Last summer, we blogged about the decision in Sandwell v. Sayers, 2022 BCSC 605, a dispute that arose after a father transferred his interest in his home in Kelowna to his daughter as joint tenants for no consideration. You can check out that post here. Some time after the transfer, the father made the argument that the joint ownership should be set aside under the doctrine of unconscionable procurement. The daughter, on the hand, argued that the father had gifted her the interest in the home and that he had simply changed his mind. Ultimately, the Supreme Court of British Columbia found that “the transfer of the interest in the property [was] legally sound.” The father appealed. 

Earlier this spring, the Court of Appeal for British Columbia released its decision in Sandwell v. Sayers, 2023 BCCA 147. On appeal, the father argued that the lower court judge erred in failing to find a resulting trust, or in failing to set aside the transfer based on the ancient doctrine of unconscionable procurement, which he said applied because he did not fully understand the legal implications of the gift. Further, he submitted he did not comprehend that the transfer could give his daughter the right to apply to sever the joint tenancy or expose the property to creditors while he was still alive, causing him to lose the security of his home.

The Appeal Court discussed the law as it relates to the presumption of resulting trust as follows:

“The presumption of resulting trust provides a tool to determine the intent of a transferor who makes a gratuitous transfer, where evidence as to the intent is unavailable or ambiguous, such as where the transferor is dead. However, the presumption can be displaced by the evidence that the transferor intended the transfer to be a gift.  

….

In my view, Mr. Sandwell’s position on appeal fails to recognize that the resulting trust presumption is simply a tool to assist a court in determining a donor’s intention where the evidence is unavailable, lacking, or ambiguous. It does not displace the evidence where there is evidence of the donor’s intention, and it does not displace the donor’s obligation to provide evidence when the donor is able to do so.” (paras 39 and 44)

The Court ultimately found there was considerable evidence that the father intended to make a present gift of a legal and beneficial interest in the home and not only a right of survivorship. This evidence included copious notes from the notary including his documented intentions over several meetings, evidence of the notary at to their discussions, and the deed of gift. 

Further, the father “did not disclaim his understanding, as evidenced by the documents he signed, that [his daughter] would, after the transfer, have an equal interest with him in the property, which is consistent with the deed of gift and declaration.” (para 63)

On the issue on unconscionable procurement, the Court opined that the case was not the best case to determine the existence of the doctrine, given the lower court judge’s findings that the father did not establish the factual basis for application of the doctrine, and given the lack of full legal argument on appeal. 

In conclusion, the Court of Appeal found in favour of the Respondent daughter and, importantly, that the law did not give the father a remedy for changing his mind. This is something all parents considering transferring property to their children should bear in mind; there is no room for regret. 

Thanks for reading,
Ian Hull & Marie Kazmer