Background
The Applicant, Elicia Salgado, and the Respondent, Simon Loor
Sabando met in October of 2013 and began living together in
February of 2014. On July 3, 2015, the parties purchased their
home for $425,000 as tenants in common. In December of 2017, the
parties purchase Tenoch Restaurant. Although the restaurant is
held by a company in which Simon is the sole Shareholder, the
couple funded the purchase jointly with $40,000 from their joint
savings and available credit. After the parties separated,
Elicia commenced litigation.
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Can Simon hold the Restaurant in trust for Elicia?
The Ontario Court of Appeal in Andrade v. Andrade, 2016 ONCA 368 at paragraph 58, stated that one of the “classic resulting trust situations”
is “where a person advances a contribution to the purchase price
of property without taking legal title”. This creates a presumption of resulting trust that can only
be refuted by showing that the monies were provided as a gift.
See Pecore v. Pecore, 2007 SCC 17 (CanLII), at paragraph 24.
The parties financed and worked to make Tenoch Restaurant a
success. On the dissolution of their relationship, Simon shut
out Elicia from the restaurant. This amounts to a “purchase money” resulting trust in favour of Elicia.
Thus, the Court held that Elicia is entitled to a 50% ownership
interest in the Tenoch restaurant and the income earned from the
business.
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Can Elicia sale the jointly owned property, without Simon’s
signature and consent?
Elicia sought an order for the sale of the home and to have the
proceeds divided in accordance with the ownership share of the
parties, that is 99% of the proceeds to the Applicant and 1% of
the proceeds to the Respondent.
The authority of the court to order partition and sale arises
from the Partition Act, R.S.O. 1990, c. P.4. ss. 2 and 3, as
well as s. 10 of the FLA, above. The sale should
be given effect unless the moving party conducting themselves in
relation to the sale in a “malicious, vexatious, or oppressive”
manner toward the responding party: see Kamil v. Bouchir, 2024 ONSC 1298 at para. 28.
Simon and Elicia are no longer in a relationship. She seeks to
sell the home. Thus, the court orders the sale and distribution
of the net proceeds.
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