IN THE SUPREME COURT OF BRITISH COLUMBIA
Parrott-Ericson v. Stockwell,
2006 BCSC 1409
Mike Stockwell, in his capacity as executor of the last will and
testament of Goran Ericson, deceased
Before: The Honourable Mr. Justice Sigurdson
Oral Reasons for Judgment
August 23, 2006
Counsel for the Petitioner
Counsel for the Respondent, Mike Stockwell
Counsel for the Respondents, Eleanor Ericson, Marie Ericson, Patrick Ericson and Christian Ericson
J.M. Milliken, Q.C.
Place of Hearing:
 THE COURT: A mortgage secured a joint and several obligation of the owners of land held in joint tenancy. One joint tenant died. The property now belongs to the surviving joint tenant by survivorship. This case concerns the liability of the deceased’s estate to the surviving joint tenant to pay half of the mortgage principal and interest.
 The petitioner seeks the following orders:
(a) That the estate of Goran Ericson owes one-half of the principal amount of the two personal lines of credit entered into by the petitioner and Goran Ericson with the Bank of Montreal on March 16, 2004, together with interest accumulated thereon since January 6, 2005.
(b) That the amount owing by the estate of Goran Ericson be paid out of the investment account of the estate at CIBC Wood Gundy.
 The petitioner, Helen Parrott-Ericson, is the widow of Goran Ericson. The respondent, Mike Stockwell, is the executor of the last will and testament of Goran Ericson.
 The petitioner and the deceased were married on August 31, 2002. On March 31, 2004, Goran Ericson and Helen Parrott-Ericson bought two strata lots in White Rock. Both were registered in joint tenancy. They borrowed about $420,000, which was secured by way of lines of credit under which they were “responsible both individually and together” for the obligations under the lines of credit. These lines of credit were secured by way of mortgages against the two condominiums, one for about $150,000 and the other about $270,000.
 On January 5, 2005, Goran Ericson died; the principal owing at that time was approximately $400,000. As joint tenant, Helen Parrott-Ericson took sole title to the condominiums upon her husband’s death.
 The petitioner has requested that the deceased’s estate pay one-half of the loan as co-borrower. The estate has refused, and that gives rise to this application.
 The petitioner says that the property is hers by way of the right of survivorship, but that as the liability under the mortgage to the lender is joint and several, she takes the position that she is entitled to contribution as to one half of the monies from the estate. She relies on the decision of McMillan v. National Trust Co. (1931), 2 D.L.R. 369, 66 O.L.R. 601 (C.A.), O.J. No. 31 (QL) [McMillan cited to QL].
 The respondents, the executor and the children of Goran Ericson, who have also brought a Wills Variation Act application that is set for trial in October and is set for an upcoming mediation, rely on, among other things, s. 30(2) of the Wills Act, R.S.B.C. 1996, c. 489. The respondents say the petitioner’s claim against the estate must fail because the property is to be the primary source of repayment. Moreover, the respondents argue that the claim for contribution fails as it is an equitable claim based on unjust enrichment and there is no unjust enrichment if the estate does not share in the mortgage debt.
 There is no dispute that by survivorship the ownership of the interest in the condominiums belongs to the petitioner.
 In Anger & Honsberger: Law of Real Property, 3rd ed. (Aurora, Ont.: Canada Law Book Inc., 2006) at p. 14-7, the author, Anne Warner La Forest says:
The most important incident of a joint tenancy is the right of survivorship, called, since ancient times, the “jus accrescendi“, the right of surviving joint tenants to have their undivided interests progressively increased by the deaths of other joint tenants, although the survivors continue as joint tenants, the last survivor taking the entirety. This feature of a joint tenancy is the natural consequence of the other incidents of complete unity of title, interest and possession, the interests of joint tenants not only being equal but being one and the same, their combined interests forming one estate. [footnotes omitted]
 Ms. Milton argues that the effect of jus accrescendi and joint and several liability for the debt is that her client is the owner of the property, but the debt is to be shared by the estate. For this proposition she relies on the McMillan case.
 I have decided that the petitioner’s claim for contribution by the estate to one half of the mortgage payments must fail.
 The petitioner’s claim for contribution arises in equity. Moreover it is based on unjust enrichment.
 In G.H.L. Fridman, Restitution, 2nd ed. (Scarborough, Ont.: Carswell, 1992) at p. 229, the author says:
Prima facie, since no one is primarily or ultimately liable for the discharge of the common demand, all contributing parties must bear the loss equally. This prima facie rule will be displaced whenever the liability of the co-obligors is not equal in quantum. Given that the right to contribution is based in unjust enrichment, the liability of the co-obligors can be varied inter se by contract since the contractual rights may affect the equities between the parties. [footnotes omitted]
 The respondents argue that it is a principle of equity that a joint tenant who takes the entire benefit of an interest in real property through a survivorship must take the burden associated with the benefit, particularly when that joint debt has been used to acquire the real property. They rely on Cunningham Reid v. Public Trustee and Another,  1 K.B. 602.
 There, the plaintiff and Sir Ernest Sanger were lessees who had jointly and severally covenanted for payment of their rent. Sir Ernest Sanger died, and the plaintiff, as surviving joint tenant, succeeded to the whole of the benefit of the lease. At p. 605, Luxmoore, L.J. said:
The substantial point in this case, however, on which I think the plaintiff is bound to fail, is that he has acquired, by reason of the death of Sir Ernest Sanger, the full beneficial interest in the lease. In those circumstances it could hardly be suggested that he, having the full benefit of the lease, could be equitably entitled to call on the executors of his co-covenantor, whose estate has no beneficial interest in it, to pay half the rent. It seems to me that in equity the claim to contribution in these circumstances must, of necessity, fail.
 In Avco Financial Services Canada Ltd. v. Colnett,  B.C.J. No. 409 (S.C.), Meredith J. referred to Cunningham Reid and said at ¶8-9:
For the plaintiff, counsel contends that Colnett has no right of contribution from Mrs. Dollard. I have come to the opposite conclusion, though not without hesitation. Would Mrs. Dollard be "justly liable" in the terms of the Laws Declaratory Act to Colnett for monies paid by him in discharge of the loan? That question may be met with another: Would Mrs. Dollard, if she paid more than one-half the debt, be entitled to contribution from Colnett, although she retains for herself the full benefit of the borrowings? …
I conclude that as Mrs. Colnett retained to herself the benefit of the borrowings, she could not claim contribution from Colnett if she repaid more than half the debt. By the same reasoning I conclude that if Colnett is called upon to pay any part of the debt he is entitled to contribution from Mrs. Dollard. …
 Here the petitioner has, by operation of survivorship, received the entire interest that secured the joint and several obligations. Similarly, it strikes me that in these particular circumstances, in the absence of an agreement to the contrary by the parties, or some suggestion that the land was worth less than the debt, or some other relevant circumstance, the petitioner could not equitably be entitled to call on the executor of the estate to pay half of the debt.
 What of the McMillan case? The respondents say that it is distinguishable, and rely on s. 30(2) of the Wills Act, among other things. That section of the Wills Act provides:
If a person dies possessed of, or entitled to, or under a general power of appointment by the person's will disposes of, an interest in freehold or leasehold property that, at the time of the person's death, is subject to a mortgage, and the deceased has not, by will, deed or other document, signified a contrary or other intention, the interest is, as between the different persons claiming through the deceased, primarily liable for the payment or satisfaction of the mortgage debt.
 I have decided that McMillan is distinguishable on the facts. I do not think that the principle that I rely on and that I think is applicable here was central to the determination of the McMillan case. That principle, to repeat, is that unjust enrichment is the foundation of a claim for contribution. I think that has particular application to the case at bar.
 McMillan was a decision of four judges of the Ontario Supreme Court, Appellate Division, which overturned a holding by the trial judge that the third party (the widow) had to contribute to the joint obligation. I think that the facts of the particular arrangements that were agreed to between the joint tenants as to their liability inter se with respect to the mortgage and when that liability crystallized were important. The wife, Mrs. Carter, and the husband, Mr. Carter, entered into a mortgage to pay Floy Palmer $10,000 plus interest. The husband, Mr. Carter, died and the property went to Mrs. Carter, his joint tenant, by survivorship. Floy Palmer assigned the mortgage to one Hayhurst who then assigned it to Mrs. Carter’s brother. He (Mrs. Carter’s brother) sued Mr. Carter’s estate on the debt, but not Mrs. Carter. Mr. Carter’s estate by his executor, National Trust, sued Mrs. Carter in third party proceedings.
 The third party claim which was the subject matter of the appeal had succeeded at trial but failed on appeal. Two judges, Masten J.A. and Latchford C.J., decided that there was no claim over because, as Masten J.A. said at ¶24:
… I would dispose of the appeal on the simple ground that, while Mr. and Mrs. Carter were each individually liable to the mortgagee for the whole principal ($10,000) of the mortgage, yet as between themselves they were, apart from any express agreement, each liable for one-half of the principal. The mortgage fell due during the lifetime of Mr. Carter, and thereupon the rights and obligations of Mr. and Mrs. Carter as between themselves crystallised, and Mr. Carter, as against Mrs. Carter, became liable to pay off the mortgage to the extent of $5,000. On Carter's death that obligation devolved on his executors, and consequently they have no right to relief over against Mrs. Carter.
 Justice Riddell accepted the third party wife’s version of the agreement she had with her husband, and he said at ¶16:
The third party set up an agreement which she said she had made with her husband that each should pay half the principal of the mortgage and the husband should pay the interest. … The husband himself took his wife's money to the mortgagee, and paid it on the principal; at the same time he took his money and paid with it the interest and insisted on, obtaining separate receipts; when the wife had thus paid half the principal, though he lived nearly three years after the mortgage was due, and long after his wife's last payment, he does not seem to have made any move to have her pay more, but he continued to pay interest. It seems to me that these facts are ample corroboration of the third party's story.
 He then said (at ¶18-19):
Where two persons are, as in this case, jointly liable upon a covenant, the presumption is that they are as between themselves equally liable, and as between themselves neither can call upon the other to pay more than his proper share; if one of them dies, his executors are in no better case…. The whole principle is sufficiently discussed in Halsbury's Laws of England …; and it is too well known to require any affirmation by us.
The result is that the trust company has no right to call upon the third party, and the "action," if it is an "action," against her, should have been dismissed. The appeal should be allowed and the third party proceedings dismissed with costs here and below.
 Justice Orde’s judgment comes as close as any of the judgments to providing support for the petitioner and is relied on by Ms. Milton. He said at ¶31-32:
… Whatever each contributed to the joint purchase must be subject to the risk of being wholly lost to the estate of the one who dies first. That is a necessary incident of joint tenancy unless it is severed in the lifetime of both.
Mrs. Carter's title is not derived from her husband. Her title as a joint tenant preceded the execution of the mortgage. Her title as a joint tenant was not subject at the time of its acquisition to any burden which might ultimately fall wholly upon her by implication or as a necessary incident. …
 It appears to me that the unjust enrichment issue was not addressed as such. The central issue was whether the co-debtor, the wife and third party, who had paid one-half of the principal, should be liable for more. At least three of the four judges hearing the case, it appears on my reading of the case, saw the land and the mortgage debt in this particular arrangement as unconnected.
 Here, on the evidence, I find that the mortgage debt and the land were clearly connected in this sense. The joint and several loan was the basis upon which the property was acquired. It was still a substantial burden on the property at the time of the deceased’s death. There was no arrangement that the estate would be liable for one-half of the debt. Of course, equity will impose that obligation in order to avoid unjust enrichment. That is the usual rule, because ordinarily there is unjust enrichment if the liability is not shared. However, here on the facts of the case at bar, I think that, given the joint debt was used to acquire the land and the petitioner received the land entirely, I find that she would be unjustly enriched if the estate had to pay one-half of the debt. On that basis, the petitioner’s claim must fail.
 Although I was inclined to think that the respondents’ argument on s. 30(2) of the Wills Act has merit, I do not have to rely on it as I think equity is against the petitioner’s claim. To saddle the estate with one-half of the debt in the particular circumstances is unjust and the petition must be dismissed.
 I would award costs on Scale 3.
“J.S. Sigurdson, J.”
The Honourable Mr. Justice J.S. Sigurdson