September 12, 2023 – Resulting Trust: Intention At the Time of Transfer is the Key

“The motion judge observed, in my view correctly, that “[f]rom the standpoint of attempting to ascertain the intention of the parent making the advances, the issue is whether the parent intended to retain a hold on the amounts advanced, regardless of whether that be by way of a resulting trust or a debt obligation” (at para. 77). Considering the relevant factors, the motion judge found that the evidence supported the conclusion that the monies were provided by way of gift by the husband’s parents. He concluded that “the reality of the situation [was] that there never was any expectation, prior to the parties’ separation, on the part of Lillian Chao that the respondent and the applicant would be required to repay any portion of the funds advanced by her and her husband” (at para. 85).

The legal test is intent at the time of the transfer. Evidence of intention that arises subsequent to a transfer must be relevant to the intention of the transferor at the time of the transfer. The court must assess the reliability of such evidence and determine what weight it should be given, guarding against evidence that is self-serving or tends to reflect a change in intention: Pecore, at paras. 44 and 59; Andrade v. Andrade, 2016 ONCA 368 (CanLII), 131 O.R. (3d) 532, at para. 63.”:

Chao v. Chao, 2017 ONCA 701 (CanLII) at 55-56