“Interestingly, Colletta, for the most part, has been interpreted as standing for the proposition that excluded property deposited into a joint account loses its exclusionary character to the extent of the one-half interest that is presumed to be gifted to the spouse: see Goodyer v. Goodyer, 1999 CanLII 20759 (ON SCDC), [1999] O.J. No. 29, 168 D.L.R. (4th) 453 (Gen. Div.), at para. 76; Cartier v. Cartier, 2007 CanLII 52427 (ON SC), [2007] O.J. No. 4732, 47 R.F.L. (6th) 436 (S.C.J.), at footnote 4; and Ilana I. Zylberman and Brian J. Burke, “Tracing Exclusions in Family Law” (2006), 25 Can. Fam. L.Q. 67.
In my view, this is, in fact, the correct approach. That this is so is best understood by recalling that, in addressing property issues under Part I of the Family Law Act, the court first determines issues of ownership before turning to questions involving calculation of the parties’ net family properties: for example, see McNamee v. McNamee (2011), 106 O.R. (3d) 401, [2011] O.J. No. 3396, 2011 ONCA 533 (CanLII), at paras. 56-63. [page327]
While s. 14 of the Family Law Act creates certain presumptions with respect to the ownership of property, it does not address how each party’s net family property is to be calculated. Rather, it is s. 4(2) that stipulates the exclusions from net family property.
In relation to gifts, s. 4(2) states that “[p]roperty, other than a matrimonial home, that was acquired by gift or inheritance from a third person after the date of marriage” is to be excluded. Similarly, “[p]roperty, other than a matrimonial home, into which [a gift] can be traced” is excluded.
Given that the legislature made clear its intention that gifts used to purchase a matrimonial home lose their excluded character, but did not do the same in relation to moneys deposited into a joint account, I discern no legislative intent that the entire amount of the gift should lose its excluded character when deposited into a joint bank account. See, also, Brubacher v. Brubacher, [1996] O.J. No. 2730, 10 O.T.C. 111 (Gen. Div.), at para. 34; LeCouteur v. LeCouteur, 2005 CanLII 8726 (ON SC), [2005] O.J. No. 1141, 18 R.F.L. (6th) 386 (S.C.J.), at paras. 50-51; Cartier, at paras. 2, 33-36.
In my view, therefore, the trial judge in this case erred in concluding that all of the gift moneys lost their excluded character when deposited into a joint account.”