Matovich Estate v Matovich, 2015 SKCA 130

Court of Appeal for Saskatchewan Docket: CACV2429 Citation: Matovich Estate v Matovich , 2015 SKCA 130 Date: 2015-10-26 Between: Barbara Ann Sagen, as Executrix for the Estate of Elizabeth Lillian Matovich Appellant (Plaintiff) And Elizabeth Marie Matovich Respondent (Defendant) Before: Jackson, Ottenbreit and Ryan-Froslie JJ.A. Disposition: Appeal dismissed (orally) Written reasons by: The Honourable Madam Justice Ryan-Froslie In concurrence: The Honourable Madam Justice Jackson The Honourable Mr. Justice Ottenbreit On Appeal From: 2013 SKQB 205 , J.C. of Saskatoon Heard: October 26, 2015 Counsel: Cara L.

Haaf for the Appellant Dwayne Z. Braun for the Respondent Ryan-Froslie J.A. I. Introduction [ 1 ] Barbara Sagen, executrix of the estate of Elizabeth Lillian Matovich [Beth Sr.] appeals a decision of the Court of Queen’s Bench following trial which found the respondent, Elizabeth Marie Matovich [Beth Jr.] and her husband, Francis, had an enforceable verbal agreement with Francis’s parents (Beth Sr. and Martin Matovich) whereby, the NW 1/4 33-29-2 W3 [NW of 33] would become the property of Francis and Beth Jr. upon the death of the Sr. Matovichs.

The appeal concerns the application of the doctrine of part performance in the context of s. 4 of the Statute of Frauds , 1677, 29 Cha II, c 3 and the right to partition land held by joint tenants. [ 2 ] Following the hearing of the appeal, oral judgment was rendered dismissing the appeal with written reasons to follow. These are those reasons. II. background [ 3 ] Beth Sr. and Martin Matovich were married in 1939, and in 1941 moved to the NW of 33 which was registered in Martin’s sole name. The NW of 33 became their home quarter, and they raised nine children there, including Francis who was the second oldest.

Throughout their marriage, the Sr. Matovichs operated a farm and in later years, built a seed cleaning plant on the NW of 33. [ 4 ] In 1974, Francis, who had lived and worked in Alberta for a number of years, returned to his parents’ home to farm with his father. In 1975, he married Beth Jr. and in 1976 they moved into his parents’ residence on the NW of 33. Approximately two years later, Francis and Beth Jr. built their own home on that quarter, where they raised six children. Francis and Beth Jr. operated the farm in partnership with the Sr. Matovichs.

Martin’s other sons were also involved in the farming operations and had land of their own. [ 5 ] The trial judge found: [7] There was an understanding between Martin, Francis, Beth Sr. and Beth Jr. that Francis and Beth Jr. would have a 99-year lease in order to ensure ownership of their home with the understanding that when Martin and Beth Sr. passed on, Francis and Beth Jr. would own the home quarter. [ 6 ] In March 1980, a written lease was entered into between Francis and his father with respect to the NW of 33 and two other quarters. The Sr.

Matovichs’ residence was excluded from the lease, which was to remain in effect for the duration of Francis’s life. [ 7 ] The trial judge found that Martin and his sons expanded the Matovich farm to a considerable size. However, in the downturn of the late 80s and early 90s they, like many families, suffered financial difficulties and ended up turning their farmland, including the NW of 33, over to Farm Credit Corporation [FCC] in response to farm debt proceedings.

It was during this period of financial difficulty that Martin’s other sons sought off farm income, leaving only Francis to farm full-time with his father. Martin and Francis purchased the NW of 33 from FCC and then leased back the balance of the farmland they forfeited. When that lease expired, Francis and Beth Jr. bought the land from FCC. [ 8 ] Francis developed health issues and, as a result, Beth Jr. took on a more active role in the farming operations. Francis died in

November 2001. Despite his death, the farm continued to operate as a partnership with Beth Jr. and Martin making the financialdecisions. [9] Shortly after Francis’s death, in April 2002, Martin transferred the NW of 33 into the joint names of himself, Beth Sr. andBeth Jr. with a right of survivorship. The trial judge found this was done “to ensure that Beth Sr. would have a place to live for thebalance of her lifetime and that should anything happen to Martin and Beth Sr., Beth Jr. and her children would have a place to live….” [10] In 2007, Martin made a will bequeathing all of his property to Beth Sr.

He expressed in the will a desire that if Beth Jr.predeceased him, her joint share of the NW of 33 would go to her children as opposed to being transferred to him and Beth Sr. byoperation of law. [11] In 2008, Martin was killed in a farming accident. As Martin had wished, their home was still available for Beth Sr. to live infor the balance of her life, however, Beth Sr. was unable to care for herself and moved into a nursing home. There were insufficientfunds to maintain Beth Sr. and, accordingly, in 2008 she began an application to partition the NW of 33.

Beth Sr. passed away in October2011 and thereafter the executrix of her estate pursued the application for partition. [12] The trial judge found Beth Sr. “was a loving mother and grandmother who did not wish to offend anyone and would dowhatever was necessary to please those around her.” He found her apparent reason for requesting partition of the NW of 33 was toensure half of that quarter would be divided amongst her surviving children. [13] The trial judge concluded there was part performance of the oral agreement that Francis and Beth Jr. would have the NW of33 on the death of the Sr.

Matovichs, though he did not identify what acts constituted that part performance, other than to say he accepted“the evidence of the defence in this regard”. Because the trial judge found part performance of the agreement, he held that s. 4 of theStatute of Frauds does not apply, and that, in the circumstances, “justice” requires that partition should not be granted. [14] The executrix of Beth Sr.’s estate now appeals that decision. The grounds of appeal raise two discrete issues: (

i) Whether the trial judge erred in law by finding part performance of the agreement such that s. 4 of the Statute of Fraudsdoes not apply, and (ii) Whether Beth Sr. was entitled to partition. III. analysis [15] The standard of review to be employed by this Court in reviewing the trial judge’s decision is one of correctness with respectto questions of law and one of palpable and overriding error with respect to questions of fact (see Housen v Nikolaisen, 2002 SCC 33 atparas 7–37, [2002] 2 SCR 235; H.L. v Canada (Attorney General), 2005 SCC 25 at para 4, [2005] 1 SCR 401). 1.

The Statute of Frauds and the Doctrine of Part Performance [16] Counsel for the estate argued the agreement between the Sr. Matovichs and Francis and Beth Jr. was a verbal one, to which s.4 of the Statute of Frauds applies.

She contended the doctrine of part performance was never pled, and if it was, it did not apply in thecircumstances of this case, because none of the acts relied on as part performance—the years of services, the building and rebuilding ofBeth Jr.’s home on the NW of 33, the lease of the land or the transfer into joint tenancy—“unequivocally, in their own nature” referredto the agreement alleged (see Maddison v Alderson, [1883] 8 App Cas 467 at 479 [Maddison]). [17] While neither the Statute of Frauds nor the doctrine of part performance were raised in any of the pleadings, Beth Jr., in herstatement of defence, asserted the existence of an agreement, express or implied, between Beth Sr., Martin, Francis and Beth Jr. withrespect to the NW of 33.

The trial proceeded on the basis that the Statute of Frauds and part performance were issues to be determinedby the Court, and the trial judge ruled accordingly. Counsel for the estate did not raise or argue any deficiency in the pleadings before thetrial judge. The deficiencies alleged relate to form, not substance, and in the circumstances of this case, carry no weight in this appeal. [18] The Statute of Frauds along with other English statutes were received into law in this province as they existed on July 15,1870.

Section 4 of the Statute of Frauds renders agreements relating to land unenforceable, unless they are in writing and signed by theparties involved. As pointed out by the Earl of Selborne in Maddison at p. 474, s. 4 of the Statute of Frauds “does not avoid parolcontracts [respecting land], but only bars the legal remedies by which they might otherwise have been enforced….” [19] In equity, part performance of a parol contract concerning land was held to take it outside the operation of s. 4 of the Statute ofFrauds.

The Earl of Selborne described the doctrine of part performance at p. 479 of Maddison as follows: All the authorities shew that the acts relied upon as part performance must be unequivocally, and in their own nature, referable to somesuch agreement as that alleged… [20] The Supreme Court of Canada has considered the doctrine of part performance on numerous occasions.

One of the first suchcases was McNeil v Corbett (1907), (SCC), 39 SCR 608, where Duff J., after quoting the above statement of the Earl ofSelborne from Maddison, went on to add this further explanation: i.e. to an agreement respecting the lands themselves; [and, as further explained in that case] a plaintiff who relies upon acts of partperformance to excuse the non-production of a note or memorandum under the Statute of Frauds, should first prove the acts relied upon;it is only after such acts unequivocally referable. [sic] in their own nature to some dealing with the land which is alleged to have beenthe subject of the agreement sued upon have been proved that evidence of the oral agreement becomes admissible for the purpose ofexplaining those acts.…

(Emphasis added) [21] In other words, for the doctrine of part performance to apply, the acts allegedly constituting part performance mustunequivocally, in their own nature, point to some dealing with the land in issue (see also Meisner v Meisner (1905), (SCC), 36 SCR 34; Degelman v Brunet Estate, (SCC), [1954] SCR 725 at 726; Brownscombe v Vercamert Estate, (SCC), [1969] SCR 658 [Brownscombe]; Thompson v Copithorne Estate, (SCC), [1974] SCR 1023; andBuchko v Buchko (1997), (SK KB), 156 Sask R 100 (QB) aff’d, (1998), (SK CA), 172 Sask R152 (CA)). [22] In the case at hand, the trial judge found as a fact that there was an oral agreement between Francis, Beth Jr. and the Sr.Matovichs that they would get the NW of 33 on the death of the Sr.

Matovichs. There was ample evidence upon which to make thatfinding, including the evidence of Beth Jr. The trial judge recognized that s. 4 of the Statute of Frauds would apply to render that paroleagreement unenforceable, unless there had been part performance of it.

While the trial judge’s findings in this regard could have beenclearer, in our view, he correctly determined that there was part performance in the circumstances of this case. [23] Not all of the acts relied upon by Beth Jr. meet the test for part performance as enunciated in the judicial authorities—forexample, the work done (services rendered) by Francis and Beth Jr. and the lease with respect to the NW of 33 do not, in our assessment,unequivocally refer to a transfer of the land. They are equally consistent with an agreement that the Jr. Matovichs would farm the land inpartnership with the Sr. Matovichs.

In my view, however, the fact Francis and Beth Jr. built their home on the NW of 33, the fact thatBeth Jr. rebuilt that home in 2006 after it was destroyed by fire, and the fact that Martin transferred the NW of 33 into the joint names ofhimself, Beth Sr. and Beth Jr. with a right of survivorship, are all acts which unequivocally, in their own nature, point to an agreementinvolving ownership of the NW of 33. [24] Our view is supported by the Supreme Court of Canada’s decision in Brownscombe.

That case involved a situation where theproponents of an alleged oral agreement to transfer land, had built their home on that land.

Hall J. speaking for the Court in that case,stated the following at p. 664: It is clear that not all the acts relied on as testified to by the appellant and his wife can be regarded as “unequivocally referable in theirown nature to some dealing with the land”, but in my view the building of the house on the lands in question in the years 1946 and 1947at the suggestion of Vercamert almost, if not wholly, at the appellant’s expense was, as the learned trial judge found “unequivocallyreferable” to the agreement which the appellant alleged had been made and inconsistent with the ordinary relationship of employee ortenant. [25] Accordingly, in our assessment, the trial judge did not err in law in finding there was part performance of an oral agreementthat the NW of 33 would belong to Francis and Beth Jr. upon the death of the Sr.

Matovichs and that, in the circumstances, s. 4 of theStatute of Frauds does not apply. 2. Partition [26] Having found the agreement as described above, the trial judge correctly determined Beth Sr. would not be entitled topartition. [27] At common law, the owners of land as joint tenants or tenants in commons had no right to the remedy of partition or sale.

Thepower to order those remedies was conferred by a series of statutes in England, which were received into law in Saskatchewan first,pursuant to s. 11 of The Northwest Territories Act, RSC 1886, c 50 and then by the provisions of The Saskatchewan Act, SC 1905, c 42.Three English statutes are relevant, namely: (

i) Statute of Partition, 1539, 31 Henry VIII, c 1 which provides that co-tenants of land could be compelled to make partition; (ii) Statute of Partition, 1540, 32 Henry VIII, c 32 which extended the 1539 Act to include co-tenants for life or for a term ofyears; and (iii) Partition Act, 1868, 31 and 32 Vict, c 40 which permits the court to order sale as opposed to partition. [28] The 1539 and 1540 Acts gave courts the power to physically divide (partition) land between co-owners who are unable byagreement to make a division or agree to a sale.

In this case, Beth Sr.’s estate is asking the Court to partition land which Beth Sr., duringher lifetime, agreed would belong to another upon her death. Before her death, she could not renege on the agreement she and herhusband had put in place. The vehicle they chose to give effect to their agreement was to transfer the land into the joint name of Beth Sr.,her husband Martin, and Beth Jr. with a right of survivorship. Upon Beth Sr.’s death, nothing further was required to give effect to theparties’ agreement.

In the circumstances, the trial judge did not err in finding Beth Sr. was not entitled to partition—she had alreadycontracted away her right to seek such a remedy. IV. conclusion [29] The appeal is dismissed. There shall be an order discharging the lis pendis registered against the NW 33-29-2 W3 by Beth Sr. [30] Beth Sr.’s estate shall pay to Beth Jr. the costs of this appeal fixed at $3,500.00. The $7,748.62 (plus interest) paid into Courtby Beth Sr.’s estate, as security for costs, shall be paid out to Beth Jr. in full satisfaction of the costs ordered in both this Court, and theCourt of Queen’s Bench.