Jul 21, 2016

Ontario Court of Appeal Summaries (July 4-8)

Anderson v. McWatt, 2016 ONCA 553 (CanLII)

Anderson v McWatt, 2016 ONCA 553

[MacPherson, Cronk and Benotto JJ.A.]

Counsel:

G. Joseph and R. Kniznik, for the appellant

P. D. Schmidt, G. Karahotzitis and M. A. Larock, for the respondent

Keywords: Family Law, Joint Business Venture, Unjust Enrichment, Constructive Trust, Limitation Periods, Discoverability, Real Property Limitations Act, Retroactive Spousal Support, Net Family Property, Equalization

Facts:

The parties together created a successful business and acquired various properties. The appellant husband owned 55% of this business and the respondent wife 45%. The business was run out of a property (the “Atlantic Property”). The Atlantic Property was purchased by the appellant prior to their marriage in his name alone, the plan was to transfer it to a corporate entity to be owned by the husband and wife in accordance with their proportionate ownership of the business, but unbeknownst to the respondent, this transfer never took place and title to the Atlantic Property remainined in the name of the husband. The parties together contributed to renovations and maintenance of the Atlantic Property. After the parties’ separation in 2000, the respondent wife stopped going to work at the Atlantic Property. In 2012, the respondent amended her application to include a claim to the Atlantic Property. The respondent claimed unjust enrichment and sought a constructive trust. The trial judge awarded at 45% interest in the Atlantic Property to the respondent, retroactive spousal support from 2000-2015, and prejudgment interest on the equalization payment.

Issues:

Did the judge err in any of the following awards?

(1) The constructive trust, specifically

(a) Is the claim barred by the Real Property Limitations Act?

(b) Was the 45% apportionment correct?

(c) Should a monetary award have been awarded instead?

(2) The retroactive spousal support from 2000-2015

(3) Prejudgment interest on the equalization payment

Holding: Appeal Dismissed.

Reasoning:

(1) No.

(a) No. The respondent did not discover that the Atlantic Property was no longer held by the corporation until 2012 and therefore her claim to the property was no statute-barred. Although the respondent was aware that she may have a claim to the property, the appellant’s financial statements indicated that the Atlantic Property was owned by the corporation, and she was permitted to rely on this evidence.

(b) Yes. The judge accepted evidence that the respondent thought the property would be jointly owned, the parties maintained it together. There was no error.

(c) No. The trial judge reviewed the evidence, considered the appropriateness of a monetary award and rejected it. She correctly considered the difficulty of recovery, the contributions made by the respondent, the market forces that increased the value of the property, and the profits that the appellant had taken for himself.

(2) No. The trial judge found that the respondent assumed primary responsibility for the household and the children during the marriage and after separation, contributed equally to the success of the joint business, suffered undue economic hardship from the marriage breakdown, made valiant efforts at self-sufficiency after the marriage but was unable to attain her marital standard of living, suffered economic disadvantage to the advantage of the appellant, and suffered emotional abuse at the hands of the appellant. The award was justified.

(3) The judge ruled that the equalization payment was due and payable to the respondent in 1997 and that there is no reason to depart from the general rule that the payor is required to pay prejudgment interest on an equalization payment at the judge’s discretion. There is no reason to interfere with this decision.

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