Sawdon Estate v. Watch Tower Bible and Tract Society of Canada et al. 2014 ONCA 101
Banks and Banking - Bank accounts - Joint accounts - Title
Sawdon transferred several bank accounts into joint accounts, with a right a survivorship, to himself and two of his five children (Wayne and Stephen). Sawdon’s will did not mention the accounts. The will contained a clause entitling each of the children to the greater of $100,000 or the largest amount owing on mortgages that he held on Wayne and Stephen’s homes. It also provided that Watch Tower Bible and Tract Society of Canada was to receive the share of any child who died without issue, as well as the residue of the estate. Sawdon died. When the trustee of the estate (Wayne) sought to pass accounts, Watch Tower claimed that the funds in the bank accounts formed part of the estate by way of a resulting trust. Wayne (in his capacity as trustee and in his own right) and Stephen applied for a determination of the issue, asserting that Sawdon had instructed them to distribute the funds in the account equally among all of his children, on his death.
The Ontario Superior Court, in a decision reported at  O.T.C. Uned. 4042, held that the presumption of a resulting trust in favour of the Sawdon’s estate had been rebutted and the funds in the accounts were not part of the estate. The parties made submissions on costs.
The Ontario Superior Court ordered Watch Tower to pay the trial costs incurred by Wayne on a partial indemnity basis. The court refused Wayne’s request that the estate indemnify him for the balance of his costs. Watch Tower appealed, asserting that the judge applied the wrong principles and that the estate was entitled to the funds in the bank accounts. Wayne, in his capacity as trustee, applied for leave to appeal the costs order and, if leave was granted, sought to cross-appeal, asserting that he was entitled to indemnification from the estate for his legal costs not recovered from Watch Tower.
The Ontario Court of Appeal dismissed Watch Tower’s appeal and allowed Wayne’s cross-appeal.