“In Kerr, the court dealt at length with unjust enrichment. At para. 33, Cromwell J. held that there is no separate line of authority for family cases developed within the law of unjust enrichment and reaffirmed the statement in Peter v. Beblow, 1993 CanLII 126 (SCC), [1993] 1 S.C.R. 980, at p. 997, that “the basic principles governing the rights and remedies for unjust enrichment remain the same for all cases.” I refer to this point because, although this is a family law case, the determination of the limitation period issue will have ramifications beyond family law. The resolution of the limitation period issue cannot turn on the fact that this is a family law case. Thus, in my view, the fact that the Family Law Act prescribes a limitation period for claims under that Act cannot be determinative of the limitation period issue.
I recognize that Cromwell J. went on to hold at para. 34, again referring to Peter, at p.997, that the courts must “exercise flexibility and common sense applying equitable principles to family law issues with due sensitivity to the special circumstances that can arise in such cases”. Indeed, the family law context was front and centre when considering the remedy for unjust enrichment in such cases. But, in my view, the resolution of the strictly legal question as to the application of the Limitations Act, 2002 and the Real Property Limitations Act turns on the interpretation of the relevant provisions of those Acts. The issue of whether the Real Property Limitations Act applies to a claim for a constructive trust will be the same whether the equitable claim for an interest in land arises out of a domestic relationship or a purely business transaction.
In Kerr, at para. 32, the court reiterated the by now well-known elements of a claim for unjust enrichment as developed in Canadian law: an enrichment of or benefit to the defendant, a corresponding deprivation of the plaintiff and the absence of a juristic reason for the enrichment. At this stage of the proceeding, those elements are not in issue. The motion judge was asked to deal with the legal issue on the assumption that the respondent could make out those elements: see para. 13 of the motion judge’s reasons. This case turns rather on the remedy for the unjust enrichment and how the remedies should be characterized.
Remedies for unjust enrichment are restitutionary and the court in Kerr affirmed that proprietary and monetary remedies are available for unjust enrichment. At para. 46, Cromwell J. described the two available remedies in these terms:
A successful claim for unjust enrichment may attract either a “personal restitutionary award” or a “restitutionary proprietary award”. In other words, the plaintiff may be entitled to a monetary or a proprietary remedy (Lac Minerals Ltd. v. International Corona Resources Ltd., 1989 CanLII 34 (SCC), [1989] 2 S.C.R. 574, at p. 669, per La Forest J.).
Further, Cromwell J. also noted that the court should first consider whether a monetary award is sufficient; in most cases it is: para. 47. Most of Kerr is concerned with calculating the monetary award. The case does, however, refer to the proprietary award in several contexts. The first context is where the plaintiff, like this respondent, seeks a constructive trust. Justice Cromwell explains as follows at para. 50:
The Court has recognized that, in some cases, when a monetary award is inappropriate or insufficient, a proprietary remedy may be required. Pettkus is responsible for an important remedial feature of the Canadian law of unjust enrichment: the development of the remedial constructive trust. Imposed without reference to intention to create a trust, the constructive trust is a broad and flexible equitable tool used to determine beneficial entitlement to property (Pettkus, at pp. 843-44 and 847-48). Where the plaintiff can demonstrate a link or causal connection between his or her contributions and the acquisition, preservation, maintenance or improvement of the disputed property, a share of the property proportionate to the unjust enrichment can be impressed with a constructive trust in his or her favour (Pettkus, at pp. 852-53; Sorochan, at p. 50). Pettkus made clear that these principles apply equally to unmarried cohabitants, since “[t]he equitable principle on which the remedy of constructive trusts rests is broad and general; its purpose is to prevent unjust enrichment in whatever circumstances it occurs” (pp. 850-51). [Emphasis added.]
Kerr also makes the point that there must be a significant link between the plaintiff’s contribution and the property that she seeks to have impressed with the trust. As Cromwell J. said at para. 51:
As to the nature of the link required between the contribution and the property, the Court has consistently held that the plaintiff must demonstrate a “sufficiently substantial and direct” link, a “causal connection” or a “nexus” between the plaintiff’s contributions and the property which is the subject matter of the trust (Peter, at pp. 988, 997 and 999; Pettkus at p. 852; Sorochan, at pp. 47-50; Rathwell, at p. 454). A minor or indirect contribution will not suffice (Peter, at p. 997). As Dickson C.J. put it in Sorochan, the primary focus is on whether the contributions have a “clear proprietary relationship” (p. 50, citing Professor McLeod’s annotation of Herman v. Smith (1984), 1984 CanLII 1238 (AB QB), 42 R.F.L. (2d) 154, at p. 156). Indirect contributions of money and direct contributions of labour may suffice, provided that a connection is established between the plaintiff’s deprivation and the acquisition, preservation, maintenance, or improvement of the property (Sorochan, at p. 50; Pettkus, at p. 852).
With that background I return to the interpretive issue and specifically to the question of whether an application for the equitable remedy of a constructive trust in real property is an application for recovery of any land. In my view, the respondent is making a claim for recovery of land in the sense that she seeks to obtain land by judgment of the Court. That the court might provide her with the alternative remedy of a monetary award does not take away from the fact that her claim is for a share of the property. The repeated references to constructive trust as a remedy for unjust enrichment in Kerr demonstrate that a proprietary remedy is a viable remedy for unjust enrichment where there is a link or causal connection between her contributions and the acquisition, preservation, maintenance or improvement of the property.
In sum, I agree with the motion judge’s conclusion at para. 80 of his reasons:
From the plain meaning of the words “action to recover any land” in section 4 of the Real Property Limitations Act, in their “entire context” as described above, I find that the applicant’s claim in this case for an ownership interest in the house in question is an “action to recover any land” within the meaning of section 4 of the Real Property Limitations Act. It is subject to a ten year limitation period. Based on the record before me, it is not possible for me to conclude that the applicant’s claim in this case is barred by the ten year limitation. Accordingly, this part of her claim is entitled to proceed.”