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BC Spousal Support and Family Property Appeals

Matrimonial Home Sale Dispute Lawyers Explain Right Of First Refusal

Our matrimonial home sale dispute lawyers  handle cases where parties are in disagreement over the value of a home, what it should be sold for, whether it needs to be sold at all and in some cases where both parties want to buy the home. Our matrimonial home sale dispute lawyers involve realtors in assessing the listing price and in assisting on helping the court determine whether a disputed purchase offer should be approved. Contact us across BC toll free at 1-877-602-9900 to meet with us in Kelowna, Vancouver , Fort St John and Surrey BC.

Can A Court Let Someone Bid First?

Our matrimonial home sale dispute lawyers also handle cases where both parties want to buy the home. This can involve a sealed bid process with the person making the highest offer taking the home. But can a court decide one person gets the right to buy the home without letting the other spouse bid on it? This may mean the home does not sell for its highest value because the court prevents a sealed bid and so there is no “bidding war”. Our skilled matrimonial home sale dispute lawyers explain the rules that apply in cases where a matrimonial home, that both parties are strongly attached to, is directed to be bought out first by one spouse.

In a recent BC Court of Appeal case of Kooner v Sangha the court allowed the wife to have the right of first refusal to but the home and the husband disagreed and appealed to BC’s highest court. Our matrimonial home sale dispute lawyers extracted the important parts for you:

[18]         There have been several cases in British Columbia where both parties sought to acquire the other’s interest in the former family home following trial. The cases include:  H.P. v. C.T.P., 2014 BCSC 2024; Dhillon v. Gaba, 2014 BCSC 1474; M. v. M., 2010 BCSC 1826; McKinney v. McKinney, 2008 BCSC 709; and Kuo v. Chu, 2008 BCSC 504, affirmed on other grounds, 2009 BCCA 405.

[19]         A review of these authorities indicates that each of the cases was decided on its particular facts. There appears to be no set of factors or principles that was repeated from one case to another.

[20]         In H.P., the judge pointed to three factors in finding that the respondent should have the first option to acquire the former matrimonial home:

·            the claimant made a decision to “abandon” the home following separation;

·            the claimant had “no genuine interest” in maintaining the home (rather, the judge found that the claimant was “motivated more by a desire … to frustrate [the respondent’s] aspirations to maintain the home than … to live in the home himself”); and

·            the claimant had not taken steps to obtain financing, whereas the respondent had taken steps to obtain financing.

[21]         In Dhillon, the judge identified two factors in finding that the claimant should have the first option to acquire the family home:

·            the claimant’s equity in the home was more than double that of the respondent’s; and

·            in his pleadings, the respondent did not seek “an interest in the property”.

[22]         In M., the parties shared joint custody of their two children, with primary residence with Ms. M. In finding that Ms. M. should have the first option to acquire the family home, the judge pointed to the “particular circumstances of this family and particularly the child S” (who was found to have behavioural problems). The judge referred specifically to the following circumstances:

·            the family home had been built by Ms. M.’s parents, and was very near their home (the maternal grandparents often cared for the children);

·            the proximity of the home to Ms. M.’s future place of employment; and

·            Mr. M. operated a business out of a garage on the property, but it was uncertain whether he could continue doing so given land use restrictions.

[23]         In McKinney, the judge pointed to several factors in deciding that Mr. McKinney should have the first option to acquire the family home:

·            the proximity of the home to Mr. McKinney’s aging parents (who often cared for the parties’ children);

·            the potential discomfort if Ms. McKinney lived next door to her former in-laws;

·            the proximity of the home to Mr. McKinney’s employment; and

·            the potential added value if Mr. McKinney inherited or acquired a right to his parents’ adjacent acreage.

[24]         In Kuo, the parties cared for their two children on an equal alternating basis. The judge pointed to the following factors in deciding that Ms. Chu should have the first option to acquire the family home:

·            Ms. Chu was living in the home, along with the children when they were in her care; and

·            there was no evidence that Mr. Kuo would continue living in the home if given the opportunity (in fact, he testified that he did not believe the home provided suitable accommodation for the children).

[25]         In my view, none of these cases should be taken as setting out a comprehensive list of factors to be considered by a trial judge when both parties seek to purchase the other’s interest in the former family home at the time of trial. The decision in such cases is a discretionary one. The trial judge must determine what is fair and just having regard to the particular circumstances.

[26]         In Kish v. Sobchak Estate, 2016 BCCA 65, Madam Justice Newbury described the characteristics of a discretionary decision:

[33]      The line between the exercise of judicial discretion and the finding of facts is not easy to enunciate. For purposes of this case, I respectfully adopt Lord Bingham’s description of judicial discretion given inThe Business of Judging: Selected Essays and Speeches (2000):

According to my definition, an issue falls within a judge’s discretion if, being governed by no rule of law, its resolution depends on the individual judge’s assessment (within such boundaries as have been laid down) of what it is fair and just to do in the particular case. He has no discretion in making his findings of fact. He has no discretion in his rulings on the law. But when, having made any necessary finding of fact and necessary ruling of law, he has to choose between different courses of action, orders, penalties or remedies he then exercises a discretion. It is only when he reaches the stage of asking himself what is the fair and just thing to do or order in the instant case that [he] embarks on the exercise of a discretion.

I believe this definition to be broadly consistent with the usage adopted in statutes. …

[27]         Discretionary decisions are entitled to deference. The standard of review was set out at para. 34 of Kish:

[34]      The standard of review applicable in Canada to the exercise of judicial discretion is found in Friends of the Oldman RiverSociety v. Canada (Minister of Transport) [1992] 1 S.C.R. 3. There La Forest J. wrote for the majority:

Stone J.A. cited Polylok Corp. v. Montreal Fast Print (1975) Ltd., [1984] 1 F.C. 713 (C.A.), which in turn approved of the following statement of Viscount Simon L.C. in Charles Osenton & Co. v. Johnston, [1942] A.C. 130, at p. 138:

The law as to the reversal by a court of appeal of an order made by the judge below in the exercise of his discretion is well-established, and any difficulty that arises is due only to the application of well-settled principles in an individual case. The appellate tribunal is not at liberty merely to substitute its own exercise of discretion for the discretion already exercised by the judge. In other words, appellate authorities ought not to reverse the order merely because they would themselves have exercised the original discretion, had it attached to them, in a different way. But if the appellate tribunal reaches the clear conclusion that there has been a wrongful exercise of discretion in that no weight, or no sufficient weight, has been given to relevant considerations such as those urged before us by the appellant, then the reversal of the order on appeal may be justified.

That was essentially the standard adopted by this Court in Harelkin v. University of Regina, [1979] 2 S.C.R. 561, where Beetz J. said, at p. 588:

Second, in declining to evaluate, difficult as it may have been, whether or not the failure to render natural justice could be cured in the appeal, the learned trial judge refused to take into consideration a major element for the determination of the case, thereby failing to exercise his discretion on relevant grounds and giving no choice to the Court of Appeal but to intervene. …

This standard was affirmed and supplemented more recently in Penner v. Niagara (Regional Police Services Board) 2013 SCC 19, where the Court stated:

A discretionary decision of a lower court will be reversible where that court misdirected itself or came to a decision that is so clearly wrong that it amounts to an injustice: Elsom v. Elsom, [1989] 1 S.C.R. 1367, at p. 1375. Reversing a lower court’s discretionary decision is also appropriate where the lower court gives no or insufficient weight to relevant considerations: Friends of the Oldman River Society v. Canada

29]         I have considered Mr. Kahn’s able submissions, but I cannot find any error in the manner in which the trial judge exercised her discretion. The trial judge was alive to the various arguments that were made by the parties, including those arising from the wife’s decision to disregard the Caldwell Order. Absent error, this Court cannot substitute its own exercise of discretion for the discretion already exercised by the trial judge. I would, subject to a one caveat, dismiss the appeal.

[30]         Paragraph 13 of the trial judge’s order gave the wife 60 days from the release of the trial reasons to purchase the Family Residence; if the wife did not complete the purchase within that time, the Family Residence was to be listed for sale. I am of the view that paragraph 13 of the trial judge’s order should be modified such that if the wife does not, within 30 days of the release of these reasons, complete the purchase of the husband’s interest in the Family Residence, the husband will have the option to purchase the wife’s interest in the Family Residence for the sum of $292,500 (for a total equalization payment of $348,250). If the husband does not exercise that option within 30 days of the expiry of the wife’s right to purchase the Family Residence, the Family Residence should be listed for sale. As directed by the trial judge, the parties will have joint conduct of sale with liberty to apply to the Supreme Court for any orders relating to the sale.

[31]         Subject to the aforesaid modification to paragraph 13 of the trial judge’s order, I would dismiss the appeal.

As top rated* matrimonial home sale dispute lawyers we know the family home often has a strong emotional attachment for both spouses. In these cases sometimes one person will be very disappointed and one party ecstatic. We’ll help you increase the chances that you will be the one who is happy at the end of the day. If you have questions contact Lorne MacLean, QC head of our matrimonial home sale dispute lawyers team.

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