Luton v. Luton, (1999) 122 O.A.C. 181 (CA)

• Judge: Morden, A.C.J.O., Osborne and Moldaver, JJ.A.
• Court: Court of Appeal (Ontario)
• Case Date: March 18, 1999
• Jurisdiction: Ontario
• Citations: (1999), 122 O.A.C. 181 (CA)

Luton v. Luton (1999), 122 O.A.C. 181 (CA)

MLB headnote and full text

Temp. Cite: [1999] O.A.C. TBEd. JN.083

Robert George Luton (defendant/appellant) v. Karen Jennifer Luton (plaintiff/respondent)

(Court File No. C30307)

Indexed As: Luton v. Luton

Ontario Court of Appeal

Morden, A.C.J.O., Osborne and Moldaver, JJ.A.

March 18, 1999.

Summary:

A husband and wife entered into a sepa­ration agreement which settled all matters between them. The agreement was not in­corporated into the divorce judgment. Under the agreement, the marital home, which had been registered in the wife's name, was transferred to the husband. The wife relied on the husband's valuation of the home at $360,000. The resolution of property matters resulted in the wife receiving a cash settle­ment as equalization. The husband repre­sented that he had no intention of selling the home. Three months later he sold the prop­erty for $575,000. The wife sued the hus­band, claiming an amount equal to the dif­ference in the amount which she should have received based on the sale price, plus inter­est. The wife also claimed support over and above that required by the separation agree­ment, asserting that the husband repre­sented that he would pay her half of the net pro­ceeds from the sale of certain commercial property.

The Ontario Court (General Division), in a decision reported at 52 O.T.C. 241, held that when the husband signed the settlement agreement he knew that the marital home was worth significantly more than what he had represented to the wife. The court held that his nondisclosure constituted fraud and deceit and awarded the wife judgment accordingly. The court held that the hus­band's promises to pay the wife extra money did not constitute an enforceable contract. The promises were gratuitous offers which formed a moral commitment. That commit­ment could be and was withdrawn at the husband's discretion. The parties made fur­ther submissions on costs and prejudgment interest.

The Ontario Court (General Division), in a decision reported at [1998] O.T.C. Uned. 115, determined the plaintiff's entitlement to costs and prejudgment interest. The husband appealed the decision respecting the sale of the marital home. The wife cross-appealed the decision on costs and prejudgment inter­est.

The Ontario Court of Appeal dismissed the appeal and cross-appeal.

Family Law - Topic 660

Husband and wife - Marital property - Separation agreement - Effect of - A sepa­ration agreement settled all matters be­tween a husband and wife - The agree­ment was not incorporated into the divorce judgment - Under the agreement, the mar­i­­tal home, which had been registered in the wife's name, was transferred to the hus­band - The wife relied on the hus­band's valuation of the home at $360,000 - The resolution of property matters resulted in the wife receiving an equaliz­ation payment - The husband represented that he had no intention of selling the home - Three months later he sold the home for $575,000 - The wife sued the husband, claiming an amount equal to the difference in the amount which she should have received based on the sale price, plus interest - The trial judge allowed the claim - The husband's failure to disclose that the home was worth significantly more than what he had represented consti­tuted fraud and deceit - The Ontario Court of Appeal dismissed the husband's appeal.

Family Law - Topic 888

Husband and wife - Marital property - Considerations in making distribution orders - Valuation - [See Family Law - Topic 660 ].

Family Law - Topic 890.2

Husband and wife - Marital property - Considerations in making distribution orders - Settlements - [See Family Law - Topic 660 ].

Family Law - Topic 3382

Separation agreements, domestic contracts and marriage contracts - Grounds for setting aside - Material nondisclosure - [See Family Law - Topic 660 ].

Family Law - Topic 3390

Separation agreements, domestic contracts and marriage contracts - Grounds for setting aside - Fraud - [See Family Law - Topic 660 ].

Counsel:

D. Smith (MacDonald & Partners), for the appellant;

Norman M. Aitken, for the respondent.

These appeals were heard by Morden, A.C.J.O., Osborne and Moldaver, JJ.A., of the Ontario Court of Appeal. The decision of the Court of Appeal was endorsed on the appeal record on March 18, 1999.