Penny v. DeLong Estate, 2013 NSCA 74

Nova Scotia Court of Appeal Citation: Penny v. DeLong Estate , 2013 NSCA 74 Date: 20130618 Docket: CA 408754 Registry: Halifax Between: Ronald V. Penny Appellant v. Donald Bruce Powers, Personal Representative of the Estate of John Hamilton DeLong and George Lewis, Personal Representative of the Estate of Helen Lewis Respondents Judges: Oland, Fichaud and Bryson, JJ.A. Appeal Heard: June 3, 2013, in Halifax, Nova Scotia Subject: Real property law. Joint tenancy. Severance. Conveyance to oneself.

Summary: Ms. Lewis and Ms. DeLong owned property as joint tenants. Before she died and without Mr. DeLong’s knowledge, Ms. Lewis conveyed her interest in the property to herself. The deed recited that it was for the purpose of severing the joint tenancy. The chambers judge found that the deed was not effective at law to sever the tenancy. He rejected arguments that severance was effective “in equity”. Issues: Had there been a severance of the tenancy in equity? Result: Appeal dismissed.

Although some jurisdictions have made legislative changes enabling a conveyance to oneself, the common law rule that such conveyances are ineffective, prevails in Nova Scotia which has no such legislation. A unilateral declaration or act by a joint tenant does not sever the tenancy absent a conveyance. Equity would recognize a severance in the case of an agreement to sell or a declaration of trust in favour of another party. Neither applied here. No estoppel arose because Mr. DeLong made no statement or took no action on whether Ms. Lewis detrimentally relied. It was not unfair for Mr.

DeLong to rely on his strict legal rights in the absence of a valid conveyance or inequitable conduct by him. This information sheet does not form part of the court’s judgment. Quotes must be from the judgment, not this cover sheet. The full court judgment consists of 6 pages. Nova Scotia Court of Appeal Citation: Penny v. DeLong Estate , 2013 NSCA 74 Date: 20130618 Docket: CA 408754 Registry: Halifax Between:

Ronald V. Penny Appellant v. Donald Bruce Powers, Personal Representative of the Estate of John Hamilton DeLong and George Lewis, Personal Representative of the Estate of Helen Lewis Respondents Judges: Oland, Fichaud and Bryson, JJ.A. Appeal Heard: June 3, 2013, in Halifax, Nova Scotia Held: Appeal is dismissed with costs of $2500, inclusive of disbursements, payable by the appellant to the personal representative of the Estate of Mr. DeLong, per reasons for judgment of Bryson, J.A.; Oland and Fichaud, JJ.A. concurring.

Counsel: Augustus Richardson, Q.C., for the appellant John Washington, for the respondent, for the DeLong Estate Brian Church, Q.C., for the respondent, for the Lewis Estate, (not present) Reasons for judgment: [ 1 ] Following oral argument the court dismissed the appeal with reasons to follow – these are they. [ 2 ] The appellant invites this court to embrace the novel proposition that a deed ineffective at law to sever a joint tenancy should be effective in equity based solely on the uncommunicated intention and conduct of one party.

The chambers judge was not persuaded ( 2012 NSSC 369 ); neither are we. [ 3 ] In 1973 the late John H. DeLong acquired two acres of land in Port Greville in Cumberland County. He later conveyed the property to himself and Helen Lewis as joint tenants. Unknown to Mr. DeLong, Ms. Lewis executed and registered a quit claim deed from herself to herself in 2010. The deed says it was executed for “the purpose of severing the joint tenancy between the current owners”. Ms. Lewis died in 2011. Mr. DeLong knew nothing of the 2010 deed nor of Ms. Lewis’ professed intention that the joint tenancy between them be severed. Mr.

DeLong died in September, 2012 [ 4 ] Ms. Lewis’ deed was prepared by Ronald V. Penny. He was granted leave to intervene in the proceeding before Justice Gerald R. P. Moir and he is the appellant. [ 5 ] The parties agree on the facts. The question is whether the chambers judge erred in law in rejecting the appellant’s arguments. The parties agree that the standard of review is correctness. [ 6 ] The parties also agree on much of the law. They agree on the character of a joint tenancy. They agree on how joint tenancies may be severed. Where they

part company is whether or not a deed by Ms. Lewis to herself ineffective at law could be given effect in equity. Joint Tenancy: [ 7 ] Joint tenancy is a very old doctrine of the common law and was well settled by the 18th century.

William Blackstone says in his Commentaries on the Laws of England : Vol. 2 (Chicago: The University of Chicago Press, 1979)] at 180: The properties of a joint estate are derived from it’s unity, which is fourfold; the unity of interest , the unity of title , the unity of time , and the unity of possession : or, in other words, joint-tenants have one and the same interest, accruing by one and the same conveyance, commencing at one and the same time, and held by one and the same undivided possession. [ 8 ] The most significant consequence of holding land in joint tenancy is the right of survivorship.

While there is only one title, more than one person enjoys that title. Blackstone says: This is the natural and regular consequence of the union and entirety of their interest. The interest of two joint-tenants is not only equal or similar, but also is one and the same. One has not originally a distinct moiety from the other; … while it continues, each of the two

joint-tenants has a concurrent interest in the whole; and therefore, on the death of his companion, the sole interest in the whole remainsto the survivor. [9] These principles have been confirmed by innumerable courts over the intervening years (for a recent example, theappellant cites Gill v. Hurst, 2011 NSCA 100 at ¶ 47). [10] A joint tenancy ceases – that is to say the single title ceases – upon severance which can occur in three ways: 1. By one party acting upon his or her own share – usually by a conveyance to someone else; 2. By mutual agreement between the joint tenants; 3.

By words or conduct demonstrating a mutual intention to treat the joint tenancy as severed See: Williams v. Hensman, [1861] EWHC Ch J51, per Sir W. Page Wood, V.C. [11] The parties acknowledge that the only type of severance applicable here is that of a party acting on his or her own share orinterest. [12] The parties also agree that at common law a deed from a joint tenant to herself is not effective (Rye v. Rye, [1962] 1 All E.R.146 (H.L.) at p. 150; Presseau v. Presseau Estate, 2010 NSSC 201 at ¶ 30 to 33). It conveys nothing.

In reviewing the jurisprudence onthis point it is important to keep in mind that the common law rule has been changed by the wholesale property law reform of 1925 in theUnited Kingdom and by statutory amendment of the common law in a number of Canadian jurisdictions. Nova Scotia has made nolegislative change to the common law rule that a deed to oneself is ineffective. The Role of Equity: [13] The appellant correctly argues that equity can effect a severance of a joint tenancy in certain cases.

For example, if one jointtenant expresses a clear intention to hold her interest in trust for another, then she will have been found to have disposed of her interest,(Re Mee, (BC CA), [1971] B.C.J. No. 694) BCCA ). Similarly an agreement to convey one’s joint tenant interest to athird party is a severance because the contract itself creates an equitable interest which passes to the third party, (Lysaght v. Edwards(1876), 2 Ch. D. 499 at 506, per Sir George Jessel, M.R.). [14] The appellant submits that the conduct of Ms.

Lewis in signing and recording a deed is a “binding and irrevocabledeclaration” whereby equity would recognize that unity of title had been destroyed. But the cases relied upon by the appellant do notsupport that submission. The “irrevocable declaration” in Mee, was in fact the creation of an enforceable trust in which legal andbeneficial title were separated and a present equitable interest was created in favour of a third party. Likewise in Stonehouse v.

AttorneyGeneral of British Columbia (1960), (BC CA), 26 D.L.R. (2d) 391, aff’d, (SCC), [1962] S.C.R. 103,the “irrevocable” act of the joint tenant was the execution of a deed which in law was effective to convey title to a third party, withoutregistration. In each of these cases it was not the joint tenant’s declaration or intention that was effective to sever the joint tenancy; itwas the act of actually transferring the interest in question – by trust and deed, respectively. [15] The appellant also relies upon the comments of Justice Stirling in Re Wilks: Child v.

Bulmer, [1891] 3 Ch. 59 that a jointtenant may sever his interest where his conduct: “… be such as to preclude him from claiming by survivorship any interest in the subjectmatter of the joint tenancy”. Of course, this begs the question of what conduct achieves that result. In Wilks, a joint tenant had appliedto sever the joint tenancy by way of a partition of interest. No final hearing occurred and no order issued. So despite the expressedintention of the applicant, no severance was effected. [16] Canadian courts have not endorsed the severance of a joint tenancy by unilateral declaration, (Walker v.

Dubord, 14 B.C.A.C.81, (B.C.C.A.); Sorensen v. Sorensen, 1977 ALTASCAD 53 , [1977] 2 W.W.R. 438 (Alta. S.C.A.D.). This is consistent withthe principle that none of the “unities” of joint ownership is thereby destroyed. Certainly a unilateral declaration could create evidentiaryproblems, (Bruce Ziff, Principles of Property Laws, 3d ed. (Scarborough: Carswell 2000) at 311).

This would be especially problematicwhere conveyancing and commercial practice favours certainty. [17] The appellant also relies upon some obiter remarks of Justice Goodman in Re Murdoch and Barry (1976), (ON SC), 10 O.R. (2d) 626: In the present case the intention of the late Patricia Murdoch was clearly expressed in her affidavit of marriage status attached to thedeed. She then executed and caused to be registered the deed in question. That constituted an irrevocable act on her part, the purpose ofwhich was to sever the joint tenancy and it was

an act which, in my opinion, constituted more than a mere declaration of intention but,rather, an endeavour on her part to carry out by her act the intention expressed in her affidavit.

Even if the conveyance in question werenot deemed to be a severance of the joint tenancy pursuant to the provisions of s. 42 of the Conveyancing and Law of Property Act,the declaration of intention in the affidavit coupled, with the execution and registration of the deed would, in my opinion, haveeffectively estopped her from claiming by survivorship any interest in the subject-matter of the joint tenancy in the event that she hadsurvived the applicant.

As she had by the conveyance precluded herself from claiming by survivorship any interest in the property, andfollowing the dictum of Stirling, J., I conclude that by such acts she destroyed the joint tenancy. [Emphasis added] [18] The chambers judge swiftly disposed of this argument: [15] There are two fundamental problems with the assertion that Ms. Lewis’ invalid deed, and its registration, found an estoppel against

Ms. Lewis that she can use to make the invalid deed achieve its purpose. Firstly, no interested party heard her. Secondly, had aninterested party heard her it would be up to that person to decide whether or not to hold her to her word. … [19] Therefore, I do not agree with the conclusion expressed in obiter in Re Murdoch and Barry. There was no estoppel because nointerested party heard anything. [19] With respect, Justice Goodman’s obiter comment is simply wrong. It describes no recognized category of estoppel and isunsupported by authority. Nor is it sound in principle.

An invalid deed which conveys nothing cannot sever a joint tenancy. Aunilateral and uncommunicated act of one joint tenant that is ineffective at law should not be rescued by equity in the absence ofinequitable conduct by the other joint tenant. For similar reasons, the obiter comments of Justice Tidman in Roby’s Estate v. Buley (NS SC), 97 N.S.R. (2d) 191 at ¶ 34 cannot be relied upon by the appellant. [20] The appellant criticises the chambers judge for saying that there was no communication of Ms. Lewis’ intention to Mr.DeLong.

He argues that communication is not always required for estoppel to arise and cites the case of the by-stander who watchessomeone improve his land without commenting. But the key to such cases is that one party innocently prejudices himself usually to theother’s advantage, who looks on in silence. It is unsurprising that where a party has been so prejudiced (and the other arguablyenriched), the latter may be precluded from asserting his strict legal rights. (See for example proprietary estoppel: Maritime Telegraphand Telephone Company v.

Chateau LaFleur Development Corporation, 2001 NSCA 167 at ¶ 50.) No such circumstances obtain here. [21] Finally the appellant resorts to the idea of “fairness” and says that if the roles were reversed, it would be unfair for Ms. Lewisto claim her right of survivorship against the estate, had Mr. DeLong predeceased, in light of her expressed intention to sever the right ofsurvivorship. Two responses may be made. First, if Ms. Lewis’ deed to herself was ineffective at law, it changed neither party’sposition; and so it would not be unfair for either to continue to rely on their existing legal rights.

But more specifically, it could never beunfair or inequitable for Mr. DeLong to rely on his legal rights when he neither said nor did anything to prejudice Ms. Lewis. Noestoppel can arise against him owing to Ms. Lewis’ behaviour. [22] The chambers judge did not err in law. The appeal is dismissed. I would order costs of $2500.00, inclusive of disbursements,payable by Mr. Penny to the personal representative of the Estate of Mr. DeLong. No costs should be paid to or by the personalrepresentative for Ms. Lewis, who did not participate in the appeal. Bryson, J.A. Concurred in: Oland, J.A. Fichaud, J. A.