Transfer of Land to Minor Nephew For No Consideration Upheld as Valid Gift

Transfer of Land

Wong v Huang 2012 BCSC 975  involves a case where the court upheld the transfer of a haft interest in a house as joint tenants between an elderly man and his 6 year old great nephew, the grandson of the plaintiff’s brother.

The defendant was born in 2000 and shortly after his birth the plaintiff executed a will leaving all his assets to the defendant instead of the plaintiff’s own children.

In September 2006 the plaintiff executed a transfer of an undivided one half interest in his home to the defendant as joint tenant. The defendant was six years old at the time and did not provide any consideration for the transfer.

The plaintiff signed an affidavit stating that the transfer was the”less expensive than giving ownership of the house to the defendant in my will”.

The plaintiffs reasoning for the transfer was that he wanted to be part of a larger family but the family bond that he had hoped for did not materialize, so he unsuccessfully requested the return of the half interest in property from the infant defendant which was refused.

The transferor then brought a court application for a declaration that the defendant held the property in trust for the transferor.

The court dismissed the claim and held that the effect of the transfer was to make a completed gift.

Because the transfer was made without consideration, the presumption of resulting trust did apply, but that presumption was rebutted by the evidence.

The court found that on the balance of probabilities, the transfers intention when he made the transfer was to make an unconditional gift to the transferee of one half interest in the property.

While the transfers wish that the property would become the family home and that may have been the motive for the gift, the gift was not conditional upon that wish becoming a reality.

The court further held that since the defendant is a minor child and the plaintiff is not his mother or father, then in that event the presumption of advancement should not apply.

Accordingly since the transfer was made without consideration, the presumption of resulting trust applies unless the presumption is rebutted on a balance of probabilities.

The onus is on the defendant to prove on a balance of probabilities that the plaintiffs intention in making the transfer was to complete a gift of one half interest in the property to the defendant.

The court found that the transfer of the property in 2006 was not an isolated event, but instead should be viewed in the context of the plaintiffs expressed intentions going back to 2000 when the defendant was born. The court in fact found five reasons in total to support the rum bottle of the presumption of resulting trust.

The Court quoted from the leading case Pecore v Pecore 2007 SCC 17:


[20]    Regardless of which presumption applies, either presumption may be rebutted by evidence on the ordinary civil standard of a balance of probabilities. The Court explained at paras. 42-44:

[42]     There has been some debate amongst courts and commentators over what amount of evidence is [page814] required to rebut a presumption. With regard to the presumption of resulting trust, some cases appear to suggest that the criminal standard, or at least a standard higher than the civil standard, is applicable: see e.g. Bayley v. Trusts and Guarantee Co., [1931] 1 D.L.R. 500 (Ont. S.C., App. Div.), at p. 505; Johnstone v. Johnstone (1913), 12 D.L.R. 537 (Ont. S.C., App. Div.), at p. 539. As for the presumption of advancement, some cases seem to suggest that only slight evidence will be required to rebut the presumptions: see e.g. Pettitt v. Pettitt, [1970] A.C. 777 (H.L), at p. 814; McGrath v. Wallis, [1995] 2 F.LR. 114 (Eng. C.A.), at pp. 115 and 122; Dreger (Litigation Guardian of) v. Dreger (1994), 5 E.T.R. (2d) 250 (Man. C.A.), at para. 31.

[43]     The weight of recent authority, however, suggests that the civil standard, the balance of probabilities, is applicable to rebut the presumptions: Burns Estate v. Mellon (2000), 48 O.R. (3d) 641 (C.A.), at paras. 5-21; Lohia v. Lohia, [2001] EWCA Civ 1691 (BAILII), at paras. 19-21; Dagle, at p. 210; Re Wilson, at para. 52. See also Sopinka et al., at p. 116. This is also my view. I see no reason to depart from the normal civil standard of proof. The evidence required to rebut both presumptions, therefore, is evidence of the transferor’s contrary intention on the balance of probabilities.

[44]     As in other civil cases, regardless of the legal burden, both sides to the dispute will normally bring evidence to support their position. The trial judge will commence his or her inquiry with the applicable presumption and will weigh all of the evidence in an attempt to ascertain, on a balance of probabilities, the transferor’s actual intention. Thus, as discussed by Sopinka et al. in The Law of Evidence in Canada, at p. 116, the presumption will only determine the result where there is insufficient evidence to rebut it on a balance of probabilities.

[21]    In Pecore, the Court considered whether the presumption of advancement should be expanded to apply to a wider class of family relationships, including dependant adult children. The Court concluded at para. 40:

I am therefore of the opinion that the rebuttable presumption of advancement with regard to gratuitous transfers from parent to child should be preserved but be limited in application to transfers by mothers and fathers to minor children.

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