Joint Ownership Added Under Pressure or Lost Capacity in Ontario

A parent adds a child to the house or the bank account, and later the rest of the family wonders why. Perhaps the parent was ill, confused or leaning heavily on one child. When the parent dies, the asset may go to the joint owner and not to the people named in the will.

This article explains how Ontario law generally treats these transfers, what kinds of evidence matter, and what routes may exist to reach the asset. Whether undue influence or lack of capacity can be proven depends heavily on the facts, so a lawyer should look at your documents.

Why joint ownership matters after a death

Property that passes by survivorship does not go into the estate. It goes straight to the surviving owner, whether or not there is a will. A deceased joint tenant's interest goes to the surviving joint tenant, not to the will's beneficiaries.

For a joint bank account, the gift is treated as made during the owner's life, when the account is opened. What is gifted is the survivor's interest in the balance at the time of death. That is why families look closely at how and why the second name was added.

The starting presumption for an adult child

For gratuitous transfers, meaning the person receiving did not pay, the presumption of resulting trust is the general rule. The person receiving the transfer carries the onus of showing a gift was intended. An adult child added to a parent's account or asset without payment is presumed to hold it in trust for the parent and, on death, for the estate.

The presumption of a gift is confined to minor children. A grown child's financial dependency does not trigger it, although it can be strong evidence against a resulting trust.

Undue influence and lack of capacity are separate arguments. In plain terms, one asks whether the parent's decision was really free, and the other asks whether the parent understood what they were doing. How a court would weigh either depends on the evidence, which is worth discussing with a lawyer.

Evidence that tends to matter

Courts may consider several kinds of evidence about what the parent intended at the time of the transfer, and sometimes later evidence if it sheds light on that intention. These include:

• The wording of the bank documents.
• Who controlled and used the funds.
• Whether a power of attorney was granted.
• How the joint account was treated for tax.

Medical records, notes from the parent's own advisors, and messages between family members can also help show the circumstances, though how much weight any item carries depends on the case.

Other routes that may reach the asset

A resulting-trust argument is not the only path. Depending on who you are and what the asset is, one of these may apply:

• Dependant support. A spouse, parent, child, or brother or sister whom the deceased was supporting, or was legally obliged to support, can ask the Superior Court of Justice for adequate provision out of the estate. For this claim, property held by the deceased and another as joint tenants, and money in an account in the deceased's name and another's, is deemed part of the net estate. For joint deposits, only the portion that belonged to the deceased counts, and the claimant must prove that.
• Matrimonial home. If a spouse dies owning a matrimonial home as a joint tenant with someone other than the other spouse, such as a child, the joint tenancy is deemed severed immediately before death and the deceased's share goes into the estate.
• Partition or sale. A joint tenant or tenant in common of Ontario land may be compelled to make or suffer partition or sale, and any person interested in the land may apply to the court.

Banks and other holders may still make payments under these transactions unless a certified copy of a suspensory order has been personally served on them. Timing therefore matters.

Deadlines and what to do next

A dependant support application cannot be made more than six months after the certificate of appointment is granted. The court may allow an application at any time for any part of the estate still undistributed on the date of the application. Do not count on that exception.

• Find out whether the asset is land, a bank account or something else, and who is on title or on the account.
• For land, order a parcel register through OnLand. The listed fee is $37.10 including HST, plus $2.56 for each additional page, but confirm the current fee.
• Gather bank documents, account statements, and any power of attorney.
• Write down dates: when the joint owner was added, the parent's health at the time, and who helped with the paperwork.
• Do not move or spend the money yourself. Speak to a lawyer about next steps and deadlines.

Frequently asked questions