4 given the length of the relationship and ws

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4. Given the length of the relationship and W’s contributions, it would be unconscionable for H to deny her a share in the other assets. WHEN DOES A CT ARISE? 1. Does it arise automatically when the requirements are satisfied and before the court declares it (“institutional” conception)? 2. Or is it a remedy granted by the court that comes into existence only when the court declares it? (“remedial” conception)? 3. Is an issue of timing, particularly in bankruptcy cases!!! 4. Deane J in Muschinksi discusses the issue but gives no clear answer. WHEN DOES A CT ARISE? PARSONS V MCBAIN 1. Each brother transferred his home to his wife shortly before he became bankrupt. 2. Trustee in Bankruptcy sought orders to set aside the transfers under Bankruptcy Act. 3. Each wife argued that before the transfers, she already had a beneficial interest as to one half under a CT, based on common intention of shared ownership and her contributions to the property – so TiB couldn’t recover her half. 5
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6 4. The creditors argued on s. 120 of the Bankruptcy Act, which brought into play s. 121. The TJ held in creditor’s favour. The wives argued they had a half share of the assets, and that they were entitled to a half share of the benefit as they always had this. This couldn’t be touched, and suggested the CT already existed BEFORE court held it to. THUS, TiB could ONLY recover HALF. PARSONS V MCBAIN: FULL FED CRT 1. Court found the wives did have a half interest under a CT before the transfers. 2. The wives’ beneficial interests under a CT arose at the time of the common intention, and were not recoverable on Hs’ bankruptcy. 3. Each wife was ordered to transfer her interest to herself and the Trustee as tenants in common in equal shares. 4. Basically argued that the “common intention (CI)” stuff was an institution (that is, do NOT have to wait for court to say it is so). NOTE, there doesn’t need to be proportionality in what is put up for the CT. WHEN DOES A BAUMGARTNER CT ARISE? 1. Parsons v McBain involved a common intention CT. 2. Does the same apply to a Baumgartner type CT? That is, does it arise when requirements are met and before a court declares it to exist? The position is unclear. 3. WE STILL DON’T KNOW!!! The reason is that the method of working out contributions occurs over time. ALSO, this requires unconscionable conduct, but the courts aren’t ready to decide on this. ESTOPPEL 1. Common law estoppel Representations as to facts, not intentions Used as a defence, not as a cause of action 2. Equitable estoppel. Equity may come to relief of plaintiff who has acted to his/her detriment in relying on a representation by the defendant in circumstances where it would be unconscionable for the defendant to resile from the representation Encompasses both promissory estoppel and proprietary estoppel.
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