Be careful how you advance money

Last week, reasons for judgement were released in the case Young Estate (Re) v. Szabo. It’s an unusual case in which the Plaintiff, the mother of a young son, established a “business” relationship with the defendant.

The defendant eventually lived with the Plaintiff and helped raise her son. They later decided to buy real estate together, and worked with a Realtor to find a property.

At one point, the Plaintiff borrowed $100,000 from a financial institution and gave it to the Defendant. It is not clear why she did that, but a month later she died. There was no written agreement regarding the money, and the deceased left no Will.

The Official Administrator (acting as Administrator of the Estate) sought a Court declaration that the funds were held by the Defendant in Trust for the deceased/Estate. The defendant had to prove to the Court that the deceased had intended a gift.

He was unable to, largely because his evidence was inconsistent and unreliable. The defendant had memory trouble because of medication he was taking, but it was clear that his summary of the events surrounding the advance of funds was not concise or clear.

The amount in question proved to be a substantial amount relative to the total size of the deceased’s Estate. Without question, the deceased’s behaviour – not seeking an agreement or even making a Will – left a lot to be desired, especially as she had a young son.

As with so many of these kinds of transactions, some planning would have helped.

This ad ran in the Richmond Review on March 20, 2015.