Nelligan O'Brien Payne gratefully acknowledges the contribution of Paula Lester, Student-at-Law to this blog post.
In 2014, the Ontario Court of Appeal released a number of important decisions which have advanced or changed the area of family law. Here’s a quick summary of how our top 5 cases may affect you. See the full article for more in depth information on each case.
1. Sawdon Estate v Sawdon, 2014 ONCA 101
In this case, when the deceased died, he had money in a joint account with two of his five children. Based on the particular facts of this case, the Court of Appeal found that when the bank accounts were opened, there had been an immediate gift to the children of a beneficial right of survivorship to all of his five children. That meant that the money in a joint account went directly to his children on death, rather than passing through his estate.
This conclusion is unusual because it’s contrary to the general rule of ‘presumption of resulting trust’, which holds that when money is in a joint account with adult children it’s being held in trust for the parent and the money should therefore go back into the parent’s estate when they die.
The reason that the rule of presumption of resulting trust did not apply in this case was that there was significant evidence that the deceased intended to gift the money in the account to his children. This was based on verbal conversations with the children and staff at the bank, as well as specifically choosing an account with the right of survivorship.
2. Senos v Karcz, 2014 ONCA 459
As you may be aware, child support can be payable for adult children under certain circumstances including if the child is under a ‘disability’. When children are over the age of 18 years, the court can reduce the amount of Table support that the payor of child support has to pay, depending on the circumstances. In this case, the Ontario Court of Appeal found that if an adult child is receiving Ontario Disability Support Program (ODSP) there may be strong grounds to reduce in the Table amount of child support.
3. Virc v Blair, 2014 ONCA 392
The Ontario Court of Appeal was asked to determine the effect of a party’s deceit with respect to his financial assets on the enforceability of a separation agreement.
In this case, a wife sought to have a separation agreement set aside because it was clear that the husband had misled the wife with respect to the state of his financial assets, to a very significant degree. The husband brought a successful motion for summary judgment, which resulted in the wife’s claim being set aside on the grounds that the wife should have been more diligent in ascertaining the state of her husband’s assets.
On appeal to the Ontario Court of Appeal, the wife argued that the motion judge had improperly shifted the husband’s disclosure obligations from the husband to the wife. The Court of Appeal agreed. In the case of a deliberate material misrepresentation about assets, the wife did not have an onus to show she had been diligent.
It is important to carefully and honestly declare all assets and debts on financial statements.
4. McConnell v Huxtable, 2014 ONCA 86
Before this case was decided there was a longstanding dispute in family law as to whether the Limitations Act, 2002 applied in family law cases and limited claimant’s rights to bring claims for unjust enrichment.
In this case, a former common law partner brought an action for unjust enrichment seeking an ownership interest in a property owned by her former partner.
The claimant wife became aware of her potential claim in June 2007 when the parties separated. However, she did not commence her action until February 2012. The issue was whether the general two-year limitation period under the Limitations Act, 2002 applied, in which case the claimant was out of time to bring her action. On the other hand, she claimed that a ten-year limitation period in the Real Property Limitations Act applied, in which case the action had been brought in time.
Because the claimant was seeking an interest in real property (land), the court found that the ten-year limitation period under the Real Property Limitations Act properly applied in this case.
This case is important because in reaching this decision the court confirmed that unjust enrichment claims not seeking the recovery of land (for example claims for the return of funds used to purchase a house rather than an interest in the house itself, or claims for other types of property than land) may be subjected to a two (2) year limitation period.
5. Gray v Gray, 2014 ONCA 659
This case involved a variation of spousal support after child support obligations came to an end. Before Gray, Ontario courts were only required to consult the Spousal Support Advisory Guidelines (‘SSAG’) on original applications for spousal support, and not on applications to vary spousal support. However, in Gray, the Ontario Court of Appeal held that the motion judge had erred by not consulting the SSAG, notwithstanding that this was a motion for variation of spousal support, rather than an initial application. The Court of Appeal noted that the original support order of $800 was deliberately lower than it ought to have been in recognition of Ms. Gray’s receipt of child support, and child support obligations had now terminated.
The court also noted that, in some variation motions there are complicating factors that must be considered before a court applies the SSAG, such as post-separation increased in income and second families. In the circumstances of this specific case, the Ontario Court of Appeal awarded spousal support at the lowest end of the SSAG range.