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Resulting Constructive Trust Unjust Enrichment lawyers deal with cases where someone put up money or effort with an expectation they would receive value in return. When someone takes advantage of these efforts and does not reciprocate with a share in an asset our Resulting Constructive Trust Unjust Enrichment lawyers get involved to help achieve justice. MacLean Family Law is Western Canada’s largest family law firm with 6 offices in Vancouver, Calgary, Surrey, Kelowna, Richmond, and Fort St John to serve you. In today’s blog by Fraser MacLean and Lorne MacLean, QC they explain how the concept of legal enrichment and deprivation work in disputes between family members and spouses.

Resulting Constructive Trust Unjust Enrichment Call 1 877 602 9900

Constructive Resulting Trust Unjust Enrichment
Fraser MacLean Vancouver office articled student 1-877-602-9900

An interesting Resulting Constructive Trust Unjust Enrichment case of Iberg was just released this week. With more parents helping children now and houses worth millions, gifts between parents and children can quickly become the source of big-dollar disputes. So what are the remedies to ensure someone doesn’t get taken advantage of when they try to help someone out? How do initial contributions get valued compared to payments over time? Let’s find out how Resulting Constructive Trust Unjust Enrichment cases are decided.

Resulting Constructive Trust Unjust Enrichment Call 1 877 602 9900

In June 2008, Anne Iberg, 75 at trial, paid well over $100,000 towards the purchase of a house plus 30,000 for appliances and landscaping. to live in with her son. Her son Mr. Claridge, who is now 45, contributed no money of his own, but was sole mortgagor and paid equally with his mother towards the mortgage payments and expenses.  The mother claimed she was a joint owner but the son said he was the sole owner and his mother gifted him the downpayment. Here is how the judge decided the case to ensure each sides contributions were given credit:

[8]The parties do not dispute the applicable law.  Although both resulting trust and constructive trust are pleaded, Mrs. Iberg relies on unjust enrichment.  When it comes to an unjust enrichment analysis, the concepts of resulting trust and constructive trust tend to overlap: Donovan W.M. Waters, Mark Gillen & Lionel Smith: Waters’ Law of Trusts in Canada, 4th ed (Toronto: Carswell, 2012) (“Waters”) at 395.  Consequently, in circumstances such as we have here, unjust enrichment and the law of resulting trusts tend to lead to the same result: Borkenhagen v Kessler, 2012 BCSC 467 at para 68;Cerenzie v Duff, 2014 BCSC 1345 at para 111.

[9]The issue really comes down to this: has Mr. Claridge been unjustly enriched, or is there a juristic reason for the benefit he has received?  As Justice (later Chief Justice) Dickson put it in Rathwell v Rathwell, [1978] 2 SCR 436 at 455:

As a matter of principle, the court will not allow any man unjustly to appropriate to himself the value earned by the labours of another….[F]or the principle to succeed, the facts must display an enrichment, a corresponding deprivation, and the absence of any juristic reason—such as a contract or disposition of law—for the enrichment.

[10]In this case, it is not contested that Mr. Claridge has been enriched by the monies his mother advanced for the purchase of the house he now claims to be solely his.  It is also not contested that Mrs. Iberg has sustained a corresponding deprivation.  The evidence is clear on these points.  The case, then, turns on the third element of unjust enrichment: is there any juristic reason for the enrichment and deprivation?  The juristic reason proffered by Mr. Claridge is that his mother gifted the monies to him for the purchase of a house to be his and his alone.

[11]Mr. Claridge accepts that, because equity presumes a bargain, the onus is on him to prove that the transfer of monies and property interest constituted a gift; see, for instance, Pecore v Pecore, 2017 SCC 17.  The question, then, is whether, on the evidence, he has done so.

[82]Given the situation here, I conclude that the property should be sold.  From the proceeds of the sale, Mrs. Iberg is entitled to a payment of $130,000, being her down payment of $107,200, and an additional sum to take into account what she spent on landscaping and gardening improvement, noting that she did so in part for her own benefit and use.  The balance of the equity remaining after payout of the first mortgage should then be divided equally.  Although money paid upfront has been considered to justify a greater share of the proceeds than money paid over time (see, for instance, Cerenzie v Duff, 2014 BCSC 1345), I divide the balance of the equity equally to reflect Mr. Claridge’s contribution as discussed above.

Here the mother got her downpayment back without interest or any extra credit for the potential proportionate increase she could have been awarded. In the end result one could argue the son still received the better end of the stick but no doubt the fact he took sole liability in name as the mortgage borrower played a role. WITHOUT the downpayment, the home could not be bought BUT without the son being able to qualify for the mortgage there would have been no purchase.
Lorne MacLean, QC Senior high net worth divorce and separation family lawyer 604-602-9000

Resulting Constructive Trust Unjust Enrichment Lawyers Call 1 877 602 9900

If you have invested money or effort and been treated unfairly call our Resulting Constructive Trust Unjust Enrichment lawyers today and click here to book an initial appointment to find out your rights.