Kent v. Kent: Matrimonial Homes and Resulting Trusts

January 8, 2020 Suzana Popovic-Montag Estate & Trust, Wills Tags: , , , , , 0 Comments

We often hear of the importance of forging and maintaining good relations with the in-laws. Hence, wishing to keep everyone united, and the spouse happy, we avert our gaze when the one in-law overindulges at the Christmas party, we bite our tongue when another in-law refers to us as “hey, you in the yellow”, and we put on a stiff smile when yet another in-law visits us on our birthday to ask for a loan. In one recent Ontario case, however, we see the grim consequences of having too good a relationship with one’s in-laws.

The cautionary case of Kent v. Kent arose from a legal dispute between the deceased’s son-in-law and her grandchildren. Perhaps unaware of her son-in-law’s inclinations towards insatiability and ingratitude, the deceased left equal shares of her home to the three eventual litigants. By and by, the son-in-law sought a declaration that he was entitled to a much larger share. He argued that since his mother-in-law had registered his late wife as a joint tenant (the transfer was gratuitous), and he and his late wife had moved in a decade after, the house “became their matrimonial home”. He relied upon subsection 26(1) of the Family Law Act:

If a spouse dies owning an interest in a matrimonial home as a joint tenant with a third person and not with the other spouse, the joint tenancy shall be deemed to have been severed immediately before the time of death.

The grandchildren countered with the presumption of resulting trust. According to this legal principle, despite legal ownership, property should be returned, or result, to the person who actually paid for the property (the beneficial owner). The presumption can be rebutted if the transferee can show that the transferor intended to gift the property (Pecore v. Pecore).

The Court ruled in favour of the grandchildren, finding that because the transfer was made from a parent to a child, with no consideration, the presumption of resulting trust applied. The son-in-law, who could not muster any evidence in his favour, did not rebut the presumption. The Court also ascribed significance to the Will itself:

The provisions of the will and transfer made by Marian in July 2015 suggest that she believed that she was the sole owner of the property, and in a position to dispose of it as she did.

This ruling might provide some comfort to those who have invited their married, adult children to live in their homes. It is a bitter fact, though, that the son-in-law’s conduct can bring no good to the reputation of in-laws, and that if his example is followed, we might see more in-laws receiving bequests of “thirty pieces of silver” or trusts comprised of stockings full of coal.

Thanks for reading!

Suzana Popovic-Montag and Devin McMurtry

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