CMB MAGAZINE cmba-achc.ca spring 2019 | 19
if they had a different understanding between
them, they could deal with that separately.
e broker testified that, notwithstanding all
of this, it was his understanding both the son
and mother were buyers. (Curiously the Court
accepted the broker's explanation without noting
Clearly the son was enriched by the
monies provided by his mother toward the
purchase of the property and his mother was
correspondingly deprived of those funds. e
question is whether there is any juristic reason
for the enrichment and deprivation.
e burden is on the son to provide a juristic
reason that his mother intended the funds as a
gi to her son. e son says the juristic reason
is that his mother gied the money to him to
purchase the house to be his alone. e onus of
proving the gi falls on the son.
e transaction was structured as it was on
the advice of the mortgage broker. e mother
had the down payment but would not qualify
for the needed mortgage because of her debts,
credit rating, and lack of income history. e
son had no down payment but had a good job
with a decent income. e broker suggested
putting the application in the name of the
son, for the mother to be cast as a tenant to
enhance the son's income, and designating the
mother's down payment as a gi (supported
by a gi letter). e broker explained that
both parties would have to say it was a gi, but
that his description could amount to involving
mortgage application fraud. Notably the Court
had declined to believe the son's explanation as
to an earlier transfer because it could amount to
involving fraudulent conveyance.)
e mortgage broker's evidence was
important in the Court's deciding that the
mother had made an investment, not a gi.
e son had failed to show that the monies
were intended as a gi.
e Court then proceeded to determine
the contributions of each party and divided the
ownership accordingly. e property was to be
sold and the proceeds divided, unless the son
bought out the mother.
TAKEAWAYS
Determine and document the true intention
of the parties as to whether the advancement
of monies is a gi, loan, or investment. It
can spare the client a difficult and upsetting
litigation process.
When the
relationship
unravelled, the
mother claimed
she was joint owner
of the property;
the son claimed he
was the sole owner
and that his mother
had gifted him the
down
payment."
