had been in a “relationship” with Ms. Klevstova “for several years” and which ended in 2003. It provides no details and does not even say the relationship was serious. Then, in his January 31, 2012 affidavit, he begins referring to her as his “common law spouse” and that continues in his subsequent evidence. His discovery evidence stated that they were in this relationship for 10 years, which conflicts with his January 30, 2012 affidavit which states it was “several years.”

[51] The documentation on the issue of Ms. Klevstova’s and the Deceased’s relationship is also inconsistent. The following documentation supports the conclusion that they were not common law spouses, as the Deceased claims.

• The Deceased declared on his tax returns in 2001 and 2002 that his marital status was ‘single’.

• The Deceased signed a solemn declaration on July 8, 2002 with regard to the Victoria Park Condominium that he was not a spouse.

• Documentation which will be discussed further below shows that he paid rent at Bowan Court when he lived with Ms. Klevstova and Ms. Avdeeva.

• Ms. Klevstova wrote a letter dated July 7, 1999 to Canada Immigration in support of the Deceased’s refugee application. It says that she knew him as a student, that he helped her when she first immigrated, that she suffered from depression at that time, that he had become “the most important and precious individual in her daughter, Stephanie’s life”, that he became her daughter’s godfather and that although she “was not in a position to give [the Deceased] sponsorship for his immigration purposes, but I am sure he will be the guardian of [her] daughter in [her will]”. This letter is consistent with her evidence at trial as to what their relationship was when they first met. It is also odd that she would be so effusive in her praise and not reference a prior or existing romantic relationship.

[52] The following documentation supports the conclusion that they were in some form of intimate relationship:

• The Deceased and Ms. Klevstova had a joint safety deposit box. She explained that this was because of problems which they had bringing currency over from Russia. They would have to purchase travelers cheques which they kept in this safety deposit box. The Deceased then assisted with converting these cheques. The fact that the Deceased performed this task was confirmed by the Deceased in his discovery evidence so that aspect of her evidence is supported by his.

• They both signed documents which included declarations that they were spouses. One of these was an Acknowledgement and Direction which related to the sale of a property which is not at issue in this proceeding dated August 27, 2003. Another is a Solemn Declaration dated August 27, 2003, which also related to the sale of the same property they jointly held specifying that they were the vendors and were spouses within the meaning of the Family Law Act, R.S.O. 1990, c. F.3. Ms. Klevstova’s evidence on this issue was that after the Deceased had failed to repay money he owed her mother, he told her that he would make her a joint owner of a property that he had purchased and that when it was sold, he would give her half the proceeds to repay the debt. The Promissory Note dated April 2002 which the Deceased wrote and signed, and which I discuss below, is somewhat supportive of this as he wrote that he “agreed to transfer assets (real estate) to Mr. and Mrs. Avdeeva equal to value of borrowed.”

Ms. Klevstova says that when this property was being sold, the Deceased told her to sign these Declarations so that she could receive part of the proceeds of sale, so she did. However, he never did give her any of the proceeds. I add that the Deceased had moved out of Bowan Court around the time of these documents, when Ms. Klevstova testified she was trying to recover monies taken by the Deceased. Therefore, the timing of this transaction is consistent with Ms. Klevstova’s evidence that she was attempting to recover her mother’s money which is why she signed these documents.

• Ms. Klevstova and Stephanie were listed as the Deceased’s dependents with his employer’s benefits plan and received health benefits.

• Stephanie’s baptismal certificate named the Deceased as her godfather.

• There are handwritten notes where the Deceased refers to Ms. Avdeeva as “Mama”.

• The Deceased established a RESP for Stephanie; however, she never received any of it.

[53] Additional relevant factors are: i) they did not hold any joint bank accounts; ii) they did not have any joint wills; iii) there are no pictures of them together; and iv) there are no emails showing any romantic involvement.

[54] Finally, there were no family law proceedings commenced by either of them. Even though there was much assertion that the relationship constituted a common law marriage, there are no family law claims here pursuant to any of the relevant legislation. The parties did not even refer to any case law or legislations as to what defines a common law relationship.

[55] In my view, the nature of Ms. Klevstova’s and the Deceased’s relationship is unclear on all the evidence as to its nature, if there was a romantic component, whether it was continuous or not, the duration, or the seriousness. I am unable to determine this issue on this record one way or another. The most the record supports is that there was a relationship which was very close, which perhaps approached a familial relationship. The Deceased assisted Ms. Avdeeva and her family with financial matters and translations and they assisted him as well by giving him a place to live while he pursued his refugee application, which Ms. Klevstova also assisted him with. The Deceased gave evidence during his discovery that Ms. Avdeeva’s family was wealthy, and as his Promissory Notes show, she assisted him by granting him loans to use in his business.

[56] As well, the Deceased had a close relationship with Stephanie as her godfather and, in my view, he was like a father to her based upon this record. And the record is clear that the Deceased was very interested in Ms. Klevstova romantically based upon what his friends said. What is unclear is whether some of his view of their relationship was more wishful thinking, or how far Ms. Klevstova reciprocated. There was no evidence about a sexual relationship.

[57] I add that while the Deceased did give evidence that he and Ms. Klevstova were in a common law relationship, what he mostly said during his discovery was that he, Ms. Klevstova, Stephanie and Ms. Avdeeva were a “family”. There are many kinds of family relationships and friends can sometimes be considered close enough to be family.

[58] When Ms. Klevstova was asked why the Deceased assisted her family, she explained that they were all new immigrants and this is what immigrants do, help one another. I find this as compelling an explanation for the way these parties interacted, as any other.

[59] Although I have felt the need to address Ms. Klevstova and the Deceased’s relationship, given the importance the parties have ascribed to it, I have nevertheless concluded that it is not very material in all the circumstances in any event.

[60] Even if Ms. Klevstova and the Deceased were in a romantic relationship of some nature, the evidence does not support the Deceased’s assertion that he has any basis for a constructive or resulting trust over Bowan Court. Being family might provide evidence in support of such entitlements if there was other evidence, but the mere fact of being a family member does not create any such entitlements.

[61] It is also unclear why this relationship, if proven, would give the Deceased any entitlements against Ms. Avdeeva, as opposed to Ms. Klevstova, who has no interest in Bowan Court.

[62] In effect, the Estate Trustee asks that I believe the witnesses who gave brief evidence on the Deceased’s and Ms. Klevstova’s relationship from over 20 years ago, conclude that it is the most critical evidence before me, and then disregard all of the contemporaneous documents and other independent evidence regarding the financial transactions which took place, which are the actual subject of this lawsuit, and which involved Ms. Avdeeva’s property, not Ms. Klevstova’s.

[63] Justice O’Halloran’s comments in Faryna v. Chorny, 1951 CanLII 252 (BC CA), [1951] B.C.J. No. 128, at para. 10, are particularly helpful in assessing credibility in this case:

The credibility of interested witnesses, particularly in cases of conflict of evidence, cannot be gauged solely by the test of whether the personal demeanor of the particular witness carried conviction of the truth. The test must reasonably subject his story to an examination of its consistency with probabilities that surround the currently existing conditions. In short, the real test of the truth of the story of a witness in such a case must be its harmony with the preponderance of the probabilities which a practical and informed person would recognize as reasonable in that place and in those conditions.

[64] In the end, in terms of credibility, I have found that the most credible and reliable witness is the lawyer, Donald J. Grant who prepared the documents in respect of the purchase of Bowan Court. As I explain, he is independent and his evidence was detailed, related to his general practice and was consistent with the documentary evidence.

[65] Despite Myer J.’s findings regarding the Default Judgment motion, and my finding that it was actually Ms. Klevstova who prepared materials which deceived the court, I have found Ms. Klevstova’s evidence as to the financial matters at issue credible and reliable as it is consistent with Mr. Grant’s evidence and the contemporaneous documents. It is trite that a trial judge is entitled to be accept all, none or some of a witness’ evidence.

[66] Ms. Avdeeva was not terribly reliable largely because of her frailty, both physically and mentally. However, in my view, she was doing her best to tell the truth. In any event, her personal credibility or reliability was not key because of Mr. Grant’s evidence as well as the contemporaneous documents. I add that the facts she could recall were mostly consistent with Mr. Grant’s and the contemporaneous documents and as such I also accept her evidence as set out below.

[67] Although Mr. Adourian had no independent recollection, he testified with respect to the Victoria Park Condominium based upon his general practice and I found his evidence reliable and credible.

[68] The Deceased’s evidence as to the financial matters at issue was mostly bald assertions which could not be supported by reasonable inferences from the surrounding circumstances or contemporaneous documents, and I have found his evidence not credible or believable. Part of this relates to his position regarding Bowan Court being intended to be a matrimonial home for him and Ms. Klevstova, which simply has no support in the record apart from his bald statements. Another aspect of this is the fact that he wrote and signed Promissory Notes and then provided an explanation which defies common sense and certainly had no basis in the contemporaneous documents. I add that I have dismissed the claim in respect of the Victoria Park Condominium because there was no claim for damages in respect of it; but I also found his evidence on that matter to not be credible for the reasons I have set out in that section below which also reflects on his overall credibility.

[69] In this case, as will be seen, the case presented by the plaintiff (her witnesses, the chronology of events, the contemporaneous documents) is more in harmony with the preponderance of probabilities, whereas the Estate Trustee’s is not. As such, I accept the evidence given by Ms. Avdeeva, Ms. Klevstova, Mr. Grant and Mr. Adourian in all instances where it conflicts with the Deceased’s.

I. BACKGROUND

[70] The Deceased had a Masters in Directing and Theatre. He was an actor and producer in the Armenian and Iranian communities and put on plays around world. Many of the witnesses testified as to his excellence in his field. He began a PhD in Theatre, but did not complete it.

[71] It is uncontradicted that Ms. Klevstova and the Deceased first met in or around 1992 when she was teaching English in Moscow and he was her student. Ms. Klevstova explained that she did not socialize with the Deceased in her personal capacity. She did, however, accompany students to performances taking place in Russia to accelerate their language proficiency and the Deceased was among the students who attended these performances. He made passes at her which she did not accept, but they became best friends.

[72] The Deceased, however, gave evidence that they began a romantic relationship in 1992 shortly after they met.

[73] Ms. Klevstova testified that in 1993, she obtained a job as a press secretary at the Iranian embassy in Ukraine where the Deceased was also working. The Deceased says that he obtained a job at the Embassy in Ukraine and that she moved there with him..

[74] It is undisputed that the Deceased left Ukraine in or around 1994 when he was fired from the Embassy while Ms. Klevstova remained there. The Deceased moved to Denmark where he made a refugee application, which was refused, and then to Sweden where it was also refused.

[75] It is undisputed that between 1994 to 1996, Ms. Klevstova had a relationship with a man named Ramin Affiaetab and in 1995 became pregnant with his child.

[76] On May 21, 1995, the Deceased immigrated to Canada. At his discovery, he said this was “illegally, with a false passport. With a false Danish passport.”

[77] On February 15, 1996, Ms. Klevstova immigrated to Canada. She was still pregnant when she arrived with Mr. Affiaetab’s child.

[78] It is undisputed that Ms. Klevstova lived with the Deceased initially at his apartment. Mr. Hambrachian and Ms. Klevstova testified that Ms. Klevstova stayed with the Deceased upon her arrival in Canada because of an argument she had with her brother’s wife. Mr. Hambrachian witnessed this when he tried to drop her off at her brother’s house where she intended to stay; they left because she no longer wanted to stay with them because of this argument. Both Ms. Klevstova and Mr. Hambrachian testified that Ms. Klevstova had her own bedroom and that Ms. Klevstova’s relationship with the Deceased during that time was simply good friends. Ultimately, Mr. Hambrachian began a romantic relationship with Ms. Klevstova in 1997 which lasted until 2000. During this period, they all went out together.

[79] In October 1996, Ms. Avdeeva and her husband immigrated to Canada.

[80] When they arrived, they spoke little English and required assistance translating things and managing their affairs. Ms. Avdeeva was retired at that time, and spent her days taking care of her four grandchildren. Ms. Klevstova, her brother and the Deceased assisted them with interpretations and managing some of their affairs. The Deceased confirmed in his evidence that Ms. Avdeeva’s English was worse than her husband’s whose English the Deceased agreed was zero. Ms. Avdeeva’s poor English skills were also confirmed by other witnesses including the witness, Anahid Nersessian.

J. THE WILKINSON PROPERTY

[81] In May 1997, Ms. Avdeeva and her husband purchased a property located at 32 Wilkinson Avenue (the “Wilkinson Property”) for $270,000.

[82] Ms. Klevstova, her family and the Deceased lived at the Wilkinson Property for three and a half years. Ms. Klevstova’s evidence was that the Deceased had his own room and paid $900 in rent per month.

K. THE VICTORIA PARK CONDOMINIUM

[83] On April 27, 2000, Ms. Avdeeva and her husband purchased the Victoria Park Condominium for $125,000 as an investment. The Deceased admitted that Ms. Avdeeva purchased it with her own money and that he did not contribute anything. At the time of purchase, the property was tenanted with monthly rent of $1,100. There was a $93,000 mortgage and the remainder of the purchase price was paid by Ms. Avdeeva.

[84] Sometime in 2001, the mortgage on the Victoria Park Condominium was paid off.

[85] On March 20, 2001, the Victoria Park Condominium was transferred to the Deceased for no consideration. Ms. Avdeeva alleges that she was tricked into signing the transfer, believing that she was merely signing a Power of Attorney to permit the Deceased the ability to help manage this property. The Estate Trustee asserts that this was a birthday gift since the Deceased’s birthday was on March 26.

[86] The Statement of Claim seeks a declaration that Ms. Avdeeva is the sole beneficial owner of the Victoria Park Condominium. It does not seek any claim for damages with respect to this property or anything that may have occurred. However, the Victoria Park Condominium was sold by power of sale, and as such, it is not possible to make a declaration that Ms. Avdeeva is the sole beneficial owner.

[87] While there is a claim for damages for conversion and mental distress, at trial Ms. Avdeeva confirmed she was abandoning these claims. In any event, it is uncertain whether they could have applied to the Victoria Park Condominium claim. The tort of conversion only relates to personal property and there was no evidence of any mental distress.

[88] Although there is claim for damages for breach of trust, she has not pleaded, nor proven, a trust relationship with the Deceased. See the following cases regarding the requirements for a breach of trust: HSBC Bank Canada v. Ba-Oose Inc., 2011 BCCA 511, 26 B.C.L.R. (5th) 209, at para. 22, Mills v. Royal Bank, 2012 ABCA 75, 61 Alta. L.R. (5th) 413, at para. 25

[89] The proper pleading here would have been fraud, which must be specifically particularized and pled pursuant to r. 25.08; 1417217 Ontario Inc. v. River Trail Estates Inc., 2021 ONSC 4785, 158 O.R. (3d) 89, at para. 174, citing Rodaro v. Royal Bank of Canada (2002), 2002 CanLII 41834 (ON CA), 59 O.R. (3d) 74 (C.A.), at para. 68.

[90] As it has not been pleaded, damages cannot be awarded.

[91] Nevertheless, I would like to set out the evidence on this issue because it is relevant to the Deceased’s overall credibility.

[92] Ms. Avdeeva testified that the Deceased brought her to Mr. Robert Adourian’s office (the lawyer who completed the transfer) and asked her to sign a document which she thought was a power of attorney so that the Deceased could help manage the Victoria Park Condominium. She said that she did not know that by signing this, she was transferring the Victoria Park Condominium to the Deceased. She denied that she ever intended to give this property to him as a gift. She said that neither Mr. Adourian nor the Deceased explained what the document meant.

[93] The Deceased’s evidence on this issue at his discovery in 2017 is troubling. He tried to distance himself from this transaction by saying that he was not present when Ms. Avdeeva signed the transfer deed, that he never attended a meeting with Mr. Adourian, never had any discussion with Mr. Adourian about the transfer deed, never saw the transfer deed, and that it was transferred to him as a surprise for his birthday which was on March 26. He suggested that the first time he saw the transfer deed was “on…your submissions, your client’s submissions”.

[94] The Deceased’s evidence cannot be true for a number of reasons.

[95] First, the transfer deed indicates that Mr. Adourian prepared it and that Mr. Adourian was acting as lawyer for the transferee, the Deceased.

[96] The Deceased’s signature appears on the transfer deed and is dated March 20, 2001. The land transfer affidavit of residence is signed by the Deceased and dated March 20, 2001. Mr. Adourian commissioned the Deceased’s signature on the very same day. Although he did not have an independent recollection, Mr. Adourian confirmed that this would have been done on March 20, 2001 and that it was his standard practice to explain all aspects of the transfer/deed and affidavit of residence.

[97] Thus, Mr. Adourian’s evidence and the documents completely contradict the Deceased’s discovery evidence. It is extremely odd that the Deceased would not recall the details of such a significant transaction.

[98] Mr. Adourian could not find his file and had no recollection or documents to show that he acted for Ms. Avdeeva as well, although he said at that time it was not uncommon to act for both the transferor and transferee. In my view, if this was the case, he would have made some notation on the transfer deed; the transfer deed specifically stated he only acted for the Deceased.

[99] Mr. Adourian also said it was not part of his standard practice to allow a recipient of a gift to act as a translator for the donor, but he did not give any evidence as to whether he followed his standard practice on that day or whether he ever departed from that practice. There is no evidence that anyone other than Ms. Avdeeva and the Deceased who attended the meeting with Mr. Adourian when the transfer deed was signed. Given that Ms. Avdeeva did not speak English, on these facts, if anyone interpreted the document, it must have been the Deceased since Mr. Adourian does not speak Russian.

[100] Ms. Klevstova had never received a gift from her parents valued at $125,000, and none of her boyfriends or her past husband had received such a gift. Up until that time, they had never celebrated the Deceased’s birthday or given the Deceased any significant gifts.

[101] Ms. Klevstova testified that she did not know about the transfer until some-time later when she opened a letter from Mr. Adourian which came to their home and which was addressed to the Deceased. She opened it although it was addressed to the Deceased because she thought Mr. Adourian was their lawyer—and indeed he had been in the past. The letter showed that there continued to be an $84,000 mortgage on the Victoria Park Condominium on July 8, 2002. This was a shock as she knew that her mother had paid off the mortgage on that property.

[102] She confronted the Deceased who was upset that she opened up his mail. He told her that he was in a “tough situation” with his businesses and needed money urgently. He was borrowing money from different people. He was dealing with a business in Iran where he was investing in construction projects. This investment would allow him to cover all of his loans and he promised to transfer the property back once he had concluded this project in Iran.

[103] Notably, the Promissory Notes which the Deceased hand wrote and signed, and which are discussed below, specifically note that he needed to borrow the money to assist him with his business. This is consistent with Ms. Klevstova’s evidence.

[104] Ms. Klevstova testified that she did not immediately tell her mother because the Deceased asked her not to since it would be resolved shortly. As well, her mother had a variety of medical issues, and she did not want to upset her.

[105] Ms. Klevstova eventually told her mother and there was a meeting between her mother, herself, the Deceased and her father. Ms. Klevstova told him that she would be phoning the police. The Deceased apologized and left the house. Again, this is consistent with the timing of the Deceased moving out in or around August or September 2003.

[106] Both Ms. Klevstova and Ms. Avdeeva testified that Ms. Avdeeva continued to pay taxes and condo fees associated with the Victoria Park Condominium. She also produced some bank statements which showed the payment of the management fees. She could not produce other documents because of the flood which destroyed many of her documents which had been stored in the basement.

[107] Preauthorized payments for the management fees continued until October 2005 when Ms. Klevstova wrote to the manager of Ms. Avdeeva’s bank at Bank of Montreal (BMO) requesting that all pre-authorized payments to the management company in the amount of $444.60 be stopped. There is documentation confirming this which then supports the fact that she had been paying these management fees all along.

[108] Ms. Avdeeva has also produced some tax documentation in support of her position that she continued to pay the taxes associated with the Victoria Park Condominium. First, all tax bills were still sent to Bowan Court even though the Deceased had moved out in 2003. She produced an interim tax bill for 2004 and a tax bill for 2005 which are stamped as paid. Ms. Klevstova testified that she knows that her mother paid the 2005 tax bill because she attended with her mother at the bank to pay it. And, they had these documents.

[109] The Deceased had no documents to contradict Ms. Avdeeva paying the taxes or management fees and did not produce any documents supporting his payment of these.

[110] Further, up until 2005, the rent checks in the amount of $1,100 were still being sent to Ms. Avdeeva. In October 2005, one of the checks bounced. When Ms. Klevstova called the tenant to question why, the tenant advised her that the Deceased had directed the tenant to issue the cheque in his name only from then on. Ms. Avdeeva has produced rent cheques from the tenants for the months of October, and December 2005 as well as January 2006 all of which were made out to Ms. Avdeeva, and which show that stop payment was made on them. This supports Ms. Klevstova’s and Ms. Avdeeva’s evidence on this issue.

[111] The Deceased’s evidence that he continued to let Ms. Avdeeva collect these rents as a form of contribution to towards his and Ms. Klevstova’s lifestyle simply makes no sense since even if they had an intimate relationship in the past, he moved out of Bowan Court in 2003 and also states in his January 30 2012 affidavit that their relationship ended in 2003.

[112] When Ms. Klevstova called the Deceased about the stop payments on the rent cheques, he advised her that from that point on he would be receiving the rent cheques.

[113] When examined for discovery, the Deceased admitted that an owner would have the responsibility to pay all expenses associated with a property but adduced no evidence that he paid the expenses associated with the Victoria Park Condominium. He did not recall paying condominium fees, condominium insurance or collecting any rents prior to October 2005.

[114] The fact that Ms. Avdeeva continued to pay taxes, and management fees, and collected rent for four years after the purported transfer supports her position that she never intended to make a gift to the Deceased of the Victoria Park Condominium.

[115] Furthermore, the first time that the Deceased claimed that the Condominium was a gift was at his discovery on October 20, 2017. His Statement of Defence to the 2005 action never pleaded this and it has never been amended. In fact, paragraph 8 of the Statement of Defence specifically states:

8. Sufficient and adequate consideration was delivered and provided to the plaintiff in respect of the transfer of the property municipally known as 2721 Victoria Park Avenue, Suite 506, Toronto (the “Condominium”). In fact, it was the plaintiff that requested that the Condominium be transferred to the Defendant.

[116] One would reasonably expect that if a gift of a fully-paid $125,000 condominium was received as a birthday present, and a claim was made to take it back, that one would immediately plead that it was a gift rather than “sufficient and adequate consideration” was given for the transfer.

[117] Even if he had a close familial relationship with Ms. Avdeeva and Ms. Klevstova as claimed, this does not mean Ms. Avdeeva intended to give him an asset worth $125,000. The weight of the evidence, cited above, is simply inconsistent with such an intention. What is particularly troubling is the Deceased’s evidence about not giving Mr. Adourian instructions to prepare the transfer deed and his claiming to have had no knowledge of it until some-time later, which is completely inconsistent with the documents and Mr. Adourian’s evidence. This, together with other evidence, raises significant credibility concerns about the Deceased’s evidence and conduct.

[118] Eventually, even though the Deceased was receiving the rent for the Victoria Park Condominium after 2005, he stopped paying taxes or maintenance fees. Ms. Klevstova learned of this because they continued to receive default notices.

[119] I add that even though the Deceased knew that Ms. Avdeeva was making a claim to the Victoria Park Condominium, he entered into an agreement with the Estate Trustee in her own personal capacity to purchase it for $120,000 before the power of sale occurred. This too, represents dishonesty and an intention to make a fraudulent conveyance.

[120] Because Ms. Avdeeva cannot succeed on this aspect of her claim because of her pleading, I have not proceeded to analyze the legal issues as to whether Ms. Avdeeva’s claim is sufficiently corroborated and whether she has a legal basis to succeed on the basis of fraud or non es factum. The analysis of these legal issues is not necessary in the circumstances, but in my view, it is important to set out the facts which I have found on this issue because of the credibility issues in this case.

L. BOWAN COURT

[121] On or about May 11, 2001, Ms. Avdeeva purchased Bowan Court for $820,000 with a closing date of July 30, 2001. Ms. Avdeeva is the only purchaser noted on the Agreement of Purchase and Sale.

[122] As will be seen, the Bowan Court property is currently held by Ms. Avdeeva as to 99 per cent and by the Deceased as to one per cent, which the documentation says he holds in trust for her.

M. RESULTING TRUST/CONSTRUCTIVE TRUST

[123] The Estate Trustee claims a resulting trust on the basis that there was an intention that Bowan Court was purchased for the Deceased and Ms. Klevstova to be their matrimonial home. In Rathwell v. Rathwell 1978 CanLII 3 (SCC), [1978] 2 S.C.R. 436 as cited in Maloney v. Maloney, [1993] O.J. No. 2724, at paras. 43 to 44, Dickson J. discusses the difference between resulting and constructive trusts and notes that a resulting trust is primarily concerned with the intent of the transferor. In Pettkus v. Becker 1980 CanLII 22 (SCC), [1980] 2 S.C.R. 834 cited in Maloney, at para. 43, Dickson J. further clarified that the sought for intention is rarely express and the court must glean the intent from the conduct of the parties and their financial arrangements, such as one partner paying for necessaries while the other pays for the mortgage.

[124] The Estate Trustee also claims a purchase money resulting trust on the basis that the Deceased contributed to the purchase price without taking legal title: Rascal Trucking Ltd. v. Nishi, 2013 SCC 33, [2013] 2 S.C.R. 438 at para. 21.

[125] The Estate Trustee also claims a constructive trust. As set out in Pettkus and Sorochan v. Sorochan, 1986 CanLII 23 (SCC), [1986] 2 S.C.R. 38, the underlying basis for a constructive trust is unjust enrichment. There must be an enrichment, a corresponding deprivation and the absence of a juristic reason for the enrichment. See also Kamermans v. Gabor, 2018 ONSC 5241, 41 E.T.R. (4th) 86, at para. 37.

[126] Many of the cases where resulting and constructive trusts have been imposed have been cases where one spouse makes contributions and/or toils away improving a property which is owned exclusively by the other, these were the facts of Pettkus, Sorochan and Rathwell.

a) The Agreement to Purchase Bowan Court

[127] The Deceased’s first position is that Ms. Avdeeva purchased Bowan Court for him and Ms. Klevstova as a matrimonial home. It is important to set out exactly what the Deceased said about the reason why Bowan Court was being purchased and compare it to the actual documentation which the Deceased signed.

[128] During his 2017 examination for discovery, he stated:

Q. Okay, and are you now saying it belongs to you because it was your matrimonial home?

A. It belonged to me and Elena.

Q. Ok, thank you.

A. I was supposed to pay all the costs of .…after the purchase.

Q. All the costs?

A. Furniture, mortgage, whatever.

Q. Okay, and whatever you’ve paid, you’ve produced?

A. She put the down payment and put..."This is your house, guys, the rest you take care of it.”

Q. Okay.

A. Okay.

Q. Okay, so tell me what those discussions were, when they happened, and who was present.

A. As I told you, it was…I was under the impression that we are buying a new house as a matrimonial house.

Q. Simply as a gift for you.

A. Sorry.

Q. As a gift for you and your wife, that’s what you believed?

A. The part that she was doing the down payment, the rest, it wasn’t a gift, I had to take care of the rest.

[129] He had no explanation for why Ms. Avdeeva’s name was on title, or why Ms. Klevstova’s was not if it was intended to be their home. He could not explain why he only held one per cent.

[130] Mr. Grant, the lawyer who closed the purchase of Bowan Court, testified that he did not have specific recollection of the transactions, but had reviewed his file to refresh his memory. A large part of his testimony was based on his general practice for over 30 years.

[131] He indicated that he met with Ms. Avdeeva sometime in July 2001 after she had entered into the agreement of purchase and sale, and that the closing was extended to August 31, 2001.

[132] Ms. Avdeeva’s mortgage application went to BMO. A few days before the extended closing date, his office was notified that BMO required a guarantor who would also hold an interest in the property since Ms. Avdeeva required a larger mortgage than expected because the Wilkinson Property sale had not yet closed and as such, these proceeds were not yet available. Mr. Grant contacted Ms. Klevstova and the real estate agent. Ms. Klevstova said that she had a close family friend who was prepared to sign a guarantee. This was the Deceased. It was Mr. Grant’s idea to prepare a co-tenancy and trust agreement whereby the Deceased’s interest would be held in trust (the “Trust Agreement”). This was all consistent with Ms. Klevstova’s and Ms. Avdeeva’s evidence.

[133] Mr. Grant testified that it is standard practice to provide guarantors like the Deceased with only one per cent interest because it is like “shouting at the world that he has no beneficial interest”. He estimated that this occurs in one out of 10 real estate transactions when people do not have funds which a lender considers sufficient for the down payment.

[134] When the instructions came from BMO, he phoned the Deceased and advised him that he would be required to sign an agreement which states that he is only a one per cent owner, but that he was protected because if he lost any money because of this transaction, (e.g. if the mortgage went into default and it was sold at a loss), he would have a right to be indemnified by Ms. Avdeeva.

[135] He assumes that he would have met with both Ms. Klevstova and the Deceased on or about August 28, 2003 which was the day he received the mortgage instructions. He assumes this because he would have to have a trust agreement in order to close and he had to be able to confirm this with the bank.

[136] He drafted the Trust Agreement dated August 30, 2001 in accordance with his standard agreements made when lenders require a guarantor.

[137] The next time he spoke to the Deceased was at his office on August 30, 2001 when the Deceased and Ms. Klevstova came in to execute the documents.

[138] When asked whether he was representing the Deceased and Ms. Avdeeva even though they were in a conflict of interest, he stated that he was not.

[139] The Trust Agreement was signed by the Deceased and by Ms. Klevstova pursuant to her power of attorney. It provides as follows:

WHEREAS the parties have purchased as tenants in common with Ms. Avdeeva holding 99% and The Deceased holding a 1% interest in the premises known municipally as 43 Bowan Court, Toronto (hereinafter referred to as the "Premises");

AND WHEREAS The Deceased has purchased only a 1% interest in order to meet the requirements of the First Mortgagee with respect to the Premises and has no beneficial interest in the Premises;

AND WHEREAS it is the intention of the parties that Ms. Avdeeva pay all costs associated with the purchase, upkeep and maintenance of the Premises as well as any profits or loss on the sale thereof,

NOW THEREFORE THIS AGREEMENT WITNESSETH as follows:

1. The parties acknowledge that Ms. Avdeeva has contributed all of the funds to complete the within transaction of the Premises including the balance due on closing, legal fees and land registration fees and disbursements.

2. The parties further acknowledge and agree that they are both parties to a First Charge/Mortgage of Land in the amount of $500,000.00 in favor of the Bank of Montreal

3. Ms. Avdeeva shall contribute all costs associated with the Premises including but not limited to mortgage payments, taxes, insurance premiums, utilities and maintenance and repairs (such costs hereinafter being collectively referred to as "Housing Costs").

4. The Deceased acknowledges that he is holding the 1% interest In the Premises in trust for Ms. Avdeeva and that he has no beneficial ownership of the Premises.

5. The Deceased acknowledges that even though he has no beneficial Interest in the Premises, he can be looked to directly by the Bank holding the Mortgage if Ms. Avdeeva defaults in making payments or there is a shortfall on any sale of the Premises. The Deceased confirms that he understands that the Bank does not have to pursue its remedies against Ms. Avdeeva before pursuing him.

6. In consideration of The Deceased holding such interest, Ms. Avdeeva hereby agrees to save harmless and indemnity The Deceased from any costs, expenses or claims expended or suffered by or brought against him as result of executing the said Charge/Mortgage herein.

7 The parties acknowledge that Donald J. Grant has acted for both and upon the instructions of both in the preparation of this Agreement. Notwithstanding the fact that Donald J. Grant has requested each to seek independent legal advice, both parties have indicated that they do not wish and will not in fact seek same. Further, the parties agree that should there be any disagreement arising out of the within Agreement at any later date, the said Donald J. Grant will not be in a position to act for either party.

IN WITNESS WHEREOF the parties have hereunto set their hands and seals at Toronto this 30th day of August, 2001.

[140] The Deceased did not confirm that he signed the Trust Agreement, but he did not dispute it either. He acknowledged that it appeared to be his signature. He stated that he was given a large stack of 300 pages that he did not have time to read; he confirmed that no one stopped him from reading the documents and that it was his choice to not read them.

[141] Mr. Grant testified that it is his standard practice to explain each and every word of these types of Trust Agreements and that he did so in this case. Further, Mr. Grant also indicated that there would have been at most, five or six documents and these would have had to be signed in duplicate. In his view, there was not a lot of documentation, and this directly contradicts the Deceased’s evidence that there were 300 pages.

[142] Mr. Grant says he explained to the parties what tenants in common meant as opposed to a joint tenancy, that the Deceased was only holding one per cent because of BMO’s requirements, that the Deceased would not have any beneficial interest in the property, that Ms. Avdeeva would be paying everything and as such would be responsible for losses, and that Ms. Avdeeva would pay all required amounts including legal fees, registration fees and costs. Mr. Grant also discussed with them that they could obtain independent legal advice, although they chose not to.

[143] Mr. Grant testified that it is his practice to take as long as is necessary to explain documents because people often have convenient memories and he wants to assure himself that parties signing these types of agreements understand them.

[144] It is particularly striking that Ms. Klevstova’s evidence and Mr. Grant’s is almost identical as to the detailed explanation which Mr. Grant gave of the Trust Agreement to Ms. Klevstova and the Deceased on August 30, 2001, even though neither was present for the other’s testimony.

[145] The reporting letter from Mr. Grant dated November 22, 2001 is addressed only to Ms. Avdeeva and reports as follows:

In accordance with your instruction, title was taken in your names as tenants in common with you holding 99 % interest and The Deceased Khankaldiyan holding 1 % all in order to satisfy the requirements of your mortgage company.

[146] The Trust Agreement is completely inconsistent with the Deceased’s position in this proceeding.

[147] The Estate Trustee raised a number of concerns about Mr. Grant’s evidence, all of which I found unpersuasive.

[148] First, Ms. Avdeeva does not speak English and when cross examined as to whether Mr. Grant was able to communicate with Ms. Avdeeva in English at the first meeting he had with her in July, he said he assumed so. This is clearly not possible as Ms. Avdeeva does not speak English. However, in my view, nothing much turns on this. This meeting took place more than 20 years ago and it is not surprising that he would not recall this detail. In any event, when re-examined, he indicated that he did not recall if anyone translated but that it was possible that the real estate agent brought someone with him to translate. He did not recall Ms. Avdeeva speaking any language in particular.

[149] Second, when asked about whether he had met Ms. Avdeeva prior to her signing of the agreement of purchase and sale he indicated that he did not think so. However, the agreement of purchase and sale dated May 11, 2001 lists him as Ms. Avdeeva’s lawyer. When confronted with this, he indicated that it did not surprise him that his name was on it even though he had not met her yet; often the real estate agent will name a lawyer who they recommend in the agreement of purchase and sale to get the ball rolling. He indicated that more than one half of the real estate transactions are done this way.

[150] Third, the Estate Trustee was particularly concerned about who drafted Ms. Klevstova’s Power of Attorney and the fact that it was not in Mr. Grant’s solicitors file. Although Mr. Grant’s reporting letter indicated that he had drafted the Power of Attorney, he acknowledged when cross examined, that he had made a mistake and that in fact, it had been drafted by BMO. Regarding why the Power of Attorney was not in the file, Mr. Grant explained that the Power of Attorney was registered on title and it was not critical that it was not in the file. The fact is that Ms. Klevstova had a Power of Attorney. I do not view any of this to be material.

[151] Fourth, Mr. Grant made a mistake in the document by stating that Ms. Avdeeva was present when she was not. Mr. Grant explained that when the documents were originally prepared, he expected that Ms. Avdeeva would be present, and they were drafted in accordance with that expectation. He simply did not catch that error. I do not view this as significant.

[152] The Estate Trustee also asserted that Mr. Grant was not credible because he had a stroke in September 2021 which affected his memory in part. I did not find this in the least persuasive.

[153] I found Mr. Grant, believable, reliable and credible. He was independent, has no interest in this proceeding, his evidence was internally consistent on all material issues, and also consistent with contemporaneous documents and Ms. Klevstova’s evidence in all material respects. As well, he readily acknowledged errors in the documents and explained them. Any such errors in the documents are not material to the issues in this proceeding in any event. He explained that the main thing that matters with these transactions is to ensure that the client has good title and that mortgage funds flow. Finally, even though he testified that his stroke had affected his memory, he was not testifying based upon his memory but based upon his standard practice and his review of the documents.

[154] The Estate Trustee also focused on minor inconsistencies between Ms. Klevstova’s and Mr. Grant’s evidence, including whether the Trust Agreement was provided in draft form. Ms. Klevstova says that it was given to her in draft a few days before it was signed, but Mr. Grant says there was no draft. However, in my view, this is an insignificant inconsistency considering the fact that these transactions took place over 20 years ago. Further, nothing turns on whether the Trust Agreement was provided in draft format earlier than August 30, 2001.

[155] There were some inconsistencies in Ms. Avdeeva’s evidence as to whether she personally had discussions with the Deceased or Mr. Grant about the Deceased being a guarantor and when that was, but again, I do not find these material. The fact is that Ms. Klevstova had a Power of Attorney, Ms. Avdeeva was away, and Ms. Klevstova executed the agreements in her capacity as Power of Attorney. In my view, it is immaterial when Ms. Avdeeva learned of this.

[156] Overall, Ms. Avdeeva, Ms. Klevstova and most importantly, Mr. Grant, gave the consistent evidence that Ms. Avdeeva was away, that Ms. Klevstova had a Power of Attorney, that BMO needed a guarantor because the mortgage would be larger than originally expected, that part of its requirement was that the guarantor be on title to Bowan Court and that it was Mr. Grant’s idea to limit the Deceased’s ownership to one per cent and to draft the Trust Agreement. The documents, which are signed, are also consistent with their evidence.

[157] The contemporaneous documents and the testimony of Mr. Donald J. Grant, supports Ms. Avdeeva’s position that the home was being purchased by Ms. Avdeeva for her family, and that there was never any intention that the Deceased have an interest.

[158] Therefore, I reject the Deceased’s first position that Bowan Court was purchased for him, Ms. Klevstova and Stephanie to live in as their matrimonial home.

[159] I also reject the Deceased’s corollary argument that the Trust Agreement is unenforceable because of undue influence. It is simply not credible, believable or probable that Ms. Avdeeva, a non-English speaking elderly woman, or Ms. Klevstova, coerced or manipulated the Deceased into entering into the Trust Agreement.

[160] Indeed, the Deceased did not even give that evidence. The highest his evidence can be is that he considered Ms. Klevstova his partner, he considered Ms. Avdeeva his mother in law and Stephanie his daughter. In that context, he also said that Ms. Klevstova was managing their affairs and that if she told him to sign something, he would because he loved her. This is a far cry from undue influence, coercion or a power imbalance. As set out in Berdette v. Berdette, (1991), 1991 CanLII 7061 (ON CA), 3 O.R. (3d) 513, (C.A.), at para. 22, for pressure to amount to duress, it must be a “coercion of the will or it must place the party to whom the pressure is directed in such a position as to have ‘no realistic alternative’ but to submit to it.”

[161] The evidence is not even remotely close to this. There was a lawyer present, Mr. Grant, who explained the Trust Agreement fully and advised the parties that they should obtain independent legal advice. It was their choice not to. A further requirement is proof that the Deceased was not careless in signing the Trust Agreement: Bulut v. Carter, 2014 ONCA 424, 322 O.A.C. 58, at para. 18. He cannot meet that test either. When examined he stated: “If I knew this is the document, I wouldn’t sign.”

[162] But that is the point, there was nothing stopping him from reading it to see what it was if he did not.

[163] Furthermore, he never pled duress, and it was raised for the first time in the Trustee’s closing submissions. As set out in Brooks v. Alker (1976), 1975 CanLII 423 (ON SC), 9 O.R. (2d) 409, this must be pleaded with full particulars.

[164] I need not fully address the allegation of non es factum which was also made for the first time in the Deceased’s closing submissions.

b) The Deceased’s Assumption of Mortgage Debt

[165] The Estate Trustee relies upon Ruff v. Strobel, 1978 ALTASCAD 151, [1978] A.J. No. 969 (Alta. C.A.), at para. 46 and Elder v. McMullen, 2008 BCSC 971, 70 R.P.R. (4th) 277, at para. 81, for the proposition that the Deceased co-signing the mortgage constitutes a contribution to the purchase price.

[166] Neither of these cases are at all comparable.

[167] The case, Ruff, concerned a woman who had moved to Calgary to live with a man in his townhouse complex as his romantic partner. I will refer to them as the Wife and the Husband for ease of reference. When units in the building became available for purchase, they agreed to purchase one and the majority of the funds were borrowed from the Wife’s father. Both parties signed the agreement of purchase and sale, as well as the mortgage application and the certificate of title was taken in both parties’ names as joint tenants. The down payment was made by the Wife and post-dated cheques were provided to the mortgage company. The parties separated shortly after the transaction closed. After the separation, the Wife paid the mortgage and condominium fees and all fees in connection with the purchase. The Husband did not pay anything towards the purchase or the mortgage. The trial judge found, as a fact, that the parties had a mutual intention that the property would be jointly owned when it was purchased. Nevertheless, the trial judge held that the Husband must be regarded as a trustee of the interest registered in his name and found a constructive trust in favour of the Wife.

[168] On appeal, in overturning the trial judge’s finding in this regard, the Court was primarily concerned with the equities and the use of the constructive trust to nullify the parties’ mutual intention to hold the property as joint tenants. The Court concluded that while it could be said that the Husband would be unjustly enriched to the extent of one half of the payments made by the Wife, a constructive trust is a proprietary remedy which is secondary to a personal remedy, available where unjust enrichment is shown, and a personal remedy is inadequate. In this case, there were many personal remedies available to the Wife, including seeking contribution from the Husband for his share of the payments, or bringing an application for partition and sale where she could be compensated out of the proceeds. The Court’s view was that the unjust enrichment was insignificant compared to the value of the property which the parties had intended to hold as joint tenants. In that context, the Court did say that by signing the mortgage the Husband had made himself liable on the mortgage and that had to be taken into account.

[169] Elder, involved an intimate relationship between a couple, who purchased a property as tenants in common as co-purchasers. The Husband claimed that the Wife held her interest in trust for him as a result of a Declaration of Trust which she signed. The court found, as a fact, that the parties had a common intention to purchase the property as co-owners. They attended at the bank together to open a joint mortgage account and obtained mortgage insurance in both their names, they evenly split the debt owed on the mortgage after revenue from the tenanted portion of the house was applied to the mortgage. In that context, the court found it relevant that the Wife had effectively advanced one half of the mortgage because she was named on the mortgage. But in doing so, the court also made it clear that the manner in which title is held, and the fact that parties have jointly signed a mortgage is not determinative. The issue is always whether there is clear evidence of the parties’ intention. In that case the court concluded, at para. 97, as follows:

On the evidence, I have concluded that at the time of the transaction, the nature of the conveyance was one pursuant to which the parties took title as tenants in common and fully understood that they were co-owners of the property both legally and beneficially. They had legal counsel who explained the documents they were signing and the registered ownership of property. Andrew did not allege that he had been misled by De Vuyst and did not seek to call him to testify to the circumstances of the retainer. The intention of the parties at the time of the acquisition was that each would have an equal beneficial interest in the property.

[170] The court further found that the declaration of trust was not evidence of the parties’ intention at the time of the transaction or even when the declaration of trust was signed and that even if it was valid, it was obtained by undue influence.

[171] The facts here are not at all comparable to the above cases. I have found no common intention that the Deceased would have any interest in Bowan Court other than a one per cent interest he held in trust for Ms. Avdeeva. The Trust Agreement provided protection to the Deceased, in that if he was ever called to make any payments by reason of default, he had a right to be indemnified by Ms. Avdeeva. Mr. Grant explained this to him, he signed the Trust Agreement and knew that he held his one per cent interest in trust for Ms. Avdeeva. There is absolutely no evidence of undue influence in this case, nor is it pleaded.

c) The Deceased’s Alleged Contribution to the Purchase Price

[172] There is significant inconsistency in the Deceased’s own evidence as to what, if anything, he contributed to the purchase of Bowan Court.

[173] As set out above, Bowan Court was purchased for $820,000. It had a mortgage in favour of the BMO in the amount of $500,000, leaving a total down payment of $320,000 made in 2001.

[174] In his affidavit sworn January 30, 2012, seeking to set aside the Default Judgment, the Deceased claimed that he put down money toward the purchase of the property and was the only one to make mortgage payments the first two years; in total he claimed he contributed more than $200,000 to Bowan Court.

[175] There was no persuasive documentary support in the January 2012 affidavit and none has emerged.

[176] When examined for discovery, in 2017 the Deceased agreed that the down payment was made by Ms. Avdeeva solely.

[177] Immediately afterwards in his discovery, he indicated that he contributed $13,000 towards the purchase by way of taking cash from his office and obtaining a bank draft with these funds that he gave to the lawyer after he received a call that there was a “shortage”. He stated:

…It was a call from lawyer’s office for the last figures that they transfer, land transfer or something was short, $13,000.

[178] His evidence was that this money was required to close the deal.

[179] Other than his bare statement, he was unable to provide any proof of this payment even though he undertook to do so.

[180] One of the new documents, which the Estate Trustee found in a storage box in December 2022, was a carbon copy of a cheque dated July 12, 2001, signed by the Deceased, from his Scotiabank account, which purported to be payable to Jarett and Thomas Limited (the real estate brokers who closed Bowan Court) in the amount of $15,000; the Estate Trustee asserts this is evidence that the Deceased paid part of the deposit.

[181] The Estate Trustee never made any attempts to contact the real estate brokerage to confirm that they received the $15,000 cheque from the Deceased and the actual cheque was never produced.

[182] Although this matter had been ongoing since 2005, and the Deceased was still alive up until 2018, the Deceased never produced any bank records showing that a $15,000 cheque corresponding to the carbon copy recently produced by the Estate Trustee, was written by him or debited from his account.

[183] This carbon copy is also inconsistent with the Deceased’s discovery evidence as to the amount and as to who he gave it to. While one could argue that the Deceased meant $15,000 when he said $13,000 and that he meant cheque when he said draft, and he meant the real estate broker when he said the lawyer, there is an error in timing which cannot be explained. The Deceased said that he provided the $13,000 because he was called and advised there was a “shortage” on closing. However, the $15,000 carbon copy dated July 12, 2001 does not at all correspond to the closing date of August 30, 2001.

[184] Most importantly, the evidence as to the Deceased’s finances at the time supports the conclusion that he did not have $13,000 or $15,000 to give.

• The only bank records produced by the Deceased for this time period show a balance on July 11, 2001 of only $35.58 and on August 28, 2001 of only $1763.77. Recall that the carbon copy of the cheque in the amount of $15,000 is dated July 12, 2001 which is the immediate day after the July 11, 2001 balance of $35.58. And the alleged $13,000 was given at the time of closing on August 30, 2001. Therefore, regardless of which amount or what time he alleges he paid it, the funds in his bank account which he disclosed do not support he had the money to do so.

• The Deceased’s tax return shows total earnings for the entire year of 2001 of only $38,401.39 after taxes ($48,625 less tax payable of $10,223 from which he paid: $10,145 on March 6, 2001 to NY Towers; $8,000 on March 2, 2001 to Stanley Cohen; $8,000 on March 22, 2001 to Stanley Cohen leaving $12,256 to live on in 2001).

[185] Furthermore, the Trust Agreement signed by the Deceased specifically states that Ms. Avdeeva contributed all the funds to complete the purchase of Bowan Court.

d) The Deceased’s Alleged Contributions to the Mortgage

Alleged Lump Sum Payment

[186] The Estate Trustee claims that the Deceased paid $90,000 towards the Bowan Court mortgage. This ignores the fact that the evidence shows that he improperly obtained funds from the mortgagee as advances in the amount of $50,000 on June 20, 2002 and $59,500 on July 23, 2002

[187] These advances are confirmed by a handwritten note from BMO indicating that these amounts were advanced from the mortgage account on these exact dates. Ms. Klevstova testified that she obtained this note from BMO when she and her mother went to BMO to make inquiries regarding the outstanding amount on the Bowan Court mortgage and that they were shocked when they saw that he had obtained these funds.

[188] The Deceased’s BMO statements also confirm that these amounts were deposited into his account on these exact dates. There is even a mortgage amendment agreement in the Deceased’s name and signed by the Deceased with reference to the $59,500 dated July 19, 2002, which was a few days before the funds were deposited into his account. There is a second signature on this document which the Estate alleged was Ms. Avdeeva’s. They had requested an adjournment of one court date, in part, to evaluate the second signature as Ms. Avdeeva refused to acknowledge it was hers. However, they produced no expert analysis of the second signature confirming it was Ms. Avdeeva’s.

[189] The Deceased wrote and signed a Promissory Note which specifically referred to these amounts and promising to repay them. The note stated:

This is to confirm that I the Deceased Khankaldiyan Haftvan, borrowed from Ms. Avdeeva, $109,500 CDN since last summer ($50,000 CDN on June 20, 2002 + $59,500 CDN on July 23, 2002) for business purposes.

I also can confirm that I will return the abovementioned funds by the end of the year 2003 to her.

With this note I am voiding all prior written or verbal statements in regard to borrowed funds from her and limiting my all liabilities to the above funds.

The Deceased Khankaldiyan Haftvan

25 September 2003

Toronto

[190] It is noteworthy that the dates and amounts in his handwritten Promissory Note correspond exactly to the dates and amounts of the advances from the Bowan Court mortgage and the deposits into his account.

[191] This cannot possibly be a coincidence.

[192] When the Deceased was asked about these amounts deposited into his account he said he could not remember where they came from. When asked whether he took out funds from BMO on the equity of the house, he said he could not remember. It is not believable that he would have no recollection in respect of such significant sums.

[193] This Promissory Note is quite damaging to the Deceased’s ownership claim. If the Deceased was always intended to be a beneficial owner, and indeed was paying the mortgage in furtherance of this understanding, why would he have to repay moneys he obtained from a mortgage advance on Bowan Court and execute a Promissory Note in that regard?

[194] The Deceased then paid back $90,000 of that money by depositing it into the mortgage account from where it was taken. The fact of this repayment is also confirmed in a handwritten BMO note obtained by Ms. Klevstova and Ms. Avdeeva which references both of the two advances as well as the $90,000 repayment.

[195] Ms. Klevstova and Ms. Avdeeva were confused about how the Deceased had been able to obtain these funds from the Bowan Court mortgage.

[196] However, this can be explained by two letters which show that the Deceased had full signing authority with respect to the Bowan Court mortgage up until 2005 for reasons which are not clear.

[197] On November 7, 2005, Ms. Avdeeva’s counsel wrote to BMO with respect to the mortgage accounts sent, which only had the Deceased’s name on them and did not identify her as mortgagor. He asked why she had been removed. At that time, he also asked for information as to whether anyone had signing authority over her various accounts and whether there were any powers of attorney.

[198] By letter dated December 5, 2005, BMO indicated that their original commitment indicated that both Ms. Avdeeva and the Deceased were on title as well as on the mortgage, but that their mortgage system did not show Ms. Avdeeva as being on the mortgage and title. They corrected this after Ms. Avdeeva’s counsel wrote to them in or around 2005 and updated their records to show that no credit could be withdrawn without Ms. Avdeeva’s consent.

[199] Therefore, up until 2005, it appears that the Deceased had access to the Bowan Court mortgage account by virtue of BMO’s mistake.

[200] In the circumstances, the Estate Trustee’s reference to a statement of mortgage account dated 2004 with respect to Bowan Court, which is addressed only to the Deceased is not very probative of anything. It was a mistake made by BMO.

[201] On a balance of probabilities, the evidence satisfies me that the Deceased obtained $109,500 from the Bowan Court mortgage improperly, promised to pay them back when Ms. Avdeeva discovered this and then did so, in part, by way of the $90,000 payment made directly to the Bowan Court mortgage.

[202] The $90,000 repayment in respect of moneys he improperly obtained as advances on the Bowan Court mortgage cannot be considered a contribution towards the mortgage.

Alleged Monthly Mortgage Payments

[203] The Deceased gave evidence that the mortgage payments were $1,500 every two weeks and that for the first two years he was the only one who made mortgage payments. But he could not provide any persuasive contemporaneous documentary support.

[204] As well, the actual mortgage payments based upon bank documents was $1,583.77 every two weeks, and so he did not even know the precise amount of the mortgage payment.

[205] The Deceased produced a carbon copy of a cheque in the amount of $930 which had the word “mortgage” written on it in darker font. The Deceased was questioned as to why the word “mortgage” was in darker font and he admitted that he wrote the word “mortgage” on the cheque many years later, after the litigation against him had already commenced.

[206] Part of the documents which the Estate Trustee found in December 2022 also included a series of carbon copies of cheques purportedly written by the Deceased to Ms. Avdeeva, suggesting that they represent mortgage payments for Bowan Court as follows:

A. August 28, 2002 in the amount of $3,000—there does not appear to be any memo line connecting this to a mortgage payment. Ms. Klevstova testified that this was the Deceased’s rent which was $1,500 a month. Ms. Klevstova said he was often late and then made up the payments.

B. $1,000 on October 9, 2002 with the memo line being “mortgage”. Like the $930 carbon copy of a cheque, the word “mortgage” was written on the carbon copy after the check was removed and the Estate Trustee admitted this when examined.

C. $2,000 on September 12, 2003 with the memo line at the bottom reading “mortgage up to end Sept”.

[207] I note that the photocopies of these cheques appear to be photocopied while still in a book of cheques, not as loose documents. It is striking that the Estate Trustee has only been able to locate the above carbon copies of similarly noted alleged payments within the same book. As well, if the Deceased kept this book of cheques which contained these carbon copies, one wonders why he would not have kept others, and why there would be no other cheques purporting to be in respect of the mortgage. One wonders why he would not have given this evidence at his discovery or in his affidavit of documents.

[208] He had the mortgage information and could have made the payments directly to the bank. There is no explanation as to why he would be making these alleged payments to Ms. Avdeeva instead of directly to the bank. There is no explanation for the odd quantum of these alleged payments which do not relate to the amount of the required mortgage payments, with such large gaps in time.

[209] As well, there is no evidence that these funds were ever received by Ms. Avdeeva or deducted from the Deceased’s bank account.

[210] The Deceased was alive until 2018, and it is odd that he would not have produced evidence from his bank as to the payment of these amounts if they were indeed payments he made to Ms. Avdeeva towards the mortgage.

[211] Although there was no limitation period asserted, it is striking that he did not even commence an application seeking a 50 per cent interest in Bowan Court until 2012.

[212] The Deceased was also asked to identify all of the payments that he said constituted payments by him which justify the imposition of a constructive trust. The question was taken under advisement, but this is the answer which was ultimately given:

1042-1043

192-193

To advise what the basis is for Mr. Haftvan to say that his interest is 50 percent in the Bowan property. To also advise what is the sum total of the amount that Mr. Haftvan alleges he contributed to the Bowan Property

The basis is set out in the materials. Supporting documents showing any contributions have already been produced.

[213] Further attempts to obtain advance disclosure to avoid surprise at trial were similarly stonewalled. In each case, the Deceased’s counsel indicated that the information has already been provided.

[214] In contrast, Ms. Avdeeva’s evidence that she was the sole financial contributor to Bowan Court mortgage was supported by the following, and I accept her evidence:

• Ms. Avdeeva produced a mortgage prepayment receipt from BMO dated October 29, 2001 showing that she made a lump sum payment on the Bowan Court mortgage in the amount of $95,000. This directly contradicts the Deceased’s claim that she told him that she would make the down-payment and then the rest of the payments were up to the Deceased.

• There is a bank printout dated January 15, 2002 from Ms. Avdeeva’s account showing that the exact amount of the mortgage payment of $1,583.77 was debited from her account every two weeks.

• Both Ms. Klevstova and Ms. Avdeeva testified that it was Ms. Avdeeva/her husband who paid the mortgage on Bowan Court by preauthorized payment and Ms. Avdeeva produced her bank statements for the year 2005 which supported this.

• There is a letter from BMO dated July 14, 2016 attaching a mortgage information search which confirms that all mortgage payments for Bowan Court were paid out of Ms. Avdeeva’s bank account.

• Ms. Avdeeva paid $100,000 towards the mortgage principal on December 8, 2005, and then paid off the Bowan Court mortgage by way of payment made on February 6, 2006 in the amount of $132,360. There are BMO transaction records in support of this and Ms. Klevstova testified that she was with her mother when it was paid off. This would be an extremely odd thing to do in 2005 and 2006 if the intention at the time of purchase was that it would be a matrimonial home for Ms. Klevstova and the Deceased. And again, this is inconsistent with some understanding that while Ms. Avdeeva made the down-payment, the Deceased would be responsible for the remainder.

[215] As noted above, Ms. Avdeeva and Ms. Klevstova’s evidence is that Ms. Avdeeva paid the mortgage, and that the Deceased was a tenant paying $1,500 in rent and I accept that evidence which is also supported by the contemporaneous documents.

[216] In the Deceased’s filed income tax return for 2002 he declared that he paid rent of $6,000 per year. It also indicated that the landlord was Ms. Avdeeva and that the rented property was 43 Bowan Court. While the amount cannot be reconciled with the $1,500 per month Ms. Avdeeva and Ms. Klevstova claimed he paid, it shows that he did pay rent and that Ms. Avdeeva was his landlord, by his own hand.

e) The Deceased’s Alleged Payment of Expenses

[217] There is some very limited evidence that the Deceased paid some expenses associated with Bowan Court.

[218] He paid for the cost for the security system for Bowan Court and there is evidence of preauthorized payments to Voxcom MSP/DIV in the amount of $35.26 per month.

[219] Ms. Klevstova explained that he paid for the security system because he was the one who required it. He was an artist and had valuable equipment in the basement and as such installed and paid for the security system. The only windows wired were in the basement where he resided. The remainder of the house did not have any wiring in support of the security system.

[220] The Estate Trustee referred to pre-authorized payments in the amount of $519.18 to BMW Group FS MSP/DIV, but there is nothing connecting this to Ms. Avdeeva or Bowan Court. This appears to relate to a car lease.

[221] There is a Home Depot quotation for the installation of blinds in the amount of $2,868.14 with the Deceased’s name on it. Then there is a receipt for payment in the amount of $2,927 which appears to be for the same blinds. There is nothing linking the payment to the Deceased and Ms. Avdeeva testified that she paid for these blinds.

[222] The Estate Trustee pointed out that there are entries on his bank statements which show that he was making preauthorized payments to Meloch Monnex insurance in the amount of $46.70, and $245 which the Estate Trustee testified were insurance payments for either a car or a house. However, these could not be connected to Bowan Court. Ms. Klevstova’s answer to the very general question of whether he paid insurance premiums of some sort was that this was an agreement the Deceased had made with her father.

[223] The Estate Trustee also relies upon the Deceased’s discovery evidence that he gave Ms. Klevstova $10,000 per month from September 2001 until September 2003 and that this money was to be used for her lifestyle and expenses at Bowan Court. After their separation in October 2003, he said he gave Ms. Klevstova $2,000 per month for nearly two years for these lifestyle expenses.

[224] Ms. Klevstova denies this and I accept her evidence.

[225] First, there was no documentary evidence in support of these payments. Furthermore, as set out above, the Deceased did not have the financial ability to make these kinds of payments.

[226] His income tax statements showed that his income for various years was as follows: 1996: $21,364; 1997: $14,443; 1998: $23,768; 1999: $26,292; 2000: 28,983: 2001: $48,625; 2002: $74,049.

[227] Some of the witnesses testified that sometime after 2002, the Deceased went into business with a friend and began earning significantly more, but there is no documentary proof of this. I add that this evidence was mostly hearsay as it is not clear how these witnesses would have had first-hand knowledge of the specifics of the Deceased’s income. When Ms. Avdeeva attempted to adduce evidence of the Deceased’s alleged business income during the discovery process, it was refused as irrelevant and has never been produced. Therefore, it is not admissible pursuant to r. 31.07.

[228] Furthermore, the Estate Trustee produced no authority for the proposition that the Deceased could claim a constructive trust in respect of property owned by Ms. Avdeeva on the basis of payments he made to Ms. Klevstova.

[229] One of the documents located by the Estate Trustee in December 2022 was an application for mortgage insurance in respect of Bowan Court dated 04/04/2002 and Ms. Klevstova did agree that there was mortgage life insurance taken out against the Deceased. This is actually the strongest point which the Estate Trustee has, but there was no evidence that he paid the premiums and on its own, it cannot possibly satisfy the burden upon the Estate Trustee.

[230] Ms. Klevstova testified that she attended with Ms. Avdeeva to pay ongoing expenses for Bowan Court. They have produced copies of Enbridge bills with teller stamps on them showing they were paid. I make the obvious point that if the Deceased had paid these, they would have been in his possession. I note here again that Ms. Avdeeva was only able to produce bills for the period from February 2005 onwards because of the flood which destroyed their documents. She was able to find earlier Enbridge receipts because she found them attached to one of her parents’ income tax statements.

[231] In all the circumstances, the Estate Trustee has failed to prove, on a balance of probabilities, that there was any intention that the Deceased have any beneficial interest in Bowan Court, or that he made contributions to its purchase, maintenance or improvement.

[232] I find that there has been no benefit obtained by Ms. Avdeeva and no corresponding deprivation suffered by the Deceased. To the extent that she obtained a benefit by his assumption of the mortgage debt, there is a juristic reason, which is the Trust Agreement which he entered into. To the extent there were some minor payments he made associated with Bowan Court (which are extremely limited even if I accept all the evidence), they are also consistent with his being a tenant or simply being a part of an extended immigrant family where people help one another which is the highest I have been able to find his relationship was. Ms. Avdeeva and Ms. Klevstova helped him by renting him a place to live, by lending money for his businesses as set out below, and by assisting him with his refugee application. He in turn assisted them by assisting with translations, agreeing to act as a guarantor on Bowan Court, and perhaps by picking up some limited expenses around the home.

[233] I make the final point that absolutely none of the evidence of the Deceased’s relationship with Ms. Klevstova, Stephanie or Ms. Avdeeva assists the Estate Trustee, even if true. Imposing a resulting or constructive trust on the basis of those relationships without any proof of common intention in regard to Bowan Court or proof of the Deceased’s contribution to the purchase, maintenance or improvement of the property would be tantamount to finding that property interests are created out of thin air merely on the basis of a familial relationship.

[234] As I have found neither a basis for a constructive or resulting trust, I dismiss the Trustee’s claim for occupation rent since 2003 which was never pled in any event.

N. THE LOANS

[235] Ms. Avdeeva claims repayment of loans which she has claimed she made to the Deceased in the amount of $24,000 CND, $60,000 CND and 31,500 USD and for which he signed Promissory Notes.

[236] As noted above, there was another Promissory Note in the amount of $109,500, also written by the Deceased. The Plaintiff’s evidence was that he repaid $90,000 of it and she has not made any claim for the remainder in this proceeding.

[237] The first is a Promissory Note handwritten by the Deceased dated March 19, 2001 which states:

This is to confirm that I The Deceased KHaftvan borrowed from Ms. Avdeeva $24,000 (Twenty four thousand dollars). I will pay 5 per cent interest each year to her for that amount and if she anytime wants her money back I will return her money back and accrued interest after fifteen days of her notice.

[238] The Deceased’s Scotiabank bank book shows a deposit into his account of $24,000 on that exact date.

[239] The second Promissory Note written by the Deceased provides as follows:

I, Levon Khankaldiyan Haftvan, confirm in written that I borrow the following amount from Mr. Victor Avdeev and his wife Ms. Avdeeva:

$21,500 US (Twenty One thousand and Five hundred American Dollars)

$60,000 CDN (sixty thousand Canadian Dollars)

I should return the abovementioned amounts by the end of the year 2002 or sooner by depositing money to Mr. Avdeev’s accounts in the Royal Bank of Canada.

This statement is valid only during the life period of Mr. and Ms. Avdeeva and mentioned sums will not be paid to their inheritors.

Levon Khankaldiyan Haftvan

28, June, 2001

Toronto, Canada

[240] A later part of the same notes reads as follows:

In addition to the above sums, I received another $10,000-U.S. through Banking Transfer of Royal Bank on 27 July 2002.

The return of this new amount is subject to the same conditions as before.

Levon Khankaldiyan Haftvan

18 Apr. 02—

I agreed to transfer assets (real estate) to Mr. and Mrs. Avdeeva equal to value of borrowed.

[241] For clarity, the $31,500 claimed by Ms. Avdeeva is the addition of the $21,500 and $10,000 US from the second document.

[242] There is a rebuttable presumption that every person whose signature appears on a promissory note received valuable consideration: Mora v. Mora, 2011 ONSC 2965, at para. 30.

[243] The Estate Trustee seeks to rebut this presumption with the Deceased’s evidence regarding why he signed the Promissory Notes which involves an alleged scheme by Ms. Klevstova and Ms. Avdeeva to defraud Ms. Avdeeva’s husband, as follows:

A. It was actually my…Ms. Klevstova wanted, and for the purpose of showing it to Ms. Avdeeva’s husband that I am getting the money. So, I signed because they wanted to explain to Victor the money that they are giving for what.

Q. I don’t understand what you’re saying.

A. I mean, these are monies that Ms. Klevstova and Ms. Avdeeva decided to do some investments, without Victor knowing about. So.

Q. The 21,500.

A. So they wanted to get money to do those investments, buying apartments or whatever, so they told me, because we can’t get money from Victor and buy apartment without letting him know, but we want to buy this apartment for you and Ms. Klevstova in future, so to explain to…why that money is coming out of the common account, I mean, wife and husband, so I sign for Ms. Klevstova, but I am getting these monies. [Emphasis added.]

[244] The Deceased’s explanation has absolutely no support in any documents, or through any admissible evidence from any witness other than the Deceased’s bald statement. It is unclear how this would be a way to defraud Ms. Klevstova’s father if no moneys were actually ever advanced. All the Promissory Notes would do is create a debt in favour of Ms. Avdeeva and her husband, who is named in one of the notes, which they could seek to collect and which would then accrue to the benefit of her family, of which her husband was a part.

[245] As well, how would the Deceased signing Promissory Notes allow for investments without Ms. Avdeeva’s husband knowing about them? And why would Ms. Avdeeva’s husband prefer loaning money to the Deceased over advancing money to his own wife and step-daughter? I add that the Deceased’s final statement set out above on the matter indicates that he did receive the money, although later in his testimony when he was asked whether he received one of the loans reflected in the Promissory Notes he stated, “Not in my hand”.

[246] The Deceased’s and the Estate Trustee’s position here is unpersuasive.

[247] Nevertheless, I am unable to find that Ms. Avdeeva’s claim is sufficiently corroborated for the following reasons.

[248] First, the September 25, 2003 Promissory Note in respect of the $109,500 states that: “With this note, I am voiding all prior written or verbal statements of borrowed funds from her and my [sic] liabilities to her to above funds.” I will pause here to point out that this handwritten statement, which seeks to void all previous Promissory Notes, would be unnecessary if all of the Promissory Notes were actually some sort of scheme to defraud Ms. Avdeeva’s husband; in fact, that statement would work against that alleged scheme.

[249] As noted above, Ms. Avdeeva and Ms. Klevstova have agreed that the Deceased paid back $90,000 of the $109,500 advanced by making a payment on the principal of the Bowan Court mortgage which would leave $29,500 owed based upon the Deceased’s September 25, 2003 Promissory Note.

[250] Ms. Avdeeva testified that the Deceased had paid some of the loans back but could not recall how much. Ms. Klevstova was asked about this and suggested that this was with reference to the $90,000 paid in respect of the $109,500 promissory note, but her evidence is far from clear.

[251] Thus, in my view, in all the circumstances, the amount of the advances which remained outstanding has not been corroborated and Ms. Avdeeva has been unable to prove this claim.

[252] I note that this claim is moot in any event. At the conclusion of the trial, the parties advised that the Estate does not have any assets, other than its claim to a 50 per cent interest in Bowan Court, which I have concluded it does not.

O. CONCLUSION

[253] I wish to circle back to O’Halloran J.’s comments in Faryna v. Chorny with respect to the preponderance of probabilities in this case.

[254] For me to accept the Estate Trustee’s position and the Deceased’s evidence, I would have to believe that Ms. Avdeeva and Ms. Klevstova were diabolically clever in engineering a series of transactions which involved deliberately structuring their financial affairs so that all documents would show that Ms. Avdeeva as an owner and lender and payer of all expenses while taking cash payments from the Deceased which could not be supported based upon his income and for which there is no or little documentary support. And they would have done this at a time when the parties were all getting along for reasons which haven’t been explained. They were not even sophisticated enough to properly retain and instruct counsel who would prosecute this claim without delay, and as a result Ms. Avdeeva was unsuccessful in respect of 2 out of 3 issues she raised. These are not the actions of the kind of sophisticated criminal mind that would be necessary to achieve such a documentary record (to be clear, this comment in no way relates to Ms. Avdeeva’s current counsel).

[255] The evidence, as a whole, supports the conclusion on a balance of probabilities that the Deceased took advantage of his close relationship with Ms. Avdeeva and Ms. Klevstova, to engineer financial transactions with respect to Ms. Avdeeva’s assets which she never authorized, not the other way around as the Estate Trustee has alleged.

[256] Ms. Avdeeva did not speak English when these events occurred and was a stay at home grandmother taking care of four grandchildren; she relied on others including the Deceased for translation and support. There was delay on her part, but during the course of this proceeding her husband and son passed away and she had two strokes. One of her past counsel repeatedly failed to attend court and gave excuses related to his medical health and she was self-represented for a time when Ms. Klevstova managed the litigation quite poorly. Any delay has only harmed her; it did not impact the fair trial for the Deceased as found by four other judges and now by me.

[257] I am granting judgment declaring that Ms. Avdeeva is the sole owner of Bowan Court and directing that the Deceased’s name be removed from title. I am dismissing all other claims.

[258] If costs cannot be settled the parties may make submissions as follows: a) the plaintiff within seven days; and b) the Estate Trustee within seven days thereafter. The submissions shall be no longer than 10 pages each.

Papageorgiou J.

Released: May 31, 2023

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

MS. VALENTINA AVDEEVA

Plaintiff

– and –

THE ESTATE TRUSTEE KHOUSEHABEH, Trustee

Defendant

REASONS FOR JUDGMENT

Papageorgiou J.

Released: May 31, 2023