Parent Added a Child to the House Title: Ontario Estate Disputes

A parent adds one child to the title of the family home, and years later the parent dies. The other children learn that the house, or a bank account, went to that one child and not into the estate. Tempers rise quickly.

The legal question is usually not what the will says. It is whether the parent meant to give the child a real ownership interest, or only wanted help managing things. This article explains how Ontario courts approach that question and what usually matters.

Why the will may not control the house

Property passes into the estate only if no one else has a right to take it by survivorship. Property that passes by survivorship 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.

A parent can add a child to title by conveying the property to themselves jointly with that child. If the joint tenancy is real and stands, the house may never become part of the estate. That is why siblings often turn to a trust argument instead.

Being named on title does not always mean joint tenancy. Land conveyed to two or more people is generally held as tenants in common unless the document shows on its face that they take as joint tenants. A tenant in common's share does not pass by survivorship.

Gift or trust: the presumption courts start from

For transfers made without payment, the starting rule is a presumption of resulting trust. The person who received the transfer must show that a gift was intended. An adult child added to a parent's account or asset without paying for it is presumed to hold it in trust for the parent and, on death, for the estate.

There is an exception for minor children, where the presumption of advancement (a gift) applies. Financial dependency of an adult child does not trigger that presumption, although it can be strong evidence against the trust.

If the court finds a resulting trust, the child holds the property for the estate. In that case the value counts for estate administration tax, because property held in another person's name that belongs to the deceased is included.

What evidence tends to matter

The question is what the parent intended when the transfer was made. Courts may consider the following kinds of evidence:

• The wording of bank or transfer documents.
• Who controlled and used the funds.
• Whether a power of attorney was granted.
• How the account was treated for tax.
• Later evidence, if it helps show the intention at the time of the transfer.

For joint accounts, survivorship rights vest when the account is opened, so the gift is made during life. What is gifted is the survivor's interest in the balance at death.

Special situations that change the answer

Adding a child can also have tax effects. A gift of capital property is treated as a sale at fair market value when you give it, and the automatic rollover applies to a spouse or common-law partner, not to children, except for qualifying farm or fishing property. A deceased person is also treated as having sold capital property just before death, even if it passes by survivorship.

What to do next

• Search the parcel register through OnLand to see how title is actually held.
• Collect the transfer documents, bank forms, and any records showing who paid for and used the property.
• Keep any messages or notes that show what the parent said about the change.
• Note deadlines. A dependant support application generally cannot be made more than six months after the certificate of appointment is granted.
• Speak with an estate litigation lawyer before anyone sells or distributes the property.

Any joint owner or tenant in common may be compelled to partition or sell land under the Partition Act. Outcomes depend heavily on the evidence, so get advice early.

Frequently asked questions