Beneficiary Designations Uncertainty: Where Are We Now?

It is a well-established principle from the Supreme Court of Canada's 2007 decision, Pecore v Pecore, that there is a presumption of a resulting trust where a gratuitous transfer of property is found. The primary example is when an asset is put into joint names by a parent with an adult child for no consideration. In this case, there is the presumption that the property is not a gift to the child but rather that the child is holding the property in trust for the estate of the parent. This presumption can be rebutted.

Although we have come a long way since Pecore, the cases relating to joint ownership appear to take two steps forward and one step back.

The most recent issue that has come into the spotlight in Ontario is with respect to beneficiary designations for registered plans. There have been two recent decisions out of the Ontario Superior Court of Justice with differing applications of Pecore  in the context of beneficiary designations.