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.

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.

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.