Can a Spouse Claim “Family Trust” Rights over a Third Party’s Property?
In high-net-worth family litigation, one of the most difficult disputes often involves allegations that family businesses or properties held by parents or relatives were actually “trust property” belonging to the spouses.
We use Wang v. Mitchell, 2024 BCSC 988 as an example to share insights into how BC courts assess alleged “family trusts” in family property division.
The Alleged Family Trust
In this case, the respondent argued that the claimant’s late father created a family trust before his death, that the claimant became a beneficiary of that trust, and that, after the marriage, the respondent himself became a beneficiary entitled to share in the businesses and properties in the alleged family trust.
The Court ultimately rejected those claims. Justice Marzari explained that the party asserting an express trust must prove its required elements. Informal references to “family money” did not establish a trust on the evidence in this case.
At trial, Ms. Cameron Lee represented the claimant and presented substantial evidence, including corporate records, ownership documents, witness testimony, WeChat communications, and financial evidence, together with legal submissions on the requirements for establishing an express trust.
The Court’s Findings
Applying established Canadian trust law principles, the Court found that there was insufficient evidence establishing the required certainty of intention, certainty of subject matter, and certainty of beneficiaries necessary to create a valid trust. The Court also referred to the requirement that the trust property be vested in the trustee and confirmed that a trust agreement need not be in writing.
The Court instead found that the claimant’s mother was the sole shareholder and directing mind of the Chinese companies throughout the marriage, and that neither spouse had established a legal or beneficial interest in the Chinese properties at issue.
Why Evidence Matters
This case highlights an important principle in BC family law. A spouse cannot successfully claim ownership of family wealth simply because financial support was provided during the marriage. Trust claims require strong evidence, careful legal analysis, and credible documentation.
At Henderson & Lee Law Corporation, we regularly represent clients in complex family property litigation involving trust claims, beneficial ownership disputes, family businesses, hidden assets, international property disputes, and high-net-worth family litigation.
This article is provided for general information only and does not constitute legal advice. Past results do not guarantee future outcomes.
