Cameron (Re) involved two cases where the husband was in debt to a bank at the time of his death and his estate was bankrupt. The wife had acquired the husband’s interest in the jointly owned matrimonial home by way of right of survivorship. 


The bank brought a motion in each case seeking an order that the acquisition be set aside under section 96 of the Bankruptcy and Insolvency Act as a "transfer under value". Alternatively, the bank argued the same result should be reached by way of constructive trust or on equitable grounds.

The Court found that section 96 of the Act did not apply to the circumstances of these cases, as automatic vesting of title in a surviving joint tenant is not a "transfer". Even if it were a transfer, it was not established as being one made "under value", as the law presumes that each widow contributed as much as her husband to the acquisition, either in money or money’s worth.


In addition, the constructive trust argument was not successful, as the Court found that automatic vesting of title in a survivor does not enrich the survivor and deprive the estate. In any event, even if there were an enrichment, there was a juristic reason for it.


Further, the Court held that the equities favored the widows, not the bank. It reasoned that there is nothing inequitable in depriving creditors of property that never vested in the trustee, was not owned by the bankrupt’s estate at date of death and to which section 96 of the Act did not apply.


This is a very interesting read on this issue, which appears to have been dealt with for the first time in this decision.


Have a great weekend!


Natalia Angelini – Click here for more information on Natalia Angelini