In the decision in Lowe Estate v. Lowe¹ Justice Reid was asked to determine whether funds held in a bank account jointly as between the deceased and his nephew rightly belonged to the estate by way of resulting trust.

Prior to his death, Lawton Lowe had set up a joint bank account with his nephew Rick Lowe with clear instructions on the distribution of funds from that account following his death.  Rick (the nephew) did not contribute funds to the account, and only undertook very minor bill payments on behalf of the deceased in the short time before his death.  Following the death of Mr. Lowe, the nephew made the payments as had been directed by the deceased, of $35,000.00 to the deceased’s granddaughter, and $10,000.00 to the deceased’s alma mater.

Lawton Lowe’s son, Garry, who was appointed estate trustee under his father’s will took the position that the funds in the joint bank account were held by way of resulting trust for the estate, in accordance with the principles in the Supreme Court decisions in Pecore v. Pecore² and Madsen Estate v. Saylor.³

The court reviewed all the facts in the case in determining whether beneficial ownership of the funds passed to the nephew or to the estate, following death.  The evidence proferred by the nephew included various sets of written instructions from the deceased respecting the disposition of the monies held in the joint account.  The nephew also deposed that he had been made a joint account-holder so as to facilitate the transfer of the funds as per the deceased’s instructions.

Justice Reid found that Mr. Lowe had intended to use the joint bank account for estate planning purposes.

The court agreed with Rick, that, consistent with the decision in Sawdon Estate v. Watch Tower Bible and Tract Society of Canada,⁴ the deceased had established a trust where Rick was the trustee, and the deceased’s granddaughter and alma mater were the beneficiaries.

In light of all of the evidence, including the banking document, the written instructions, the manner in which the funds were treated, and the fact that there was no evidence that the monies were to be treated as estate funds, the court held that Rick’s onus to rebut the presumption of resulting trust had been met.  Thus those monies were not part of the deceased’s estate.

The facts in this decision are unusual. In most cases in which the issue of resulting trust is disputed, the joint account-holder seeks to retain those monies for his or her own benefit.  Still this decision is helpful in elucidating the type of evidence that helps rebut the presumption of resulting trust: specifically, evidence of the deceased’s intentions to use the joint account for estate planning purposes, and clear written instructions from the deceased to that effect.

—
1. 2014 ONSC 2436 (CanLII)
http://www.canlii.org/en/on/onsc/doc/2014/2014onsc2436/2014onsc2436.html

2. 2007 SCC 17, [2007] 1 S.C.R. 795
http://www.canlii.org/en/on/onsc/doc/2004/2004canlii5047/2004canlii5047.html

3. 2007 SCC 18, [2007] 1 S.C.R. 838
http://www.canlii.org/en/ca/scc/doc/2007/2007scc18/2007scc18.html

4. 2014 ONCA 101 (CanLII)
http://www.canlii.org/en/on/onca/doc/2014/2014onca101/2014onca101.html