McGILL LAW JOURNAL
[Vol. 20
Murdoch ‘V. Murdoch: Just about what the
Ordinary Rancher’s Wife Does
The decisions of the House of Lords in Pettitt v. Pettitt’- and
Gissing v. Gissing2 provoked a great interest in the subject of
family property3 Those casies left the common law in an unsatis-
factory state firstly because they did not give a clear exposition
of all applicable principles and,-secondly because the policy of rigid
separation of property which the Law Lords were unwilling to
bend ignored the partnership aspects of rmbdern marriage. The
Supreme Court of Canada had not ruled on the question since
the 1961 decision in Thompson v. Thompson,4 which preceded Pettitt
and Gissing by almost ten years and which, while consistent with
the rationale employed by the House of Lords, merely scratched
the surface of the problems. A post-Gissing pronouncement by the
Supreme Court should have been welcomed, but the recent deci-
sion in Murdoch v. Murdoch 5 aggravated the difficulties and the
controversy which it produced may impel the provinces to legis-
late a solution.”
The facts of the Murdoch case are quite well known.’ For the
first four years after their marriage in 1943 the Murdochs worked
on ranches in Alberta as a hired couple. In 1947 the husband ac-
quired his first ranch property in that province and thereafter,
through a progression of sales and purchases, acquired properties
of increasing value culminating in a substantial homestead-ranch.
After the marriage collapsed in 1968 Mrs Murdoch claimed a decree
1 [1970] A.C. 777.
2 [1971] A.C. 886.
3 The leading articles include: Lesser, The Acquisition of Inter Vivos Matri-
monial Property Rights in English Law: A Doctrinal Melting Pot, (1973) 23
U. of T. L.J. 148; Brown, English Law in Search of a Matrimonial Regime,
(1970-71) 4 Ottawa L.Rev. 331; Kahn-Freund, Recent Legislation on Matrimonial
Property, (1970) 33 M.L.R. 601; Miller, Family Assets, (1970) 86 L.Q.R. 98.
4 [1961] S.C.R. 3.
5 (1974), 41 D.L.R. (3d) 367; [1974] 1 W.W.R. 361 (S.C.C.).
6 The Ontario Law Reform Commission has made an exhaustive study of
the entire field of family property law in Ontario and has- recently produced
its report. See Ontario Law Reform Commission, Report on Family Law,
Part IV, Family Property (1974). (Hereinafter called Report on Family Law.)
7-It has been the subject: of extensive- journalistic comment. See, e.g., Time,
25 March 1974, Canadian notes,, -7
, ……
.
1974]
COMMENTS –
COMMENTAIRES
of judicial separation and a one-half interest in the ranch, the title
to which was vested in the name of her husband. Her initial con-
tention was that she and her husband were equal partners in the
ranching business, but when the case reached the Supreme Court
of Canada, on appeal from the Appellate Division of the Alberta
Supreme Court, Mrs Murdoch abandoned the partnership claim.
She submitted that there was a resulting trust in her favour for
a one-half share in the property because she contributed either
directly in cash or indirectly through labour to the successive
acquisitions of property.
When Murdoch was litigated, certain clear principles of law
could be distilled from the earlier cases. Pettitt and Gissing illus-
trated the primary rule: where one spouse claims a beneficial
interest in property in which the legal title is vested in the other
spouse then the party who asserts the existence of a beneficial
interest must establish that the legal owner holds the property in
trust for the claimant. The same rule applies to disputes about
beneficial ownership between strangers. 9 Section 17 of the English
Married Women’s Property Act -0 is procedural and does not entitle
a court to vary existing property rights.” It follows that a court
cannot make a discretionary division of “family assets”. 2 This
view of the law had already been accepted by the Supreme Court
of Canada in Thompson 13 and the submission on behalf of Mrs
sGissing v. Gissing, [1971] A.C. 886 especially per Viscount Dilhorne at 900
and Lord Diplock at 904.
9 Gissing v. Gissing, [1971] A.C. 886, 904-5 per Lord Diplock.
10 45 & 46 Vict., c.75. This section has been enacted in most of the Canadian
Provinces. See, e.g., Married Women’s Property Act, R.S.O. 1970, c.262, s.12(1):
In any question between husband and wife as to the title to or possession
of property, either party … may apply in a summary way to a judge
of the Supreme Court… and the judge may make such order.., as
he” thinks fit….
There is no legislation equivalent to s.17 of the English Married Women’s
Property Act in Alberta, but in view of the propositions adopted in Pettitt
and Gissing it is clear that the same substantive principles apply whether
or not that section is enacted.
11 Pettitt v. Pettitt, [1970] A.C. 777, 793 per Lord Reid, 798 per Lord Morris,
807-8 per Lord Hodson, 813 per Lord Upjohn, 820 per Lord Diplock.
12 The contrary doctrine (that s.17″ would permit the discretionary division
of “family assets”) was developed by the English Court of Appeal in a line
of cases beginning with Rimmer v. Rimmer, [1953] 1 Q.B. 63, and including
Pettitt v. Pettitt and Gissing v. Gissing and was never accepted in Canada.
Fribance V. Fribance, [1957] 1 All E.R. 357. This approach was rejected in
See f.n.13.-
‘2 Thompson v. Thompson, [1961] S.C.R. 3, 13-14 per Judson,J.
McGILL LAW JOURNAL
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Murdoch that there was a resulting trust in her favour was simply
an attempt to apply the rules adopted by the most authoritative
courts in Canada and England.
There was thus no doubt that the issue in Murdoch was to be
governed by the law of trust, but the judgments in Pettitt, Gissing
and Thompson did not settle all the circumstances in which a court
could find a resulting trust. It would appear that a claimant must
establish that there was a common intention at the time of acqui-
sition of the property that he or she was to have a beneficial in-
terest.14 A court can infer this intention from the conduct of the
spouses and in particular from contributions to the purchase price
by the claimant spouse.15 But the problem is complicated by the
fact that the modem land transaction is not completed by a simple
cash payment. The purchase is usually made by the payment of
an initial deposit followed by instalments for the balance of the
price payable over an extended time period. The claimant’s contri-
bution to the purchase price might therefore be a direct cash
payment toward the deposit or instalments, or an indirect contri-
bution, “e.g. by paying household bills, so as to enable [the legal
owner] to pay for the house”.Y’ A substantial direct cash contri-
bution will provide a court with sufficient evidence to infer that
the spouses intended it to carry a share in the property. 7 How-
ever, the position where only indirect contributions are made was
14 Gissing v. Gissing, [1971] A.C. 886, 898 per Lord Morris, 900 per Viscount
Dilhorne, 905-6 per Lord Diplock. In Pettitt v. Pettitt some of the Lords in-
dicated that the court may impute to the parties an intention which they
did not in fact have, but which they would have had if they had thought
about the matter: [1970] A.C. 777, 795 per Lord Reid, 816 per Lord Upjohn,
823 per Lord Diplock. However, in Gissing v. Gissing a majority of the members
of the court stated that a “court cannot ascribe intentions which the parties
in fact never had”: [1971] A.C. 886, 898 per Lord Morris. Cf. also [1971] A.C.
886, 900 per Viscount Dilhorne, 904-06 per Lord Diplock. Lord Reid seemed to
believe that a court can still impute such an intention: [1971] A.C. 886, 897.
Lord Pearson noted that “imputed intent does not differ very much from an
implied agreement”: [1971] A.C. 886, 902. The doctrine that the court can infer
the parties’ common intention was accepted in Murdoch v. Murdoch (1974), 41
D.L.R. (3d) 367, 377 per MartlandT.
15 Gissing v. Gissing, [1971] A.C. 886, 896 per Lord Reid, 900 per Viscount
Dilhorne, 902 per Lord Pearson, 906 per Lord Diplock. But this is not to
impute to the parties an intention which they did not have.
10 Gissing v. Gissing, [1971] A.C. 886, 896 per Lord Reid.
17 Gissing v. Gissing, [1971] A.C. 886 especially per Viscount Dilhorne at 900
and Lord Diplock at 907-8. Thompson v. Thompson, [1961] S.C.R. 3, 13-14.
Of course, if the payment is made by the husband who takes title in the
name of his wife he may be unable to rebut the presumption of advancement.
19741
COMMENTS – COMMENTAIRES
not resolved by Gissing 18 and received only passing mention in
Thompson.19
To see how these principles were applied in Murdoch, one must
look at its detailed facts. The first of the succession of properties
which Mr Murdoch purchased was a dude ranch. He bought it in
1947 in partnership with his father, each of them contributing
$3000. Martland,J., who wrote the majority judgment in which
Judson, Ritchie and Spence,JJ. concurred, stated that Mr Murdoch
paid his share of the price out of his own assets.20 The sole dis-
senting judge, Laskin,J. (as he then was), noted that during the
preceeding four years, when the Murdochs worked as a hired couple,
their pay of $100 per month was received by the husband and
part of his share of the price of the dude ranch came from those
earnings. 21 The property was sold in 1951 and Mr Murdoch re-
ceived $3,500 from the proceeds of sale.
In 1952 Mr Murdoch made a loan of $4,000 to one Sturrock
in return for grazing rights but the source of these funds was dis-
puted. Mrs Murdoch’s father died during that year and left moneys
to his wife. The latter then gave some of the money to Mrs Mur-
doch, who deposited it in a bank account in her own name. The
funds for the Sturrock loan came out of that money but Mr
Murdoch alleged that he borrowed the money from his wife’s
mother. He produced book entries in support of this argument
and the trial judge found that “he understood and treated that
money at all times as a loan made to him”.22
Mr Murdoch’s next acquisition was the Ward property, for which
he paid $4,500. He contributed $2,500 from the proceeds of sale
of the dude ranch, and the remaining $2,000 came from the estate
moneys of Mrs Murdoch’s father, which had been deposited in
18 There were statements both for and against the proposition that the
requisite intent can be inferred from indirect contributions. See Lesser,
supra, f.n.3, 1934. The writer does not accept Lesser’s conclusion that a
majority of their Lordships believed that an indirect contribution could never
give an interest in the property. See infra, at p. 316.
19 [1961] S.C.R. 3, 14 per Judson,J. The Ontario Law Reform Commission
observed that “there is much residual uncertainty concerning the precise
nature of the contribution required to be made by a spouse to the matri-
monial home as a condition precedent to establishing entitlement to a bene-
ficial interest therein”: cf. Report on Family Law, supra, f.n.6, 38. This remark
is equally applicable to all items of family property.
20 (1974), 41 D.L.R. (3d) 367, 369.
21 (1974), 41 D.L.R. (3d) 367, 379. The judgments of Laskin and Martland,JJ.
are marked by differences of opinion on both fact and law.
2 (1974), 41 D.L.R. (3d) 367, 371.
McGILL LAW JOURNAL
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her bank account. However, the trial judge found that, as with
the Sturrock loan, Mr Murdoch treated it as a loan from his
mother-in-law and not as a contribution from his wife.
The final transaction took place in 1958 and concerned the
purchase of a ranch described as the Brockway property. This
was the land in respect of which Mrs Murdoch claimed her one-
half interest. Mr Murdoch paid $25,000 for it and also bought
some farm machinery for $3,800. He paid a $6,200 deposit on the
real estate and cash for the machinery. Both these sums came
from the proceeds of sale of the Ward property and the repay-
ment of the Sturrock loan. He agreed to pay the balance of the
purchase price by instalments and duly made the payments.
In addition to the abovementioned cash contributions which
Mrs Murdoch claimed to have made toward the eventual purchase
of the Brockway property, she also relied upon the fact that during
the marriage she had worked very hard in her husband’s ranching
business. She described the nature of her work as follows:
Haying, raking, swathing, moving, driving trucks and tractors and teams,
quietening horses, taking cattle back and forth to the reserve, dehorning,
vaccinating, branding, anything that was to be done. I worked outside
with him, just as a man would… .23
Moreover, Mr Murdoch was absent from the properties for five
months in every year on other business and he admitted that his
wife looked after the ranches while he was away. Nevertheless,
he thought that this was “just about what the ordinary rancher’s
wife does”124 and that view of the facts was accepted by the trial
judge.25
Thus there was evidence in the Murdoch case of both direct
and indirect contributions. Mrs Murdoch’s principal evidence of
a direct cash payment was that she had paid $6,000 into the Stur-
rock loan and the Ward property and that these funds formed
part of the deposit for the Brockway ranch. But the trial judge’s
finding of fact that Mr Murdoch treated the money as a loan
nullified the attempt to infer from this payment a common inten-
tion to share ownership. Martland,J. accepted without question
the trial judge’s factual determination and the conclusion of law
which followed from it 20 LaskinJ.’s dissent was based mainly on
2: Excerpt from Mrs Murdoch’s evidence in chief. See
(1974), 41 D.L.R.
(3d) 367, 380.
24 Excerpt from Mr Murdoch’s evidence in chief. See
(1974), 41 D.L.R.
(3d) 367, 380.
25 (1974), 41 D.L.R. (3d) 367, 375-376, 380-381.
20 (1974), 41 D.L.R. (3d) 367, 373.
19741
COMMENTS – COMMENTAIRES
other grounds and he did not take issue with this point, remarking
only that “clarity could have been better served if ,this is intended
as a finding that the money was a loan from the wife’s mother”.27
It is settled law that where evidence establishes only a loan of
money used for the purchase of property there is no resulting
trust to the lender who has the status merely of a creditor.28 The
decision that no resulting trust arose from the wife’s financial
contribution was based not on this principle but on the impossi-
bility of inferring a common intention to share ownership in the
face of Mr Murdoch’s belief that the funds were a loan.
This is logical reasoning but it simply underscores the inade-
quacy of analysing family property cases in terms of the general
principles of property law which govern disputes between strangers.
For example, Mr Murdoch’s mother-in-law would not have lent the
money to him if he were not married to Mrs Murdoch. Further-
more, Mrs Murdoch’s mother would hardly have paid such a large
sum of money to Mr Murdocl for- a private benefit from which
Mrs Murdoch was excluded. Martland,J.’s judgment should be
compared with the decision of Lacourcierej. in Calder v. Cleland,29
where his Lordship gave special attention to the motivating factors
in family finances. There the spouses sold the matrimonial home
which they owned as joint tenants and the proceeds of sale were
used in part for the purchase of a new home. The balance of the
down payment was a gift from the husband’s father, and in con-
sidering the nature of that contribution Lacourciere,J. said:
… it is natural to think that the defendant’s father intended to benefit
both his son and daughter-in-law, who lived- harmoniously and were the
parents of his grandsons … he may not have given explicit instructions
as to title, but he clearly envisaged subsidizing the purchase of a new
matrimonial home… .30
Since the trial judge in Murdoch did not hold that the money
used in the Sturrock and Ward transactions was an actual loan,
it was open to the Supreme Court to conclude that the money
was either a contribution from Mrs Murdoch or, at least (as in
Calder v. Cleland), a payment which was intended to benefit both
husband and wife. Mr Murdoch’s assertion that he did not treat
the money as a contribution presented a hurdle for the Court but
it could have held that a reasonable man in his position would
have realized that the money was intended to benefit both spouses.
27 (1974), 41 D.L.R. (3d) 367, 382.
2 8 Pettitt, Equity and the Law of Trust 2d ed. (1970), 94.
29 (1971), 16 D.L.R. (3d) 369.
3o Ibid., 374.
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However, a majority of the House of Lords has held that a court
cannot impute an agreement to the spouses which they did not
make 8 ‘ and the doctrine of imputed intention was not discussed
in Murdoch.
The submission on behalf of Mrs Murdoch that she made an
indirect contribution to the purchase of the property through
her labour raised even more difficult problems. Her counsel relied
on the judgment of the Alberta Supreme Court in Trueman v.
Trueman.32 In that case the wife claimed an interest in her hus-
band’s property by doing more work on it than is usually expected
of a farm wife. She worked in the fields beside her husband, oper-
ated the farm machinery and contributed to the fund which was
realized from the sale of grain and livestock which was used to
pay for the purchase of the farm. The evidence, which in this
respect was similar to Murdoch, included “cutting the crop, stook-
ing, cutting hay, raking hay, discing, harrowing, anything there
was to do”.33 Mrs Trueman also shared the actual work of building
the farm house.
Johnson,S.A. held that on these facts the wife was entitled to
a one-half share in the property. He quoted extensively from the
judgment of Lord Reid in Gissing in which his Lordship said that
he could “see no good reason” for the distinction between direct
and indirect contributiori,’ and from Judson,.’s opinion in Thomp-
son. The following passage from that judgment is crucial:
But no case has yet held that, in the absence of some financial contribu-
tion, the wife is entitled to a proprietary interest from the mere fact of
marriage and cohabitation and the fact the property in question is the
matrimonial home. Yet, if the principle is sound when it is based on a
financial contribution, no matter how modest, there seems to be no
logical objection to its application and the exercise of the same discretion
when there is no financial contribution when the other attributes of the
matrimonial partnership are present. However, if one accepts the finding
of the learned trial judge, the basis for the application of the rule at
its present stage of development in England is not to be found in the
present case.35
Johnson,S.A. noted that on the facts of Thompson there was no
indirect contribution and therefore the principle subsequently ac-
cepted by Lord Reid was not applicable. 36 He then concluded that:
31 Cf. supra, f.n.14. See also Lesser, supra, f.n.4, 191-2.
32 [1971] 2 W.W.R. 688; 18 D.L.R. (3d) 109 (Aita. S.C. App.Div.).
33 [1971] 2 W.W.R. 688, 694.
34 [1971] A.C. 886, 896.
s5 [1961) S.C.R. 3, 13-14.
30 [1971) 2 W.W.R. 688, 693.
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COMMENTS
– COMMENTAIRES
In most of the English cases, the contribution is made by cash contributed
by the spouse. It is evident from the passage from the judgment of
Judson,T. in the Thompson case which I have quoted that this principle
should logically extend beyond financial contributions. Surely if services
which the appellant rendered relieved the respondent from employing
extra help to do the work which the appellant did, the value of such
work should be counted as a contribution both to the purchase price
of the farm and to the improvement created by the building of the house.3
In the Murdoch case Martland,J. took an equivocal stand with
respect to the status of Trueman. “Assuming that the conclusion…
was, on its facts, correct”,3 8 he attempted to distinguish the case
in two ways. Firstly, he observed that Trueman involved an in-
terest in the family homestead or matrimonial home whereas Mrs
Murdoch claimed a share in her husband’s ranching business.39
It is submitted that this is not a ground for distinguishing the
case. As mentioned above, the House of Lords and the Supreme
Court have expressly stated that a court has no discretion to apply
special rules to “family assets”. This proposition was reiterated
by both Martland,J. and Laskin,J. in Murdoch.4 The same princi-
ples therefore apply to the matrimonial home as to other property.
Secondly, Martland,J. observed that while in Trueman the trial
judge found that the wife made a substantial contribution to the
acquisition of the property, the trial judge in Murdoch decided
that the wife had merely done the same work as any other ranch
wife.4′ Martland,J. did not interfere with that finding and there-
fore equated Mrs Murdoch’s labour with ordinary household chores
which undoubtedly do not give a wife a proprietary interest in the
home under a system of separation of property. However, in view
of the fact that Mr Murdoch was absent from the property for
five months of every year during which time his wife performed
all the farming jobs that her husband would have done, the trial
judge’s finding might well have been overturned. After all, aside
from Mrs Murdoch’s work with her husband, does a normal farm
wife spend five months of every year for twenty years tending
her husband’s property while he is away on other business? The
failure of the courts to give her an enforceable remedy in return
for these services was a travesty of justice.
37 [1971] 2 W.W.R. 688, 695.
38 (1974), 41 D.L.R. (3d) 367, 375.
39 Ibid. It is interesting to note that in Thompson v. Thompson, [1961] S.C.R.
3, 9 his Lordship distinguished Rimmer v. Rimmer, [1953] 1 Q.B. 63 on the
same ground.
40 (1974), 41 D.L.R. (3d) 367, 373, 384.
41 (1974), 41 D.L.R. (3d) 367, 375-376.
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The view of the facts which Martland,J. accepted avoided the
necessity of considering whether indirect contributions can give
an interest in property and whether Trueman should be overruled.
Unfortunately his Lordship did not take the opportunity to con-
sider those questions. It may well be that he considered that the
above-quoted passage from Judson,J.’s judgment in Thompson in-
dicated that a resulting trust will be inferred only from a direct
financial contribution, for after his discussion of Thompson he
stated that “[i]f a financial contribution is necessary in order
to found the appellant’s claim, it has not been established” 4 2 It
is submitted that in certain circumstances indirect contributions
should allow the courts to find a resulting trust in favour of the
contributor and that Trueman was correctly decided. The House
of Lords in Pettitt and Gissing discussed the problem of indirect
contributions but it is wrong to conclude that a majority in Gissing
believed that beneficial interests in property cannot be acquired
solely by indirect contributions.4 3 Lords Reid and Pearson appeared
to state that an interest can be acquired through indirect contri-
butions alone,44 Lord Morris and Viscount Dilhore were of the
opinion that the intention of the spouses in each case will be a
question of fact,4
5 and Lord Diplock’s judgment contains state-
ments which seem to support both sides of the argument.46 Finally,
the Thompson case did not deal with the problem. Since there
are thus no constraints of binding precedent it is submitted that
the correct position with respect to indirect contributions is that
they should enable a court to infer an intention of co-ownership
provided they are not too remote from the acquisition of the
property itself. Thus a purchase of clothing or furniture will not
be sufficient while regular payments of a substantial sum for
42 (1974), 41 D.L.R. (3d) 367, 373. However, Laskin,J. apparently’ did not
believe that Judson,J. considered the possibility that indirect contributions
or physical labour may carry an inference of beneficial ownership. He stated
at pages 384-5 that:
I read this passage [of Judson,J.] as emphasizing the illogic of an arbitrary
half-interest division in favour of a wife who has made little or no financial
contribution. It does not relate to the equity considerations that may
warrant a court in declaring some entitlement in a wife who has con-
tributed substantially in money or in labour to the acquisition of- property
taken in the husband’s name.
43But cf. contra, Lesser, supra, f.n.4, 194.
44 [1971] A.C. 886, 896 and 903 respectively.
45 [1971] A.C. 886, 898 and 900 respectively.
40 [1971] A.C. 886, 907-908 and 909. But see Lesser, supra, f.n.4, ‘193.
19741
COMMENTS – COMMENTAIRES
property taxes on the house in dispute might be enough.47 Further-
more, contributions of labour should not be characterized as in-
diredt payments but as contributions of money’s worth to the
acquisition of property. It would be illogical to admit that a spouse
can buy an interest in property which was built by another and
yet deny that she can build that interest with her own hands.
However, these submissions cannot be stated as categorical pro-
positions of law and their acceptance in Canada must be subject
to some doubt after Murdoch. Certainly Martland,J. expressed no
opinion on these points, but his silence suggests that he may have
been reluctant to venture beyond the inference of a resulting trust
from direct financial payments. On the other hand, it will be seen
that Laskin,J.’s dissent has the paradoxical effect of supporting
the contention -that indirect payments or contributions of physical
labour do not justify the finding of a benefical interest through
the medium of the resulting trust.
Laskin,J.’s judgment differed from that of the majority on both
facts and law. His Lordship was of the opinion that Mrs Murdoch’s
“uncontradicted evidence of the physical labour” 48 could not be
equated with simple housekeeping chores. He therefore overruled
47This, seems to be the view adopted by the English Court of Appeal after
Gissing v. Gissing. See, e.g., Falconer v. Falconer, [1970] 3 All E.R. 449. But
it is possible that the post-Gissing decisions of the Court of Appeal ignore
the distinction between direct and indirect contributions and between inference
and imputation of intention. See Lesser, supra, f.n.4, 196-209. In Murdoch v.
Murdoch (1974), 41 D.L.R. (3d) 367, 389 Laskin,J. cited those cases, noting
that:
What has emerged in the recent cases as the law is that if contributions
are established, they supply the basis for a beneficial’ interest without
the necessity of proving in addition an agreement (see Hazell v. Hazell,
[1972] 1 All E.R. 923), and that the contributions may be indirect or take
the form of physical labour (see Re Cummins, [1971] 3 All E.R. 782).
However, Martland,J. made no reference to any of the Court of Appeal’s
post-Gissing judgments and this may suggest that he did not think they were
correctly decided.
48 (1974), 41 D.L.R. (3d) 367, 378. His Lordship further observed that:
On the evidence … I cannot share the trial Judge’s appreciation of nor-
malcy. The wife’s contribution, in physical labour at least.., can only
be characterized as extraordinary.
This distinction was crucial but the Ontario Law Reform Commission has
expressed the view (supra, f.n.6, 45-6) that:
the normalcy of some duties, the
Fine legal distinctions concerning
“extraordinary” character of others and further judicial definition of
the types of extraordinary duties that may move a court to find the
creation of a beneficial interestwill not serve to alter the uncertain state
of the Law….
McGILL LAW JOURNAL
[Vol. 20
the trial judge’s finding of fact. While his Lordship would also
have been prepared to find that Mrs Murdoch made direct finan-
cial contributions, he based his judgment mainly on the effect of
her physical labour for which he would have imposed a remedial
constructive trust on the husband. Thus Mr Murdoch would have
been under an obligation as a constructive trustee to convey to
his wife the beneficial interest to which she was entitled.49 This
is an accepted restitutionary remedy in the United States 0 and
his Lordship cited the following statement from the American
treatise, Scott’s Law of Trusts, to support his judgment:
A constructive trust is imposed where a person holding title to property
is subject to an equitable duty to convey it to another on the ground
that he would be unjustly enriched if he were permitted to retain it …. 53
It is true that in Gissing Lord Diplock remarked that the principle
applicable to disputes about ownership is “the law relating to
the creation and operation of ‘resulting, implied or constructive
trusts”
9 2 and Laskin,J. might be thought to have simply built on
1
this foundation. However, while some writers have called for a
new approach, English law has not followed the American rule
that the constructive trust is a remedy for unjust enrichment. 3
49 LaskinJ. held that Mrs Murdoch’s “various ventures in labour and
money” entitled her to an interest in the Brockway property, but he refrained
from “arbitrarily” fixing the size of her interest and would have referred it
back for report on this point: (1974), 41 D.L.R. (3d) 367, 389.
90 See, e.g., American Law Institute, Restatement of the Law of Restitution
(1937).
95Scott, V Law of Trusts 3d ed. (1967), 3,215. Laskin,J. noted that the
Supreme Court of Canada in Deglman v. Guarantee Trust Co., [1954] S.C.R.
725 seemed to adopt the American doctrine of restitution in an action for
quantum meruit. However, in a review of the case law since Deglman,
Professor Angus concluded that the decision did not “open the flood gates
[of restitutionary remedies] in all directions… There have been applications
of the general principle introduced by the Deginan case, but -they could
hardly be termed shocking in their scope”: Angus, Restitution in Canada
Since the Deglman Case, (1964) 42 Can. Bar Rev. 529, 559. See also McClean,
Unjust Enrichment – Common Law Wine in Civil Law Bottles, (1969) 4
U.B.C. L.Rev. 1.
Angus’s view must be read in light of recent cases which. have given a
somewhat broader application to the Deglman principle. See, e.g., Re Jacques
(1968), 66 D.L.R. (2d) 447; Peter Kiewit v. Eakins Construction, [1960] S.C.R.
361; Farrar v. MacPhee (1971), 19 D.L.R. (3d) 720; Greenwood v. Bennett, [1972]
3 All E.R. 586; Parklane Hospital v. City of Vancouver, [1973] 2 W.W.R. 289.
52 [1971] A.C. 886, 905.
53See Waters, The Constructive Trust (1964), ch. 1, especially 9-26; Goff
and Jones, The Law of Restitution (1966), 13; Granger, Equity, Law, and
Restitution, (1967) 2 Ottawa L.Rev. 195; Samek, Unjust Enrichment, Quasi-
contract and Restitution, (1969) 47 Can. Bar Rev. 1.
1974]
COMMENTS – COMMENTAIRES
Instead the. constructive trust has been viewed as a substantive
institution applied to particular relationships including vendor and
purchaser, mortgagor and mortgagee and fiduciary and beneficiary
because in such cases the relationship has been characterized as
analogous to the express trust 4 Husband and wife have not pre
viously been brought under this protective umbrella of the law.
Academics may argue that Canadian courts should adopt the
full tenor-of the American restitutionary remedies but the past
record of the judiciary suggests that this will not happen. 55 Thus,
until the position is changed by legislation, a spouse who may have
worked like a trooper will have to establish a resulting trust in
order to obtain a beneficial interest in the property. However, as
mentioned, above, there are statements in Laskin,J.’s judgment
which suggest that a resulting trust will not be obtained from
indirect contributions orphysical labour. His Lordship, after stating
that the resulting, trust is a presumption which arises from the
contribution of money to buy property, remarked that:
… the presumption (as a mere inference from the fact of payment, of
money) is considerably weakened if not entirely dissipated; and … there
is no historical anchorage for it where the contribution of money is
indirect or the contribution consists of physical labour. … and resort
to the resulting trust to give it sanction seem[s]
to me to be quite
artificial.
The appropriate mechanism to give relief to a wife … whose contribu-
tion to the acquisition of property is physical labour rather than purchase
money ‘is the constructive trust which does -not depend on evidence of
intention. Perhaps the resulting trust should be as readily available in
the case of a contribution of physical labour as in the case of a financial
contribution, but the historical roots of the inference that is raised in
the latter case do not exist in the former. It is unnecessary to bend or
adapt them to the desired end because the constructive trust more easily
serves the purpose.56
It follows that there was no “historical anchorage ‘ for the inference
of a resulting trust in Trueman or in any case involving indirect.
contributions. While the writer would not agree, a court might
thus hold that Trueman was, incorrectly decided.
The general reluctance of the courts -to “bend or adapt” existing
principles of resulting trust to obtain desirable social ends or to
adopt. the remedial constructive trust reqbires’ the provincial legis-
4i4Naters, The Coistructive Trust (1964), 2-3.
55 See supra, f.n.51.
56 (1974), 41 D.L.R. (3d) 367, 387-388. It should be noted that since the
constructive trust arises in spite of the intention of the parties, this approach
avoids the artificiality of ascribing an intention to them;
McGILL LAW JOURNAL.
[Vol. 20
latures to act promptly in this matter. It
is disappointing that
the courts have not led the way but the notoriety of Murdoch must
not be repeated. The Divorce Act gives the court in proceedings
under that Act a discretion based on the conduct of the parties
and their conditions, means and other circumstances
to adjust
effectively the property interests of husband and wife through
orders for secured maintenance and lump sum payments. 7 The
provinces must now ensure that a just and equitable division of
property is effected in non-divorce proceedings.
The recent proposals of the Ontario Law Reform Commission
are thus encouraging.; The present system of family property rela-
tions in Ontario and the common law provinces is separation of
property. Under this system, as the Murdoch case graphically
illustrates, each spouse owns only that property in which he or
she can establish a proprietary interest through the rigid rules
of property and trust law. The Commission’s principal recommen-
dation is that the system of separation should be replaced by a
new matrimonial regime under which the spouses would be separ-
ate as to property during marriage but upon its termination would
share equally in property acquired in the course of the mar-
riage.59 If that regime had applied to Murdoch, then upon termin-
ation of the marriage Mrs Murdoch would have been entitled
to a one-half share in her husband’s ranch assets. The new system
recommended by the Commission would be the “basic regime”
57 Divorce Act, R.S.C. 1970, c.D-8, s.11(l). See, e.g., Ceicko v. Ceicko (1969),
5 D.L.R. (3d) 360 (Man. Q.B.). It is doubtful whether the terms of the Act
permit the court to order the conveyance of property from one spouse to
another as a condition of the granting of a decree. See Gomes v. Gomes (1972),
24 D.L.R. (3d) 112 (B.C. S.C.) on s.12(b) of the Divorce Act. In the event that
Mr and Mrs Murdoch should now petition for divorce, the court would be
able to reconsider the question of maintenance in the light of the above-
mentioned provisions It should not be estopped by the previous ruling in
the decree of judicial separation that Mrs Murdoch be awarded $200 a
month for maintenance. See MacDougall, “Alimony and Maintenance”
in
Mendes da Costa (ed.), I Studies in Canadian Family Law (1972), 282, 331-333.
58 Report on Family Law, supra, f.n.6.
59 Ibid., 55-59. This proposal would have the following effect (Ibid., 55):
the Commission’s subsequent recommendations
Subject to
respecting
restrictions on dealings with the matrimonial home, and on the making
of gifts that are other than reasonable or customary, the property position
of the spouses during marriage will be the same as under the present law
of Ontario –
each will be free to hold and dispose of his or her own
property.
The division of the family’s assets (or “equalizing claim”) would not take
place until termination of the marriage.
19741
COMMENTS – COMMENTAIRES
for all future marriages unless the spouses “formally elect to have
their property relations either governed by the regime of separate
property or by a marriage contract”. 0 It is beyond the scope of
this paper to comment on the proposal, -which involves an examin-
ation of the extensive rules prescribing family property relations,
but it should be noted that a similar regime exists in the Province
of Quebec.0 ‘
In addition to the basic reform of the family property system,
the Commission proposes legislation dealing with the matrimonial
home and its contents. 62 Particular attention is given to this sub-
ject because the Commission observes that:
[t]he matrimonial home occupies a special position in family property
relations for two reasons. First, it is the shelter and focal poini of the
family and second, it is an asset – usually the single item of property of
greatest value owned by either or both spouses during marriage.63
Nevertheless, as the Commission notes, the present law is out-
moded because of the necessity of a financial contribution by a
claimant spouse, and also because it ignores completely the role
of a wife who devotes her efforts to caring for the home and
family.64 The Commission therefore recommends reforms which
it believes should be enacted independently of any changes in the
matrimonial property regime.6
The Commission’s proposed solution is that husband and wife
be entitled to equal shares in the matrimonial home through the
60 Ibid., 52-53.
61 A recent study in this province has found that the proportion of marriages
in which the parties have elected to exercise their right to opt out of the
statutory regime is 53.3%. See Rivest, Enqudte aupras du Registre Central
des Rdgimes Matrimoniaux (1974), an unpublished private study conducted
for the Civil Code Revision Office of Quebec. The study covered the period
from 1 July 1970 (when the regime began) to the end of 1973. While it
appears to indicate a high degree of dissatisfaction with the regime, the
writer has been advised by the Civil Code Revision Office that it expects
the number of marriages contracting out of the regime to decline gradually
as knowledge of its provisions become better known.
62Report on Family Law, supra, f.n.6, 131-161.
63 Ibid., 131.
64 Ibid., 134. These remarks were made in the context of the matrimonial
home but the Murdoch case illustrates that the comments are equally appli-
cable to other assets. Mrs Murdoch claimed an interest in her husband’s
ranching business. The farmhouse which they used as their matrimonial
home. formed only a part of the ranch assets.
65 Ibid., 131.
McGILL LAW JOURNAL
[Vol. 20
adoption of “the principle of co-ownership”6 6 The proposal would
ensure that the spouses will not be deprived of joint control of
the home even if title is not held’in both names, since in every
disposition of the property the non-titled spouse must either be
a party to the transaction or sign a written form of consent to
it. 17 The full rights of parties who hold security -interests in the
home at the time the law comes into effect are preserved.”” But
in the future, if a mortgage is obtained without, the consent of
the non-titled spouse, the mortgagee will not be entitled to realize
his security in respect of that spouse’s share in the property. 9
Provision is made for the. spouses to, agree that the home should
not be jointly owned but the Commission also recommends that
the courts be given “broad ‘powers … to set ,aside or vary such
arrangements”. 0
that the Commission
proposes that the legislation-be given retrospective effect in order
“to supplant an already arbitrary doctrine with one that coincides
more closely with public expectations”. 71
It must be emphasized
Two principal criticisms can be made of this proposal: Firstly,
it would complicate real estate transactions. Every purchaser and
mortgagee of residential housing would be put on enquiry about
the owner’s marital status where title is not held in the joint
names of husband and wife. Failure to obtain consent could have
grave consequences for a purchaser or mortgagee. 2 Moreover,
66 Ibid., 135. In the Commission’s view this principle “‘would give full legal
acceptance to the extremely prevalent and growing practice, of husband and
wife taking title to the matrimonial home in their joint names”: ibid. The
Commission’s definition of the matrimonial home is “the dwelling, and the
area attached thereto,, that is owned by either of the spouses, and occupied
by them during marriage as their principal family residence”: ibid., 132. The
Commission accepts the definition of “curtilage” in Black’s Law Dictionary
4th ed. (1951), 460 to, describe the area attached to the matrimonial home
(“a space, necessary and convenient and habitually used for the family pur-
poses, and the carrying on of domestic employments”): ibid, 132-133.
67 Ibid., 137. The Commission. recommends that the non-titled spouse’s
interest be capable of registration but that it should, without registration,
prevail over the claims of third parties who transact solely with the titled
spouse: ibid., 140.
68 Ibid., 139.
61) Ibid., 141.
70 Ibid., 136.
71 Ibid., 138.
72 The Commission recommends at page 141 that:
If a matrimonal home is sold by one spouse without the written consent
of the other spouse, or without a court order dispensing with consent…
the non-consenting spouse should have a claim against the other spouse
1974]
COMMENTS – COMMENTAIRES
given the mobility of Canadians, it may sometimes be difficult
to determine whether an owner is married. Secondly, while it is
evident from the Murdoch case that a spouse should not have to
make a financial contribution to obtain a proprietary interest, it
must be asked whether a spouse who has made no such contri-
bution to the marriage should necessarily be entitled to a one-half
share in the home. Should an incorrigibly lazy husband who did
not support his family and merely “hung up his hat in the hall”‘ 3
be given the right to an interest in a matrimonial home purchased
by his wife? It is therefore submitted that a more flexible remedy
be developed along the lines of the discretionary powers granted
to the courts in England and New Zealand in all questions of
family property.”4 The only disadvantage of that approach is that,
while the Commission’s recommendations would give the spouses
guaranteed rights, the English and New Zealand statutes require
the spouses to apply for an exercise of the court’s discretion.
Finally, it should be noted that if the Commission’s recom-
mendations on the matrimonial home are adopted independently
of the proposed reform of the matrimonial regime, there may still
be instances of injustice unless other reforms are enacted. No
case illustrates this point more clearly than Murdoch. If the pre-
cise terms of the Commission’s proposals on the matrimonial
home had been applied to the facts of that case, Mrs Murdoch
would have been entitled to a one-half share of the ranch house
but she would have had no claim to the rest of her husband’s
for one-half the proceeds of the sale or the right to apply to the court
to have the sale set aside and for such other relief as the court may
deem just.
The mortgagee’s security interest would be reduced by a failure to obtain
consent. See supra, frn.69.
7 See Collins v. Collins, [1964] A.C. 644, 657.
74 In England, the Matrimonial Proceedings and Property Act, 18-19 Eliz. II,
c.45, s.4 -provides that on the grant of a decree of divorce, nullity or judicial
separation the court may order either spouse to transfer property to the
other. Section 5(1) provides that in exercising this power the court must have
regard to all the circumstances of the case, including such matters as the
income and financial needs of the spouses and the contributions made to
the family’s welfare (which includes looking after the home and caring for
the family). In New Zealand, the Matrimonial Property Act, 1963, N.Z., no.72,
s.5 provides that in any dispute between the spouses on the title to property,
they may apply to a judge or magistrate who “may make such order…
whether affecting the title to property or otherwise, as appears just …
notwithstanding that the spouse in whose favour the order is made has no
legal or equitable interest in the property”. See s.5(3).
McGILL LAW JOURNAL
[Vol. 20
property. The house would have been the matrimonial home be-
cause it was the “principal family residence”,75 but the land would
not have been considered accessory to the home in terms of the
Commission’s definition because it was not “used for the family
purposes, and the carrying on of domestic employments”.”0 Furth-
ermore, she would have .had no right to the cattle or other
ranch assets.77 Thus, once again, Mrs Murdoch would have been
denied the fruits of her labour.
Peter Jacobson *
75 See supra, f.n.66.
70 Ibid.
77 The Commission recommends that a right to occupy the matrimonial
home, which is an incident of the principle of co-ownership, should include
the right to “use and enjoy” the “household goods”. However, goods used
for business purposes are excluded from the definition of “household goods”.
See Report on Family Law, supra, f.n.6,. 145-147.
* B.A., LL.B. (Sydney), LL.M. (Penn.), Assistant -Professor of Law, McGill
University. The author wishes to thank Dr D.W. Waters for his helpful
comments.
