Ferreira v. Macedo et al.

• Jurisdiction: Ontario
• Court: Superior Court of Justice of Ontario (Canada)
• Judge: J. Wilson, Stewart and Thorburn, JJ.
• Citation: (2016), 348 O.A.C. 317 (DC),2016 ONSC 951
• Date: 05 February 2016

Ferreira v. Macedo (2016), 348 O.A.C. 317 (DC)

MLB headnote and full text

Temp. Cite: [2016] O.A.C. TBEd. MR.018

Antonio Ferreira (appellant) v. Gildo Macedo and Maria Pia Pagliuca (respondents)

(271/15; 2016 ONSC 951)

Indexed As: Ferreira v. Macedo et al.

Court of Ontario

Superior Court of Justice

Divisional Court

J. Wilson, Stewart and Thorburn, JJ.

March 11, 2016.

Summary:

In 1993, Ferreira and Macedor, his brother-in-law, jointly purchased a property. Ownership was split equally between them, pursuant to a Trust and Indemnity Agreement. Each contributed to the down payment, lived together in the property and paid for the carrying costs. In 1996, Ferreira moved out, and stopped paying carrying costs. Macedo and his family continued to occupy the property. A dispute arose between the parties as to their respective entitlement to the property. Ferreira applied under the Partition Act, seeking an order that the property be sold and that he receive 50% of the proceeds of sale.

The Ontario Superior Court dismissed the application on the basis of equitable doctrines, and awarded Ferreira $13,000 (the amount of Ferreira's contribution toward the down payment), payable upon the eventual sale of the property. The Court awarded costs to Macedo in the amount of $13,000. Ferreira appealed the substantive disposition of his application and the decision on costs.

The Ontario Divisional Court granted the appeal. The application judge erred by relying on the doctrines of laches, acquiescence and waiver, and in restricting Ferreira's relief to the return of his original down payment. The Court ordered that the property be listed for sale and sold, and the proceeds of sale prima facie be split equally between Ferreira and Macedo, or held in trust pending accounting before a Master. Ferreira was awarded costs of the application, fixed at $13,000, and costs of the appeal, fixed at $6,000.

Limitation of Actions - Topic 4144

Recovery of land - Application of limitation period - Action for partition and sale - The applicant sought the remedy of partition and sale to recognize his one-half ownership interest in the subject property - His claim was based on a legally enforceable Trust Agreement in writing and registered on title, rather than equity - The application judge, in denying partition and sale, decided the issue on the basis of equitable doctrines, and therefore did not consider s. 42 of the Real Property Limitations Act (any limitation period in the case of an express trust ran from the date of conveyance of the land to a bona fide purchaser) - The applicant appealed - The respondent argued that the limitation period started to run when he transferred legal title to the property from himself to himself and his common law spouse, jointly in 2000, and expired before the applicant commenced his application - The Ontario Divisional Court disagreed - The transfer to the respondent's common law spouse was not to "a purchaser for valuable consideration" within the meaning of s. 42 of the Act - The transfer to her was in breach of the terms of the Trust Agreement and there was no evidence of any consideration - In any event, the respondent continued to have legal title to the property as a joint tenant - Accordingly, the limitations period had not begun to run as against the portion of title that the respondent has retained for himself - See paragraphs 44 to 48.

Real Property - Topic 6681

Partition - Bars - General - The applicant and the respondent (his brother-in-law) jointly purchased a property - Ownership was split equally between them, pursuant to a Trust and Indemnity Agreement - Each contributed to the down payment, lived together in the property and paid for the carrying costs - Three years later, the applicant moved out and stopped paying carrying costs - The respondent and his family continued to occupy the property - A dispute arose between the parties - The applicant sought an order for partition and sale pursuant to the Partition Act - The application judge denied relief on the basis of the doctrines of laches, acquiescence and waiver - The Ontario Divisional Court granted the appeal - The application judge misdirected himself as to the test for the limited discretion to refuse an order for partition and sale - Relief pursuant to contract was not governed by the equitable doctrines of laches, or acquiescence - Those defences could not successfully resist a legal claim such as that advanced under the Trust Agreement - The applicant, upon learning of the transfer by the respondent to his common law spouse, registered the Trust Agreement on title - By doing so, it was evident that he had not waived his interest in the property - The arrangement between the parties, although they were "family", was a commercial contractual one - There was no evidence of malice, oppression or vexatious intent shown as against the applicant - See paragraphs 32 to 49.

Real Property - Topic 6742

Partition - Practice - Costs - The Ontario Divisional Court determined that an order for partition and sale ought to have been granted in this case, and that the application judge made an overriding and palpable error in restricting the applicant's relief to the return of his original down payment - "The usual order in the case of partition and sale is to order the sale of the property in question, with an appropriate accounting for relative contributions and benefits by each of the parties. Instead, the application judge awarded [the applicant] $13,000, based upon his assessment of the equities of the situation, which was the amount he paid as a deposit when purchasing the property many years ago. ... The application judge concluded that he had inadequate evidence to support any of the calculations relied upon by either side. ... [T]he failure of the application judge to refer the matter to a Master for an accounting of proceeds to occur following the sale of the property likewise amounts to a palpable and overriding error." - See paragraphs 50 to 57.

Counsel:

Samuel Kazen, for the appellant;

Peter D. Woloshyn, for the respondents.

This appeal was heard at Toronto, Ontario, on February 5, 2016, before J. Wilson, Stewart and Thorburn, JJ., of the Ontario Divisional Court. In reasons written by Stewart, J., the Court delivered the following judgment, released on March 11, 2016.