The Estate of William Robert Waters v. Gillian Henry et al., 2024 ONSC 4190

COURT FILE NO.: CV-22-00680467-0000

DATE: 20240731

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

THE ESTATE OF WILLIAM ROBERT WATERS BY HIS ESTATE TRUSTEES LINDSAY HISTROP AND AGNES KUSSINGER

Plaintiff

– and –

GILLIAN HENRY, NOELLE HENRY, MATTHEW ALEXZANDER HENRY, CEDRIC NOEL BUTTERS, JEAN ELAINE BUTTERS, DONNA MCGRATH, MICHELLE AMANDA LLOYD, SHAMILE LLOYD, RICHARD ANTHONY LLOYD, 2325587 ONTARIO LIMITED, 2329223 ONTARIO LIMITED, 7222874 CANADA INC., JOHN DOE #1, JANE DOE #1, JANE DOE #2, JOHN DOE CORP., KING OF HEARTS STABLES LTD., GMNT LIMITED, GMT LENDING CORPORATION

Defendants

Lorne Silver, Robert Cohen, Jonathan Shepherd, and Sarah Kemp, for the Plaintiff/Defendants to the Counterclaim

Arie Gaertner, Allan Sternberg and Karen Sanchez, for the Defendants/Plaintiffs by Counterclaim

AND BETWEEN:

GILLIAN HENRY

Plaintiff by Counterclaim

– and –

THE ESTATE OF WILLIAM ROBERT WATERS, by his Estate Trustees LINDSAY HISTROP and AGNES KUSSINGER

Defendants to the Counterclaim

HEARD: November 27, 28, 29 and 30, December 1, 4, 5, 6, 7, 8, 13, 14, 15, 18, 19, 20, 21 and 22, 2023, January 18 and 19, 2024

REASONS FOR DECISION

Callaghan j.

[1] William Waters (“William”) was an academic, successful businessman, and philanthropist. He had amassed a significant sum in his life. He died at the age of 88.

[2] Upon his death, his estate trustees on behalf of his estate (the “Estate”) would learn that he had provided most of his money to his wife’s personal care worker, Gillian Henry (“Gillian”). Over the better part of 10 years, William had provided Gillian more than $30 million, which Gillian spent acquiring property and living the good life. Unbeknownst to his friends, colleagues, and the estate trustees, over those years, William was involved in an intimate relationship with Gillian.

[3] The Estate sues Gillian seeking the return of the money and properties purchased with the money. It claims that Gillian cannot keep the money. It asserts the money was given to Gillian to invest for William. In contrast, Gillian states the money was a gift and she is not required to repay the Estate or return the properties.

[4] This case turns on the intentions of William. Was the money a gift or was the money to be invested and returned to him? Of course, William is dead. He cannot speak and tell us his intentions. Instead, his intentions must be deciphered from the other evidence adduced at trial.

[5] I have concluded that William did intend most of the money to be a gift. I have concluded that William intended to retain an interest in the business known as King of Hearts Stables (“King of Hearts”). I have further concluded that William improperly gifted his wife’s money to Gillian, which he could not do, and which must be returned to Phyliss. Further, there are certain debts that are agreed to be owing that must be repaid and a mortgage that must be discharged. Finally, there is an Order of Canada medal that must be returned.

[6] There was a Counterclaim issued alleging that William committed a sexual battery on Gillian at the outset of their relationship. I have dismissed that claim.

William Waters

[7] One of William’s friends described him as resembling a character from a Horatio Alger novel. Horatio Alger wrote books about boys who, by the dint of their own honest efforts, rose from humble beginnings to positions of success. In some respects, this rags-to-riches analogy captures the rise of William.

[8] William was born on August 21, 1932. He was an orphan who was eventually adopted by a 51-year-old single parent. After high school, he could not afford university and instead worked. He eventually earned enough money to attend the University of Toronto. He would earn an MBA from the University of Toronto and went on to obtain a PhD in economics from the prestigious University of Chicago. He then returned to the University of Toronto where he taught finance and economics, at what is now known as the Rotman School of Management. He was an associate Dean in the early 1970s and was the first director of the executive MBA program. By all accounts he was a well-regarded professor who took an active interest in his students, some of whom testified at this trial.

[9] He later married Phyliss Waters (“Phyliss”). They lived in mid-town Toronto.

[10] Aside from his academic success, William was also a successful businessman and expert witness. He was an expert in financial returns for utilities and was an expert witness before various rate setting tribunals. He possessed a significant library of financial data, which he successfully monetized by creating computer modeling program companies. He founded Portfolio Analytics and Financial Models Company Inc. in 2003 and 2005 respectively, both of which he later sold. Along the way, he was involved in contentious litigation with his former partner (see Katokakis v William R. William Ltd. (2005), 2005 4090 (ON CA), 1 B.L.R. (4th) 168 (Ont. C.A.)). As a result of selling these ventures, William was said to have received approximately $50 million.

[11] He was an active philanthropist. The University of Toronto (“UofT”) was a significant beneficiary. He was rightly considered a leader among his peers in giving to the UofT.

[12] Some of his giving was done at a more personal level. One such case involved a young waitress who William befriended. He learned that she had an opportunity to study opera but lacked the funds to do so. William graciously funded the waitress’ opera studies, and the student went on to some notoriety as a professional opera singer.

[13] William was recognised for his achievements and philanthropy with an honourary degree from UofT and an Order of Canada.

[14] William conducted much of his business through a company, William R. Waters Limited (“WRW”). For many years, William maintained an office near his home in mid-town Toronto. The number of employees who worked for him varied over the years depending on his business ventures, expert testimony services, and other requirements. Over the years, he was assisted by two long term colleagues.

[15] Meredith Brown ran his office and was his administrative assistant (“Meredith”). Notwithstanding that his financial success was derived from selling computer models, William did not use computers, iPhones and the like. Meredith would send and receive emails on his behalf. She would prepare typewritten documents and emails from William’s handwritten notes.

[16] Agnes Kussinger (“Kussinger”) had been William’s student at UofT. She worked with William off and on starting in the 1970s. Kussinger was involved in a wide array of William’s and WRW’s businesses. She is the co-executor of the Estate and is the attorney for property for Phyliss.

[17] Both Kussinger and Meredith assisted William with assembling documents and information for the accountants who would produce the taxes of William, WRW, Phyliss, and Gillian. In the case of Meredith, she would prepare the monthly expenses.

[18] William was not an absentee manager of his affairs. He reviewed every financial statement, every investment statement, and every VISA bill. For example, Meridith would provide William with the VISA bills for him, WRW, Phyliss, and later, Gillian. He would review the bills and Meridith would pay the bills only after she was authorized to do so by William.

[19] At all times, William was aware of where his money was being spent. He personally gave directions to his bankers and investment advisors. This is verified by the notes and faxes retained by the financial institutions, particularly CIBC and Wood Gundy. His accounts were not discretionary.

[20] He made several net worth statements over the years and he personally reviewed both his personal and corporate taxes. He also invested his wife’s money via a power of attorney for property. In short, he was in complete control of his and his wife’s finances.

[21] William maintained an active social life well into his mid-eighties. He was a member of the York Club, which he frequented regularly. He went to dinner with former students on a quarterly basis.

[22] He was not an extravagant man. Given the extent of his wealth, he lived modestly. He did not own a car. He only bought his first house in the 1990s to accommodate his wife’s health care needs.

[23] William had several health problems over the years. Prior to meeting Gillian, William was treated for cancer. During the later years, he suffered kidney failure. He was treated with dialysis, first at home and later at the hospital.

[24] Both parties retained geriatric medical experts for the purpose of this action. However, neither side called any expert as to the mental capacity of William. There was some discussion about William suffering “brain fog” but what, when and how “brain fog” accounted for his actions over this period was never adequately explained or proven.

[25] William utilized professional advisors, including lawyers, accountants, and financial advisors. He sought the advice of his estate, tax, and corporate lawyers, Ms. Lindsay Histrop (“Histrop”) and her colleagues at Cassels Brock & Blackwell LLP (“Cassels”). Cassels had acted for him in a very contentious piece of litigation involving his former business partner (see para. 10 above). Histrop prepared William’s wills and is the co-trustee, along with Kussinger, of the Estate. He was in regular contact with his now deceased solicitor and friend Richard Arnold, who assisted him with several documents relevant to Gillian. He consulted his accountants, Alex Fraser and then Peter Chambers. He sought the advice of his friend and Gillian’s accountant, Ian Hawkins. He was in regular contact with Richard DeMelo, his broker at Wood Gundy. He also met with lawyers, Mr. Wade and Mr. Greenberg, for independent legal advice when dealing with loans and mortgages. In short, the record demonstrates that William was in contact with and had access to a plethora of advisors regarding both his financial and legal affairs.

[26] His professional advisors expressly stated that they had no issue with his ability to appreciate the advice given and provide instructions. As Histrop told DeMelo in 2018, “[William’s mind] is still very sharp”. DeMelo continued to transfer funds on William’s instructions until the end of 2019. Through the 10 years or so in issue, William signed several wills, the last in 2018. It is agreed by all that he retained capacity to do so during that time.

[27] William was not just an astute person but a very private person. He did not share information that he chose to keep private. Several witnesses testified that if you pried into his personal or business life, you did so at the expense of your relationship with him.

[28] Both Meredith and Kussinger knew William was providing significant funds to Gillian but never asked him why he would be doing so. They both said it was not their business but more to the point, neither were prepared to pry into his personal dealings as it would not be appreciated by William. Hawkins challenged William’s largess to Gillian. William stopped contacting Hawkins. Hawkins rightly believes that his enquiry ended their relationship.

[29] None of William’s friends or advisors were aware of William’s relationship with Gillian, even though it continued for some ten years. Aside from his family doctor, he appears to have told no one about his romantic relationship with Gillian. Notwithstanding that many knew of his largesse to Gillian, they either chose not to make the obvious leap or simply did not comprehend that he could be in such a relationship.

[30] William and Phyliss moved to a seniors’ residence prior to Covid. He died on July 28, 2021, at the age of 88.

Phyliss Waters

[31] William was married to Phyliss for 53 years. They had no children. Aside from Phyliss’s sister, there was no family. William had no heir, apparent or otherwise.

[32] For the relevant period, Phyliss was a housebound recluse. She had injured herself in a fall some time in the 1990s. She suffers from chronic pain, depression, and dependent personality disorder. She struggled with alcohol. She requires daily care, including the assistance of personal support workers.

[33] By the time Gillian enters the Waters’ home, there was little contact between the Waters. Phyliss lived exclusively in her room on the second floor. They did not dine together. There is no credible evidence that they were close during this period. Their only interaction was that William would attend at Phyliss’s room each night and provide her a rum drink and medication.

[34] In August 2009, Phyliss attended the Canyon in California. The Canyon is an addiction and mental wellness centre. She lived at the Canyon from August until January 30, 2010.

[35] Nonetheless, William consistently expressed that Phyliss’s long-term well-being was a priority. Indeed, one of his unsuccessful business ventures was a company that was to develop a machine to alleviate the type of chronic pain suffered by Phyliss.

[36] Phyliss was not a party to this litigation. However, her presence loomed large throughout. She is still alive. She is 85 and resides in a seniors’ residence that provides care for her. The cost of her care is approximately $32,000 per month plus accommodation expenses.

[37] While William professed that his priority was to ensure Phyliss’s long-term care, the reality is that he dissipated nearly all of Phyliss’s money and nearly all of his money. Phyliss, at one time, had approximately $5.4 million of her own money. The money was under William’s control via a power of attorney. All but approximately $500,000 of that money is gone.

[38] As discussed in more detail below, in his wills, William always provided Phyliss with a life interest in his Estate. Kussinger is the attorney for property for Phyliss. She is also the co-trustee of William’s Estate. She did not make an election on behalf of Phyliss for an equalization payment under the Family Law Act, R.S.O. 1990, c. F.3, s. 6. Nonetheless, Kussinger testified that she would still elect for a life interest in the estate for Phyliss over equalization.

[39] The defendants sought to have Phyllis attend as a witness at the trial. A concern was expressed by the Estate that Phyllis currently lacks the capacity to be a witness. As a result, I ordered an independent capacity assessment to be conducted. It was determined that Phyllis did not have the capacity to testify at this trial. Accordingly, she was not called as a witness by either party.

Gillian Henry

[40] Gillian was born in Guyana in 1969. Her mother immigrated to Canada when she was a young child. Her father remained in Guyana with Gillian and her siblings. He was an absentee father. Gillian and her siblings moved about and lived at the homes of various relatives and friends, including with her grandmother. Life was not easy in Guyana.

[41] During the currency of this litigation, Gillian was seen by the psychiatrist, Dr. Jaffee. In a session with Dr. Jaffee, she disclosed she had been abused when she was a child in Guyana. Her sisters, who are also defendants in this action, testified that they too were abused while in Guyana as children. The impact of this childhood abuse took up time during the trial as it was interwoven with the allegations of later sexual abuse by William and Gillian’s responses to the events in this litigation. I accept that Gillian and her sisters were abused while in Guyana.

[42] Gillian came to Canada as a teenager. She struggled in school as she had difficulty reading. She opted out of school after grade 10. She went to work with her mother cleaning and doing laundry. Gillian later completed the required courses to become a personal support worker (“PSW”).

[43] At the age of 20, she met Asif Thompson, who she married. The marriage was short lived, although it produced their son, Matthew, who is a defendant. She subsequently met Kerwin Henry (“Kerwin”), who she married in 1995. They had their daughter, Noelle, who is also a defendant. As discussed in more detail below, the relationship between Kerwin and Gillian was at an end by 2009.

[44] By May 2009, she was separated, raising two children, and in significant financial difficulty. The family home she and Kerwin purchased and which she resided in with the children was located at 64 Elder Crescent in Whitby (“Elder”). The house was heavily mortgaged. As part of the separation, Gillian was to assume the debt, and, in return, she would end up with title to the home. With a modest salary and minimal to no support from Kerwin, Gillian was in significant debt in the spring of 2009.

Gillian is Hired by The Waters

[45] In 2008, Gillian was working as a PSW for Mrs. Dyer when she was asked by an agency if she would meet the Waters, who were looking to hire a nighttime PSW for Phyliss. Gillian met the Waters at the end of 2008. However, at that time, she declined the offer to work for the Waters as Mrs. Dyer was still in need of her services. However, Mrs. Dyer died in early 2009 and the Waters again asked if Gillian would be free to work for them.

[46] By this time, the Waters already employed Reena Sookdeo, a PSW who worked during the day. Reena had been working for the Waters for over 10 years. The Waters also employed a cook.

[47] William was prepared to pay Gillian $60,000 a year, which was more than Gillian had ever earned.

[48] By all accounts, Gillian got along very well with Phyliss. William was said to be worried about Phyliss’s relationship with the PSWs who cared for her and was delighted that Gillian was a well-liked caregiver and companion to his wife. It is suggested by the Estate that William was very generous to Gillian because he wanted to persuade her to stay with the Waters and, particularly, Phyliss for years to come. However, this theory is at odds with the fact that Reena had been with the Waters for over 10 years, suggesting that there was already longevity and loyalty in respect of other PSWs. It is undoubtedly true that conditions were placed on some financial benefits for Gillian, which obliged her to stay to assist Phyliss even after William died. However, as discussed next, loyalty to Phyliss was not the only reason for William to advance considerable sums to Gillian and, in my view, this was a convenient explanation for William that kept prying eyes from inquiring into his real motives.

Gillian and William

[49] This case revolves around Gillian and William. The seemingly inexplicable sums advanced to Gillian by William happened within the context of a romantic relationship that was kept secret. How the relationship began is a matter of some contention. Gillian states it began with her being sexually abused, which is disputed by the Estate. Gillian described how that relationship morphed into a consensual relationship over time.

[50] Gillian described that William was very interested in her and her life story. Soon after she started working for the Waters, her son was in a car accident, damaging the family vehicle. William offered to provide her money to pay for a new car.

[51] On May 21, 2009, William advanced Gillian $101,000.00. According to Gillian, William suggested she buy a Mercedes SUV. The advance by William of over $100,000 to a woman in admitted financial difficulty making $60,000 per year seems extraordinary. Gillian could not recall the reason for this initial advance when asked on a cross-examination on an affidavit prior to trial. Nonetheless, there is no dispute that William provided $101,000 and Gillian used the money to buy a new Mercedes SUV. At trial, Gillian testified for the first time this was to be a loan, although there is no written confirmation to this effect.

[52] William was very curious as to Gillian’s background and learned not just of her financial woes but her marital and family history.

[53] On June 2, 2009, two weeks after the $101,000 advance for the new car, William advanced Gillian $400,000. Gillian also received $310,000 on June 26, 2009. Gillian testified that William provided the money to permit her to pay off the mortgages on her home and other debts. She testified these amounts were loans from William.

[54] There is a note by William’s banker on May 20, 2009, asking the bank to “arrange a mortgage for his wife’s nurse/caregiver, Gillian Henry.” The loan was to be for debt consolidation. William was “prepared to provide complimentary subordinated financing with no interest or repayment obligation, and a guarantee on the bank’s mortgage financing ... basically whatever it takes.” As it happens, the bank loan did not proceed. Rather, money was advanced directly by William.

[55] There was no loan documentation provided for either the $101,000 or $400,000, although an unsigned document was produced referencing the $310,000 loan.

[56] An unsigned promissory note dated June 26, 2009, acknowledges the loan of $310,000. The note refers to the money being used to discharge the first mortgage on Elder. The note was in favour of WRW and was to carry a 3% interest rate, which was not payable for the first twelve months and could be waived at the discretion of WRW. No payment of principle was owing under the note, except if Elder was otherwise encumbered or if Gillian was to leave the employ of William or Phyliss. The note was to be discharged on the deaths of both William and Phyliss. The note was undoubtedly drafted by William’s deceased solicitor, Richard Arnold. There was no explanation as to why the loan documentation was never signed or why the loan documentation would not include the $400,000 or $101,000 which are admitted being loans.

[57] On June 9, 2009, there was an inter-spousal transfer of Elder from Kerwin to Gillian for $2.00. Three mortgages were discharged on the home in the ensuing months. The principal amount of those discharged mortgages was $476,250.00. Gillian testified the money from William was also used to pay a loan that she and Kerwin owed her parents of $110,000. According to Gillian, she paid off debts of $576,250.00. She also made improvements to Elder, including adding a pool and remodelling the kitchen. Some of the money was used for jewellery and other expenditures.

[58] There was one more significant advance in this first tranche. This was a $26,000 cheque cashed on June 8, 2009. A note in the banking records of William has the word “ring” beside it. When suggested by counsel that this was William’s handwriting and that he advanced the money for a ring, Gillian refused to accept it was his handwriting or that the money was for a ring. She said she did not trust that the Estate had not doctored the document. I accept that the note was not doctored as suggested by Gillian. It was found in William’s possession after he died.

[59] Within a very short time of commencing employment, William was providing Gillian significant sums, which continued over the years. All and all, in just over a month of Gillian starting her employment with the Waters, William advanced over $800,000 to Gillian, without any signed note or security.

[60] Gillian testified that after the initial $400,000 was advanced, William sexually assaulted her. I will address the issue of the sexual assault later in these reasons. Gillian testified that the relationship morphed into a long-term consensual relationship.

[61] William’s generosity was not just the generosity of an employer, but rather the generosity of an intimate partner.

[62] Without exception, the witnesses for the Estate testified that not only were they unaware of an intimate relationship between William and Gillian, but they found the concept to be out of character for William. However, the evidence is unassailable that an intimate relationship existed.

[63] The fact that William never confided in any of his friends and colleagues is not surprising. First, it was an extramarital affair. The glowing reviews of his character by his friends were inconsistent with him having an affair with his housebound wife’s support worker. For him not to share his relationship with Gillian with others is consistent with maintaining his image with his friends and colleagues. Second, he was a private person. Every witness who claimed to know him well confirmed this. It is evident that William maintained a strict distance between what he would and would not share with others. As already mentioned, prying inquiries were not welcomed by William.

[64] The most convincing evidence of the intimate relationship is William's desire to correct his erectile dysfunction. On June 25, 2009, William visited Dr. Klotz, a urologist, seeking a treatment for erectile dysfunction. A variety of treatment options were discussed, including the drug Cialis, which treats erectile dysfunction. Dr. Klotz recommended that William follow up with his family doctor. The family doctor saw William in early October. His family doctor’s notes refer to Cialis and then the Doctor writes “got a gf (he has one age 40 Nigerian-early days).” William was clearly confiding in his family doctor that he had a girlfriend (“gf”). While Gillian is Guyanese and not Nigerian, she was 40 years old at the time.

[65] At the time of the visit with the family doctor, Phyliss was in a treatment centre in California for several months starting in August 2009. Notwithstanding that Phyliss was in California, William still had Gillian attend at the home each day, even though there was no one requiring care. Gillian testified and I accept that the intimate relationship continued during this period.

[66] Dr. Rupert was a former student and friend of William. He is a family doctor who started a business called RCM Health Consultancy. The business provided what he called “complexity care”. Essentially, he co-ordinated the health care for patients with complex health issues, including the referral to various specialists. William used his services.

[67] Dr. Rupert’s records show that he prescribed Cialis to William in 2012, 2013, and 2014. Each prescription was referred to as a “Refill Authorization Request”, which indicates there were prior prescriptions. Dr Rupert, like Water’s other friends, knew nothing of his relationship with Gillian. Indeed, Dr. Rupert testified that while the Cialis prescriptions were made out to William and were in his medical file, the prescriptions may have been for someone else. It was Dr. Rupert’s view that Cialis was neither an appropriate nor safe prescription for William. Dr. Rupert says that William’s use of Cialis would be inconsistent with what he was told by William, which was that William was not interested in sex. Dr. Rupert’s testimony is not persuasive and, in fact, was proffered before Dr. Rupert was confronted with the report and notes of Dr. Klotz and the family doctor of which he knew nothing, notwithstanding he was both William’s physician and friend.

[68] Dr. Rupert’s prescriptions for Cialis were for William and were for the purpose of carrying on his affair with Gillian. However, the reaction of Dr. Rupert is telling. Rupert could not accept that William would have an affair and, moreover, William was never forthcoming with him about the affair.

[69] The relationship was more than physical. Gillian spent time with William. As mentioned, William’s relationship with his wife was strained and, undoubtedly, he turned to Gillian for companionship. William dined with Gillian both at restaurants and the York Club. He also asked her to attend his investiture in the Order of Canada. It was suggested by the Estate that she went simply as a caregiver. I do not accept that she went simply as a caregiver. She was asked as a guest because she was a significant part of William’s life. I accept that William considered her a “special friend” and invited her for that reason.

[70] Gillian states that, even when apart, she and William spoke every day, right up to his death. In fact, the night before he died, William left Gillian the following voice message:

Oh hi Gillian. I hope you’re doing better as you weren’t so good yesterday and uhh call me anytime. Thanks…for now…bye bye sweet heart.

[71] The relationship was real. It was intimate and of long standing. As I discuss later in the decision, it is an important consideration when assessing the actions and intent of William.

The Financial Overview

[72] From the summer of 2009 to December 2019, William would advance over $30 million to Gillian. The money was conveyed by cheque, by direct deposits, and by VISA payments. The money was used to buy property, cars, jewellery, trips, clothes, and other items.

[73] There were numerous properties purchased by Gillian. Aside from the properties where she lived, Gillian claims William was setting her up as a real estate investor. She states that he acted not just as her financial backer but as her mentor. She testified that she conferred with him regarding property purchases. She listened and followed his advice. She states they were not in business together, but rather these were gifts from him to her. The Estate states that they were not gifts.

[74] The Estate says they were investments for William’s benefit. In its 100-page closing argument, the Estate put its position succinctly as follows:

[William’s] actual intention at the time of transferring the majority of the funds was that the funds were an investment in a real estate enterprise.

[75] Each party paints a very different picture of William’s intent.

[76] It was suggested by the Estate in its Statement of Defence to the Counterclaim and Reply to the Statement of Defence that if there was an intimate relationship, it was a “romance scam wholly predatory in nature” intended by Gillian to gain financial benefits from William. There was no such claim advanced by the Estate in its Amended Amended Statement of Claim. The Estate did not advance the argument of a romance scam either in its 100-page written or oral closing submissions, although it relied on the doctrine of fraud as it related to Gillian as an investor. Rather, the argument advanced was that the money provided by William was in furtherance of a business relationship for which Gillian must account to the Estate. Among other causes of actions, the Estate relies on the legal doctrines of resulting trust and undue influence with their attended presumptions to assert Gillian cannot retain the money or properties acquired and must account to the Estate.

[77] There is no dispute that the money to purchase the properties acquired by Gillian originated with William for which there was no consideration. There is also no doubt that William was aware of the purchases of the properties.

[78] There were over 393 transfers, by direct transfer or cheque, from either William’s or WRW’s bank accounts or investment accounts. They ranged in amounts as small as $2,000 to as large as $2,100,000. There were over seventy transfers of more than $100,000 amounting to over $15 million. The parties agree that of the $30 million at issue, some $19 million went to property purchases and renovations.

[79] Gillian was asked about discussions with William regarding the money transfers. She indicated that for the vast majority of the transfers, she had no recollection of the discussions. She testified that William often deposited money directly into her account without her knowing. She testified that William was aware of expenses related to the property and would provide money as needed. She said she would have discussed the larger transfers with William as they related to the acquisition of properties. She said that the acquisition of properties was something she reviewed with William.

[80] The following yearly amounts, over the ten-year period from 2009 through to 2019, were transferred by William to Gillian:

2009- $3,620,000

2010 -$3,502,430

2011- $4,741.779

2012 -$3,189,730

2013- $3,696,850

2014 -$3,621,741

2015- $3,294,500

2016- $1,033,500

2017- $2,138,348

2018- $769,100

2019 -$554,000

TOTAL: $30,161,978.00

[81] Of this amount, the parties agree that $12 million was used by Gillian to purchase property. There was an additional $7 million spent on renovations to properties located on Brock Rd., being King of Hearts ($4.5M) and Northern Dancer ($2.5M).

[82] There has been no forensic analysis of how the money was spent, including the exact expenditure of the $11 million remaining of the $30 million, although Gillian used a portion of the money to buy expensive vehicles for her and her family, to buy horses for her daughter, to discharge her siblings’ mortgages, to pay expenses for the properties, for trips, for jewellery, for dinners, and for other items. Money was also put into RRSPs and TFSAs for her and her children. There was over $3 million spent by Gillian using the VISA card provided by William.

[83] Regardless of how the money was spent, William approved each advance. As mentioned, in the case of the VISA expenses, William reviewed each statement before authorizing payment. In respect of transfers from either his bank account or investment account, transactions were personally approved by William and confirmed by CIBC/Wood Gundy personnel. Cheques issued to Gillian were signed by William.

[84] As discussed below, there is documentation evidencing William’s intentions in respect of some of the advances. For example, some of the monies were clearly provided by William by way of loan. There was loan documentation referencing $1.4 million with security documentation referable to properties on Brock Rd., Concession Rd., and Delight Way. As of 2014, William held a $400,000 mortgage on Elder. There was documentation relating to money advanced for a home on Secretariat and a proposed trust for Noelle’s education. In some cases, those loans were excused.

[85] Gillian repaid $2,350,000.00 by way of 6 separate transfers to William or WRW. She paid $1,200,000 of this to him in his lifetime and the remainder to the Estate since his death.

[86] As a result of pre-trial orders, various properties have been sold since the commencement of the litigation. Nonetheless, due to expenses and legal fees, at the time of trial, the Estate had about $580,000 remaining and it owes Phyliss $5,424,000 for amounts lost by William while he controlled her money.

The Properties

[87] From 2009 onward, Gillian bought and sold several properties, using the money received from William. There was no consideration provided to William from Gillian.

[88] She also used the money from William to pay off the mortgages on Elder, to pay off the mortgage of her sister, and to purchase homes for her sisters and parents. Her children, parents, two sisters, and a brother-in-law are defendants in this action.

[89] Gillian incorporated companies that held title to certain properties that were to be used as rental properties. These included 2325587 Ontario Limited (“587 Ontario”), 2329223 Ontario Limited (“223 Ontario”), and 722874 Canada Inc. (“874 Canada”). All the companies are defendants, along with other corporate entities controlled by Gillian. Some of the properties were rented.

[90] There was one operating business, being King of Hearts, which was a business catering to horses, including the boarding of horses. King of Hearts was located at the Brock Rd. property.

[91] The following is a brief description of the properties that were either bought, renovated or both with William’s money:

(a) 64 Elder Crescent - owned by Gillian prior to meeting William. Renovations were done to the home; mortgages were paid off; and a subsequent mortgage was added to the home in favour of William, which is registered as of today.

(b) On August 27, 2009, Gillian purchased 1374 Linstead St., Oshawa, for $250,000. On June 11, 2013, she transferred the property to her sister, Donna McGrath, for $170,000.

(c) On November 2, 2009, Gillian purchased 152 Taunton Rd., Ajax, for $175,000. The property was subsequently transferred to her sisters, the defendants Michelle Lloyd and Shamile Lloyd, for no consideration in 2011. Eventually, Michelle sold her interest to Shamile in 2011. Shamile transferred the home to her and her husband in 2012. They sold the property to 223 Ontario in February 2015. The property was sold by 233 Ontario on February 26, 2021, for $529,000.

(d) On November 4, 2009, Gillian and her son Matthew purchased 154 Taunton Rd., Ajax, for $170,000. The property was sold on February 26, 2021, for $549,000.00.

(e) On December 15, 2009, Gillian purchased 1 Delight Way for $272,543. This property is still owned by Gillian.

(f) On April 1, 2010, Gillian purchased 1169 Secretariate Rd., Newmarket, for $765,000. The property was sold on November 1, 2013, for $885,000.

(g) On March 4, 2011, Gillian purchased 9 Northern Dancer Ln., Aurora, for $2,000,000. This is where she currently resides.

(h) On May 31, 2012, 587 Ontario purchased 4532 Holborn Rd., Mount Albert, for $459,000. It was sold on January 15, 2015, for $469,000.

(i) On August 1, 2012, 223 Ontario purchased 7790 Concession Rd. 5, Uxbridge, for $685,000. It was sold on August 20, 2014, for $796,000.

(j) On April 5, 2013, 587 Ontario purchased 350 Harry Walker Parkway, unit 14, Newmarket, for $339,000. It was sold on May 27, 2022, for $750,000.

(k) On April 30, 2013, 587 Ontario purchased 350 Harry Walker Parkway, units 5 & 8, Newmarket, for $299,000. It was sold on April 30, 2021, for $562,500.

(l) On November 25, 2013, 587 Ontario purchased 1580 Brock Rd. for $2,500,000. 587 Ontario still owns Brock Rd. It is the location of King of Hearts. The property and business was being marketed for sale at the time of the trial.

(m) On September 26, 2016, Gillian purchased the pre -construction property 1010 Dundas St. east, suite 106, for $68,000. This property has yet to close. This property interest is still owned by Gillian.

(n) On February 23, 2018, 223 Ontario purchased 72 Bettina Place, Whitby, for $570,000. It was sold on April 29, 2022, for $900,000.

(o) On April 10, 2018, 223 Ontario purchased 2520 Bromus Path, Oshawa, for $343, $1781.00. It was sold on November 15, 2023, for $600,000

(p) On April 10, 2018, 223 Ontario purchased 2524 Bromus Path, Oshawa, for $360,490.00. It was sold on September 1, 2021, for $675,000

(q) On August 11, 2020, 587 Ontario purchased 39 Braebrook Drive for $850,000. The property is still owned by 587 Ontario.

(r) On August 7, 2020, 587 Ontario purchased 1047 Mantopic Rd. Newmarket, for $1,430,000. It was sold on September 6, 2023, for $1,720,000.

(s) On January 7, 2022, 587 Ontario purchased 708 Dunlop St. West, Whitby, for $1,625,000. It was sold on December 16, 2022, for $1,500,000.

(t) On December 19,2022, Gillian purchased 2250 Simcoe St. North, unit 2216, Oshawa, for $467,913. It was sold on August 1, 2023, for $660,000.

[92] Gillian also purchased a property in Guyana. There is no documentation regarding the property. Gillian asserts that the property was in Georgetown and was a preconstruction purchase for $100,000.

[93] Of the properties purchased, five remain unsold, plus the preconstruction condo that has yet to close. The total purchase price for these unsold properties was $6,075,449.91. The sold properties were purchased for $7,770,084.00 and were sold for $10,738,500.00. While all the funds used by Gillian originated from William, certain purchases were made with proceeds of prior sales; hence it was not all new money from William. Many of the properties were sold after the commencement of this litigation and at the direction of the court.

Sea Ranch

[94] There are several specific transactions that were the subject of testimony and that each side relies upon to advance their case. One such transaction is the Sea Ranch property. Soon after Gillian began working for the Waters, Phyliss entered the Canyon in California, where she resided from August 2009 to January 2010.

[95] William decided to purchase a property in California, supposedly so Phyliss could spend the colder months there. William’s idea was that Gillian would accompany Phyliss to California for the winter months. While Phyliss was seeking treatment in 2009 at the Canyon, William paid for Gillian and her sisters to go to California to look for a suitable home. He was partial to an area called Sea Ranch where he and Phyllis had visited years before.

[96] Soon enough, a suitable home was found. William then deliberated about who should take title to the home. In October 2009, lawyers at Cassels were consulted by William. It was suggested to the lawyers by William that Gillian should incorporate a company to hold title. The initial concept was that in recognition of Gillian having to leave her children, who were still young, to be with Phyliss each year for an extended period in California, she should be rewarded with the home upon the death of William and Phyliss.

[97] However, conveying Sea Ranch to Gillian or having her work in California posed a host of cross-border tax issues. In the end, the property was purchased by a holding company owned by William and remained under his control. There was discussion between William and his estate lawyer, Histrop, that she should prepare a codicil transferring ownership of Sea Ranch to Gillian upon the death of both Phyliss and William. There never was a codicil signed and, in fact, neither William nor Phyliss ever used Sea Ranch.

[98] During October 2009, there was a further suggestion by William to Histrop that there could be a virtual account for Gillian’s benefit of up to $1.5 million, which she would get if she remained in the employ of William and Phyllis. The notional account never materialized. Phyliss left for the Canyon in August. This arrangement was proposed even though Gillian had spent only a couple of months with Phyliss.

[99] Moreover, by the end of October 2009, Gillian had bought her first property (Linstead) and was about to close on two more (both on Taunton Road). When dealing with Histrop on Sea Ranch and the notional account, William chose not to share with her that, by this time, he had already provided some $3 million to Gillian. Nonetheless, the proposed arrangements evidence William’s desire to benefit Gillian which continued over the years.

Noelle’s Education, Secretariate, and Northern Dancer

[100] William was a significant patron to UofT and other academic institutions. William was described as passionate about education. He offered to provide a private school education for Gillian's daughter, Noelle, who was entering high school. Gillian accepted the offer.

[101] Noelle did not get into the private school near her home. Instead, she was admitted to Pickering College in Newmarket. Newmarket was some distance from Gillian’s home on Elder. While Pickering College offers boarding for students, Gillian did not feel comfortable with this option. In the end, William offered to purchase a home for Gillian in Newmarket.

[102] According to Gillian, she wanted a safe community for her and her daughter to live in as she was concerned about unwanted visits from her estranged husband. A home was eventually found on Secretariate Drive, Newmarket (“Secretariate”). The home was close to Noelle’s school.

[103] Secretariate was bought for $765,000. The purchase funds were provided by William, by way of a loan. Gillian signed a promissory note, dated April 24, 2010, in favour of William, for the purchase price (the “Promissory Note”). The loan was to attract interest following the first twelve months at 3%. There was no term to the loan. However, the loan was tied into the commitment by William to pay for Noelle’s education. There was attached to the promissory note a document entitled “Commitment By William R William and Gillian Henry Re The Education of Noelle Henry” (the “Commitment Letter”). The Commitment Letter provided that William would make “a substantial commitment to the funding of the education of Noelle Henry throughout her post primary educational studies.” It was agreed that Secretariat would be sold in 2014, following Noelle’s last year at Pickering College. It was agreed that the sale proceeds, less $200,000.00, would be repaid to William, and would be placed in a joint investment account in the names of William and Gillian for the use of Noelle’s post-secondary education.

[104] Histrop drafted a trust document for William in October 2010 regarding Noelle’s education and discussed it with him on several occasions in March, May, and June of 2011. The draft was never shared with Gillian, nor was it signed.

[105] In the end, William also paid for Noelle’s post-secondary education. After Pickering College, she went to the University of Edinburgh for a year and then to McMaster University.

[106] The Estate accepts that the money spent on Noelle’s education was a gift from William and was consistent with his emphasis on education and his philanthropy. He also supported Noelle’s love of horses. Noelle rode competitively and had several horses, paid for by William. The Estate says those things were not gifts.

[107] In March 2011, Gillian purchased a home on Northern Dancer Drive, Newmarket (“Northern Dancer”). Gillian testified that William was concerned that there were too many stairs at Secretariate and that he encouraged Gillian to buy a home that had less stairs. Gillian said that William wanted to marry and live with her should Phyliss pre-decease him. Northern Dancer was a bungalow. Northern Dancer was in the same general area as Secretariate and close to Pickering College.

[108] The purchase price of Northern Dancer was $2 million. Secretariate was not sold immediately but was leased by Gillian. The rental payments went to Gillian and were claimed by her on her taxes.

[109] William spoke to Histrop about Northern Dancer. Histrop was told that Gillian would sell Elder to fund the downpayment and then take out a home equity line of credit (“HELOC”) to fund the rest. This is denied by Gillian.

[110] As it happened, Elder was never sold. A HELOC was put on the property for $1.3 million, guaranteed by William. The remainder of the purchase price was funded by William. William paid the mortgage on Northern Dancer.

[111] Histrop advised William that he should have insisted that Gillian sell Secretariate. Histrop also suggested to William that Gillian ought to sell the other properties that she had acquired by this time. William did not heed this advice.

[112] In the meantime, Histrop amended the draft trust agreement to reflect the existence of William’s guarantee of the HELOC and that monies would not flow under the trust until the HELOC was extinguished. She again advised William that Secretariate should be transferred to him and that the trust should be incorporated into his will. She suggested there be a management agreement to address Gillian’s role in managing Secretariate after it was transferred to William as William wanted Gillian to use the rents to pay the mortgage. One draft specifically referred to Gillian owing Secretariate as a “bare trustee” and William as the beneficial owner. These documents were never finalized and never executed.

[113] Notwithstanding Histrop’s repeated advise, William took no immediate steps to record the funding issues with Northern Dancer, or to transfer or sell Secretariate, or to have a management agreement with Gillian. He never completed the trust document. The HELOC and William’s guarantee for Northern Dancer remains in place to this day.

[114] There was a new will prepared and signed by William on October 13, 2011. Wills are discussed in detail below. For now, it is sufficient to point out that there was provision in the will for Noelle’s education. The will created a testamentary trust of $500,000 for Noelle, but only if Gillian transferred title to Secretariate or the net proceeds of any sale to William. There was a provision that Gillian would be entitled to any remainder in the trust up to $100,000 provided she was in the continuous employ of the Waters for at least 10 years or until Phyliss dies, whichever was sooner.

[115] On June 19, 2013, William handwrote on the Promissory Note and the Commitment Letter that each were now void. It was not clear what precipitated the timing of voiding the two documents.

[116] The 2011 will again stated that Gillian holds legal title to Secretariate on a “resulting trust and/or bare trust for [William] and/or [his] estate”. There is no such language in respect of Northern Dancer, notwithstanding the will expressly acknowledging that William had guaranteed the Northern Dancer mortgage.

[117] Gillian acknowledged in her testimony that she agreed to repay William for the money advanced to buy Secretariate. Secretariate was sold on November 1, 2013, for $885,000. On November 12, 2013, Gillian transferred $700,000 to William. This was paid in satisfaction of the debt she owed William for purchasing Secretariate.

The Security Agreement and Elder Mortgage

[118] Mortgage documentation, dated February 4, 2014, was drafted evidencing a mortgage of $400,000 to be placed on Elder in favour of William. On February 3, 2014, William advanced $400,000 to Gillian in furtherance of the mortgage. The details are found in the file of William’s lawyer Jack Greenberg. Gillian testified that this mortgage was added as part of the defence to Kerwin’s family law claim, which is addressed below, although it was never explained why. There is currently a mortgage registered, dated February 4, 2014, on Elder in favour of William for $400,000 (the “Elder Mortgage”).

[119] On May 7, 2014, a security and loan agreement was signed by William and Gillian (the “Security Agreement”). In the Security Agreement, Gillian acknowledges a debt to William of $1.4 million. The Security Agreement was dated as of February 24, 2014. It acknowledged that the loan was used to purchase Delight Way, Concession, and Brock, which were described as collateral in the Security Agreement. It acknowledged that the collateral (i.e., the three properties) were owned by Gillian “free and clear”. The $1.4 million was to be paid back by February 25, 2018, and interest was set at 2.5% per annum. It appears the Security Agreement was drafted by William’s long-time solicitor, Richard Arnold. It was not explained why this document was created at this time, particularly as the properties involved had been bought as much as 4 years early. However, the Security Agreement, like the Elder Mortgage, was drafted during the family law litigation between Kerwin and Gillian.

[120] Concession was sold on August 20, 2014, for $796,000. On August 28, 2014, Gillian paid William $400,000 upon the sale of Concession. Gillian was not clear why she paid the $400,000 and what debt that money was to extinguish. The timing makes it clear that it was a payment in respect of Concession which had been subject to the Security Agreement. It was not a payment for the initial $400,000 from 2009.

King of Hearts Stables

[121] King of Hearts is the only asset owned by Gillian that operates as a stand-alone business. In that regard, it is distinguishable from the other properties purchased by Gillian with William’s money, which at most were rented.

[122] As a result of Noelle’s horse riding, Gillian sought to buy a farm where she could not only board Noelle’s horses but expand to build a business to board other horses for a fee and operate a tack shop.

[123] She first bought 10 acres in East Gwillimbury on May 13, 2012. This was 4532 Holborn Road (“Holborn”). It was purchased using 587 Ontario. Gillian then used 223 Ontario to purchase Concession, which had more acreage.

[124] She then purchased a horse farm under a power of sale on Brock Road in Uxbridge in November 2013 (“Brock”), using 587 Ontario. The purchase price for Brock was $2.5 million. Brock became King of Hearts Stables. Eventually, both the Holborn and Concession properties were sold. Both Brock and Concession were subject to the Security Agreement signed May 7, 2014. I also accept that the $400,000 repaid by Gillian on August 28, 2014, was in respect of the sale of Concession which occurred on August 20.

[125] Gillian renovated King of Hearts, spending $4.5 million to expand the stables to provide boarding, an equestrian ring, and tack shop. It was to be an operating business. The money to purchase and renovate the property and stables was provided by William.

[126] There are several indications that William treated the money provided for King of Hearts as an investment.

[127] For example, William provided notes to Meridith, which he had typed into a document entitled “Financial Status as of Sept. 8/14”. It reads like a balance sheet of money advanced against payments received. It was found, among William’s possessions, in a file folder labelled “Ranch Financing”, dated “Sept 5/14” (“Sept note”). Meridith was of the understanding that William had a business interest in King of Hearts.

[128] The Sept note records the purchase price of Brock being $2.5M of which $2.1M was paid by William and $400K was paid by Gillian. William’s financial records indicate that on October 25, 2013, he advanced Gillian $2.1 million, which was money used to purchase Brock. This was confirmed by DeMelo, who noted in his records that the transfer of that date was for King of Hearts. The Sept note further reflects the mortgage on Elder of $400K, which had been registered on money advanced in February 2014. It records enhancements made as of September 2, 2014, including a tractor for $65,000 in August and payment to Dutch Master of $195,000 in August. Dutch Master conducted the renovations on King of Hearts which closely aligns with a payment of $195,000 made by William to Gillian on September 2, 2014. The Sept note is contemporaneous with these expenditures.

[129] The Sept note also records payments from Concession and Secretariate of $400,000 and $700,000. As noted above, the $400,000 had been paid by Gillian on August 28, 2014, just 11 days prior to the Sept note. The Sept note refers to preferred shares. There were never any shares issued nor was there any indication that William asked his advisors to prepare or request shares.

[130] As discussed below, in net worth statements William provided to advisors, he referenced the King of Hearts. He recorded a guarantee on a line of credit, which continued to reduce. By 2017, the debt was down to $200,000 from a high of $1 million. William then remarks, “[n]o tax liabilities are anticipated on capital gains on shares due to charitable donations.” The comment referencing “charitable donations”, reflects that William had a charitable trust he had set up that he anticipated would balance any capital gains. His accountant testified that William would offset any capital gains with his charitable foundation donations. While no shares were issued, the net worth statement does reflect that William anticipated shares which would give rise to a capital gain. The net worth statement was provided to his lawyer Jack Greenberg as late as November 2017.

[131] During 2015 and 2016, conversations with his advisors revealed that William was concerned about the mounting cost of the build out of the stables. For example, in 2015, William spoke with his friend and Gillian’s accountant Hawkins about the mounting expenditures at the King of Hearts. Hawkins testified that he expressed his concern that William was being taken advantage of by Gillian. Hawkins was told by William that King of Hearts was owned by Gillian, but William had advanced the funds to purchase Brock and that Gillian still needed money to fund renovations. William described King of Hearts as being on life support.

[132] William told Hawkins that he had made a terrible mistake and needed his help. William asked Hawkins “what he should do to get his money back?”. Hawkins told William that he needed to document his financial interest, including obtaining a mortgage in relation to Brock.

[133] Hawkins subsequently wrote William in the fall of 2015 in strong language that William needed to take steps to protect what he had given Gillian, to advise her that the money for King of Hearts was not “another…gift” and to stop providing additional funds to Gillian. He told him to get a mortgage registered on title so that she realized it was “YOUR property not hers - until she pays for it.” He specifically wrote William, as follows:

I also feel obliged to tell you that this has to stop. You have been exploited by this woman. There are thousands of caregivers out there who will work for a salary and do not drive high-end Mercedes SUVs. Do you know how much you have given to her over the years? Does she understand that this latest is a loan and not another in a series of gifts? [Emphasis added.]

[134] Hawkins’s advice was not heeded by William. William never responded to his correspondence. Hawkins’ contact with William was “almost non-existent” thereafter.

[135] William also spoke to Histrop about the mounting costs at King of Hearts. Histrop spoke with him in late July 2016, by which time there had been a lot of renovations to King of Hearts. She says that he was quite animated and went on “a little bit of a rant” about the cost. Histrop says that he told her that King of Hearts “wasn’t turning a profit”. It was Histrop’s understanding that William had an investment interest in King of Hearts. She described how William continued to invest in building horse stalls that could be rented so that the operations would turn a profit. There was no similar conversation regarding any of the other properties purchase by Gillian.

[136] William spoke with his financial advisor at Wood Gundy about advancing money to Gillian for King of Hearts. DeMelo recalled when the money was advanced that William was making an investment in King of Hearts which was owned by Gillian. DeMelo’s understanding was that William was a “co-investor or an investor” in King of Hearts. In contrast, DeMelo had no recollection of William saying he had any interest in any other real estate properties owned by Gillian.

[137] These discussions occurred while William was advancing considerable sums into renovating and improving King of Hearts in the hopes that it would become profitable. In my view, these discussions are contemporaneous with his investing in King of Hearts.

[138] Unlike the other properties, I am satisfied that William’s intent was that he had invested in King of Hearts and continued to have a beneficial interest in the property and business.

[139] As indicated, there is no forensic analysis breaking down what has been spent by William on King of Hearts by way of renovations and expenditures. Nonetheless, it was agreed that there was $4.5 million contributed by William to renovations to King of Hearts, above the purchase price.

Net Worth Statements and Taxes

[140] William prepared several net worth statements over the years. These were provided to financial institutions, even when they were not requested. In each net worth statement he set out his assets, including shares and property that he owned. These net worth statements span several years. At no time did his list of assets include any interest in the property owned by Gillian. There was no claim of any shareholding interest in any of Gillian’s corporations, aside from the reference mentioned regarding King of Hearts as discussed above. The net worth statements did list various guarantees provided by William in respect of those properties. In November 2014, those included a $900,000 line of credit on King of Hearts (later said to be $200,000) and a guarantee for the Northern Dancer HELOC.

[141] While the net worth statements were not asked for by the banks, William nonetheless provided them. He would be aware that while the bank might not have required the statements, they surely would rely on them if it was necessary. Aside from King of Hearts, he disclosed no financial benefit in any of Gillian’s properties.

[142] In respect of his taxes, William did not include any income or expenses for any of the rental properties owned by Gillian. He also did not claim any capital gains or losses with respect to the sale of any of the properties owned by Gillian, which the Estate now claims are beneficially owned by William.

Gillian’s Taxes

[143] In 2011, William referred Gillian to Hawkins to prepare her taxes. William not only made the introduction to Hawkins but amassed Gillian’s tax information which he forwarded to Hawkins. William dealt with Gillian’s taxes for the years 2008 to 2014. In fact, during this period, there is very little communication regarding Gillian’s taxes other than between William and Hawkins.

[144] The communication between William and Hawkins demonstrates that William was aware of the comings and goings of Gillian’s investment in properties and the use she made of his money.

[145] William began his communication with Hawkins on February 7, 2011, by advising that Gillian “received rental income from a trio of properties which she acquired in 2009, all with my help.” The letter goes on to say that there had been a complication as the corporate entity 874 Canada had been “created at my suggestion in anticipation of her rental properties undertaking. However, the properties were, in fact, purchased personally….” He set out the rental income that Gillian earned from the properties, including Secretariate, 154 Taunton, and, later, Linstead and Delight Way.

[146] Gillian transferred 152 Taunton Rd. to her sisters, Shamile and Michelle, on February 3, 2011. Gillian says she transferred 152 Taunton to her sisters to provide them with rental income to help with their children’s educations. She says William supported this. The Estate now asserts that the sisters and Shamile’s husband, in acquiring 152 Taunton, are in knowing receipt of trust property.

[147] Earlier that year, William was in communication with his lawyer, Richard Arnold. In an email from Arnold to William on January 7, 2011, Arnold confirms that Gillian “wishes to obtain mortgage financing on the properties in order to give cash to her siblings to pay off or pay down their mortgages.” Arnold confirmed that Gillian owned properties in “Brooklin, Newmarket and Oshawa” at this time, being her home and properties bought by her with William’s money.

[148] In preparing the 2011 taxes, Hawkins asked William for the sale price of 152 Taunton, which had been transferred by Gillian to her sisters. William responded that he would send Hawkins the sale price. While there was no apparent response in the file, it is clear William was aware, through his dealing with the taxes, that Gillian had transferred 152 Taunton to her sisters.

[149] In June 2013, Gillian transferred Linstead to her sister-in-law, Donna. The disposition of this asset also had to be addressed in Gillian’s taxes. In a note to Hawkins in April 2014, William states that Linstead was no longer rented as it was “provided gratis to sister-in-law and family”, being Donna McGrath. It is clear from the evidence that William was aware of Donna and her challenges with her son, who he called “pyro”. Donna had been evicted in the past because her son had set fire to previous rental units. Gillian had told William that Donna needed a home. While it was intended to be “gratis”, Donna was able to provide funding, via a mortgage, for a portion of its value. Hawkins advised William that Gillian would have to show a disposition cost on her taxes.

[150] The key takeaway is that William was aware that Gillian was providing homes, at less than or no cost, to family members. These are not transaction of which William was not aware.

[151] William told Hawkins of Gillian’s Mercedes, Noelle’s education, and Noelle’s riding expenses. William told Hawkins of RRSPs and TFSA accounts for Gillian and her children. Indeed, William provided the RRSP and TFSA account statements to Hawkins. All of this was funded by money provided by William. William was also aware of the renovations to Elder as he provided Hawkins with those receipts.

[152] Gillian is a member of the Whitby Christian Assembly. William was aware of her sizable donations to the church. William sent the invoices to Hawkins. The donations were not sustainable by Gillian on her income. For example, in 2011, she donated $37,980.00 on an income of $60,000. The money to donate to her church came from William and he was aware of those donations. He was also aware of and paid for her charitable work in Guyana, where she sponsored a school and orphanage, all with William’s money.

[153] The dialogue with Hawkins regarding Gillian’s taxes demonstrates that William was aware of how Gillian was dealing with the money he gave her and none of those dealings suggested that he had a continuing financial interest in her property, or the money provided, aside from the aforementioned documented Promissory Note that was voided in 2013, the 2014 Security Agreement, 2014 Elder Mortgage, and King of Hearts.

[154] Hawkins was advised by William that Gillian would not require his services after April 2015.

The Wills

[155] With the assistance of Histrop, William prepared several wills over the period 2011-2018. For probate purposes, William had both a primary and secondary will.

[156] There were some specific bequests in these wills, a few of which are relevant to these proceedings. In each will, Phyllis was to receive a life interest in the Estate. Upon her death, the remainder of the Estate was to be set aside for 23 charitable institutions. The beneficiaries’ respective shares were set out as a percentage of the Estate, from a high of 14% to a low of 0.88%. Some bequests were to be set aside as endowments, which implied a significant bequest. William amended these share proportions up until 2018, by which time most of his money had been lost to investments, already gifted to charities, or was in the hands of Gillian.

[157] The 2011 will, as mentioned earlier, specifically refers to William’s guarantee on Northern Dancer. It then states, “Gillian Henry holds legal title on resulting trust and/or bare trust for me and/or for my estate, to the real property known municipally as 1169 Secretariat Road, Newmarket”. There is no mention of Northern Dancer or any other property being held in trust for him. There is mention that Gillian was to pay off the mortgage on Northern Dancer, so his Estate would have no further liability due to his guarantee and that she provides him any proceeds of sale or the title to Secretariat. Secretariat was eventually sold and $700,000 was provided to William. The provision was removed from future wills.

[158] The will was updated in 2017. By this time, Noelle had largely completed her education and there is no longer a provision in the will for her education. The 2017 will provided that Gillian would receive 500,000 shares of a private company called Hawthorne Green (“Hawthorne”). Hawthorne was a start up company in the energy sector that William hoped would be a great success. In fact, in 2018, William mortgaged his home and invested an additional $375,000.00 in the company, which is discussed below in respect of independent legal advice (“ILA”).

[159] The final will was prepared in 2018. This time the bequest of the Hawthorne shares to Gillian came with a condition. Gillian would receive the 500,000 shares “provided she pays to my estate the assets she holds for me on resulting trust”. This language was inserted at the suggestion of Histrop. By this time, Histrop believed Gillian had taken advantage of William.

[160] Histrop had discussed the concept of resulting trust with William over the years. In the 2011 will, as mentioned, it referred to Secretariate being held by Gillian as a “resulting trust\bare trustee”. Clearly, William was aware of these concepts. Unlike 2011, there is no reference to any specific property in the 2018 will being held on a resulting/bare trust. Histrop was only aware of Northern Dancer, which was not subject to a claim of a “bare trust/resulting trust” in 2011, and Brock Rd. Histrop was not aware of the Security Agreement which already addressed three properties.

[161] In January 2018, Histrop advised William to sue Gillian for the return of the assets that Histrop believed Gillian received from William. Histrop was unclear what property aside from Northern Dancer and King of Hearts (i.e., Brock Rd.) that Gillian supposedly held for William’s benefit. William told Histrop that he had given Gillian some $5 million, although Histrop did not believe William; she rightly thought it was more, although she had no idea how much more.

[162] Although she was wary of Gillian, the conversations between Histrop and William did not go very deep. She was unaware of the intimate relationship between William and Gillian. She was unaware of either the extent of Gillian’s properties, the other financial advancements by William, or the various agreements over the years that William had with Gillian, including the Promissory Note, Commitment Letter, Security Agreement, and Elder Mortgage.

[163] Nonetheless, Histrop told William that if he wanted to pursue Gillian, he needed to start by making a demand for whatever he thought Gillian held for his benefit. She testified that he declined to do so. In her note of the January 2018, Histrop records that she “offered to go after Gillian for the return of the money she has taken from him to invest”. William never accepted her offer “to go after Gillian”.

[164] Histrop noted in 2018 that William continued to have capacity but may have been vulnerable to the influences of others. She states that William promised her that he would not provide Gillian any further funds. She noted in her memo to file that when she pushes too hard, William becomes defensive.

[165] Later, Histrop was retained to assist in the sale of the Waters’ matrimonial home. They were moving to a retirement residence. It was then that Histrop learned that William had placed a mortgage on the home for a line of credit for $2.4 million. He wanted to invest in Hawthorne . Histrop confronted William on this new mortgage. As a result, William told her she was no longer handling the sale of the home. He referred the matter to another lawyer who had earlier provided him ILA, Jack Greenberg.

[166] In May 2018, after learning of the sale of the home and her lack of involvement, Histrop’s concern intensified. Histrop was so concerned about possible undue influence on William that she sought advise as to her obligations from the Law Society of Ontario.

[167] She called and spoke with DeMelo at Wood Gundy and Peter Chambers, who was William’s accountant in the later years. Histrop explained her concern and sought Chambers assistance in setting up a meeting with William under the guise of tax planning so that she could confront him with her belief about Gillian. The meeting never occurred. In further communication, Histrop refers to having to “tread softly” lest William pushes back “on her investigation”.

[168] DeMelo said he got a call from Histrop on May 11, 2018. He listened to her concerns and said he would keep an eye out. He later advised that for privacy concerns, he could not share any details with Histrop without William’s consent. DeMelo had expressed a concern over the years about the amount of money William sent to Gillian. Each time he was satisfied William knew what he was doing.

Independent Legal Advice

[169] During this period, William received ILA for several transactions, often at the request of the bank due to his age. He dealt with Jack Greenberg (“Greenberg”) and David Wade (“Wade”). They each testified that William had capacity, was aware of the transactions, and did not appear to be coerced. This includes transactions involving Gillian.

[170] William first attended before lawyer Greenberg in 2011 for ILA when William guaranteed the mortgage on Northern Dancer. Greenberg met with William alone and satisfied himself that William freely agreed to be a guarantor. He recalled that William said Gillian was a friend and he was doing her a favour. He had no concerns about William’s capacity to understand. He provided a certificate of ILA that said William was freely giving the guarantee without “fear, threat, influence or compulsion” of the bank or Gillian.

[171] In 2014, William attended again before Greenberg to advance $400,000 to Gillian and to obtain the Elder Mortgage. Greenberg again had no issue with William’s ability to comprehend the transaction.

[172] William later attended in 2015, seeking to discharge the Elder Mortgage in favour of a promissory note. Greenberg advised William against giving up the mortgage security on Elder. Because he was advising William not to proceed, he had his assistant sit in on the meeting. The note from that meeting described William as alert, that he understood Greenberg’s advice, and he was not under any duress, coercion, or influence. Greenberg sent drafts of material to Gillian’s lawyer, Mr. Lewis. No signed copies of the promissory note or discharge have been located. Greenberg believes the transaction was aborted, which appears to be the case as the Elder Mortgage is currently registered on title.

[173] The next retainer involved the placing of a mortgage on the Waters’ matrimonial home in February 2018. This would require ILA for Phyliss as well. Greenberg knew Phyliss was housebound, so he provided ILA to Phyliss at the home while Wade was retained to provide ILA to William. The purpose of the transaction was to access funds to invest in Hawthorne. While the registered mortgage was $2.4 million, William only accessed $375,000 to invest in Hawthorne.

[174] William met with Wade alone at his office. Wade felt Hawthorne was a terrible investment. He strongly cautioned William against the investment, although he conceded investment advice was not his role. However, William had made up his mind that he would increase his investment in Hawthorne. Wade could not budge William. He recalls that William “had a very strong personality”. Wade had no concerns about William’s mental capacity or acuity, he simple saw this as a terrible investment. He recorded that he provided William ILA, that William understood what he was doing, and that he was obtaining the mortgage without coercion, influence, or threat from the mortgagee or any other person. He took the time to reiterate both in a letter and in his account that he advised against the transaction, but that William was “in full possession of his mental faculties and he understood what he was signing” and reiterated there was no undue influence. As it happened, Wade was right, Hawthorne was a bust. Nonetheless, William believed that Hawthorne would be a great success.

[175] Greenberg’s final retainer was the sale of the matrimonial home. He met both William and Phyliss on this occasion in May 2018 at the seniors’ residence. He completed the transaction.

[176] On each occasion, Greenberg and Wade satisfied themselves that William was capable of understanding and executing on the applicable transaction and was not subject to duress or external influence. Some of the transactions are contemporaneous with transactions with Gillian, including the guarantee on Northern Dancer and the Elder Mortgage in 2014 for $400,000. On all occasions, the observations of Greenberg and Wade support the consensus that William was of sound mind , had capacity and had a “very strong personality”.

[177] It was suggested by the Estate that Greenberg and Wade did not know William well, had no base line to assess William’s capacity, and could not be certain that he was not coerced by Gillian or others before entering their offices. While I accept the ILA process is not perfect, the evidence of Wade and Greenberg is evidence that may be weighed with the rest of the evidence and which, as mentioned, supports the conclusion that William was of sound mind, had capacity and had a very strong personality.

The Matrimonial Dispute

[178] Perhaps the most bizarre element of this saga is Gillian’s matrimonial dispute.

[179] Gillian separated from her husband, Kerwin, in late 2008, prior to her working for the Waters. It will be recalled that at that time, she and Kerwin were heavily in debt. Kerwin ceded title to Elder to her, which was heavily mortgaged. Some time later, Kerwin came to learn that Gillian had acquired several homes and other assets through William. As a result, in 2013, when Gillian sought a divorce, Kerwin filed a family law proceeding with the intent of acquiring a stake in these newly acquired assets, by claiming that he and Gillian lived together as husband and wife as late as July 14, 2013. This was a lie. However, this necessitated Gillian having to disclose all her assets.

[180] She enlisted the help of William to prepare a list of her assets, which by then included a number of properties. She swore her Financial Statement listing her assets and liabilities on June 11, 2014. The value of the property she owned was listed as being $8,770,843.90. There were additional assets including two Mercedes, a Jaguar, and $100,000 in jewellery. There were a host of bank and investment accounts in her name, in her companies’ names, and in her children’s names. She attested that her total assets were $10,295,260.00.

[181] Gillian undoubtedly feared Kerwin’s ruse might succeed. Accordingly, to offset the assets, she listed debts of some $11.8 million. The largest creditor was listed as William and his company for $10 million. This included amounts of $1.4 million and $400,000, reflecting the Security Agreement and the Elder Mortgage, which were signed earlier that year.

[182] William had a comprehensive understanding of Gillian’s financial affairs at this time, as evident by his preparing her tax information for Hawkins. William was intimately involved in the preparation of Gillian’s Financial Statement. This is evident by the listing of the actual dates of money advanced to Gillian, which was said to amount to the $10,295,260. This list mirrors some, but not all, of the actual advances by June 2014. In fact, William had advanced closer to double that amount. I accept that William was involved in the preparation of Gillian’s financial statement and was aware of its use. I am also satisfied that Gillian was aware of what she was purporting to claim in the material filed with the family court, including her alleged financial situation.

[183] The figure of $10,295,260.00 conveniently matched her assets, resulting in zero net assets.

[184] On June 13, 2014, William attended at the notary office of Jeffery Brown (“Brown”). William had prepared a statement headed “To Whom It May Concern”, which was notarized by Brown. The statement outlined his background, including his academic credentials and his Order of Canada. The statement speaks of Gillian’s work as a PSW with the Waters and how impressed William and Phyliss are with her caring attitude. It then states:

In all, I and my corporation have provided - in addition to salaries and gifts of appreciation - $10,645,000 in loans in the expectation of her real estate and farm-based endeavors bearing fruit in due time. I also provide my professional expertise in the latter endeavour.

[185] By June 2014, William had advanced over $17 million to Gillian, not $10,645,000. There is no breakdown as to how this “loan” was allocated to the various properties owned by Gillian. There was no mention of any specific mortgages or security in the letter, including the Security Agreement and Elder Mortgage signed earlier that year. This letter was prepared by William for and used by Gillian in her matrimonial dispute.

[186] William visited notary Brown again on August 27, 2014. This time Brown witnessed William sign the following statement addressed to “Ms. Henry”:

Further to my affidavit dated June 13, 2014 on this matter, this document is an amendment to recognize as “loans” only those covered by formal documentation: i.e., (1) the mortgage on 64 elder Cres., Brooklin, ON L1M 2H7 in the amount of $400,000.(Four hundred thousand dollars) and (2) the promissory note relating to No.1 Delight Way, Brooklin and King of Hearts stables, Bronte Rd. [sic] in the amount of $1,000,000 (One million dollars). The additional funds included in the June 13, 2014 affidavit represent non-repayable imbursements.

[187] This statement at least is supported by the Security Agreement and Elder Mortgage, This notarized letter was dated the day before Gillian repaid William $400,000 on August 28, 2014. The $1.4 million from the Security Agreement is now $1 million and there is no mention of Concession. William credited the $400,000 payment from Gillian to the amount owing on Concession and not the initial $400,000 or Elder Mortgage.

[188] Brown testified that his records also show that William attended two more times at his office to have documents notarized. Those documents have not been located.

[189] Gillian used the first letter in support of her matrimonial case. The letter was filed in court and was relied on by her in that proceeding. In respect of the second letter, she says William and she shared a bottle of champagne and that he presented the second notarized statement. He said she only owed him the $1.4 million and the rest was a gift.

[190] On cross-examination, when asked about her affidavit containing her financial information and the supposed $10,646,000 loan from William, Gillian was non-responsive. She claimed not to have read the affidavit. She says William talked with her lawyer and the affidavit was prepared with the information from William. She testified that until the August 2014 notarized statement, William could take back what he had given her. She says after the August 2014 notarized statement he could not. In my view, Gillian was fully aware of the purpose of the Financial Statements and the August 2014 letter which were used to defeat Kerwin’s claim for equalization. She was aware that both the letter and statement were not accurate.

[191] Both notarized letters were admitted during the trial without objection. In Gillian’s closing, for the first time, her counsel objected to the June 13 letter being relied upon by the Estate. Counsel asserted that the letter was discussing events from prior years and was hearsay as William is dead. In contrast, her counsel sought to rely on the August letter as an admission against William’s interest.

[192] First, for the reasons articulated later in these reasons, I do not put much stock in either letter, other than to demonstrate that both Gillian and William were working in tandem to defeat Kerwin, even if they had to misrepresent matters to the court.

[193] As to the objection, I will not repeat the law on hearsay as it relates to the deceased as I canvass it elsewhere. However, I do not agree that the June letter is inadmissible. First, the letter was relied on by Gillian in a legal proceeding. She not only filed it but incorporated it into her own sworn statement as to her finances. In that sense, she adopted the letter for her own purposes. I do not see how she can object to its admissibility in this proceeding. Second, it is not possible to read the August letter without regard to the June letter as it specifically mentions then deviates from the June letter. I see no reason not to admit the letterers. The ultimate reliability and what may be inferred from the letters is quite a different matter.

[194] In the end, Kerwin did not contest the divorce, or seek support or equalization. Indeed, he did not show up at the family law hearing.

After William Death

[195] William died on July 28, 2021.

[196] In February 2021, as his attorney for property, Kussinger attempted to ascertain what assets were available for William and Phyliss’s future needs. She had access to the bank and brokerage accounts but nothing regarding Gillian. She was aware that Gillian must have received some $17 million, although she could not be certain as to the total as she had very little documentation. She asked William for any documentation regarding the money provided to Gillian. He was of no help. William said Gillian might have some paperwork. He said he would call her but never did. Kussinger eventually called Gillian to ascertain what paperwork might exist regarding the advances of so much money. Gillian advised Kussinger that William would have any paperwork but that she owed William $1,000,000. Gillian also provided Kussinger with confirmations of the two payments to William of $700,000 and $400,000.

[197] William never did provide any documentation to Kussinger before he died. It was only after William died that Kussinger located any documents, aside from account statements, referrable to Gillian. The documents were in plain sight, in William’s bookcase at his condo in the seniors’ residence.

[198] Between William’s death and the commencement of the action, the Estate obtained several orders freezing Gillian’s access to funds. Orders were issued requiring Gillian to market and sell properties. Gillian sold 6 properties totalling $3.9 million. Pending this decision, I ordered there be no further sales. In this pretrial stage, Gillian paid for the care costs for Phyliss, until Gillian had depleted her finances.

[199] This action involves more than Gillian and her corporations. The Estate has also sued Gillian’s children, her parents, several siblings, and their spouses. It is alleged these defendants were aware that Gillian misappropriated assets that they, in turn, received. It is alleged they were in knowing receipt of assets that were subject to a resulting trust or otherwise belonged to William.

Issues

[200] There are both procedural and substantive issues raised in this case. The issues include considerations of:

(i) The admissibility of William’s notes;

(ii) The applicable limitation periods;

(iii) Law of corroboration;

(iv) Credibility;

(v) The Resulting Trust Claim;

(vi) The Undue Influence Claim;

(vii) The Unconscionable Procurement Claim;

(viii) The Fraud Claim;

(ix) The Fiduciary Duty Claim;

(x) The Unjust Enrichment Claim;

(xi) Claims Against Family Members;

(xii) Conclusion on the Main Action;

(xiii) The Counterclaim; and

(xiv) Costs.

i) William Notes

[201] The Estate wishes to rely on handwritten notes of William. The notes were found with his papers after he died. They refer, among other things, to sums that have been given to Gillian and to some of the properties that she purchased. The Estate seeks to use the notes to establish that the advances to Gillian were not gifts but rather investments by William. Gillian objects to admitting the notes as they constitute hearsay.

[202] As William is dead, his notes, if tendered for the truth of their content, would constitute hearsay as William is not present to testify or to be cross-examined. As such, the notes meet the three components for hearsay as set out in R. v. Schneider, 2022 SCC 34, at para. 47:

Hearsay evidence has three components: (1) a statement (or action) made outside of court by a declarant; (2) which a party seeks to adduce in court for the truth of its content; (3) without the ability of the other party to contemporaneously cross‑examine the declarant.

[203] The admissibility of the notes was the subject of argument at the outset of the trial. The Estate relies upon the principled exception to the hearsay rule to have the notes admitted for the truth of their contents. There was a voir dire in which affidavit evidence and the notes were filed.

[204] At that time, I was satisfied the notes were those of William. I was also satisfied that the component of necessity was met given that William is dead. However, for several reasons, the issue of threshold reliability could not be determined at the voir dire. First, it was not clear what in the notes was being relied upon by the Estate. The Estate tendered some 40 pages of 300 pages of notes found at William’s home. The notes, like most notes, were not written in prose, and the Estate sought to rely on certain notations within the 30 pages, upon which it would ask the court to draw a factual conclusion, directly or by inference.

[205] However, what notations the Estate was relying upon was not clear and had not been shared with counsel for Gillian. As such, it was not possible to ascertain what factual conclusion the court was being asked to draw and from what notations.

[206] To better understand the Estate’s position and to ensure Gillian had fair disclosure of the Estate’s request, the Estate was ordered and did resubmit the notes highlighting exactly what they relied upon.

[207] To establish threshold reliability, the Estate intended to rely upon evidence of corroboration, including the cross-examination of Gillian and other defence witnesses; however, that evidence had yet to be called. As it was not clear what that evidence of corroboration was going to be, we proceeded with the trial, and I reserved my decision on admissibility until the conclusion of trial. This is that decision.

[208] Threshold reliability is central to the principled exception to hearsay rule: R. v. Bradshaw, 2017 SCC 35, [2017] 1 S.C.R. 865. The preferred and tested method for challenging a statement is cross-examination at trial, which cannot occur as William is dead. Without the ability to cross-examine, the court must be satisfied that the evidence may be reliably accepted for the purpose for which it is being tendered. The rationale was discussed by the Supreme Court of Canada in R. v. Khelawon, 2006 SCC 57, [2006] 2 S.C.R. 787, at para. 63.

[209] In this case, the Estate seeks to overcome the absence of William’s availability to be cross-examined by demonstrating that the portion of the notes that it intends to rely upon are corroborated with other evidence and therefore meets the reliability threshold. However, corroboration alone does not guarantee reliability. Reliability is an assessment as to whether in all the circumstances, the absence of the witness may be sufficiently compensated for by other safeguards. The supreme Court described the threshold reliability process in Bradshaw, at para. 27:

The hearsay dangers can be overcome, and threshold reliability can be established by showing that (1) there are adequate substitutes for testing truth and accuracy (procedural reliability) or (2) there are sufficient circumstantial or evidentiary guarantees that the statement is inherently trustworthy (substantive reliability).

[210] Procedural reliability requires the court to be satisfied that there are adequate substitutes for testing the hearsay evidence. Often, courts are satisfied where a statement has been made under oath or affirmation. That is not the case with the notes. Substantive reliability is determined by the court determining if the statement is “inherently trustworthy”, which can be assessed by the court considering “the circumstances in which it was made and evidence (if any) that corroborates or conflicts with the statement”: Bradshaw, at para 30. While substantive reliability is intended to be a hurdle, it is not intended to be a guarantee of reliability.

[211] I have concluded that most of the notes do not meet either the procedural or substantive test for reliability such that they should be admitted.

[212] In most cases, the notes are far too vague to be admitted into evidence for the factual purpose tendered by the Estate. Even where the notes may be tangentially corroborated, William’s intention, which is the truth the Estate seeks to adduce from the notes, is not clear from the notes and frankly, when considering the surrounding circumstances, cannot be easily inferred from the notations relied upon. It would be fundamentally unfair to allow the notes to be admitted where the notes could not be challenged by cross-examination.

[213] It is not clear why William took these notes. It is said he was an inveterate note taker. That may be true, but there are no notes after 2014. He continued to fund Gillian until late 2019. The context in which he takes the notes is also not clear. Do they follow discussions with Gillian, or William’s advisors? Was there a specific purpose to the notes or are they just musings? Was he simply following Gillian’s progress as he mentored her or was he recording his investments? None of this is clear.

[214] There were a number of notes that the Estate sought to admit. There was a chart of corroboration provided but what use was to be made of each not was not always clear as they were not all referenced in the closing. They referred to only a few in their closing. I will comment on those relied upon in closing, which the Estate asserts is evidence of William’s financial interest in the businesses and properties, as those were the ones where the Estate clearly stated the inference it sought to draw from the notes.

[215] Several notes list various properties with dollar values beside them. For example, notations from February 3 (H6655) and 4, 2011 (H6656) list properties that are owned by Gillian. The highlighted portion of one note says “$700,000 on sale of Secretariate (in interim, rent)”. In the same note, the Estate has highlighted “sale of Elder” at the end of a sentence saying “700,000 pref shares on sale of Elder”. The estate only relies on the phrase “sale of Elder”. This is because the Estate contends that on the purchase of Northern Dancer, Gillian was to sell Elder, which she did not do. Histrop says she was told this by William. Gillian denies that she was ever going to sell Elder. It is established that when Secretariate was sold, Gillian gave William $700,000. However, there is no way to establish what William meant by the “sale of Elder” note. Moreover, Northern Dancer was, in fact, bought in March 2011 without Gillian selling Elder, which William was clearly aware of at the time and which suggests that she was never to sell Elder as alleged. These are issues that would have been explored in cross-examination by Gillian’s counsel. The note is not a reliable document, particularly when viewed in respect of the remainder of the evidence.

[216] Similarly, the note of October 10, 2010, has a notation that says, “Future Properties: Ownership by corporation” (H6644). It is suggested this meant 874 Canada was intended to be a holding company that they were to own together. It is suggested that thereafter, Gillian diverted the properties to other companies controlled by her. This ignores that William emailed Hawkins in February 2011 regarding Gillian’s 2010 taxes and advised that he created the company for Gillian but that the properties were inadvertently registered in her personal name. All of this was done according to William for “her rental properties undertaking”. No doubt, much would be made in cross-examination of William if he suggested that the note reflected an ownership interest in what he refers to as “her rental properties undertaking”. The note is not reliable in supporting the assertion that the creation of 874 Canada was intended to hold an interest for William in Gillian’s rental businesses which William never asserted prior to his death and which he knew Gillian was claiming as her own on her taxes.

[217] Another note from January 2011 is said to reflect that they discussed shifting Secretariate to a company, (H6651) which, in turn, reflects an intention that all properties were to be held for William’s benefit. Secretariate was bought in 2010. It was mentioned in several documents, including William’s will, where it was said to be subject to a resulting trust and that Gillian was to provide the sale proceeds to the Estate to him. Nowhere does it mention Secretariate being moved to a company. As it happened, Gillian paid William $700,000 on the sale of Secretariate. Again, any examination of William would undoubtedly challenge the suggestion made by the Estate that the properties were to be owned by corporations for William’s benefit. Indeed, Secretariate was clearly dealt with differently from the other properties in William’s 2011 will which were not said to be subject to a resulting trust. Indeed, Gillian paid William $700,000 on the sale which supports that Secretariate was dealt with differently and did not involve a corporate entity.

[218] In a similar argument, the Estate wishes to admit several notes that mention “pref shares” (see eg. H6665, H6666 and H6668) as evidencing William’s intention that Gillian was to provide him with preferred shares, which, in turn, would demonstrate the money was not gifted but rather was an investment. As corroboration, the Estate points to the fact that Gillian had incorporated companies that could issue preferred shares. This is said to show an intent that William was to receive preferred shares. There is no reason to accept that the articles of incorporation were anything more than standard form articles or that the companies’ ability to issue preferred shares reflected an intent to provide preferred shares to William. The fact is, no preferred shares were prepared or issued by any of the companies. Moreover, William was a sophisticated businessperson. He had access to and used many legal, accounting, and financial advisors. At no time did he take steps to ensure he received preferred shares. A cross-examination of William on these points would undoubtedly undermine any suggestion that the notes reflected that money given to Gillian was intended to be an investment in exchange for preferred shares.

[219] The Estate also referred to a note from March 7, 2011, which refers to “[c]apital recovery” of $650,000 on 64 Elder (H6629). But this does not say William expects to receive that amount and is also consistent with him tracking Gillian’s progress and helping her with her finances. Finally, the Estate quoted from a note dated September 23, 2014, which says “[s]ell two properties immediately to raise cash (I do not expect to receive it)” (H6668). The Estate did not include the part in parentheses in their quote. But this is consistent with the properties being Gillian’s and William noting that he does not expect her to use the proceeds to repay him for other amounts that he loaned her.

[220] All these points are fertile ground for cross-examination. What William would have said is unknown, but the statements are not reliable, and the proffered corroboration is insufficient to meet the test for threshold reliability.

[221] I raise the above examples as illustration. Most of the notes are cryptic. They are not reliable statements upon which any fact or inference may reliably based, aside perhaps from the fact that William made the notes and that he was following, for a period, the money provided to Gillian, which itself is not terribly relevant. Most of the notes have no indicia of procedural reliability. Without cross-examination, there is no reliable process to test the purpose for which most of the notes were written and what facts may be adduced.

[222] As such, I do not find most of the notes to have met either the procedural or substantive requirements for threshold reliability. Most of the notes are not admitted.

[223] If I have erred in applying the test for threshold reliability and the notes ought to be admitted, I would have had to consider their ultimate reliability. I would not have accepted the notes of William as evidencing an intention to receive a return of any of the money, aside from money for King of Hearts. Most of the notes, as stated, are simply too vague to allow for a general conclusion that all money or even all money for property was intended to be an in vestment in favour of William. In my view, overall, the notes are generally unreliable for the broad proposition advanced by the Estate.

[224] I have already mentioned the note that was provided by William to Meridith, being the Sept note, which showed the financial status of King of Hearts as at September 8, 2014. In my view, this note sits on a different footing. The surrounding circumstances lead me to conclude that threshold reliability has been met in respect of that note: Brisco Estate v. Canadian Premier Life Insurance Co., 2012 ONCA 854, 113 O.R. (3d) 161.

[225] As noted earlier, the Sept note was given to Meridith by William to type up and was placed in a file which he entitled “Ranch Financing September 5/14”. The file was retained by William at his home. He presumably segregated this information because he deemed it important. The typewritten version of the note and file folder was admitted without objection. As such, the information in the note is before the court. However, I also accept the handwritten note may be admitted.

[226] Much of the Sept note appears either contemporaneous and/or can be corroborated with other evidence. The note sets out that William paid $2,100,000 toward the purchase price of Brock, which is corroborated by William’s financial records and DeMelo’s note of his conversations with William. There is then a list of amounts to renovate the property, albeit not the $4.5 million agreed upon by the parties, but frankly this is still early days in the renovations of King of Hearts and, as evident, by William’s discussions with Histrop and Hawkins the renovations were an ongoing financial drain. There is a notation that $400,000 was “paid via mortgage on 64 Elder”. This appears to be the mortgage placed on Elder in February 2014 for $400,000. The note also refers to the “sale of Secretariate $700,000” and “sale of Concession $400,000”. These are amounts that, in fact, were received by William in November 2013 and August 2014. The note concludes with amounts that the Estate says were put into King of Hearts by William less the $1.1 million received by William, which coincides with the payments by Gillian of $700,000 returned from Secretariat and the $400,000 paid on August 28, 2014. Owing to “WRW as of September 8/14” was said to be $1,660,000. It is suggested that this demonstrates an investment in King of Hearts by William as of September 8, 2014.

[227] I do not say all of the Sept note is reliable. For example, the notation regarding preferred shares is not reliable as he never took steps to obtain preferred shares, but most of the note is reliable. It was typed up and preserved into a file folder entitled “Ranch Financing”. As noted, the typing and preservation of the note in a file labelled financing suggests that the information was important to William. The note reflects advances made and documents signed in or about the time the note was dated. I have already reviewed evidence of William’s discussions with Histrop, Hawkins, and DeMelo where William claimed to have an interest in King of Hearts, which is reflected in the note, albeit with reference to shares. As noted, the typed version of the Sept note in the file folder was admitted into evidence without objection. As such, there is no reason not to admit the handwritten note. As I have said, the ultimate reliability of the note and what inferences may be drawn from the note will be discussed later in this decision.

[228] As mentioned earlier, the only other hearsay objection was made on closing by Gillian’s counsel to the June notarized letter. This trial also involved evidence whereby witnesses testified as to what they were told by William or what he wrote. There were no objections to this other evidence, and it was accordingly admitted. Of course, in considering the ultimate reliability of what William said or wrote to others, I was alive to the fact that William could not be cross-examined on what he wrote or said.

ii) Limitation Periods

[229] This action was started by a Notice of Action on April 29, 2022. The action involves constructive trust claims over land owned by Gillian, land sold by Gillian, and land held and sold by her family members. The claim also seeks damages for $30,167,978.00 for monies received by Gillian that are alleged to have been procured by a host of alleged tortious and equitable breaches.

[230] The Defendants assert that much of the claim is outside the applicable limitation periods. In this case, there are two possible limitation periods. The first is the basic limitation period of two years from the date when the cause of action was or reasonably could have been discovered, as provided for in s. 4 of the Limitations Act, 2002, S.O. 2002, c. 24, Sch B. There are exceptions to the basic limitation period, one of which is found in s. 4 of Real Property Limitations Act, R.S.O. 1990, c. L.15 (the “RPLA”). That section provides a 10-year limitation period for actions falling within its purview.

[231] Section 4 of the Real Property Limitations Act provides as follows:

No person shall make an entry or distress, or bring an action to recover any land or rent, but within ten years next after the time at which the right to make such entry or distress, or to bring such action, first accrued to some person through whom the person making or bringing it claims, or if the right did not accrue to any person through whom that person claims, then within ten years next after the time at which the right to make such entry or distress, or to bring such action, first accrued to the person making or bringing it.

[232] Section 4 has been interpreted to extend the limitation period if there is a claim for the recovery of land. This includes a claim for a constructive trust over land: see McConnell v. Huxtable, 2014 ONCA 86, 118 O.R. (3d) 561, at para. 20. A constructive claim over land is considered “an action to recover land”, albeit not one that fits nicely with an equitable claim. This is the case here, where the Estate is not technically claiming land but rather is asking to have an equitable interest recognised.

[233] Section 4 also applies to “money that stands in the stead of land”: Bank of Montreal v Iskendorov, 2023 ONCA 528, 168 O.R. (3d) 1, at para. 50. This includes circumstances where land has been converted into money. As stated in Studley v. Studley, 2022 ONCA 810, 78 R.F.L. (8th) 410, at para. 35, to interpret s. 4 otherwise “might incentivize strategic, covert sales designed to reduce the limitation period from 10 years to two, extinguishing an otherwise viable claim.”

[234] The Real Property Limitations Act does not just encompass property but also money to acquire property. This is because the definition of “Land” in the RPLA, at s. 1, includes “money to be laid out in the purchase of land”, a phrase having “scant jurisprudence”, but one which has been held to apply to the return of a deposit on land: see Harvey v. Talon International Inc., 2017 ONCA 267, 137 O.R.(3d) 184, at paras. 54-5; Scicluna v. Solstice Two Limited, 2018 ONCA 176, 421 D.L.R. (4th) 675, at para. 25.

[235] The definition of “land” also “includes messuages and all other hereditaments, whether corporeal or incorporeal, chattels and other personal property transmissible to heirs, money to be laid out in the purchase of land…”. The word “messuages”, although not in common usage today, refers to a dwelling house, its outbuildings, the area immediately surrounding the dwelling, and the adjacent land appropriate to its use: Huxtable, at para. 14. Accordingly, the definition of “land” includes money used to purchase the property but also the dwellings on the property.

[236] In some cases, money was provided by William to renovate buildings, after the purchase of the property. While land includes the building, the definition is directed at the “purchase of land”, not the renovation of property. Both parties submitted that money to renovate property would create a deemed purchase of land. I think the better way to characterize the renovations is that the money used for the renovations is part of the constructive trust claim, and that the money was infused in the land/messuages such that the trust claim now “affects” land. Moreover, it is argued that the renovations are continued investments in land that is said to be held in trust. It therefore reflects a continuing investment that affects land. This is certainly true with King of Hearts, where the infusion was intended to improve the land so as to improve the business. In short, I accept the submission of both counsel that, in this case, as it relates to money to renovate property, the RLPA applies.

[237] All limitation periods commence when a party knows or ought to know they have a claim. While this case is brought by the Estate, the knowledge of William is important. If William believed he was owed any money, Gillian states he was obligated to bring the action in his lifetime. To wait until his death creates a manifest unfairness as William is not here to testify and his intention is the centre of the case.

[238] The Estate’s claim involves both property and non-property claims. The non-property claims include countless VISA purchases and 393 direct deposits or cheques. Each type of transaction requires consideration of the applicable limitation period and whether William knew or ought to have known he had a claim.

[239] The Estate relies upon the doctrine of fraudulent concealment: Zachariadis Estate v. Giannopoulos, 2019 ONSC 6505, 54 E.T.R. (4th) 295, at paras. 48-9. The doctrine applies to toll the limitation period where the defendant, who must be in a “special relationship” with the plaintiff that makes the concealment unconscionable, actively concealed the cause of action from the plaintiff, or the cause of action was concealed by the manner of the wrongdoing of the defendant. On the concealment, it is argued by the Estate that Gillian was to hold the assets for William through preferred shares or in some other corporate capacity and it was not known until he died that that was not so.

[240] I do not accept that Gillian concealed any cause of action. I do not accept that she was in the type of “special relationship” whereby she either agreed to generally protect William’s financial interest or provide him shares. As I have said, William was well aware of his financial situation and was not misled by Gillian. Accordingly, I reject that fraudulent concealment applies in this case.

[241] In addressing the limitation period, and as previously discussed, William was aware of how he expended his money. He signed every cheque, he authorized every transfer, and he reviewed every VISA bill. He knew what he had given Gillian. He was involved in preparing Gillian’s taxes until 2015 and was aware of the properties that she had in her name, those which she conveyed to her family, the expenses she had, and the revenue she received. He was aware of the concept of a resulting trust and even referred to it in his 2011 will. In May 2018, Histrop was so concerned that she urged him to make a demand for the property. And, over the years, he was urged by advisors to do so. Assuming that he was not intending any of these advancements as a gift, he had all the knowledge required to start this action in his lifetime.

[242] Three million dollars was charged to William’s VISA account, which he reviewed and paid each month. While the Estate in closing said it was not seeking to be repaid theses amounts, these amounts would all fall within the two-year standard limitation period. Accordingly, the money advanced through VISA payments is beyond the two-year limitation.

[243] In respect of the direct money transfers or cheques, all transfers and cheques by William stopped in December 2019. Again, I find that William was aware of the transfers when they occurred. There is no evidence of fraudulent concealment. Therefore, the money transfers not proven to be associated with the purchase of property are beyond the two-year basic limitation period and are dismissed.

[244] There was money advanced to Gillian for a proposed cannabis business in November 2019. There was not a great deal of evidence on this latter advance but there is no indication that it was related to any property that would extend the regular 2-year limitation period. As such, the claim is beyond the limitation period and is dismissed.

[245] In respect of money for renovations, counsel agree that $7 million was spent on renovations to Northern Dancer and King of Hearts. The last of those amounts were paid prior to 2019. Accordingly, on the theory advanced by the Estate and as agreed by the Defendants, the limitation period for both Northern Dancer and King of Hearts is 10 years from the last renovation. It is not entirely clear when the last renovations were, but they were well within 10 years of the commencement of the action.

[246] In respect of the properties, the Plaintiff claims a declaration of ownership pursuant to a resulting trust or damages in lieu of a possessory interest. The Plaintiff also claims that this was a business venture and Gillian holds the beneficial interest of any property for William. In respect of these claims over property, the RLPA limitation period of 10 years would apply.

[247] The Estate suggests that the limitation period does not start to run until a demand was made of the Estate, after William died, for the return of the subject properties. I disagree. William was aware that he advanced this money for the purchase of the properties. He was aware of the concept of a resulting trust. Indeed, he elected not to make a demand in 2018 when suggested to do so by Histrop or to rectify any title issues in 2015 when he spoke with Hawkins. In such circumstances, the limitation period ought not to begin anew because he died. Moreover, the Court of Appeal, in Camarata v. Morgan, 2009 ONCA 38, 94 O.R. (3d) 496, has held that the limitation period is not extended because a trustee is dealing with an estate.

[248] In my view, the limitation period for the property claims accrues from the date when William would understand that, if these were not gifts, he had a proprietary or equitable right in the property.

[249] To recap, there were 19 properties purchased by Gillian for approximately $13.5 million dollars. The acquisition cost, less mortgages, was approximately $12 million. Given the proprietary nature of the claims, the acquisition dates of the properties are relevant.

[250] The 10-year limitation period would preclude any claim where William knew or ought to have reasonably known that he had a claim prior to April 29, 2012. This would include all property bought before that date, as William knew that the property was registered in Gillian’s name. There were 5 properties that were acquired prior to the date: 1374 Linstead, 152 Taunton Road East, 154 Taunton Road East, 1 Delight Way and 9 Northern Dancer. Only 1 Delight Way, and Northern Dancer remain; the others have been sold. However, in each case, had William believed that he had an entitlement to a resulting trust as claimed, he ought to have brought a claim. I have already addressed Northern Dancer as having a 10-year limitation from the last renovation. Any claim for the remaining 4 properties purchased more than 10 years ago is barred by the limitation period.

[251] As well, the status of William’s guarantee of the HELOC on Northern Dancer is still a live issue and any claim in respect of the guarantee is within the limitation period.

[252] In the case of Linstead, it was acquired by Gillian more than 10 years prior to start of this action. She transferred title to Gillian’s sister, Donna McGrath, in 2013 for $170,000. It is alleged in the claim, but not in the closing argument, that Donna McGrath is in knowing receipt of property that was impressed with a trust. William was fully aware of the acquisition of Linstead by Gillian, and the transfer to McGrath. In my view the transfer to McGrath does not revive the limitation period in the property.

[253] 152 Taunton was purchased on November 4, 2009, being more than 10 years ago. It was transferred to Gillian’s sisters, Michelle and Shamile, on February 3, 2011. Both dates are 10 years prior to April 29, 2021. The claim of knowing receipt against Shamile and Michelle is predicated on this transfer. The property was conveyed from Michelle to Shamile, and later from Shamile to herself and her husband. The property was then bought back by Gillian, using 223 Ontario, for $175,000 on December 11, 2014.

[254] As discussed earlier, William was aware of the transfers in 2009 to Michelle and Shamile. In my view, the limitation period, either RLPA or basic, has expired on the claim as against Michelle, Shamile, and Michael for knowing receipt in 2009.

[255] On the other hand, the money used to repurchase 152 Taunton in 2014, like all purchases, was from William. It was sold on February 26, 2021, for $529,000. The Estate is within time to claim a proprietary interest in these proceeds.

[256] 154 Taunton Rd. was purchased on November 4, 2009. It was sold on February 26, 2021. As discussed earlier, it was known to William that his money was used to purchase 154 Taunton Rd. Any proprietary claim ought to have been made by November 4, 2019. The claim is therefore barred.

[257] 1 Delight Way was purchased by Gillian on December 15, 2009. It is still owned by Gillian. It was a property listed as security in the 2014 Security Agreement. This agreement certainly implies that William’s interest in Delight Way was limited to his interest in the security. The claim under the Security Agreement remains outstanding, including the loan amount. However, any resulting trust or proprietary claim relating to the acquisition of the property has expired.

[258] Elder was not purchased with funds from William. However, William advanced funds prior to 2011 to discharge mortgages. Prior to 2011, money was also provided by William to renovate the kitchen and add a pool. All this activity occurred with William’s knowledge. Any claims because of the advance of those funds are beyond the 10-year limitation period. There is the Elder Mortgage that was placed on title to Elder on February 14, 2014. In my view, this relates to the advance of $400,000 provided to Gillian in February 2014. That claim is not barred by the limitation period. Similarly, the claims related to the loans for the $101,000, $400,000 and $310,000 (although not secured by property) in 2009 which were admitted by Gillian are within the limitation period.

[259] The remaining properties were acquired within the limitation period of RLPA. However, all but four have been sold. Per Studley, claims to the proceeds of those sales are within the limitation period. The only properties that have not been sold for which resulting trust claims continue are Brock Rd, Northern Dancer, and 39 Braebrook. I have found that the claim for Delight Way is beyond the limitation period.

iii) Corroboration

[260] Ordinarily, the law does not require evidence to be corroborated; the evidence of one witness is legally capable of meeting the burden of proof in a civil proceeding: Brisco, at para. 59. However, s. 13 of the Evidence Act, R.S.O. 1990, c. E.23, requires that there be corroboration in certain prescribed circumstances, including litigation by or against an estate.

[261] Section 13 reads as follows:

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.

[262] The section speaks of actions by or against an estate. While the objective of s. 13 is to avoid fraud by uncorroborated testimony by the living against the dead, it equally applies to evidence adduced by the Estate: Brisco at para. 61.

[263] Corroborating evidence is simply evidence that enhances the probability of the truth of the evidence of the party requiring corroboration. Corroborating evidence may be a single piece of demonstrative evidence, or it may be several pieces of circumstantial evidence. In the latter case, one piece of evidence viewed in isolation may not be corroborative, but seen in the context of other evidence, the totality of the evidence may be corroborative; Brisco, at para. 65; Burns Estate v. Mellon (2000), 2000 5739 (ON CA), 48 O.R. (3d) 641 (Ont. C.A.) at para. 29.

[264] In this case, assertions by both the Estate and Gillian must be corroborated. To ascertain William’s intention, I largely rely on the direct and circumstantial evidence of how William dealt with his money, dealt with Gillian, and dealt with others regarding his money to arrive at my conclusion.

iv) Credibility

[265] The Estate challenges the credibility of Gillian. In its closing, it provided several reasons why Gillian is not credible.

[266] Credibility is a distinct concept from reliability. As explained in R. v. H.C., 2009 ONCA 56. 244 O.A.C. 288, at para. 41, credibility concerns the veracity, reliability, and accuracy of the witness’ testimony. While a credible witness may provide unreliable evidence, where a person is deemed not to be credible, that person’s evidence can not be relied upon on that point, although they may provide reliable evidence on other points: R. v. Morrissey (1995), 1995 3498 (ON CA), 22 O.R. (3d) 514, at 526 (C.A.). However, assessing credibility is not a science. The Court may consider several factors in assessing credibility, including: (i) whether there is independent confirming or contradicting evidence, (ii) the existence of a motive to fabricate, and (iii) the demeanour of a witness, including non-verbal cues such as body language, tone of voice, and manner of speaking.

[267] In considering credibility and reliability, the court may believe, all, none, or some of a witness’s evidence: R. v. Kruk, 2024 SCC 7 at para. 145. Accordingly, in assessing a witness’s evidence, it is not all or nothing. The court can accept or reject parts of a witness’s testimony or can accord little or no weight to evidence the court has accepted: R. v. Howe (2005), 2005 253 (ON CA), 192 C.C.C. (3d) 480 (Ont. C.A.), at para. 44. It is recognized that a credibility finding does “not always lend itself to precise and complete verbalization”: R. v. R.E.M., 2008 SCC 51, [2008] 3S.C.R.3 at para. 405.

[268] I will address the main action here as the Counterclaim raises different considerations.

[269] First, the main action is directed to the intent of William and whether he intended to advance money to Gillian as a gift or not. In my view, there is sufficient independent evidence for this court to make that determination.

[270] I accept that Gillian has a significant motive to misrepresent, overstate, and fabricate evidence. There is a significant amount of money involved in this case. Her family has been implicated in the financial transactions, including her children. This alone does not evidence a lack of credibility but rather it only provides a motive.

[271] I accept there were points in her evidence where her answers were vague, showed poor recollection, or simply exaggerated. For example, Gillian’s evidence on the details of the gifts is scant. She received 393 transfers and said she recalled discussions regarding the significant amounts that went to houses but had little recollection of others. The Estate avoided asking questions about the conversations about the homes that she states she recalls. She says that William would advance money directly to her as he was aware of upcoming expenditures. Nonetheless, I would have expected a more fulsome recollection.

[272] There were some inconsistencies in her testimony that were pointed out by the Estate, both within her own testimony and between her and others. I have mentioned some of the evidence that troubled me.

[273] I have significant difficulty on the evidence regarding the matrimonial proceeding. In my view, both she and William were concocting a story so as to defeat Kerwin’s claim, which itself was a fabrication. There is no evidence of loans of $10 million. The loan amounts conveniently zero out the listed assets. Both William and Gillian presented a story to the family court that was not accurate, and that Gillian knew was not accurate. On that issue, she is not credible and has demonstrated a willingness to mislead.

[274] As I will explain when I address the Counterclaim, I have great difficulty with the allegation that she was sexually assaulted by William. I have concluded that her evidence is not convincing on that issue.

[275] I have looked at other evidence for corroboration that the money provided to Gillian from William was a gift. In most instances, I find it was a gift based on the surrounding circumstances, including the conduct of William. I therefore accept Gillian’s main assertion that William gifted her much of the money. In the case of King of Hearts, I come to the opposite conclusion, which is that William intended to have a continuing beneficial interest in King of Hearts. In this regard, the evidence regarding King of Hearts does not oust the presumption of a resulting trust. The surrounding evidence suggests that William intended to have a continuing interest. As such, the assertion that King of Hearts was a gift cannot stand as the presumption has not been ousted and as explained below, the onus rests with Gillian to oust the presumption of a resulting trust. But Gillian’s evidence of gifts generally is accepted and supported by corroborative evidence.

[276] As is evident by the totality of my ruling I have accepted most, but not all, of the evidence I have heard, including from Gillian. As the trier of fact, I am entitled to do so.

v) Resulting Trust

[277] The resolution of this case depends upon the law pertaining to gifts. Gillian must establish that William intended to provide this money to her as a gift with the full intent that the money would not be returned. To establish a gift, one must show the donor intended to donate the gift, that there was sufficient delivery of the gift, and acceptance of the gift: McNamee v. McNamee, 2011 ONCA 533, 106 O.R. (3d) 40, at para. 24. A gift has also been described as an intention by the transferor to relinquish the beneficial interest in what is being gifted. In Nishi v. Rascal Trucking Ltd., 2013 SCC 33, [2013] 2 S.CR. 438, at para. 37, Rothstein J. described a gift in this way:

In Canada, our jurisprudence is that there is no difference between the intention to make a gift and the intention that the transferor does not hold a beneficial interest. In other words, in the case of a gratuitous transfer, there is a gift at law when the evidence demonstrates that, at the time of the transfer, the transferor intended the transferee to hold the beneficial interest in the property being purchased.

[278] The Estate relies on the “presumption of resulting trust” and the “presumption of undue influence” to defeat any claim that the money provided by William to Gillian was a gift. The Estate also relies on other legal theories such as fraud and unjust enrichment. While those will be discussed below, if Gillian establishes these are gifts, freely provided by William to her, then those causes of action largely fall away.

[279] There is a rebuttable presumption that the transfers were not gifts: Pecore v. Pecore, 2007 SCC 17, [2007] 1 S.C.R. 795, at para. 23. The presumption applies in cases such as this where money was advanced without any consideration being provided by Gillian to William. To rebut the presumption, there must be sufficient evidence adduced to displace the presumption. In other words, there must be sufficient evidence adduced to establish that Gillian was gifted the money and that William intended that that money or resulting properties ought not to be returned to him, either directly or by a return on an investment. In this regard, the legal burden rests with Gillian to demonstrate that a gift was intended. The presumption must be rebutted on a balance of probabilities: Pecore, at paras. 43-44.

[280] The Estate also relies on the doctrine of “purchase money resulting trust”. This is a species of gratuitous transfer resulting trust where a person advances a contribution to the purchase price of property without taking legal title. The resulting trust presumptively arises when one party gratuitously transfers money to an unrelated person for the purpose of purchasing property and that property is put in the other’s name: Nishi, at para. 21. The discussion regarding resulting trust applies equally to the assertion that there exists a purchase resulting trust in respect of the properties.

[281] The Estate submits that these doctrines apply in respect of advances from William to Gillian for the purchase and renovation of the homes that Gillian acquired with William’s money. They argue that it also applies to the acquisition and renovation of Brock and King of Hearts. Gillian concedes that the contributions to purchase and renovate the properties she acquired were made without consideration and that she and William are not related. As a result, the legal presumption of resulting trust applies.

[282] The relevant intention is the intention of William when he advanced the funds used by Gillian to purchase or renovate the properties. Gillian must rebut the presumption by establishing on a balance of probabilities that William intended to make a gift to Gillian at that time: Nishi, at para. 30.

[283] On the issue of the burden of proof, I am mindful that there is only one standard of proof when applying the balance of probabilities. It is the civil standard. Some older cases suggest there may be a higher evidentiary burden than the civil standard in cases such as this. This is no longer so. The civil standard requires that the evidence must always be clear, convincing, and cogent to satisfy the balance of probabilities test. Even though the test may be difficult to apply, the judge is required to decide. This is a particularly difficult task where the assessment is to be made based on the intention of a dead person. Nonetheless, the court must weigh the evidence, have regard to the onus, and make the best decision possible. In doing so, the court must be alive to the probability of an event occurring when weighing the evidence. In F.H. v. McDougall, 2008 SCC 53, [2008] 3 SCR 41, at para. 48, the Supreme Court described the weighing exercise as follows:

Some alleged events may be highly improbable. Others less so. There can be no rule as to when and to what extent inherent improbability must be taken into account by a trial judge. As Lord Hoffmann observed at para. 15 of In re B:

Common sense, not law, requires that in deciding this question, regard should be had, to whatever extent appropriate, to inherent probabilities.

It will be for the trial judge to decide to what extent, if any, the circumstances suggest that an allegation is inherently improbable and where appropriate, that may be taken into account in the assessment of whether the evidence establishes that it is more likely than not that the event occurred. However, there can be no rule of law imposing such a formula.

[284] There is no magic list of factors to be considered in assessing William’s intention. At one time, subsequent conduct by the transferor was considered unreliable evidence. It was felt that that donors might seek to revoke prior gifts and that self serving statements could be easily fabricated. However, such a rigid rule no longer applies. Rather, “evidence of intention that arises subsequent to a transfer should not automatically be excluded”. But the evidence “must be relevant to the intention of the transferor at the time of the transfer” and the court must guard “against evidence that is self-serving or that tends to reflect a change in intention”: Pecore, at para.59; Nisha, at para. 46.

[285] The court may also look to items such as banking or tax documents and wills, even though they do not necessarily show equitable interests. They may have evidentiary value as to intention when seen in context of the totality of the evidence: Pecore, at para. 61.

[286] Aside from documents, the court may also look to the dynamic of the relationship between the transferor and transferee: Pecore, at paras. 37 and 64. While such an analysis often involves child/parent relationships, as was the case in Pecore, common sense dictates that the nature of the relationship often will impact a decision made by one party in favour of another party.

[287] In short, the analysis is contextual but is focused on the donative intention of the transferor at the time of the transfer.

Application to the Facts

[288] There are several factors that lead me to conclude that the vast majority of the money given to Gillian were gifts, not money to be invested on behalf of William as claimed by the Estate. In saying so, I reiterate that the burden of proof rests with Gillian.

[289] There were some 393 transfers. Some were small, some were large. Some went to houses, and others to luxury expenses and less mundane purchases. These transactions may be seen in three buckets: money for property, money for King of Hearts, and money for other items, including VISA purchases. There is a fourth distinct bucket related to Phyliss’s money, which I will address separately.

[290] In its claim, the Estate asserts all the money was impressed with a trust, except for money given for Noelle’s schooling. In its closing, the Estate said that it is “not seeking to recover credit card receipts”, although they are expressly claimed for in the Estate’s Amended Amended Statement of Claim.

[291] I accept that the sheer size of the monies in issue may cause a reasonable person to question the transfers. However, the transfers were over 10 years and happened in a context for which there is plenty of direct and circumstantial evidence that may be examined to ascertain William’s intentions.

[292] In this case, all the money given to Gillian was provided within an intimate relationship. In my view, this informs why William wanted her to have the money.

Non-Property Amounts

[293] William provided a great deal of money for which there is no real accounting by him or anyone else. This appears to be true for the vast majority of 393 payments and VISA payments. Although the Estate in its closing says it is no longer asking for the repayment of credit card receipts, those payments are part of the narrative that informs William’s intention when dealing with Gillian. William clearly signed off on the VISA statements. These amounted to some $3 million. They included charges for groceries, clothes, jewellery, dinners, trips, and other luxury and mundane items. He knew from the statements that he was funding Gillian and her family’s lifestyle. He never objected to any payments and there is no evidence he questioned any expenditures. He never made a request for repayment. These were gifts.

[294] Similarly, independent of the VISA payments, there were transfers through direct deposits or cheques that amount to another $7 million, which were not spent on acquiring or renovating property. As there was no forensic analysis of this amount, it is not clear how all this money was used by Gillian. Some was used on luxury vehicles. William knew that Gillian drove expensive cars, as did her children. Indeed, as a PSW making $60,000 a year, he encouraged her to buy an expensive Mercedes SUV which without his help she could not afford. To his knowledge, she gave to charities in a disproportionate rate to her income and funded a school and orphanage in Guyana. He was aware that Gillian went on lavish trips. And bought expensive jewellery. Like the VISA statements, there is no reason to expect that William did not know the reason why he was advancing money to Gillian. Transfers were verified with him directly by CIBC/Wood Gundy. He was in control of his money. It is hard to rationalize any distinction between money given through direct transfers for these items and amounts charged to VISA for similar items. I accept that William was aware of why he advanced money to Gillian and how she spent it.

[295] William authorized every transfer. There was no credible evidence that he had any interest in what was purchased or that he had any expectation that the money would be repaid. These were all gifts.

Property Investments

[296] The Estate’s suggestion that William gave the money to Gillian to invest in property on his behalf makes little sense. In fact, the testimony was that William (and indeed many of his fellow UofT academics) did not believe buying property was a wise investment. Indeed, he bought his first house very late in life because Phyliss needed the room. Property was not where William traditionally, or ever, invested his money.

[297] Moreover, Gillian was a PSW with a grade 10 education. She had no experience as an investor. William was a business professor. He had at least two successful start-ups. It makes little sense that he would entrust his wealth to Gillian to invest on his behalf. I do not accept the Estate’s premise that Gillian was to invest William’s money in real estate. Rather, I accept he was providing the money for Gillian to acquire real estate for her own purposes, and he mentored her in that regard.

[298] In respect of property, when William intended the money to be repaid, he documented it accordingly, using legal counsel. The Promissory Note, Elder Mortgage, and Security Agreement are all evidence that when William’s funds were to be loans and not gifts, he documented them as such. He had the assistance and advice of solicitors, Arnold and Greenberg, who prepared the appropriate documentation. He documented when he excused a debt or obligation, such as the Promissory Note and Commitment Letter. For most funds, the money was provided without such documentation or security.

[299] Comments made to Hawkins, Histrop, and DeMelo by William suggested that that his only investment was in King of Hearts. It was never suggested William asserted an interest in Gillian’s other properties to any of these advisors.

[300] Comments and statement by William to his advisors clearly indicated that he was aware that all the property belonged to and was in the name of Gillian or her companies. For example, his communications with Hawkins always acknowledged that the properties belonged to Gillian, as did the rents.

[301] Similarly, his net worth statements did not disclose any interest in the properties, other than the guarantees that he listed as contingent liabilities and his reference to capital gains in King of Hearts. He did not list Gillian’s properties as assets because he did not consider them to be owned by him, even beneficially.

[302] The Estate relies on the last 2018 will to suggest that William was claiming a resulting/bare trust on all of Gillian’s properties. This is taken from the gifting precondition in the will that bequeaths Hawthorne shares to Gillian, but only if she returns all property that she is said to hold subject to a resulting trust. In the 2017 will, the gift to Gillian of 500,000 Hawthorne shares was an unconditional legacy. This language was modified in the next will at the insistence of Histrop, who, by 2018, did not trust Gillian. However, Histrop never obtained a list of properties that William believed were owned by Gillian and subject to a constructive/ bare trust. When asked which properties these might be, Histrop could only identify Northern Dancer and Brock.

[303] In the case of Northern Dancer, the property was mentioned in the October 2011 will, along with Secretariate. In that will, there was an express mention of Secretariate being held by Gillian as bare/resulting trustee for William. There was no mention of Northern Dancer being held by Gillian in trust for William. Gillian did buy Secretariat with William’s money and acknowledges she owed him money when it was sold. She remitted $700,000 to William when she sold Secretariate in November 2013.

[304] The 2018 will was signed long after the purchase of Northern Dancer in March 2011 and would not constitute reliable evidence of William’s intentions at the time he provided the funds to purchase Northern Dancer. If this property was to be held in trust for William, it would surely have said so in the 2011 will, which was signed in October, months after the purchase. The 2018 will is not evidence of William’s intention at the time of Northern Dancer’s acquisition. I do not accept that Northern Dancer was to be held in trust for William. William gifted the money for Northern Dancer to Gillian.

[305] As mentioned earlier, William was aware that Gillian conveyed properties to her sisters and sister-in-law (Linstead and Taunton). His note to Hawkins was that one was to be conveyed “gratis”. This is consistent with Arnold’s note confirming Gillian was going to help her sisters. There was no objection to Gillian conveying title at that time and no protest or claim by William that she had transferred his property. Again, had he intended for these to be investments, there would not be such clear acquiescence by William. These were gifts.

[306] In respect of the two notarized letters signed by William and their significance, I have already expressed my skepticism as to the June letter being a ruse for the purpose of defeating Kerwin’s equally deceptive matrimonial claim. The amounts claimed to be advanced by William to Gillian are woefully less than the amounts actually advanced. Of course, the loans match up with the claimed assets, resulting in a net worth of zero. Even if the letter had a tinge of credibility, it is referring to past transactions for which there is no corroboration as to the vast amount of the loans. The letter is given no weight by me.

[307] The August letter is corroborated by more recent events. It not only reflects the Security Agreement amount of $1.4 million, but also accounts for the payment of $400,000 after the sale of Concession, which had just occurred. The letter refers to the Elder Mortgage registered months earlier.

[308] I am urged by the Estate that the phrase “non-repayable imbursement” in the August letter is intended to reflect an investment intent. They rely on the archaic definition of “imbursement” being “money laid up in stock”. This is such an archaic definition that counsel conceded they had to look it up. However, it is suggested William, as a business professor, would know the phrase. Of course, imbursing also means the state of being imbursed or to pay, as in re-imbursed. For example, the Collins English Dictionary defines imburse simply as a verb - “to pay”: Collins English Dictionary, 14th ed. (Glasgow: HarperCollins, 2023).

[309] In my view, it is more likely the word “Imbursement” was used to signify payments, not stock. If I were to accept the Estate’s chosen definition, there is still the modifier “non-repayable”, which implies that, whatever was intended, William was not looking for the money to be returned or repaid. This is consistent with it being a gift. Either way, I do not put a great deal of stock in this letter.

[310] It was also suggested by the Estate that William believed he was leaving a legacy to be enjoyed by the charities he named in his will. He was said to have modified the percentages for the charities up to his May 2018 will. The very month he signed the 2018 will, he was told by DeMelo that he had depleted his non-registered assets.

[311] It may well be that he thought the investment in Hawthorne would be a great success, like his earlier ventures, as he told Wade. As noted below, I find that William believed he had an interest in King of Hearts. Together with Hawthorne, he could well have believed there were sufficient assets to warrant the will’s bequests. Whatever the reason, William was not under any illusion as to what his assets were and what he had given Gillian. I do not accept that the will evidences an intention by William that the properties acquired by Gillian with his money were to form part of his estate.

[312] In the end, I am satisfied that William intended to gift the money used to buy the properties, other than King of Hearts, and that he did not intend to retain a beneficial interest in those properties. Gillian’s evidence is corroborated by the way William dealt with the properties and how he communicated with others about the properties. He never claimed a financial interest when dealing with his many advisors, in his net worth statements or taxes. He was told repeatedly that, if he had an interest, he ought to document it which he did on a few limited occasions. Aside from King of Hearts, he made no specific reference to having a beneficial interest in the properties. I do not accept that William would enter a business relationship with Gillian as argued by the Estate. I do accept that given their intimate relationship that William gifted her the money to purchase the properties for her benefit.

King of Hearts

[313] The evidence points to King of Hearts being distinct from the other properties. I accept that William intended to retain a beneficial interest in King of Hearts.

[314] It was the only investment that was an operating business as opposed to being simply a real estate holding. It is also the single biggest asset purchased by Gillian with over $4.5 million in renovations. The evidence from the advisors is that William referred to King of Hearts as an investment. It is consistent with him keeping a file entitled “Ranch Financing” setting out his investment at that time. It explains why he continued to fund the renovations in the hope that it would be profitable. He described his frustration with the losses from King of Hearts to both Histrop and Hawkins, hoping it would turn a profit. His net worth statements refer to him offsetting any potential capital gains from King of Hearts, albeit in shares that were never issued. His concern of potential capital gains reflects that he believed he had a continuing financial interest in King of Hearts.

[315] Unlike the properties, the VISA payments, and the other financial advances, William continually asserted a financial investment in King of Hearts. Gillian has not advanced clear, convincing, and cogent evidence to oust the presumption of a resulting trust that King of Hearts was intended as a gift. Rather, in my view, William expressed a continuing financial interest in King of Hearts. I find there is a resulting trust in respect of the money advanced for King of Hearts.

Conclusion of Resulting Trust

[316] I find that there is a resulting trust arising from William’s advancement of money for the purchase and renovation of King of Hearts and Brock Rd. I discuss William’s proportionate interest in King of Hearts when I discuss the conclusion of the claim.

[317] I find there is no resulting trust relative to any other advances, VISA payments or other properties.

[318] To many, William providing this amount of money to Gillian is extraordinary. William had the right to do so. The equitable principle of resulting trust is not intended to oust a person’s autonomy; rather, it is intended to ensure that the money was truly gifted. In this case, over 10 years, William gave a substantial portion of his estate to an intimate partner.

Phyliss’s Funds

[319] It is agreed that, as Phyliss’s attorney for property, William had a fiduciary obligation to invest Phyliss’s money in her best interest. It is further agreed that he managed to lose $5.4 million of her money from 2009 to his death. The Estate accepts that it owes Phyliss $5.4 million.

[320] It is not clear where the entire $5.4 million was spent. However, there are sufficient records that explain how more than half of that money was spent.

[321] During the trial, evidence was submitted through Wood Gundy that demonstrates how and why $2.85 million of the transfers were made from Phyliss to William. These transfers were made from December 2013 to April 2018.

[322] There are accompanying notes from Wood Gundy that explain the events occurring at the time of these transfers. In my view, those transfers ended up funding Gillian. These were part of William’s “gifts” to Gillian.

[323] During this period from 2013-2018, the vast majority of payments from William’s CIBC/Wood Gundy accounts went to Gillian. Aside from stocks, William had a margin account. All counsel agreed that William used his margin account to fund his payments to Gillian. At one point, his margin account was overdrawn by $10 million. There was a constant need to pay down the margin account while continuing to fund Gillian. This was achieved by William shifting money from other sources, including Phyliss’s money, to pay down the margin account.

[324] Some of the transfers demonstrate with clarity this relationship. For example, on January 16, 2015, William spoke to DeMelo, seeking to transfer $225,000 to Gillian. He was advised he had only $245,000 available in his margin account. To make the transfer work, on January 19, 2014, he authorized the sale of 4,000 of Phyliss’s Enbridge stock. He then wired $225,000 to Gillian on January 20, 2015, which he paid with money transferred by WRW. However, he then replenished his account with $225,000 from Phyliss’s account later that week.

[325] Elsewhere, Phyliss’s funds are used to top up William’s margin account, either after he provided funds or in anticipation of him advancing funds to Gillian. For example, on March 18, 2015, William transferred $295,000 from Phyliss’s account to his account. In the preceding month, from February 12 to March 18, 2015, William had provided Gillian with $420,000, undoubtedly necessitating the top up of the margin account.

[326] In July 2015, William tells DeMelo that he would be providing more money to Gillian. Between July 13 and September 14, 2015, he advanced $580,000 to Gillian. By August 24, there was a margin call on William’s account. He sold some of his own stock to cover the margin, but he also transferred $465,000 from Phyliss’s account to his own account on September 24, 2015. In the following month, William transferred over $500,000 to Gillian. But for Phyliss’s money, all these transfers to Gillian would not have taken place.

[327] The pattern is repeated over and over. I have no doubt that the money from Phyliss flowed to Gillian. I cannot say all the $5.4 million went to Gillian as not all the records are available. However, the CIBC records demonstrate that $2.85 million was moved from Phyliss’s account to William’s account to fund Gillian.

[328] William was not investing with Gillian. He was gifting her the money. However, he had no right or power to gift Phyliss’s money to Gillian. As he could not gift money that he had no right to gift, there could be no legitimate donative intent on his part. William knew his obligation in respect of this money was to invest for Phyliss, not gift to Gillian. In my view, Gillian cannot overcome the presumption of a resulting trust. On a balance of probabilities, there was no legitimate donative intent as required when proving a gift.

[329] Both Gillian and William were in fiduciary relationships with Phyliss. Phyliss was incapacitated. Gillian was her caregiver. William was her attorney for property. Together they were carrying on a secret relationship that they did not share with Phyliss. During that relationship, they were joined in a common enterprise to benefit Gillian with excessive gifts.

[330] The actions of Gillian and William were unconscionable as it relates to Phyliss. There is no doubt that William “gifted” Phyliss’s money to Gillian (and likely more than can be gleaned from the records). In circumstances such as this, the doctrine of equitable fraud would prevent the retention of the money by Gillian.

[331] In Performance Industries Ltd. v. Sylvan Lake Golf & Tennis Club Ltd., 2002 SCC 19, [2002] 1 S.C.R. 678, at para. 39, the Supreme Court described equitable fraud as follows:

[Equitable fraud] . . . refers to transactions falling short of deceit but where the Court is of the opinion that it is unconscientious for a person to avail himself of the advantage obtained” (p. 37). Fraud in the “wider sense” of a ground for equitable relief “is so infinite in its varieties that the Courts have not attempted to define it”, but “all kinds of unfair dealing and unconscionable conduct in matters of contract come within its ken” . . .

[321] Equitable fraud is concerned about ensuring that the law can right unconscionable wrongs. It is often used to prevent the impact of limitation periods. It is not necessarily focused on the abuse of relationships, although it often arises where one party is vulnerable. Indeed, older cases often focused on the relationship, which is no longer the sole focus.

[332] The Supreme Court has pointed out that the “inquiry is not into the relationship within which the conduct occurred, but into the unconscionability of the conduct itself” and whether it would be, for any reason, unconscionable for the defendant to rely on the advantage gained: Pioneer Corp. v Godfrey, 2019 SCC 42, at para. 54.

[333] In this case, William and Gillian were both fiduciaries to Phyliss. Phyliss was an incapacitated recluse who was dependent on both of them, which left Phyliss completely vulnerable and exposed.

[334] Both law and equity require that this money be repaid to the Estate. William had no right to gift the money for the benefit of Gillian. He was to invest the money for Phyliss. It is unconscionable that Gillian would end up with Phyliss’s money. Gillian gained this advantage by having an affair with William, who also breached his responsibility to Phyliss. Phyliss is on the brink of being destitute. For Gillian to retain the money in those circumstances is unconscionable.

[335] However, this is not money that belongs to the Estate. It belongs to Phyliss. The money must be returned to Phyliss and not used by the Estate for any other purpose. I have also found that the money constitutes an unjust enrichment, which is discussed below.

[336] To be clear, Phyliss was not the plaintiff in this case. This result is intended to return to the Estate that which was not a gift, but which must then be returned to Phyliss. This award does not preclude any claim Phyliss may have against any party to this litigation or any person who was obligated to protect her interest because of the dissipation of both her money and the marital assets. Phyliss had every right to expect that all her needs would be met given her own assets and the marital assets that she and William had built over the years. However, this Court can only address the action before it. For this action, Phyliss’s money does not constitute a gift from William to Gillian and must be returned to Phyliss.

[337] I also recognise that this order places Kussinger in an uncomfortable spot. As the attorney for property, she must protect Phyliss. As the co-trustee of the Estate, she must account to Phyliss for the actions of William. Frankly, this conflict has existed from the outset of her two roles. Serious thought should be given on how best to protect Phyliss’s interest, including whether Kussinger should continue as Phyliss’s attorney for property.

vi) Undue Influence

[338] The equitable doctrine of undue influence provides that a party may set aside a transaction where that party was induced to enter into the transaction by another’s undue influence: Bank of Montréal v. Duguid (2000), 2000 5710 (ON CA), 47 O.R (3d) 737 (C.A.), at para. 4. Undue influence has been described as “the ability of one person to dominate the will of another, whether through manipulation, coercion, or outright but subtle abuse of power”: Geffen v. Goodman Estate, 1991 69 (SCC), [1991] 2 S.C.R. 353, at p. 377.

[339] Like the doctrine of resulting trust, a person’s autonomy is still an important factor in looking at the doctrine of undue influence. While others may find a person’s choice to be peculiar or even repugnant to their own beliefs, where there is no undue influence, a person remains free to do as they please with their assets. However, even where there is an apparent gift, the doctrine of undue influence may intervene to negate donative intent.

[340] The law imposes a presumption of undue influence in certain circumstances. As such, there are two classes of undue influence, actual undue influence and presumed undue influence: Bank of Montreal, at para. 6.

[341] In the case of actual undue influence, the plaintiff must “prove affirmatively that the wrongdoer exerted undue influence on the complainant to enter that into the particular transaction which is impugned”. In the case of presumed undue influence, the plaintiff must show,

in the first instance, that there was a relationship of trust and confidence between the complainant and wrongdoer of such a nature that it is fair to presume that the wrongdoer abused that relationship in procuring the complainant enter into the impugned transaction… once a confidential relationship has been proved, the burden shifts to the wrongdoer to prove that the complainant entered into the impugned transaction freely, for example by showing that the complainant independent advice: Bank of Montreal , at para.6.

[342] There are two classes of cases where undue influence may be presumed. The first are those types of relationships where the courts have imposed obligations and duties upon one party for the benefit of another (for example, a solicitor and client relationship). Second, there are those relationships where the complainant “proves that the de facto existence of a relationship to or under which the complainant reposed trust and confidence in the wrongdoer, the existence of such a relationship raises the presumption of undue influences”: Bank of Montreal, at para. 6. The courts have noted that “the mere fact of a close relationship does not give rise to a presumption of undue influence.” It must be established that the relationship was one in which the donor “generally reposed trust and confidence in the wrongdoer”: Bank of Montreal, at para. 16. In either scenario, like the presumption in resulting trust, the presumption may be rebutted having regard to the nature of the transaction and the evidence adduced.

[343] In this case, whether the presumption applies will turn on whether William reposed trust in Gillian in respect of his financial dealings. As the Court of Appeal noted, even in a matrimonial setting, the court must examine whether, in fact, one party relied upon the other “in decisions on financial affairs”: Bank of Montreal, at para. 19; see also Morreale v. Romanino, 2017 ONCA 359, 30 E.T.R. (4th) 21, at para. 23.

[344] There is no evidence that William relied on Gillian to make his financial decisions. Indeed, the evidence is to the contrary. William provided financial advice to Gillian. This is most evident in his dealing with her taxes. I do not accept that Gillian was in a position where William trusted her on general financial matters.

[345] I have found that William invested in King of Hearts. However, I do not find that this meant that William relied generally on Gillian such that any presumption would arise. Rather, the presumption of undue influence does not apply.

[346] The Estate argued that Gillian was a caregiver for William, which, in turn, gives rise to a dependency that should impose the presumption. I disagree. Gillian was hired to care for Phyliss, not William. Undoubtedly, she provided some assistance to William from time to time toward the latter part of their relationship, but this was not as a constant caregiver.

[347] In any event, the test is one of financial dependency. William controlled his own finances. He dealt with his advisors on his own, right to the end, with each advisor believing he was competent and of sound mind. There was no dependency by William on Gillian in this regard.

[348] Where the presumption does not apply, the claimant must prove undue influence. Even if there are suspicious circumstances surrounding the gifts, the onus does not shift to the recipient to disprove undue influence: Keljanovic (Estate of) v. Sanseverino (2000), 2000 5711 (ON CA), at para. 62.

[349] Where the presumption does not apply, the question is whether there was actual undue influence: whether a person’s free will was overborne by an act of coercion or fraud: Keljanovic Estate, at para. 61. This includes consideration of the interaction of the parties and the capacity of the donor. In Morreale, the court had regard to the fact the testator who provided the inter-vivos gifts was a strong-willed person who was in control of his finances. This was certainly the case with William. The Court may also take into consideration the magnitude of the benefit, which I accept was considerable: Gefen, at para. 45.

[350] In Keljanovic Estate, at para. 83, O’Connor J.A. (as he then was) commented that where the donor has capacity, proving undue influence would be a significant challenge:

Weighed against this is the uncontradicted evidence that Keljanovic was strong willed, well educated and not subject to being pushed around. She was clearly the dominant personality in the relationship with Sanseverino. Furthermore, she had the capacity to understand the consequences of the transfer. This is important. Although undue influence raises a different issue than lack of capacity, “[i]f it is established that the testator knew and appreciated what he was doing, in many cases there is little room for a finding that the testator was coerced”: Vout v. Hay, supra at 890.

[351] William knew and appreciated what he was doing as it related to his finances and the money that he gave Gillian. Moreover, the professionals involved all testified that William had capacity to undertake the various tasks at hand, including signing wills, executing legal documents, and authorizing financial transactions.

[352] William was strong willed. All who knew him said as much. He controlled his finances and reviewed his expenditures. There is nothing to suggest Gillian or anyone else ousted his free will. He had the benefit of advice from legal, accounting, and financial advisors. He was not dependent on Gillian.

[353] This was not a single gift. William provided a consistent flow of money over almost 10 years. His gifting was constant and reflective of his free will. There was no compelling evidence that circumstances changed over that period, such that there was a period after which William either did not have capacity or was overwhelmed by Gillian such that he gave her money due to undue influence. In fact, the evidence was that William knew and appreciated what he was doing throughout, and all his advisors accepted that he had capacity to the end and acted on his instructions. As noted, while geriatric medical experts were on the trial list, none were called.

[354] William acted as he did because he chose to do so. He knew and appreciated what he was doing. There was no undue influence. The claim is dismissed.

vii) Unconscionable Procurement

[355] The Estate also raises the doctrine of unconscionable procurement. This doctrine was recently revived in the trial decision of Gefen v. Gaertner, 2019 ONSC 6015, 148 O.R. (3d) 229. The doctrine appears to have been dormant for many years. The doctrine apparently arises from Kinsella v. Pask (1913), 1913 612 (ON CA), 12 D.L.R. 522 (Ont. C.A.), at p. 526, where Mulock C.J. of the Ontario Court of Appeal said:

In every case where a person, to his own advantage, but to the prejudice of the giver, obtains by donation some substantial benefit, he is bound to prove clearly, not only that the gift was made, but that it was the voluntary, deliberate, well-understood act of the donor, and that the donor was capable of fully appreciating and did fully appreciate its effect, nature, and consequences.

[356] In Kinsella, the plaintiff was taken advantage of by her daughter. She had been bed ridden and feared her children would place her in a “lunatic asylum”. She signed over her money to her daughter on inadequate advice. The issue was whether the money was given to the defendant as a gift or for safekeeping. The onus was said to be on the defendant to establish that it was a gift. The court was satisfied that had the plaintiff had proper advice, she would not have signed over the money to her daughter. Moreover, it was held that her state of mind “prevented her appreciating the consequences to herself of such an improvident gift.”

[357] In Gefen v. Gaertner, the parties accepted that the doctrine was part of the law of Ontario. They agreed that unconscionable procurement requires that a "person who obtains a benefit from another by voluntary donation must establish that the donor did so voluntarily and deliberately, knowing what he was doing". This would seem to reflect the presumption which arises in the resulting trust cases. Of course, as I have already opined, there is plenty of evidence that William provided most of the funds as a gift. As I read it, the unconscionable element as articulated in Kinsella merely refers to ensuring that the evidence adduced satisfies the onus that the gift was freely given (which I take to already to be part of the proof required to establish a gift). In Gefen v. Gertner, at para. 162, the court described the test this way:

The attacker must ensure that there is enough evidence before the court in the final weighing to allow the court to conclude, as a finding of fact, that the donor failed to have a conscionable understanding of what she was doing when completing the transaction. This issue turns on whether the donor appreciated the effect, nature, and consequence of the transaction in a manner sufficient to render it fair, just, and reasonable: Poyser, at p. 574.

[358] In the end, the doctrine was not applied. However, on appeal (2022 ONCA 174, 161 O.R. (3d) 267), the Court specifically stated that the doctrine, as articulated in Gefen v Gertner, may not be the law of Ontario. The Court of Appeal said, at para. 61, as follows:

The parties did not challenge the validity of the doctrine of unconscionable procurement. In the absence of full legal argument on the existence and desirability of any doctrine of unconscionable procurement, I do not propose to address the merits of any such doctrine and whether grounds to attack transactions beyond such traditional grounds as undue influence and incapacity should be endorsed. Thus, this decision should not be taken as approval or rejection of unconscionable procurement being part of the law of Ontario.

[359] The argument before me did not address whether the doctrine ought to be part of the law of Ontario, or whether it conflicts with or adds anything to the other legal doctrines in this case, such as the law of resulting trusts and the law of gifts.

[360] Apart from King of Hearts and Phyliss’s money, I have already found that the money was a gift freely given. I have further found there was no undue influence. William appreciated that he was providing gifts to Gillian. He appreciated the effect that those gifts were having on his assets. He was told as much by his advisors. He could see the effect and consequences as he monitored his funds. He had a “conscionable understanding” of the “effect, nature and consequence” of giving the funds to Gillian.

[361] I do not find any unconscionable procurement. The claim is dismissed.

viii) Ad Hoc Fiduciary

[362] The Estate claims that Gillian is an ad hoc fiduciary and therefore owed fiduciary duties to William: Glamabos v. Perez, 2009 SCC 48, [2009] 3 S.C.R. 247, at para. 49. The Estate asserts that “[Gillian] gave an implicit undertaking…to act in [William’s] best interests.” The undertaking is said to arise out of Gillian creating a business for the benefit of both her and William. The Estate claims William was her “business partner” and that her corporations were created for the benefit of William.

[363] I reject the premise of this claim. Gillian was not operating a property business for William and she did not implicitly or explicitly agree to deal with her properties in William’s best interest. As I have articulated, William was in control of his finances throughout and he gifted the majority of the money to Gillian for her own use. King of Hearts is a business for which a resulting trust applies, but Gillian did not undertake or have a general duty, either implicitly or explicitly, to act in William’s best interest. The claim is dismissed.

ix) Fraud

[364] It is alleged that Gillian obtained the funds through fraud. The test for civil fraud requires the Estate to prove: i) Gillian made a false representation; ii) she knew the representation was false; iii) the false representation caused William to act; and iv) Gillian’s actions caused a loss to William: Bruno Appliances and Furniture Inc. v. Hryniak, 2014 SCC 8, [2014] 1 S.C.R. 126, at para. 21.

[365] The Estate claims that Gillian represented to William that she would purchase and hold on to the properties for his benefit. I have already found that this is not the case. There was no representation as alleged by the Estate.

[366] As I find there was no representation, there was no reliance or harm. The claim is dismissed.

x) Unjust Enrichment

[367] The Estate claims that there has been an unjust enrichment. To establish an unjust enrichment, the Estate must prove that Gillian was enriched, that the Estate suffered a corresponding detriment and that there was no juristic reason for the enrichment. The Estate accepts that the established categories of juristic reasons include a donative intent by William: Moore v. Sweet, 2018 SCC 52, [2018] 3 S.C.R. 303, at paras. 57-58. I have found a donative intent by William, except in respect of the money he took from Phyliss and money he invested in King of Hearts. As such, for the bulk of the funds, there is no basis for a claim of unjust enrichment and, as the Supreme Court stated, “the analysis ends” at that stage. The claim is dismissed as it relates to all funds gifted by William to Gillian as determined above.

[368] As indicated by the Estate, this claim is duplicative and does not need to be addressed where a resulting trust has been found to exist. As such, I will not address King of Hearts under this heading as I found there to be a resulting trust. As mentioned earlier, however, I will briefly address Phyliss’s money, even though I already found no donative intent.

[369] In respect of the funds that came to Gillian that were Phyliss’s funds, I find there has been an unjust enrichment. There is no juristic reason for Gillian to have received money from Phyliss. William had no right to provide Phyliss’s funds. In such circumstances, equity steps in where “good conscience so requires”: Moore, at para. 32. The Estate concedes it owes $5.4 million to Phyliss. This deprivation constitutes a detriment and is, in part, made up of the $2.85 million that was a corresponding enrichment to Gillian and for which I find there was no juridical reason, given the inability of William to form the necessary donative intent. Accordingly, a portion of the Estate’s current debt to Phyliss was an enrichment retained by Gillian.

[370] Even if there was a juristic reason for Gillian to keep the money, such as a donative intent (which I find was not the case), the court may still consider the legitimate expectations of the parties, and moral and policy-based reasons why the money ought not to be retained: Kerr v. Baranow, 2011 SCC 10, [2011] 1 S.C.R. 269, at paras. 43-44.

[371] It is recognized by all parties that Phyliss has little money to take care of her needs, which are in excess of $32,000 a month. Given the near destitute position of Phyliss and the need for her care, William had a responsibility to manage her money to meet those care needs. He failed to do that, and the Estate now owes Phyliss $5.4 million. I have concluded $2.85 million went to benefit Gillian.

[372] In the circumstances, it would be unconscionable if that money was not returned to the Estate and then returned to Phyliss for her care. Gillian could have had no expectation that Phyliss’s money would be provided to her by William. Because much of this money was used for King of Hearts, I address below in the conclusion the relative benefit to Gillian and the Estate of this unjust enrichment.

xi) Family Members

[373] The Estate has made claims against Gillian’s family members. The claims are predicated on the doctrine of knowing receipt. It claims that knowing receipt applies to money given to Gillian’s parents, Jean and Cedric Butters. The Estate says knowing receipt also applies to Gillian’s sisters, Michelle in relation to money to pay down her mortgage on Mantopic, and Shamile in relation to 241 Lynwood Drive, which was bought using proceeds from 152 Taunton. I have already found that the initial transaction regarding 152 Taunton is statute barred and thus any money arising from that transaction is barred. Indeed, Lynwood was bought by Shamile in December 2011, which is beyond the 10-year Real Property Limitations Act limitation. If I am wrong on the limitation period , I also find William knew and encouraged Gillian to help her sisters. Based on the evidence of Hawkins, William was aware that Gillian had transferred 152 Taunton to her sisters. This was a gift and not knowing receipt of trust property.

[374] Mantopic is Michelle’s home. She did receive money from Gillian to assist her with her medical needs. $70,000 was used to pay down her mortgage on Mantopic. A charge and discharge were registered on title in 2009 by Gillian. This obviously is beyond the 10-year limitation period in the Real Property Limitations Act. If I am wrong on the limitation period, I find that this was a gift that was known to and agreed to by William. William was found to have a notice of Michelle’s mortgage statement from 2009 in his papers. Given his hands-on nature, I infer William knew that Gillian paid a portion of Michelle’s mortgage in 2009. It is consistent with comments to Arnold that he was helping the family. This was part of the gifts and not trust property. This claim is dismissed. I also note there was no evidence or argument regarding the home on 3 Willcocks Cres. That claim is dismissed.

[375] In the Estate’s closing, there was no argument that either Donna or Richard Lloyd was liable to the Estate. Neither testified. There is insufficient evidence to infer knowledge on their part of the monies given to her by Gillian. In the case of Donna, I have found that Linstead was acquired by her more than 10 years prior to the start of this action. If I am wrong on the limitation period, I find that William was clearly aware that money was being provided to Donna. He believed it was a gift, given “gratis”. It was a gift. In any event, in the absence of any argument, I take it they are no longer being pursued by the Estate. That claim is dismissed.

[376] In the case of Gillian’s parents, Jean and Cedric Butters, neither were called as witnesses. It is alleged that they had actual or constructive knowledge of a breach of trust or breach of fiduciary duty by Gillian and that they participated in and/or assisted Gillian in her fraudulent and dishonest conduct. Neither testified at trial. There was no evidence that either participated in any such conduct. Moreover, as already discussed and noted below, the premise of the allegation that Gillian was involved in such conduct is without foundation. The claims are dismissed.

[377] Cars owned by Gillian’s children were specifically mentioned by the Estate. The cars were purchased more than 2 years prior to the commencement of the action. For example, Matthew’s last vehicle was a 2018 and Noelle’s last vehicle was in 2019. As indicated, William was aware his money was being used to fund Gillian and her family, including expensive cars as evident on Gillian’s statement of assets in the family proceedings that was prepared with the help of William. The claims are dismissed as being beyond the limitation period. Moreover, these were purchases made with money gifted to Gillian by William and the action is dismissed as there was no receipt of trust property.

[378] The Estate also raised that Gillian purchased several horses for Noelle over the years. The Estate sues Noelle for knowing receipt. Frankly, it was never established that the title to the horses belonged to Noelle. Moreover, the horses were purchased more than 2 years prior to the commencement of the action and some as far back as 2012. It was known to William that Noelle was riding horses and that he was funding her lifestyle, including her horses. There is no indication he expected to be repaid. The last horse, Spirit, was not for Noelle but her nephew, who is not a party to this litigation. To the extent Noelle’s horses are an issue, they were bought years ago and are beyond the limitation period. In any event, they were purchased with money gifted to Gillian by William. The claim is dismissed.

[379] There was mention by the Estate of the TFSAs and RRSPs set up for family members, including Noelle and Matthew. William was aware of these from the outset, as evident from his work with Hawkins on Gillian’s taxes, and he took no action. Like the rest of the above advances, there is no indication that William expected these amounts to be repaid. These were gifts. The money was advanced more than two years before this action was commenced and therefore any claim is also statute barred.

[380] In respect of all these claims, the premise of knowing receipt and knowing assistance is that the family members received trust property with actual or constructive knowledge that the property is being misapplied: Quantum Dealer Financial Corporation v. Toronto Fine Cars and Leasing Inc., 2023 ONCA 256, 481 D.L.R. (4th) 137, at para. 52.

[381] The action fails against all the family defendants as I have found the funds were not imposed with a trust, except for Phyliss’s funds and King of Hearts, which cannot be traced to any of these transactions. The money for all these transactions were gifts. Accordingly, the action is dismissed against all the family members.

xii) Conclusion of Estate Action

[382] I list below those claims that succeeded and the result or damages arising from those claims. The remainder of the claims are dismissed.

Successful Claims

a) King of Hearts

[383] I have found that there exists a resulting trust as it relates to King of Hearts. The money used to purchase and renovate King of Hearts was William’s money. In my view, William intended an ownership interest as explained above. However, he freely acknowledged that Gillian had legal title to King of Hearts. He was aware that Gillian was operating King of Hearts and, in my view, he would expect Gillian to have some continued ownership interest. Of course, this Court is left to estimate that proportionate share based on the evidence available. As disclosed in the Sept note regarding the King of Hearts financing, he calculated his contribution to the purchase price as $2.1 million and Gillian’s contribution being $400,000, as secured by the Elder Mortgage. The Sept note is the best evidence reflecting William’s intentions. It reflects that he viewed each having contributed to King of Hearts. In my view, William intended to retain an 80% beneficial interest in King of Hearts, approximating the relative contributions as reflected in the Sept note. This reflects the proportionate share of intended beneficial ownership: Nishi, para at 29; Bradshaw v. Hougassian, 2023 ONSC 3266, 89 E.T.R. (4th) 35, at para. 90.

[384] I recognize that there were significant funds advanced by William for renovations thereafter that might suggest a larger ownership share for William. However, William was relying on Gillian to operate King of Hearts at this time and I am satisfied he would expect her to have an ongoing interest. Accordingly, I do not believe William’s additional investment ought to alter the breakdown of proportionate beneficial interest reflected in the Sept note. While William may have contributed money for the renovations, Gillian contributed sweat equity that is reflected in her continuing 20%.

[385] Accordingly, the Estate is entitled to an 80% ownership of 587 Ontario’s interest in King of Hearts, which owns Brock, and an 80% interest in King of Hearts Stables Ltd. I recognize that 587 Ontario owns Braebrook, and perhaps other assets. The award is intended to only reflect an 80% interest in King of Hearts.

[386] King of Hearts had been subject to a pretrial judicial sale order. It had been marketed but not sold. At the conclusion of trial, I had ordered that no sales take place until this decision was released. Absent good reason, I would order King of Hearts/Brock Rd. be sold and, subject to my comments regarding Phyliss below, the net proceeds be divided 80/20 as between the Estate and Gillian. However, if there is good reason that a sale ought not happen, either party may seek a case conference to explain why that ought not to occur.

b) Outstanding Loans

[387] The Estate is entitled to be repaid the outstanding loans, both documented and undocumented. The parties were divided on the calculation. In my view the amounts owed are those admitted to by Gillian and those documented in the Security Agreement and Elder Mortgage. Those amounts are:

a) $110,000 for the SUV;

b) $400,000 and $310,000 being the amounts provided in May 2009;

c) $1,400,000 referred to in the Security Agreement; and

d) $400,000 provided to Gillian at the time of the Elder Mortgage (collectively the “Loan Amounts”).

[388] Offset against the Loan Amounts are the amounts paid by Gillian on the following dates:

a) $400,000 paid August 28, 2014;

b) $100,000 paid May 5, 2021;

c) $500,000 paid September 1, 2021;

d) $100,000 paid March 25, 2022; and

e) $500,000 paid July 4, 2022 (collectively the “Repaid Amounts”).

[389] Gillian is ordered to pay the Estate $1,020,000, being $2.62 million in Loan Amounts less the $1.6 million in Repaid Amounts.

[390] It was argued that Gillian should get credit in the Repaid Amounts for the $700,000 that she repaid William on November 12, 2013. I disagree. That was a repayment for the purchase of Secretariate. She extinguished her debt at that time. It does not involve a current debt that ought to be offset.

[391] In respect of the February 4, 2014, Elder Mortgage, upon payment of the amount owing in para. 389, the Elder Mortgage is to be discharged.

[392] It has not been made clear to me what impact the sale of the properties since the commencement of this proceeding has on this calculation or the overall payments, including King of Hearts. As I have found the monies used to purchase those properties were a gift, the properties sold belonged to Gillian. To the extent that that creates a further offset, I would ask the parties to either agree or attend before me to address that issue. As such, a formal order cannot be issued in respect of this amount until that issue is addressed. The parties shall confer and advise the court how they wish to proceed.

c) Phyliss’s Money

[393] Phyliss is owed $2.85 million in respect of money received by Gillian that originated from Phyliss. The Estate is to receive this money in trust for Phyliss and remit the money to Phyliss. This money is not an Estate asset.

[394] The $2.85 million was provided to Gillian beginning in December 2013 and payments carried on for a number of years thereafter. This coincides with the period when $4.5 million was used to renovate King of Hearts. There was no forensic accounting provided to show which funds were used for the renovations. Clearly, some of Phyliss’s money was used for King of Hearts. Having awarded 80% of King of Hearts to the Estate, it would be double counting not to account for the fact some of the $2.85 million is reflected in the value of King of Hearts and should be borne by the Estate in proportion to its ownership in King of Hearts. In the absence of better evidence, I am left to estimate that amount.

[395] From 2014-2018, William advanced approximately $11.4 million to Gillian, of which $4.5 million went to renovating King of Hearts. As such, 40% of the money spent during this period was spent on King of Hearts. Utilizing the 40% figure and applying it to the $2.85 million, I estimate $1.14 million of Phyliss’s money (being 40% of $2.85 million) was used for King of Hearts. Upon the ultimate settlement of funds, the Estate shall hold in trust $912,000, being 80% of the $1.14 million, for Phyliss. Gillian shall be responsible for the remainder, being $1,938,000, to be paid to the Estate to be held for Phyliss.

d) Guarantee

[396] I accept that it was the intention that William’s guarantee on Northern Dancer would be extinguished upon his death. This is reflected in the trust document and his wills. As such, I order Gillian to take such steps as are necessary to remove the guarantee, which may require her to pay off the mortgage or, if necessary, sell Northern Dancer to do so.

e) Order of Canada

[397] Finally, Gillian was given William’s Order of Canada medal by Phyliss. The Estate says it should be returned. It is not clear on what basis Phyliss had the medal. The property of William vested with the Estate Trustees on William’s death, and they have testified that they did not authorize the gifting of the medal to Gillian. While I am satisfied Phyliss willingly provided it to Gillian, Phyliss could not gift it to Gillian as it is the property of the Estate. In my view, the medal should be returned to the Estate.

f) All Remaining Claims are Dismissed

[398] All remaining claims are dismissed.

[399] As mentioned, to the extent the implementation of this decision requires further orders, the parties shall seek a case conference through my judicial assistant.

xiii) Conclusion to Main Action

[400] As evident from the above decision, William’s failure to properly document his intentions has created a monumental task for those left behind, including the Estate Trustees and the lawyers. Whether it was his intention or not, he has left his wife Phyliss in a most precarious position. He has left it to the court to ascertain what he intended to gift Gillian and what he intended to retain. For a studious and otherwise careful person, William left a mess in his wake.

[401] This case was always about recognizing William’s right to do with his money as he chose, balanced against the legal presumptions about bargains and gifts. This Court waded through the voluminous records with the ambition of ascertaining William’s intention. While it is