In our earlier posts, we focused on the use
of a constructive trust as a remedy for breach of fiduciary duty and third party fraud liability.
By June 2007, the respondent was aware that she had claims or potential claims against the appellant including a claim for unjust enrichment and a
remedy of constructive trust.
Prior to Kerr, only two remedies were commonly thought available: a monetary award based on quantum meruit (or «value received»), or a proprietary
award of constructive trust (based on «value survived»).
Representing a party defending a claim brought by Twentieth Century Fox, MGM, Disney and other film studios for a
declaration of constructive trust by reason of the alleged receipt of proceeds of internet piracy
(2) the trial judge erred in awarding damages to the respondent father on the basis
of his constructive trust claim regarding the home the two parties shared during the relationship.
In endorsing the trial judge's decision to craft a minimally - intrusive solution (which used the legal
concept of constructive trust and essentially gave Donald a personal, exclusive lifelong license to use the land), the Appeal Court pointed out that it would have been simply inadequate to award him monetary damages in light of the significant emotional attachment to the property.
Property Faith regularly advises on and acts in property disputes including claims in
respect of constructive trusts, proprietary estoppel, easements, restrictive covenants, boundary disputes, the enforceability of charges, relief from forfeiture, and other landlord and tenant matters.
The English Court of Appeal allowed her appeal on the basis that the claim was more in the
nature of a constructive trust, as opposed to a resulting trust, and by whatever name it is described, it is a trust imposed by law, whenever justice and good conscience require it.
As this was not a
case of constructive trust (i.e. not a class 2 trustee), the defendant argued that section 21 (1)(a) was not engaged.
Bushan v Chand [2015] EWHC 1298 (Ch)(Four week trial in the Chancery
Divisions of constructive trust claim to some 40 commercial and residential properties in Birmingham).
While the C.A. recognized that the imposition
of a constructive trust generally made the claimant the beneficial owner of the property, the trial judge had appropriately crafted a narrower remedy (the C.A. also opined that an irrevocable licence was also an appropriate remedy for proprietary estoppel).
The BC Court of Appeal in BNSF Railway v Teck Metals Ltd 2016 BCSC 350 the court delivered the following brief summary of the
history of constructive trust as an equitable remedy:
The case of Gissing v Gissing [1971] AC 886 sets out the basic
principles of a constructive trust; there must be a common intention or agreement between the couple that they were to share the benefi cial interest and the non-owner acted to their detriment in relying on such intention.
The consequences of the parties» risky choices in structuring their Property Settlement Agreement as they did, did not justify the
application of a constructive trust that would harm third parties, the former husband's creditors.
The causes of action included breach of contract, fraudulent and negligent misrepresentation, breach of fiduciary duty, breach of an implied covenant of good faith and fair dealing, unjust enrichment and
breach of constructive trust.
We are experienced in all manner of civil claims based on dishonesty, including those based on misrepresentation or on accessory liability for a breach of fiduciary duty, both at the corporate and individual level; and in the various techniques of asset recovery, including tracing, the
imposition of constructive trusts, claims against third parties who have participated in or received proceeds from the fraud and piercing of the corporate veil.
Where a property is in the sole name of one cohabitant, in the absence of any express declaration, the
doctrine of constructive trusts will need to be carefully considered when trying to establish a benefi cial interest for a non-owner.
If the court is asked to grant such a remedy and determines that a
declaration of constructive trust is warranted, then the proprietary interest awarded pursuant to that remedy will be deemed to have arisen at the time when the unjust enrichment first occurred.»
The Ontario Court of Appeal in Moore v Sweet 2017 ONCA 182 discussed the
concept of constructive trusts that had been pronounced by the Supreme Court of Canada in the decision Soulos v. Korkontzillas 1997 2 SCR 217 in rejecting the claim of a named... Read more
Neutral evaluation of the merit of an appeal from an order dismissing a complaint pre-answer seeking recission of a gift and imposition
of a constructive trust.
A majority of the Court, disagreed, however, with the Ontario Court of Appeal's remedy for that breach, finding that the imposition
of a constructive trust was not appropriate.
Note that the doctrine is much wider and more flexible than
that of constructive trusts.
There is no appeal of the Chambers Judge's imposition
of the constructive trust.
Other than the doctrine
of constructive trust, it is possible in certain circumstances to apply other equitable principles such as proprietary estoppel.