Was It a Gift? Challenging Joint Accounts and Joint Title After a Death

A parent dies, and the family learns that one sibling was a joint owner of mom's bank account, or of dad's house. The bank and the land title office treat that sibling as the survivor, and the asset never reaches the estate. Other siblings often ask whether that can be right.

Sometimes it is. Sometimes it is not. In Canada, the question is what the parent intended, and the law starts from a presumption that can favour the estate. This guide explains how a challenge works from the side of the siblings and beneficiaries left out.

Survivorship moves the asset, not necessarily the right to keep it

When two people hold a bank account or land as joint owners and one dies, the survivor becomes the sole owner on the records. The bank typically releases the account to the survivor, and the land title office can register the house in the survivor's name alone. Our guide on transferring title after a joint tenant dies covers that paperwork.

But who holds legal title is not the end of the question. Canadian law separates legal title from beneficial ownership, meaning who is really entitled to the asset. A child added to a parent's account may hold it only as a trustee for the parent's estate.

The Pecore rule: the starting presumption is a resulting trust

The key case is Pecore v. Pecore, decided by the Supreme Court of Canada in 2007. The Court confirmed that when someone transfers property to another person for nothing in return (a gratuitous transfer), the general rule is a presumption of resulting trust. The person who received the asset is presumed to hold it for the person who gave it, or after death, for that person's estate.

For joint accounts, the Court held that the surviving joint holder has to prove the deceased intended to give them the right of survivorship. A different presumption, the presumption of advancement, can apply depending on the relationship between the parties. In the common case of a parent and an independent adult child, families should expect the starting point to be a resulting trust.

These presumptions only guide the court when the evidence of intention is unclear. They are rebutted on the ordinary civil standard, the balance of probabilities. In practice, the case turns on evidence of what the parent actually intended when the account was opened or the title was changed.

What evidence matters

Courts look at the whole picture. Evidence that often matters includes:

• Bank documents. Pecore recognised that account opening forms and joint account agreements can be strong evidence of intention about who benefits, though they are not always decisive.
• How the account was used. Who deposited, who withdrew, who paid tax on the income, and whether the child used the money during the parent's lifetime.
• Later statements and conduct. Under Pecore, evidence from after the transfer is not automatically excluded if it is relevant, but the court weighs its reliability and guards against self-serving accounts.
• The parent's wider plan. What the will says, whether the parent spoke to a lawyer, and whether the transfer made sense with how the rest of the estate was divided.

A common pattern is the "convenience" account: one child was added so they could pay bills when the parent's health declined. If that was the purpose, the account may belong to the estate. In other cases the parent clearly meant to leave that child something extra. The same analysis applies to a house placed in joint names; our article on the risks of adding a child to title explains why these transfers are so often disputed later.

Who can bring the claim

A resulting trust claim seeks to bring the asset back into the estate, so the usual claimant is the executor or administrator. That creates an obvious problem when the executor is the sibling who kept the account.

The Wills, Estates and Succession Act gives beneficiaries two main options:

• Sue on the estate's behalf. Under section 151, a beneficiary can ask the court for leave to bring a claim in their own name on behalf of the estate. The court must be satisfied that the beneficiary made reasonable efforts to get the executor to act, gave notice, is acting in good faith, and that the claim is necessary or expedient to protect the estate or the beneficiaries.
• Replace the executor. Under section 158, a person with an interest in the estate can apply to remove or pass over an executor who should not continue, for example because of a conflict. See our guide to removing an executor in BC.

Why it matters for the rest of the estate

Assets that pass by survivorship generally sit outside the estate. That affects more than one sibling's share. A wills variation claim under section 60 is a claim against the will-maker's estate, so an asset outside the estate is out of reach unless it is brought back in. If a resulting trust is established, the asset is distributed under the will (or the intestacy rules) with everything else.

Protect your position early

• Ask for records. The executor can request account opening documents and statements from the bank. Beneficiaries can ask the executor for them, and, if needed, seek them through the court process, along with any lawyer's file on a title transfer.
• Preserve real estate. If the asset is land, a person claiming an interest in land in a court proceeding can register a certificate of pending litigation under section 215 of the Land Title Act. That generally stops the survivor selling or mortgaging while the claim is decided.
• Watch the time limits. Limitation periods can apply to estate and trust claims. Our guide to the BC limitation period explains the general rule; get advice on your specific claim promptly.
• Keep the family dispute in proportion. Many of these cases settle once the documents are on the table. Our article on disputes between siblings over an estate has more on resolving them.

Think a joint account or house should have been part of the estate?

Our probate and estate lawyers can review the account and title records, assess whether a resulting trust claim is worth pursuing, and advise on bringing it through the executor or on the estate's behalf.

Call 604-259-2844 or send us a message to arrange a consultation at our Vancouver office.