Stevens v. Stevens et al., (2006) 214 O.A.C. 201 (CA)

• Judge: Simmons, Cronk and Juriansz, JJ.A.
• Court: Court of Appeal (Ontario)
• Case Date: May 30, 2006
• Jurisdiction: Ontario
• Citations: (2006), 214 O.A.C. 201 (CA)

Stevens v. Stevens (2006), 214 O.A.C. 201 (CA)

MLB headnote and full text

Temp. Cite: [2006] O.A.C. TBEd. JL.028

Catherine Mary Stevens (applicant/respondent in appeal) v. Ian Stevens, Royal Bank of Canada , and Crown Attorney (Lidia Narozniak)

(respondent/appellant in appeal)

(C44282)

Indexed As: Stevens v. Stevens et al.

Ontario Court of Appeal

Simmons, Cronk and Juriansz, JJ.A.

July 10, 2006.

Summary:

On September 17, 2004, Flynn, J., made an order in a matrimonial proceeding between Stevens and Nagtzaam, vesting title to the former matrimonial home in Stevens, retroactive to July 31, 1998, the date of separation (the "vesting order"). However, on November 30, 2000, the Royal Bank of Canada (RBC) had filed writs of seizure and sale against Nagtzaam concerning an unsatisfied judgment arising from his default under a loan advanced to him by RBC in 1999. Stevens applied for, inter alia, a declaration that the writs were not applicable to the matrimonial home. RBC cross-applied for an order amending or varying the effective date of the vesting order to September 17, 2004 (the date of Flynn, J.'s, order) or, alternatively, granting RBC standing to appeal the vesting order.

The Ontario Superior Court, in a decision reported at [2005] O.T.C. 854, granted Stevens' application and dismissed RBC's cross-application. RBC appealed.

The Ontario Court of Appeal dismissed the appeal.

Execution - Topic 1087

Writ of execution - Priorities and property affected - Trusts - [See second Family Law - Topic 631.3 ].

Family Law - Topic 631.3

Husband and wife - Marital property - Matrimonial home - Vesting order - On September 17, 2004, in a matrimonial proceeding between Stevens and Nagtzaam, Flynn, J., made an order vesting title to the former matrimonial home in Stevens, retroactive to July 31, 1998, the date of separation (the "vesting order") - However, on November 30, 2000, RBC had filed writs of seizure and sale against Nagtzaam - Stevens applied for a declaration that the writs were not applicable to the matrimonial home - RBC cross-applied for an order amending or varying the effective date of the vesting order to September 17, 2004 (the date of Flynn, J.'s, order) or, alternatively, granting RBC standing to appeal the vesting order - Reilly, J., granted Stevens' application and dismissed RBC's cross-application - The Ontario Court of Appeal dismissed RBC's appeal - Although Flynn, J., did not mention retroactivity in his reasons and "in trust" or "constructive trust" did not appear therein, he signed the formal vesting order - In the absence of evidence to the contrary, the court had to presume that Flynn, J., was aware of the terms of the vesting order, including its provision for retroactivity, and that he was satisfied that the order reflected his disposition concerning the matrimonial home - In any event, Flynn, J., implicitly found that, from shortly after the date of their separation in July 1998, Nagtzaam's interest in the matrimonial home was impressed with a trust in favour of Stevens - The retroactive nature of the vesting order accorded with this key finding - Although Flynn, J., did not refer explicitly in his reasons to the doctrine of constructive trust, he held that Nagtzaam and Stevens had reached an understanding concerning the matrimonial home, which was enforceable "in equity"- He further held that Stevens acted in reliance on the understanding that Nagtzaam's interest in the matrimonial home would be transferred to her in consideration for her payment of his debts and their joint debts at the time of separation - Stevens fulfilled her part of this bargain - See paragraphs 1 to 12.

Family Law - Topic 631.3

Husband and wife - Marital property - Matrimonial home - Vesting order - On September 17, 2004, Flynn, J., made an order in a matrimonial proceeding between Stevens and Nagtzaam, vesting title to the former matrimonial home in Stevens, retroactive to July 31, 1998, the date of separation (the "vesting order") - However, on November 30, 2000, RBC had filed writs of seizure and sale against Nagtzaam concerning an unsatisfied judgment arising from his default under a loan advanced to him by RBC in 1999 - Stevens applied for a declaration that the writs were not applicable to the matrimonial home - RBC cross-applied for an order amending or varying the effective date of the vesting order to September 17, 2004 (the date of Flynn, J.'s, order) or, in the alternative, granting RBC standing to appeal the vesting order - Reilly, J., granted Stevens' application and dismissed RBC's cross-application - The Ontario Court of Appeal dismissed RBC's appeal - At the time of their separation, Nagtzaam agreed to transfer all of his right, title and interest in the matrimonial home to Stevens, provided that she paid his and their debts - She did so but he then refused to sign a transfer document - Flynn, J., found that Stevens became entitled to Nagtzaam's interest in the matrimonial home through a constructive trust from the time that she paid those debts, a time before RBC had acquired any legal rights as Nagtzaam's execution creditor - Further, Stevens had notified RBC of allegations of fraud against Nagtzaam following the parties' separation, when she discovered that he was defrauding her company - RBC chose to ignore her warning - RBC also chose not to intervene in the matrimonial proceeding despite having received notice that it could be adversely affected - See paragraphs 13 to 29.

Family Law - Topic 637

Husband and wife - Marital property - Constructive trusts - [See both Family Law - Topic 631.3 ].

Family Law - Topic 665

Husband and wife - Marital property - Practice - Jurisdiction - [See Trusts - Topic 2306 ].

Family Law - Topic 866

Husband and wife - Marital property - Distribution orders - Jurisdiction or application of statutes - [See Trusts - Topic 2306 ].

Trusts - Topic 2306

Constructive trusts - General principles - When trust takes effect (incl. retroactivity) - On September 17, 2004, Flynn, J., made an order in a matrimonial proceeding between Stevens and Nagtzaam, vesting title to the former matrimonial home in Stevens, retroactive to July 31, 1998, the date of separation (the "vesting order") - However, on November 30, 2000, the Royal Bank of Canada had filed writs of seizure and sale against Nagtzaam - Stevens applied for a declaration that the writs were not applicable to the matrimonial home - The Bank cross-applied for an order amending or varying the effective date of the vesting order to September 17, 2004 (the date of Flynn, J.'s, order) or, in the alternative, granting the Bank standing to appeal the vesting order - An application judge granted Stevens' application and dismissed the Bank's cross-application - The Ontario Court of Appeal stated that "I agree with the application judge that Flynn, J.'s, reasons compel the conclusion that he based the Vesting Order on the equitable principles inherent in the constructive trust remedy. The Bank, quite properly in my view, does not suggest that the remedy of constructive trust cannot have retroactive effect in a proper case. That Flynn, J., also alluded to his authority under s. 10 of the Family Law Act to declare the ownership or right to possession of particular property does not displace this interpretation. ... [Section] 10 of the Family Law Act is procedural in nature. It is a vehicle through which questions of ownership or possession may be determined and the declaratory relief authorized by s. 10(1)(a) must find a substantive basis elsewhere." - See paragraph 12.

Trusts - Topic 2308

Constructive trusts - General principles - Circumstances when imposed - [See first Family Law - Topic 631.3 ].

Cases Noticed:

Martin v. Martin (1992), 55 O.A.C. 9; 8 O.R.(3d) 41 (C.A.), refd to. [para. 12].

Miller v. Miller, [1996] O.J. No. 863, refd to. [para. 12].

Maroukis v. Maroukis, [1984] 2 S.C.R. 137; 54 N.R. 268; 5 O.A.C. 182, refd to. [para. 15].

Ferguson v. Ferguson (1994), 7 R.F.L.(4th) 384 (Ont. U.F.C.), refd to. [para. 15].

Soulos v. Korkontzilas et al., [1997] 2 S.C.R. 217; 212 N.R. 1; 100 O.A.C. 241, refd to. [para. 22].

Peter v. Beblow, [1993] 1 S.C.R. 980; 150 N.R. 1; 23 B.C.A.C. 81; 39 W.A.C. 81, refd to. [para. 22].

Statutes Noticed:

Family Law Act, R.S.O. 1990, c. F-3, sect. 10(1)(a) [para. 12].

Counsel:

Larry W. Keown, for the appellant, Royal Bank of Canada;

Robert K. Bickle, for the respondent.

This appeal was heard on May 30, 2006, by Simmons, Cronk and Juriansz, JJ.A., of the Ontario Court of Appeal. Cronk, J.A., delivered the following decision for the court on July 10, 2006.