Cowper-Smith v. Morgan, (2016) 386 B.C.A.C. 287 (CA)

JudgeSaunders, D. Smith and Willcock, JJ.A.
CourtCourt of Appeal (British Columbia)
Case DateMarch 09, 2016
JurisdictionBritish Columbia
Citations(2016), 386 B.C.A.C. 287 (CA);2016 BCCA 200

Cowper-Smith v. Morgan (2016), 386 B.C.A.C. 287 (CA);

    667 W.A.C. 287

MLB headnote and full text

Temp. Cite: [2016] B.C.A.C. TBEd. MY.009

Nathan Cowper-Smith and Max Wayne Cowper-Smith (respondents/plaintiffs) v. Gloria Lynn Morgan and Gloria Lynn Morgan Executor of the Will of the Late Elizabeth Flora Cowper-Smith, Deceased (appellants/defendants)

(CA42981; 2016 BCCA 200)

Indexed As: Cowper-Smith v. Morgan

British Columbia Court of Appeal

Saunders, D. Smith and Willcock, JJ.A.

May 9, 2016.

Summary:

Prior to her death Elizabeth Cowper-Smith transferred her Victoria residence (the property), into the joint names of Elizabeth and her daughter, Gloria Morgan. Both the property and certain investments were subject to a Declaration of Trust, wherein Elizabeth was the named beneficiary of the assets and Gloria the bare trustee; upon Elizabeth's death, Gloria was entitled to both assets "absolutely". The effect of those transactions was to render Elizabeth's estate devoid of any significant assets. Elizabeth died. According to her will, the estate was to be distributed equally among her three children (i.e., Gloria and Elizabeth's two sons). The two sons commenced an action against Gloria and Elizabeth's estate, claiming that Gloria held the property and investments in trust for the estate to be distributed in accordance with Elizabeth's will. The plaintiff's claimed further that one of the sons, Max Cowper-Smith, was entitled to purchase Gloria's one-third interest in the property at fair market value. The following issues arose: 1. Was the transfer and the Declaration of Trust the result of undue influence; 2. What was Elizabeth Cowper-Smith's intention when transferring various assets to Gloria Morgan? Did Gloria Morgan hold the assets in resulting trust?; and 3. Was Max Cowper-Smith entitled to purchase Gloria Morgan's one-third interest in the Victoria property at fair market value on the basis of the doctrine of proprietary estoppel?

The British Columbia Supreme Court, in a decision with neutral citation 2015 BCSC 1170, found that the circumstances in which the transactions occurred gave rise to a presumption of undue influence that was not rebutted by Gloria. Therefore, the assets received by Gloria on Elizabeth's death were held by her on a presumptive trust for Elizabeth's estate. Further because of the undue influence exerted by Gloria over Elizabeth, the presumption of resulting trust with respect to the assets was not rebutted. Also, the court held that Max reasonably relied, to his detriment, on Gloria's representation that the estate would be divided equally among the siblings and, therefore, the doctrine of proprietary estoppel entitled him to acquire and obliged Gloria to sell him her one-third interest in the property. In the result, the court declared that the Victoria property and the investments were assets belonging to the estate and were to be distributed in accordance with the will. Further Max Cowper-Smith was entitled to purchase the one-third interest of Gloria Morgan in the Victoria property. Gloria Morgan was ordered to provide an accounting of her use of the assets and, if necessary, there would be a tracing order. Gloria Morgan and the estate appealed. On appeal, Gloria conceded that the evidence supported the judge's finding of a presumption of undue influence. She argued, however, that the judge erred in finding that the legal advice received by Elizabeth before executing the land transfer for the property and the declaration of trust was insufficient to rebut the presumption. She also submitted that the doctrine of proprietary estoppel was not available to Max on the undisputed facts of this case. Gloria appealed.

The British Columbia Court of Appeal, D. Smith, J.A., dissenting in part, allowed the appeal to the extent of setting aside the order made in Max's favour because the circumstances of this case did not give rise to proprietary estoppel. The court otherwise dismissed the appeal. The court held that the evidence supported the judge's finding that neither the presumption of undue influence nor the presumption of resulting trust was rebutted by Gloria.

Estoppel - Topic 1324

Estoppel in pais (by conduct) - Acquiescence or encouragement - Proprietary estoppel - See paragraphs 67 to 119.

Trusts - Topic 2044

Resulting trusts - Voluntary property transfers - Presumption of resulting trust - See paragraphs 54 to 66.

Wills - Topic 1704

Preparation and execution - Undue influence - What constitutes - General - See paragraphs 48 to 66.

Counsel:

C. Hunter and E. Patel, for the appellant;

H. Fisher, for the respondent.

This appeal was heard in Victoria, B.C., on March 9, 2016, before Saunders, D. Smith and Willcock, JJ.A., of the British Columbia Court of Appeal. The decision of the court was delivered in Vancouver, B.C., on May 9, 2016, including the following opinions:

D. Smith, J.A., dissenting in part - see paragraphs 1 to 87;

Willcock, J.A., (Saunders, J.A., concurring) - see paragraphs 88 to 119.

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32 practice notes
  • Cowper‑Smith v. Morgan, 2017 SCC 61
    • Canada
    • Supreme Court (Canada)
    • December 14, 2017
    ...York: Oxford University Press, 2012. APPEAL from a judgment of the British Columbia Court of Appeal (Saunders, Smith and Willcock JJ.A.), 2016 BCCA 200, 400 D.L.R. (4th) 579, 386 B.C.A.C. 287, 667 W.A.C. 287, [2016] 10 W.W.R. 497, 19 E.T.R. (4th) 225, 87 B.C.L.R. (5th) 273, [2016] B.C.J. No......
  • Michel v Saskatchewan,
    • Canada
    • Court of Appeal (Saskatchewan)
    • September 22, 2021
    ...untying entirely from its ties to property the only estoppel that can be used as a sword” (at para 34, quoting from 2016 BCCA 200 at para 117). She then continued: [35]     I cannot agree. With respect, the conclusion reached by the Court of Appeal major......
  • Sandwell v Sayers,
    • Canada
    • Court of Appeal (British Columbia)
    • April 4, 2023
    ...Pecore], Bostrom v. Bigford, 2019 BCSC 79, and Geffen v. Goodman Estate, [1991] 2 S.C.R. 353, 1991 CanLII 69 and Cowper-Smith v. Morgan, 2016 BCCA 200, rev'd 2017 SCC 61 on other grounds. He noted that both resulting trust and undue influence can be rebutted by evidence the person inte......
  • Davy v. Davy, 2019 BCSC 1826
    • Canada
    • Supreme Court of British Columbia (Canada)
    • October 24, 2019
    ...BCSC 82 [Modonese] at paras. 96-129; Porter Estate v. Porter, 2015 BCSC 2354 [Porter Estate] at paras. 36-133; Cowper-Smith v. Morgan, 2016 BCCA 200 [Cowper-Smith] at paras. 39-40 and 48-53; Burkett v. Burkett Estate, 2018 BCSC 320 [Burkett] at paras. 187-217. It was not disputed in [52] Un......
  • Request a trial to view additional results
28 cases
  • Cowper‑Smith v. Morgan, 2017 SCC 61
    • Canada
    • Supreme Court (Canada)
    • December 14, 2017
    ...York: Oxford University Press, 2012. APPEAL from a judgment of the British Columbia Court of Appeal (Saunders, Smith and Willcock JJ.A.), 2016 BCCA 200, 400 D.L.R. (4th) 579, 386 B.C.A.C. 287, 667 W.A.C. 287, [2016] 10 W.W.R. 497, 19 E.T.R. (4th) 225, 87 B.C.L.R. (5th) 273, [2016] B.C.J. No......
  • Michel v Saskatchewan,
    • Canada
    • Court of Appeal (Saskatchewan)
    • September 22, 2021
    ...untying entirely from its ties to property the only estoppel that can be used as a sword” (at para 34, quoting from 2016 BCCA 200 at para 117). She then continued: [35]     I cannot agree. With respect, the conclusion reached by the Court of Appeal major......
  • Davy v. Davy, 2019 BCSC 1826
    • Canada
    • Supreme Court of British Columbia (Canada)
    • October 24, 2019
    ...BCSC 82 [Modonese] at paras. 96-129; Porter Estate v. Porter, 2015 BCSC 2354 [Porter Estate] at paras. 36-133; Cowper-Smith v. Morgan, 2016 BCCA 200 [Cowper-Smith] at paras. 39-40 and 48-53; Burkett v. Burkett Estate, 2018 BCSC 320 [Burkett] at paras. 187-217. It was not disputed in [52] Un......
  • Bostrom v. Bigford, 2019 BCSC 79
    • Canada
    • Supreme Court of British Columbia (Canada)
    • January 24, 2019
    ...the onus moves to the transferee to show the transferor made the gift with “full, free and informed thought”: Cowper-Smith v. Morgan, 2016 BCCA 200 at para. 50 [Cowper-Smith BCCA], rev’d on other grounds in 2017 SCC 61. To show full, free and informed thought, the following factors are rele......
  • Request a trial to view additional results
3 firm's commentaries
  • Estop And Think Before Relying On Future Estate Interests: An Update
    • Canada
    • Mondaq Canada
    • January 19, 2018
    ...in May of 2016, our firm discussed the decision of Cowper-Smith v Morgan, 2016 BCCA 200 [Cowper-Smith], which signaled a return to a stringent application of the doctrine of proprietary estoppel. However, in keeping with recent Canadian decisions, which crafted more liberal criteria for app......
  • 4 Business Cases To Follow In The Supreme Court's Spring Term
    • Canada
    • Mondaq Canada
    • April 18, 2017
    ...to the chief investigator's examination. The court will consider the applicability of proprietary estoppel in Cowper-Smith v Morgan, 2016 BCCA 200 [Cowper-Smith]. The doctrine of proprietary estoppel permits parties to ground a claim for transfer of land based on a gratuitous promise made i......
  • Cowper-Smith v. Morgan: Independent Legal Advice And Undue Influence
    • Canada
    • Mondaq Canada
    • January 30, 2017
    ...Introduction Cowper-Smith v. Morgan 2016 BCCA 200, the British Columbia Court of Appeal upheld a finding of undue influence by the testatrix's daughter, despite advice from two separate lawyers. The Court also dealt with issues of proprietary estoppel, which are not discussed here. The Supr......

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