In B.C., a title showing any particular person(s) as owner(s) is allowed to be relied on as accurate. Our system of land registration (the Torrens system) permits this, so that the system has credibility and can function day to day. It was not always like that but the system has evolved well.
Still, our law has in the past decade or so, changed. The system of land registration we have remains. However, in my opinion, Courts will now to a greater extent, look behind title in certain cases, in order to find what other interests persons may have in any particular property. That is so whether or not the person is registered as an owner on title.
One of the critical aspects of such a legal investigation is the issue of the intent a person might have in choosing how to show ownership on title. That is paramount in cases where parents and children are registered owners of property. Earlier this month, in a case called McMaster Estate v. McMaster, such an investigation was done. This is a case to consider, perhaps even in your own Estate planning.
The deceased died in late 2015 at age 84. She was the surviving spouse in a long marriage and she is survived by four adult children. The family lived for many years in West Vancouver but the deceased, with one of her four children (the defendant), ultimately moved to the Sunshine Coast and purchased a home there. Title was registered as a Joint Tenancy in the names of the deceased and the defendant adult son.
The son was not in a relationship and had no children. He was not steadily employed most of his adult life, according to the reasons for judgment. He did live with the deceased and over many years, looked after her and assisted her with essential things, including taking her to medical appointments and doing the grocery shopping.
The deceased did not make a Will. The Plaintiff, another of the deceased’s children, made application for Letters of Administration (which is similar to an application for a grant of Probate, but where there is no Will).
The deceased’s Estate consisted mainly of her interest in the Sunshine Coast home. There was a modest bank account also.
The intending Administrator launched action, in order to seek a Court Order determining whether the title represented a “true” joint tenancy. If the Court determined that a joint tenancy existed, then the defendant registered on title would become sole owner of the home. If not a joint tenancy, the home would become part of the Estate and under B.C. intestacy rules, all the four children would inherit and share equally in its value. The home was assessed most recently at approximately $1 million.
It seemed clear in the reasons that the defendant, registered on title, did not have good relations with all his siblings. In the reasons, there were stated various instances where the siblings’ telephone calls to the deceased were not returned (and the defendant may have had something to do with that) and some of the children were prevented by the defendant from visiting the deceased.
The Court conducted an exhaustive look into the family dynamics, the documents that were available (not many, frankly), decisions that were made by the deceased and the defendant, and concluded that the deceased did not have the intention to gift her interest in the property to the defendant. As a result, the joint tenancy was dissolved and the Sunshine Coast property was transferred to the deceased’s Estate, to be divided equally among the four children.
The Court noted that no Deed of Gift was made and, significantly, no Will was made. The deceased was not given any legal advice (the property on the Sunshine Coast was purchased using a Notary, rather than a Lawyer). There were some comments made by the deceased, which came into evidence at the Trial but they were insufficient for the Court to conclude an intention on the part of the deceased to gift the property to the defendant. The Court felt that the deceased was not sophisticated.
The Court found that the defendant was not malicious and he did look after his Mother, though there seemed to be some shortcomings over the years of his living with her and the Court did find undue influence on the deceased by the defendant (at one point the Court said “I need not find (defendant’s) actions to be malicious or reprehensible to establish undue influence”). The Court noted, for example, that a gift note was made with respect to the property that was signed by the deceased but it appears that the defendant wrote it out, and there were errors made with respect to the date it was made and the content of the gift note caused the Court some concerns.
This case was, in a sense, a story of family dynamics. One of the key takeaways is, I suggest, that when a person buys a property and is deciding how to register ownership on title, their intention is most important. Where more than one person will become registered owner, try to think it through. Documenting it would be prudent (not to mention making a Will also) because documents establish that intention, if there is doubt later on. In this case, the deceased may have wanted the defendant to have the house but her intention in that regard was very unclear. It’s become a cliché, but planning these things helps.