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Co-ownership with kin?

Get it in writing
Mark Weisleder, Toronto Star September 2, 2013 Family members often decide to take title to properties together for various reasons, sometimes for estate planning purposes but primarily when one family member alone cannot qualify for a mortgage. However, if there is no written agreement regarding ownership and who is making the payments, it can become costly to change the title later. A continuing legal dispute in B.C. is an example of when things went wrong: In 1990, Yuk Chun Suen, known as Albert Suen, moved to Vancouver from Hong Kong with his wife, two daughters and son Andy. He bought a home with his wife, sold it and bought a new home on Pender St. in Richmond B.C. Andy graduated from university in 1998 and started contributing $1,000 per month to the family expenses. His mother died in 2001. Thereafter, Albert became the sole owner of the Pender St. property. Based on evidence presented during a civil suit, Albert could not control his spending and started going into debt. In 2002, again based on evidence presented during the suit, Albert agreed to transfer half of the Pender St. house to his son in exchange for Andy looking after the expenses. The agreement was not put in writing and Andy was never registered on the title. The Pender St. property was sold and a new home was purchased on Captain's Way in Richmond, partly with the proceeds of the sale of Pender St. and partly with Andy's money. Title to this property was registered in both Albert and Andy's names. Problems arose as Albert continued to pile up debt, according to evidence presented at trial. It was Andy's position that since he had made the payments on the Pender St. property as well as the Captain's Way home, his father's portion of the Captain's Way house was really held in trust for his benefit. Albert's view was that he was entitled to a 50-per-cent ownership until his death, when the property would go to Andy. Albert sued Andy to confirm he owned 50 per cent of the property; Andy countersued claiming 100 per cent, based on his financial contributions. At the trial in 2012, Justice Peter Rogers of the B.C. Supreme Court ruled Andy became the beneficial owner of 100 per cent of the property as a result of the 2002 agreement, based on all the evidence that he heard. A key piece was an alleged statement by Albert that "the house is yours if you agree to come back and live with me and pay my debts." The judge concluded Albert did not contribute to the purchase of the Captain's Way property and was not expected to pay for its upkeep. The case went to the B.C. Court of Appeal. In her June 28, 2013 decision, Madam Justice Daphne Smith had issues with the fact that the supposed 2002 agreement was not written down and may have just been gratuitous promises that were not binding on Albert. She did, however, leave open the possibility

that Albert may have been unjustly enriched by remaining the 50-per-cent owner without contributing to the upkeep. She sent the case back for another trial to determine if Andy should recover more than his 50-per-cent-ownership based on his contributions to the property. The legal fees involved in both the initial trial and appeal, as well as what may become a second trial, must be staggering. All of this could have been avoided had there been a clear written agreement detailing who was to pay which costs and what everyone's degree of ownership was. Mark Weisleder is a Toronto real estate lawyer: