Who is the beneficial owner of a transferred property?

An interesting question that recently arose related to who was the beneficial owner of a property after having transferred to his son?

This was discussed in McCready v. McCready, 2024 ONSC 2922 (CanLII), <https://canlii.ca/t/k4spt.

During the marriage the respondent transferred the Hwy 522 property to himself and to his adult son, as joint tenants, for no consideration.  The parties separated several years after this transfer.  The respondent argues the transfer was a gift.  The applicant disagrees and submits the legal and beneficial ownership of the property remains with the respondent pursuant to a resulting trust.

So who is the actual owner of the property?

A beneficial owner has been described as “the real owner of property even though it is in someone else’s name”: Pecore v. Pecore, 2007 SCC 17 at para 4.  The presumption of resulting trust can be rebutted by evidence establishing, on a balance of probabilities, the transferor’s intention to gift the property.

A party that seeks to establish that a transfer was a gift must show the following three conditions have been met, as set out in Falsetto v. Falsetto, 2023 ONCA 469, at para. 27:

a. The donor intended to gift the property;

b. The gift was accepted by the recipient; and

c.  A sufficient act of delivery or transfer of the property occurred to complete the transaction.

What did the judge conclude?:

The evidence, considered as a whole, was clear about the respondent’s intention to gift an interest in the Hwy 522 property to his son. The Court found that the intention of the respondent was that his son would live there and help the respondent manage the property during their lives.  There is insufficient evidence the property was intended as a gift and survivorship adds nothing to prove this fact.  The respondent has accordingly failed to rebut the presumption. So the judge found that the respondent was actually the beneficial owner of the property despite having feigned to have transferred it to his son.

As one can see, this case has a lot of the analysis depending on the research, understanding and application of case law to the facts of the case. This requires analysis, research and reading. We do this well at Shankar Law.

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