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INTEREST IN LAND - Life estates - Rights of life tenant

Friday, March 13, 2020 @ 9:04 AM  

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Appeal by the defendants from summary judgment declaring that the plaintiff had a life interest, with exclusive possession, in the parties’ family cottage. The parties were all siblings. The cottage property was owned by their mother. During the mother’s lifetime, all the children were given generous access to the cottage and all of them used it. In 1995, the mother transferred the cottage property from herself alone to herself and the appellants as joint tenants with the respondent receiving a life interest. The mother did not inform any of her children that she was making these arrangements. The mother died in 2007. The respondent never learned she was on title as an additional transferee until five years after the mother’s death. In 2013, the appellants decided to sell the cottage. The respondent, however, did not agree to release her life interest without compensation and ultimately commenced this action.

HELD: Appeal allowed. An order was made that the respondent’s interest in the cottage property was limited to a lifetime licence to occupy the cottage property on a non-exclusive basis, consistent with the way the cottage property was used in the past. The motion judge erred in both law and fact in concluding that the respondent had an exclusive life interest in the property. The wording on the registered transfer on title was ambiguous as it listed the appellants and their mother as transferees without limiting their interest in any way. Given this ambiguous wording, it was appropriate to look to the evidence of actual intention. The evidence supported only one reasonable conclusion that she intended all of her children to continue to enjoy shared use of the cottage after her death in the manner that they had during her lifetime, and that she intended for the appellants alone to enjoy ownership interests beyond the shared right to use during their lifetimes. There was no evidence that suddenly the mother intended that the respondent would be the only child entitled to use the cottage property. If the motion judge’s conclusion was correct, then the mother herself had no right to use the cottage property after she made the transfer. Since the evidence of actual intention in this case was so clear, the presumption of resulting trust became irrelevant and was easily rebutted by the evidence and circumstances surrounding the transfer that clearly demonstrated that the mother transferred title for succession planning and therefore with the clear intent to gift the property.

Donaldson v. Braybrook, [2020] O.J. No. 433, Ontario Court of Appeal, J.M. Simmons, P.D. Lauwers and I.V.B. Nordheimer JJ.A., January 31, 2020. Digest No. TLD-March92020012