BLANEY’S APPEALS: ONTARIO COURT OF APPEAL SUMMARIES (NOVEMBER 26 – 30, 2018)Styres v. Martin, 2018 ONCA 956 (CanLII)
[Strathy C.J.O., Benotto and Roberts JJ.A.]
G. Smits, for the Appellants
H. E. Staats, Q.C., for the Respondents
Keywords: Family Law, Estates, Real Property, Breach of Fiduciary Duty, Breach of Trust, Unjust Enrichment, Gifts, Express Trust, Resulting Trust, Capacity, Undue Influence, Civil Procedure, Appeals, Sufficiency of Reasons, Statute of Frauds, RSO 1990, c S.19, Maple Ridge Community Management Ltd v Peel Condominium Corporation No 231, 2015 ONCA 520
The appellant appeals from the dismissal of his action claiming damages arising from the disposition of a house which he transferred to the respondent, his former common law spouse, in 2004. The appellant lived in the house for 20 years. In 1998, he suffered a brain injury and became unable to work. In 2000, he began a relationship with the respondent and she became his caregiver. In 2002, he signed a Power of Attorney for Personal Care and for Property naming her as his attorney. On February 13, 2004, he transferred the house to the respondent. The parties did not have legal advice or assistance in preparing and registering the transfer. On December 23, 2009, the respondent granted a mortgage on the house to her mother, to secure a loan to her in the amount of $200,000. The parties separated in 2013, and the appellant requested that the respondent re-convey title of the house to him. The respondent refused and transferred the house to her mother in satisfaction of the mortgage that had come due in 2012. After her mother’s death in 2015, her estate sold the house for $300,000.
At trial, the appellant asserted claims for damages for breach of trust, breach of fiduciary duty and unjust enrichment. He alleged that he had temporarily transferred the house to the respondent in trust to avoid its potential seizure because of Excise Act charges against him for his involvement in selling unmarked cigarettes. The trial judge preferred the evidence of the respondent and of her daughter that the house was a gift. He found that the respondent gave the appellant the proceeds of her caregiver cheques, purchased vehicles which he used, and helped him with child support and various bills, household expenses and utilities. This was hardly the predatory conduct of a person taking advantage of the other. Moreover, there could be no trust regarding the house without a written instrument in accordance with the Statute of Frauds.
(1) Did the trial judge err in failing to consider or address the various claims for breaches of trust and fiduciary duty, and unjust enrichment?
(1) Yes. This was a case of a disabled man with a catastrophic brain injury and admitted cognitive difficulties conveying his only significant asset to his caregiver and common law partner who also held his power of attorney without any legal advice. The Court found that while the trial judge was entitled to find the transfer to be a gift, he was still required to address the issues that arose from the appellant’s pleaded claims for breaches of trust and fiduciary duty, and unjust enrichment.
The Court stated that the absence of a written instrument would not bar a claim of resulting trust and would have no relevance to a claim for breach of trust or breach of fiduciary duty. Insufficient reasons that prevent meaningful appellate review constitute an error of law reviewable on a correctness standard. The Court found that the deficiency of the trial judge’s reasons precluded meaningful appellate review. The record was not sufficient to make the determinations necessary to dispose of the issue, and the matter was remitted to the Superior Court of Justice for a new trial of all issues before a different judge.