Mortgage Broker is the magazine of the Canadian Mortgage Brokers Association and showcases the multi-billion dollar mortgage-broking industry to all levels of government, associated organizations and other interested individuals.
Issue link: http://digital.canadawide.com/i/309414
legalease MortgageBroker mbabc.ca spring 2014 | 37 – an investment is presumed where the presumption of advancement does not apply c. Presumption of ademption – an advance on a bequest under a will is presumed where a parent in a will leaves an equal amount to each of their children and aer preparing the will gives one or more of the children property provided for in the will. Upon distributing the estate the law will take into account such already made advances in reducing the amount the recipient inherits under the will. 5. e presumptions are only starting points in determining what the contributor intended. ey can be rebutted by evidence showing the intention was different than presumed. To displace the presumption, the evidence needs to be sufficient to persuade a court that the intention was more likely than not (i.e. on the balance of probabilities) contrary to the presumption. 6. For a gi to be completed, relying on the presumptions and any evidence sufficient to rebut the presumptions, the law requires that: a. e contributor has intended a gi; b. ere has been a sufficient delivery of the property; and c. e recipient has accepted the gi. 7. e relevant intention is the one the contributor had at the time the property was transferred. 8. e delivery which is sufficient will depend on the nature of the property being transferred. e contributor must have done all that is needed to transfer the ownership of the property to the recipient. Where the gi is money, it is likely it would be sufficient for the contributor to deliver the money to the lawyer for the recipient on the condition that it be used toward the purchase of the specified property and that it be returned to the contributor (or held to the order of the contributor) if the purchase does not complete by a specified date. 9. If a gi has not been completed, a court will not complete the gi unless the contributor has done all they can do in their power to complete the gi (e.g. filled out all transfer papers for the bank administration to process). 10. A court will not undo a completed gi unless the contributor has expressly reserved a power to revoke the gi. In doing so the court may really not be undoing a completed gi but rather finding that there has not been a completed gi as the contributor, by reserving a power of revocation, has not done all that could be done to transfer the property to the recipient. 11. If a gi fails the court may find the money was provided as an investment or a loan. Mortgage brokers can provide considerable assistance to their clients by having them clearly document whether the transfer of money is intended as a gi, a loan, or an investment; the document should additionally set out these terms. In the case of a gi the document should, at least, set out: • ere is to be a gi from the named contributor to the named recipient in the provided amount on the provided date; • ere is no expectation the funds will be returned; • No consideration has been paid to the contributor for the providing of the funds; • Any preconditions for the gi (e.g. to be used only for the purchase of 123 Elm Street and to be returned immediately upon the purchase not completing); • Any special delivery method (e.g. to the recipient's lawyer in trust); • e signatures of all contributors and recipients and the dates of the signatures; and • In bold print above the signatures of the contributors an acknowledgement from the contributors that once the gi is completed there is no right to require the return of the gi. Aside from better servicing the client, the minimal effort it takes to document a gi better avoids the potential for the mortgage broker to be a witness in court proceedings, to face claims of civil liability, and to be accused of being a part of a mortgage fraud. • p36-37_LegalEase.indd 37 14-05-08 2:29 PM