Suing a Fiduciary and Reverse Onus Is Important
The duty of loyalty of a fiduciary is protected through onuses. Fiduciaries are held to an irregularly high standard of behavior in civil law due to the nature of their duties. It is the peculiarly unequal position of the parties that results in the reversal of onus onto the fiduciary in most fiduciary relationships.
Typically, the reverse onus works as follows: in asserting a breach of fiduciary duty claim, the plaintiff need only establish a prima facie inference of the fiduciary obligations and the breach. The fiduciary concept then imposes a reverse onus that shifts the burden of proof onto the fiduciaries to disprove the beneficiaries’ allegations.
The reverse onus burden of proof was applied more recently by Satanove J. in Lee Estate v. Royal Pacific Realty Corp., (2003) BCSC 911, where she held that certain relationships and specific categories of actors are presumed by law to be of a fiduciary nature. When such a presumption arises, the onus is on the defendants to rebut that presumption. She explains that even in the case of a real estate agent and a buyer, the court should look at the evidentiary factors which support or contradict the existence of a fiduciary relationship between them, recognizing that the burden of proof will be on the defendants.
Lasky v. ProwaX (1993), 7 ET.R (2nd) 70 (B.C.S.C) is another case where a reverse onus of burden was applied. This case involved the undue influence of a niece over a mentally compromised and hospitalized patient. The niece was able to get the patient to sign over sole possession of the house and cash into her name, in direct contravention of a will executed a month prior. The defence bore the onus of rebutting the presumption in s. 20 of the Patients Property Act (B.C.) that a gift made by a patient is to be deemed fraudulent and void as against the committee if the gift is not made for full and valuable consideration or the donee has notice at the time of the gift of the mental condition of the patient. Although the niece herself was not committee, the dangerous position of the patient and the importance of a protective and accountable fiduciary duty was evident to the judge. The BC Court of Appeal recently approved these cases in their decision Easingwood v Cockroft 2013 BCCA 182.