What is Constructive Trust Claims

What is Constructive Trust Claims

When an individual dies, property, wills, and estates can become complicated matters during separations/divorces, and especially more so However, death does not always necessarily end the individual’s obligations to others. It also does not remove the possibility of enforcing a claim against the estate of a deceased person.

A person may have a right to property by virtue of his or her contributions to it even though he or she is not the legal owner. This situation would allow for a constructive trust claim by the latter party, and if granted, the remedy would act to redress an unjust enrichment.

In family law, constructive trusts are an equity remedy that exists to prevent unjust enrichment amongst spouses and common-law partners. A spouse who works more hours or a child who is home to care for children can apply this remedy.

These types of claims are compensatory in nature and often arise from the deceased’s acceptance of services or contributions that allowed for maintenance or the enhancement of an estate’s value.

 

Constructive Trust Claims In Family Law

A successful claim could result in the court ordering the claimant to pay part of the mortgage, repairs and upkeep, taxes, etc. or lead to a division of the property between the couple. This can be enforced even after the property owner has passed.

 

Test for Unjust Enrichment and Constructive Trust Remedies

In order to make a claim of unjust enrichment, a plaintiff must prove three factors

1. One party received an enrichment;

2. The other party has been deprived or suffered a loss because of the enrichment (i.e. corresponding deprivation); and

3. There is an absence of a juristic reason for the enrichment – in other words, there is no legal reason for the enrichment.1

Once unjust enrichment has been established, the claimant may be entitled to either a constructive trust or a monetary award. The constructive trust would give the claimant an interest in the property or estate, either in whole or in part, through a court declaration.

In order to obtain a constructive trust proprietary remedy, the claimant spouse would then need to show that:

1. There is a sufficiently strong causal connection (i.e. a clear link) between their contributions and the acquisition, preservation, maintenance or improvement of the property/estate in question, and

2. That a monetary award would not be sufficient.2

Without a sufficiently strong connection between the claimant’s contributions and their asset. It may be possible for an estate to provide monetary awards instead.

We will be working with clients to present the facts in a constructive trust that is beneficial for them.

We highly discourage anyone from seeking out legal advice through this article. This article only provides general information and should you have any further questions regarding the wills, estates and constructive trust claims, please contact us to book a free initial consultation 905-366-0202 or through our website here.

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