Case Name:

Carrigan v. Quinn

Between

Mary Melodee Dianne Carrigan, Plaintiff, and

Jennifer Quinn, Defendant

[2011] O.J. No. 559

2011 ONSC 585

Court File Nos. CV-09-12443CM, CV-08-011505

 Ontario Superior Court of Justice

M.J. Nolan J.

Heard: December 13-16 and 23, 2010; January 4-7, 2011.

 Judgment: January 28, 2011.

(91 paras.)

Counsel:

Rodney M. Godard, for the Plaintiff.

Raymond G. Colautti and Kathleen M. Montello, for the Defendant.

REASONS FOR JUDGMENT

M.J. NOLAN J.:--

INTRODUCTION

1     Ronald Leo Anthony Carrigan (Mr. Carrigan) died unexpectedly at age 57 on June 4, 2008. At the time of this death he was Vice-president of Finance of the Electrozad group of companies (Electrozad) with whom he had commenced employment in 1977.

2     By about 1985, because of his skills and financial acumen, his value to the corporation resulted in Mr. Carrigan being offered the opportunity to become a shareholder, an opportunity which he accepted. His success and that of the company continued. In some of the years leading up to his death, his income tax returns disclosed that Mr. Carrigan earned in excess of $1,000,000.00.

3     Unfortunately for those close to him, Mr. Carrigan did not appear able, or perhaps chose not to, apply those same financial skills to his own personal life and he died with personal debt over half of a million dollars.

4     As well, Mr. Carrigan's skills as a successful manager in the corporation do not appear to have enabled him to manage and resolve the complicated issues in his own personal life and he died leaving much unfinished business, financially, emotionally and legally.

5     This unfinished business has resulted in the two women, other than his two daughters and two granddaughters who, were closest to him during his lifetime fighting each other in court, a fight that began only weeks after Mr. Carrigan's death and which culminated in the trial before me two and a half years later.

6     The two women are Mary Melodee Dianne Sawyer Carrigan (Mrs. Carrigan), and Jennifer Margaret Quinn (Ms. Quinn). The former is the woman Mr. Carrigan married in 1973, with whom he had two daughters, Carli-Rea and Crystal and to whom he was still married when he died. She is the woman who was named in Mr. Carrigan's will made in 1986 as the estate trustee as well as the sole beneficiary of the residue of his estate after two small bequests to his daughters. She is the woman who remained living in the jointly owned matrimonial home and all of whose expenses were paid by Mr. Carrigan up to the day he died.

7     Ms. Quinn is the woman who Mr. Carrigan met in 1996 and with whom he began living in a conjugal relationship no later than January 2000 in a condominium jointly owned by Mr. Carrigan and Mrs. Carrigan as joint tenants. She is the woman with whom he was living on the day he died.

8     In the several anxious days at the hospital after his heart attack and before his death, in the immediate aftermath of his death and at the funeral, both of these women appeared to act with grace and dignity and treated each other with respect. Regrettably, this was short lived. The relationship soured when the issue of money reared its ugly head.

9     Although Mrs. Carrigan was the sole beneficiary of the residue of his estate, the sole beneficiary of all his life insurance policies and became the sole owner by right of survivorship of both the matrimonial home and condominium, the size of the estate was significantly diminished by the outstanding debts left by Mr. Carrigan, debts about which neither Mrs. Carrigan nor Ms. Quinn were aware. Nevertheless, Mrs. Carrigan also assumed that since she had been named, along with their daughters, by Mr. Carrigan as a beneficiary of his pension, she would be receiving one-third of the death benefit. It had always been Mrs. Carrigan's understanding from what Mr. Carrigan told her that he intended that she would inherit everything he owned when he died.

10     It appears that it was in this context that Mr. Carrigan talked with Mrs. Carrigan and their daughters sometime around 2006 about making some financial provision for Ms. Quinn in the event of his death. Mr. Carrigan proposed that Mrs. Carrigan would transfer her interest in the condominium to him and that, as sole owner, he could leave ownership of the condominium to Ms. Quinn. In addition, Mr. Carrigan would designate Ms. Quinn as the beneficiary of a $100,000.00 life insurance policy. Mrs. Carrigan agreed with this plan.

11     At around the same time, Mr. Carrigan talked with Ms. Quinn in what seems to have been more general terms about somewhat similar plans to provide some financial security to her in the event of his death.

12     Mr. Carrigan took no action to give effect to these plans. Even though he consulted a family law lawyer, Mr. Wright, in 2006 with a view to "putting to paper" the arrangements he had discussed in detail with both Mrs. Carrigan and his daughters on one hand, and in less detail with Ms. Quinn on the other, he never followed through and his plans came to nought.

13     At the hospital while Mr. Carrigan was on life support, at least once, Mrs. Carrigan approached Ms. Quinn to assure her that she intended to honour Mr. Carrigan's plans with respect to the transfer of title to the condominium and the $100,000.00 life insurance policy.

14     Several weeks after the funeral, Mr. Roberts, a lawyer who played a number of roles in this conflict, visited Ms. Quinn during her first week back at work at Electrozad. Mr. Roberts was the corporate lawyer for Electrozad. He had also been Mr. Carrigan's personal lawyer for a number of years and was well acquainted with the financial and legal complications of Mr. Carrigan's life. It was Mr. Roberts who had arranged for Mr. Carrigan to meet with Mr. Wright in 2006 for the purposes of preparing a Cohabitation Agreement for himself and Ms. Quinn. By the time he visited Ms. Quinn at Electrozad, Mr. Roberts had also been retained to act for the estate of Mr. Carrigan by Mrs. Carrigan who would be applying to the court for appointment as estate trustee pursuant to Mr. Carrigan's will.

15     The purpose of Mr. Robert's visit was to offer Ms. Quinn a settlement of any claim she may have had against the estate of Mr. Carrigan on account of their relationship. The settlement offered was the one Mr. Carrigan and Mrs. Carrigan had agreed to sometime around 2006 and which was referred to earlier in this judgment.

16     Ms. Quinn told Mr. Roberts that she had retained counsel, Ms. Montello, to provide her with legal advice in regard to Mr. Carrigan's estate. Mr. Roberts then sent a letter to Ms. Montello dated June 26, 2008, which, in addition to enclosing a copy of Mr. Carrigan's will of April 8, 1987, and the first codicil of September 22, 1999, it made the following offer: transfer of title to the condominium, subject to the existing mortgage of approximately $57,000.00 to Ms. Quinn, along with a lump sum of $100,000.00. In return, Ms. Quinn would waive any other claim she may have had against the estate, pursuant to the Succession Law Reform Act, R.S.O. 1990, c. S.26 ("Succession Law Reform Act") and the Family Law Act, R.S.O. 1990, c. F.3 ("Family Law Act").

17     Although Ms. Montello had, according to the letter, requested an inventory of the assets and liabilities of the estate, Mr. Roberts' letter advised that he did not yet have "sufficient details regarding the assets and liabilities of the estate to provide you with this information. In addition, I currently do not have instructions [from Mrs. Carrigan] to provide you with this information."

18     This letter was followed up with a further letter from Mr. Roberts to Ms. Montello dated July 11, 2008. In that letter, Mr. Roberts referenced some discussions he and Ms. Montello had had on July 2 and July 9 at which time Ms. Montello had advised him there would be no settlement on the basis proposed and there would be no settlement without full disclosure of all the assets and liabilities of the estate along with disclosure of assets referred to in s. 72 of the Succession Law Reform Act.

19     Mr. Roberts' letter also contained a further and better offer which was open for acceptance for seven days, at which time the offer would be revoked. The offer provided a transfer of the condominium free and clear of the existing mortgage plus a payment of $100,000.00. In the alternative, Ms. Quinn could accept a lump sum of $250,000.00 and turn over vacant possession of the condominium to Mrs. Carrigan.

20     The letter then went on to set out what Ms. Quinn would have to provide in exchange for accepting either offer: in addition to executing a Full and Final Release of any rights Ms. Quinn may have had pursuant to the Succession Law Reform Act and the Family Law Act, the same release that had been requested in the letter of June 26, 2008, a further waiver was required: "any right to claim the proceeds of any insurance policies, pension plans or jointly held assets." [Emphasis added.]

21     The letter went on to point out to Ms. Montello, quite correctly in my view, that the fact that the matrimonial home and the condominium were held jointly by Mr. and Mrs. Carrigan was not sufficient to trigger the provision in s. 72(1)(d) of the Succession Law Reform Act. There had been no "disposition" of the property by Mr. Carrigan and Mr. and Mrs. Carrigan had acquired the property jointly.

22     The letter concluded by advising that since the jointly owned property passed to Mrs. Carrigan by right of survivorship and was not caught by s. 72(1)(d), Mrs. Carrigan would be "taking immediate proceedings to obtain vacant possession of the property [the condominium] if Ms. Quinn commenced an application pursuant to the Succession Law Reform Act.

23     Ms. Quinn did not accept the offer, she commenced a claim for support as a dependant pursuant to the Succession Law Reform Act, Mrs. Carrigan commenced her own proceedings and the bitter struggle over money began its long, arduous journey through the courts.

24     I will not detail the various court attendances and the resulting orders at this point in the judgment but will be referring to some of them in a different context later.

25     By at least August 5, 2008, Mr. Roberts recognized the difficulties of wearing so many hats and referred the estate file to the estate's and Mrs. Carrigan's current counsel. In the formal transfer letter of August 12, 2008, (Ex. 21A) which provided, among other things, at list of documents being delivered to current counsel. Included in that list was a copy of drafts of the Cohabitation Agreement prepared by Mr. Wright along with a copy of Mr. Roberts' notes from the meetings held between Mr. Wright, Mr. Carrigan and Mr. Roberts (Ex. 25). The letter also referred to Mr. Roberts' meeting with the new counsel on August 5, 2008 and referred to the material he had provided at the meeting: "my preliminary estimated Inventory of Assets and Liabilities in the estate of Ronald Carrigan along with the particulars relating to the insurance policies and pension plans held by Ronald Carrigan at the date of his death." [Emphasis added.] The balance of the letter dealt with Mr. Carrigan's holding company, R.L. Carrigan Holdings Ltd. which owned all of Mr. Carrigan's shareholdings in the various Electrozad group of companies and the transfers which were necessary in accordance with various shareholder agreements.

26     Mr. Roberts' involvement in the matter had not ended, however, as he continued to act on behalf of Electrozad. In that capacity, he wrote to Ms. Montello on November 25, 2008, in response to a letter from her about the Electrozad pension. It is clear that Mr. Roberts was of the view that both Mrs. Carrigan and Ms. Quinn "potentially qualify as spouses pursuant to the said Plan. Section 7 of the Plan deals with pre-retirement death benefits and in particular paragraph 7.5 deals with the designation of a beneficiary and a spouse's rights."

27     Just above that comment, Mr. Roberts had set out the definition of "spouse" found in paragraph 1.32 of the Electrozad Supply Company Limited Executive Pension Plan:

Spouse means persons of the opposite sex who,

a) are legally married to each other, or

b) are not married to each other and are living together in a conjugal relationship

(1) continuously for a period of not less than three (3) years and are not living separate and apart at the time in question. [Emphasis added.]

28     Mr. Roberts' notes made at the meetings with Mr. Wright and Mr. Carrigan indicate that Mr. Carrigan had said that he separated from Mrs. Carrigan in 1996. In light of this knowledge, his opinion that Mrs. Carrigan could potentially qualify as a spouse is a curious one.

29     Prior to setting out the definition of "spouse" Mr. Roberts' letter also said:

As you are well aware, pursuant to Ronald Carrigan's Last Will & Testament he provided that his wife, Melodee Carrigan would be the beneficiary of the all pension benefits due and owing to him. Furthermore, I understand you have been provided with a copy of the Designated Beneficiary Form completed by Ronald Carrigan during his lifetime where he has designated Melodee Carrigan along with his daughters Carli Rae Carrigan and Crystal Carrigan to be the designated beneficiaries of the death benefit payable pursuant to the Electrozad Supply Company Limited Executive Pension Plan. Furthermore, you have also been provided with a copy of the said Executive Pension Plan. In particular, paragraph 1.32 defines spouse as follows ...

30     In the paragraph following Mr. Roberts' opinion, the letter went on to say:

Electrozad was always under the impression that Jennifer Quinn was going to be executing a waiver of her rights pursuant to the Plan and the Pension Benefits Act as part of the settlement of her application for support pursuant to the Succession Law Reform Act. I have always taken the position on behalf of the Electrozad Supply Company Limited that the death benefits payable pursuant to the Plan would not be paid to Melodee Carrigan unless Jennifer Quinn executed a waiver and release in the required form. It is also my position on behalf of Electrozad Supply Company Limited that the Plan will not pay the death benefit to Jennifer Quinn unless Melodee Carrigan executes the required waiver and release as well. Currently, a final decision has not been made by the Plan Administrator with regard to which spouse would be entitled to the death benefit pursuant to the terms of the Plan and the provisions of the Pension Benefits Act. It is very likely that the Plan Administrator may not be able to make this determination given that many of the relevant facts may be in dispute and that this issue will have to be determined by a court. You will be advised of the Plan Administrator's final decision in this regard as soon as it has been made.

31     On the same day Mr. Roberts sent his letter, Ms. Montello responded with her own letter which said, among other things,

Finally, I find it most peculiar that you were under the impression that Jennifer Quinn would be executing a waiver of her rights pursuant to the Plan and the Pension Plan Benefits Act. You were never so advised by this office.

32     Before proceeding to identify the issues as they were presented by the parties at the beginning of the trial and my analysis of those issues, I feel compelled to comment on how the "sabre-rattling" that both sides engaged in within just weeks of Mr. Carrigan's death added to the confusion, the conflict and the failure to address the fundamental issue in this case - who was Mr. Carrigan's spouse on the day he died.

33     At first blush, the issues that confronted these parties seemed somewhat complex. Upon further analysis, however, the outcome is inevitable. Tragically the anguish, to say nothing of the expense, this lawsuit has caused those closest to him could have been avoided had Mr. Carrigan taken the advice he was given in 2006 or Mrs. Carrigan had acted to protect her own situation prior to 2006.

ISSUES

34     The issues to be determined at trial can be summarized as follows:

1) Is there a spouse entitled to claim the death benefit in relation to the pension of Ronald Carrigan in accordance with section 48 of the Pension Benefits Act, R.S.O. 1990, c. P.8 ("Pension Benefits Act")?

2) Are the express provisions of s. 48 of the Pension Benefits Act which award the death benefit to "the spouse" subject to any remedies, either equitable, by way of a resulting or constructive trust, or pursuant to the Family Law Act in favour of Mrs. Carrigan?

3) Does the designation by Mr. Carrigan of Mrs. Carrigan and his daughters as beneficiaries under the pension plan have any effect on Ms. Quinn's entitlement to the death benefit pursuant to s. 48(1) of the Pensions Benefit Act?

4) Can a claim for support pursuant to the Succession Law Reform Act as against the death benefit entitlement under s. 48 of the Pension Benefit Act succeed?

5) Is Mrs. Carrigan in contempt of the prior orders of the court respecting the preservation of assets and disclosure by way of a full accounting of the assets of the estate?

Issues 1:

Is there a spouse entitled to claim the death benefit in relation to the pension of Ronald Carrigan in accordance with section 48 of the Pension Benefits Act?

35     A concession was made by counsel for Mrs. Carrigan at the beginning of the trial that Mr. Carrigan and Ms. Quinn had lived in a conjugal relationship for a period over three years and the acknowledgement at the end of trial that Mr. and Mrs. Carrigan had been separated at the time of his death. Given this, I will first deal with whether Mr. Carrigan had a spouse at the time of his death who was entitled to the death benefit as a spouse pursuant to s. 48 of the Pension Benefits Act.

36     Much trial time was spent in an attempt to establish that Mrs. Carrigan was not "living separate and apart" from Mr. Carrigan at the time of his death and that their "partnership" continued to his death. Initially, Mrs. Carrigan had acknowledged the separation in an affidavit filed in response to Ms. Quinn's application for dependant's relief pursuant to the Succession Law Reform Act. She had also acknowledged when being cross-examined on her affidavit prior to trial that Mr. Carrigan and Ms. Quinn had lived together in a conjugal relationship. That all changed in November 2008 when she reversed both of these positions.

37     In January 2009, Mrs. Carrigan commenced her own proceeding against herself in her capacity as Estate Trustee of Mr. Carrigan's estate and against Ms. Quinn. It was not until the first day of trial that she once again reversed her position in regard to Ms. Quinn.

38     Mrs. Carrigan, however, did not reverse her position about her separation from Mr. Carrigan until the end of the evidentiary part of the trial when her counsel argued that although separated, Mrs. Carrigan remained a legal spouse pursuant to the provisions of the Pension Benefits Act. A curious and temporary departure from the position that she was not separated from Mr. Carrigan when he died took place in December, 2008. Just before she commenced her application, Mrs. Carrigan's lawyer swore an affidavit in support of a motion seeking an order for an extension of time to file an election under s. 2(8) of the Family Law Act. In that affidavit, counsel said that Mrs. Carrigan "would require a valuation of the pension as at November 1999, the ostensible date of separation, in order to determine her equalization rights."

39     There is no doubt that Mr. and Mrs. Carrigan's separation was unusual. From their marriage date in 1973, Mr. and Mrs. Carrigan discussed and made various financial decisions together; they spent every Christmas day together at the former matrimonial home with their daughters and granddaughters; Mrs. Carrigan, who had worked as a hairdresser early in their marriage, continued to cut Mr. Carrigan's hair every month; the condominium was purchased in their joint names; and, according to Mrs. Carrigan, they continued to have sexual relations from time to time when he would visit the matrimonial home to which he always had a key and to which he was free to come at any time. For reasons that perhaps could have been explained by the accountant who prepared them, Mr. Carrigan continued to use the address of the matrimonial home as his address on his driver's licence, his annual income tax returns, and to identify himself as married with his spouse's name as Mrs. Carrigan. Mrs. Carrigan's returns also identified her as married to Mr. Carrigan. A review of his returns, however, shows that Mr. Carrigan continued to claim Mrs. Carrigan as a deduction against his taxes. Because there was no court order or separation agreement providing for spousal support, Mr. Carrigan could not claim a deduction as spousal support for any of the generous financial payments he made to and on behalf of Mrs. Carrigan for all her expenses, a practice he maintained from the day he moved out of the matrimonial home until his death.

40     Though on his income tax returns Mrs. Carrigan is identified as his spouse, this was not the case on his pension plan benefit statements. On those documents, as of 2003, while "Melodee" [Mrs. Carrigan] and Carli-Rae and Crystal [their daughters] are identified as Mr. Carrigan's beneficiaries of the pension benefits, the "Name of Spouse" was shown as "Not available."

41     As to when Mr. and Mrs. Carrigan separated, it was sometime in 1996, according to the evidence of Crystal, who said it was just before her 16th birthday. It was also 1996 according to Mr. Roberts and Mr. Wright who testified that Mr. Carrigan had told both of them that it was in 1996. Although Mrs. Carrigan remembered this disruption in their lives taking place sometime in 1998 or 1999, she was clear that the reason was because she found out that Mr. Carrigan had commenced a relationship with Ms. Quinn.

42     Mr. Carrigan, according to Mrs. Carrigan, stayed at a hotel for a short period, came back home briefly and then lived in the Lonsdale Apartments on Riverside Drive. Once Mr. Carrigan moved into the rental accommodation, there is no evidence that he ever returned home and reconciled his marital relationship with Mrs. Carrigan. Nevertheless, up to his death he continued to pay all of her expenses in the home and otherwise and deposited money on a regular basis to their joint bank account. After the separation, Mrs. Carrigan remained living in the jointly owned matrimonial home with Carli-Rae and Crystal after Mr. Carrigan moved out. She continues to live in that home today.

43     In October 1999, Mr. and Mrs. Carrigan, as joint tenants, purchased a partly furnished two-bedroom condominium in LaSalle, not far from the matrimonial home. In either November 1999 or January 2000, Ms. Quinn moved into the condominium with Mr. Carrigan. She continued to live there with him in a conjugal relationship until he died in 2008.

44     At the trial, I heard evidence over seven days. It dealt with various financial aspects of Mr. Carrigan's estate as well as the nature and quality of his relationships with both Mrs. Carrigan and Ms. Quinn. In addition to the evidence of Mrs. Carrigan and Ms. Quinn, I also heard from Crystal, Stephen Roberts and Joel Wright, lawyers who both had provided legal advice to Mr. Carrigan and as such, had knowledge of some of his financial and personal affairs and a representative from Electrozad who provided some pension documents (Ex. 35, 35A and 35B). I heard as well from Mr. Carrigan's sister, and some mutual friends of Ms. Quinn and Mr. Carrigan.

45     Even if counsel for Mrs. Carrigan had not made the concessions he did at the beginning of trial and again at the end of trial, the evidence overwhelmingly supported a finding that Mr. and Mrs. Carrigan were separated at the time of his death, and had been for a number of years. The evidence also overwhelmingly supported a finding that Ms. Quinn had lived with Mr. Carrigan in a conjugal relationship in excess of three years, and that she was living with him at the time of his death.

46     If I was required to determine the date of separation, it is more likely than not that it was sometime in 1996. In any event, I find that it was no later than January 2000. Ms. Quinn and Mr. Carrigan were living together openly in the condominium and Ms. Quinn was being introduced and acknowledged by him as his partner. The case law is clear that only one of the parties need have the intention to separate to establish the separation. In Lashman v. Lashman (1970), 12 D.L.R. (3d) 221, (Ont. C.A.) the Court of Appeal held that for parties to be living separate and apart there must be both a physical separation coupled with a recognition by at least one of the parties that the marriage is at an end. There was also uncontradicted evidence that Mrs. Carrigan had established a long term romantic relationship and that she, too, had moved on with her life. Even if the actual separation date was not earlier, by January 2000 Mr. Carrigan openly and notoriously demonstrated his intention to be separated from Mrs. Carrigan with no reasonable prospect, from his perspective at least, that he and Mrs. Carrigan would resume cohabitation.

47     The Pension Benefits Act defines "spouse" in s. 1:

"spouse" means either of two person who,

(a) are married to each other, or

(b) are not married to each other and are living together in a conjugal relationship,

(i) continuously for a period of not less than three years, or

(ii) in a relationship of some permanence, if they are the natural or adoptive parents of a child, both as defined in the Family Law Act; ("conjoint")

Taken on its own, this definition applies to both Mrs. Carrigan and Ms. Quinn.

48     Section 48 of the Pension Benefits Act deals with the distribution of the pre-retirement death benefits if a member of a pension plan, in this case Mr. Carrigan, dies before the commencement of payment of the pension. The relevant section of s. 48 provides:

48.(1) If a member or former member of a pension plan who is entitled under the pension plan to a deferred pension described in section 37 (entitlement to deferred pension) dies before commencement of payment of the deferred pension, the person who is the spouse of the member or former member on the date of death is entitled. [Emphasis added.]

(a) to receive a lump sum payment equal to the commuted value of the deferred pension; or

(b) to an immediate or deferred pension the commuted value of which is at least equal to the commuted value of the deferred pension.

Idem

(2) If a member of a pension plan continues in employment after the normal retirement date under the pension plan and dies before commencement of payment of pension benefits referred to in section 37, the person who is the spouse of the member or former member on the date of death is entitled,

(a) to receive a lump sum payment equal to the commuted value of the pension benefit; or

(b) to an immediate or deferred pension the commuted value of which is at least equal to the commuted value of the pension benefit.

Application of subs. (1, 1)

(3) Subsection (1) and (2) do not apply where the member or former member and his or her spouse are living separate and apart on the date of the death of the member or former member. [Emphasis added.] ...

Designated beneficiary

(6) A member or former member of a pension plan may designate a beneficiary and the beneficiary is entitled to be paid an amount equal to the commuted value of the deferred pension mentioned in subsection (1) or (2) if,

(a) the member or former member does not have a spouse on the date of death; or

(b) the member or former member is living separate and apart from his or her spouse on that date. R.S.O. 1990, c. P.8, s. 48(6); 1999, c. 6, s. 53(14); 2005, c. 5, s. 56(18).

Estate entitlement

(7) The personal representative of the member or former member is entitled to receive payment of the commuted value mentioned in subsection (1) or (2) as the property of the member or former member, if the member or former member has not designated a beneficiary under subsection (6) and,

(a) does not have a spouse on the date of the member or former member's death ; or

(b) is living separate and apart from his or her spouse on that date.

...

Order or domestic contract

(13) An entitlement to a benefit under this section is subject to any right to or interest in the benefit set out in a domestic contract or an order referred to in section 51 (payment on marriage breakdown).

49     Counsel for Mrs. Carrigan initially argued that Mrs. Carrigan was a "spouse" as defined by the Pension Benefits Act because she was not living "separate and apart" from Mr. Carrigan at the time of this death. Later there was an admission that she was separated. In spite of having made that admission, counsel argued that since s. 48(1) of the Pension Benefits Act allows for the death benefit to go to only one spouse: "the person who is the spouse" and because s. 1 of the Pension Benefits Act articulates the definition of spouse in the alternative, that is either a legal spouse or common law spouse, it cannot be both. The argument continued that Mrs. Carrigan is the "spouse" to whom s. 48 applies because she was still legally married to Mr. Carrigan when he died.

50     The argument continued that even if I was to find that Mr. and Mrs. Carrigan were living separate and apart when he died, s. 48(3) and s. 48(6) come into play. In the view of counsel for Mrs. Carrigan, s. 48(3) of the Pension Benefits Act provides that s. 48(1) does not apply if Mr. Carrigan [the member] and Mrs. Carrigan [his legal spouse] are living apart on the date of his death. Further, it makes no difference that Ms. Quinn may also fit the definition of "spouse" because s. 48(1) is not divisible. It either applies or it does not. Counsel for Mrs. Carrigan purported to find support and reinforcement for this interpretation in the provisions of s. 48(6) of the Pension Benefits Act which he argued provides that the beneficiary (or in this case beneficiaries, that being Mrs. Carrigan and her two daughters) is entitled to be paid an amount equal to the commuted value of the pension if the member [Mr. Carrigan] was living separate and apart from his spouse [Mrs. Carrigan] on the day he died.

51     As for Ms. Quinn's claim to the death benefit since she was a common law spouse living with Mr. Carrigan on the day he died and Ms. Quinn's position that Mr. and Mrs. Carrigan were living separate and apart on the day he died, counsel for Mrs. Carrigan argued that such a position is in direct contradiction with the plain reading of s. 48(3), which he interprets as providing that s. 48(1) does not then apply and s. 48(6) mandates that the death benefit must go to the designated beneficiary. In the view of Mrs. Carrigan's counsel, Ms. Quinn would only be entitled to the death benefit under s. 48(1) if Mr. and Mrs. Carrigan were not spouses on the day he died because they were divorced.

52     This creative approach to the interpretation of s. 48 of the Pension Benefits Act was not supported by any authorities and, in my view, is not consistent with the ordinary rules of statutory interpretation. The wording of the s. 1 definition of "spouse" captures both Mrs. Carrigan and Ms. Quinn. Section 48(1) and (3) are clear and unambiguous in their language. The member who dies before being entitled to payment of his pension can only have one spouse on the day he died, "the spouse," and the entitlement to receive the death benefit as a spouse can only be reasonably interpreted to be the person who meets one of the requirements in the s. 1 definition of spouse as well as the requirement found in s. 48(3) that the spouse and the member cannot be living separate and apart on the day of the member's death. There is, therefore, only one person who meets the requirements of both s. 1 and s. 48 of the Pension Benefits Act as well as the definition of "spouse" in the pension plan itself: that is Ms. Quinn.

Issue 2:

Are the express provisions of s. 48 of the Pension Benefits Act which award the death benefit to "the spouse" subject to any remedies, equitable, by way of a resulting or constructive trust, or pursuant to the Family Law Act in favour of Mrs. Carrigan?

53     The core of the argument made on behalf of Mrs. Carrigan with regard to the payment of the death benefit to Ms. Quinn is that it would be "manifestly unfair" to Mrs. Carrigan and her two daughters.

54     Mrs. Carrigan asserts an entitlement to a fifty percent interest in Mr. Carrigan's pension, based on principles of unjust enrichment and constructive trust or alternatively under a resulting trust based on the common intention of Mr. Carrigan and Mrs. Carrigan. The trust claims are based on Mrs. Carrigan's "34 years of unpaid contributions to the family fortunes." If granted, any trust interest in the pension would reduce the amount upon which the death benefit would be calculated.

55     A constructive trust is an available remedy where a claimant can establish that a respondent has been unjustly enriched by the claimant and there is a direct link between the claimant's contribution and the property subject to the trust claim.

56     To be entitled to compensation for unjust enrichment, the claimant must establish:

(1) the respondent has been enriched;

(2) the claimant who provided the enrichment was correspondingly deprived; and

(3) there is no juristic reason for the respondent's enrichment.

These principles were articulated by the Supreme Court of Canada in both Pettkus v. Becker, [1980] 2 S.C.R. 834 para. 38 (S.C.C.) and Peter v. Beblow, [1993] 1 S.C.R. 980 (S.C.C.) at paras. 3, 6, 68-70.

57     It was Mrs. Carrigan's position that during the 34 years of marriage she gave up her career as a hairdresser, gave birth to two daughters, and was the principal caregiver not only for the children but also for the management of the house, entertainment, meal preparation and the "countless tasks falling on the shoulders of a stay-at-home wife and mother." Her counsel asserts that she was paid nothing for these services but from the outset had the expectation, encouraged by Mr. Carrigan, that she would share equally with him in the fruits of his efforts at Electrozad. Her unpaid services enabled Mr. Carrigan to work and earn a salary, acquire shareholder interests in Elecrozad and related companies, advance his career and generate a substantial pension. The provision of these domestic services by Mrs. Carrigan without compensation constituted a significant enrichment to Mr. Carrigan by giving him the opportunity to acquire the shares and the executive pension.

58     Again relying on Peter v. Beblow, supra, at paras. 3, 15, 19, 20, 23, 80, 88, 89, 91, 94 and 96, counsel for Mrs. Carrigan argued that the provision of these services by Mrs. Carrigan without compensation constituted a corresponding deprivation to her; that as a general rule, if one party has been enriched by the efforts of a second party, there will, almost as a matter of course, be a corresponding deprivation suffered by that second party. Counsel argued that since Mrs. Carrigan was under no obligation, contractual, statutory or otherwise to provide these domestic services to Mr. Carrigan, there was no juristic reason for Mr. Carrigan's enrichment. According to counsel, the elements of an obligation on Mr. Carrigan to compensate Mrs. Carrigan for this unjust enrichment are thus made out.

59     With respect to the remedy, counsel for Mrs. Carrigan argued that, for a number of reasons, an interest in the pension was most appropriate because she could have obtained a half interest in it by seeking an equalization payment while Mr. Carrigan was alive; it was Mr. Carrigan's intention that she would be entitled to his pension in accordance with his will made in 1987; Mr. Carrigan continued to assure her even after 1999 that she would get his pension; she continued to expect there could be a resumption of cohabitation and for that reason she did not pursue either a divorce or equalization of net family assets; and finally, it would be "manifestly unfair" for Ms. Quinn to get the death benefit to the complete exclusion of Mrs. Carrigan and his daughters who he intended would get the death benefit. As for the link between the services rendered and the pension, it was acquired, along with all other of Mr. Carrigan's assets, from his ability to devote his time to work at Electrozad. This was only possible, according to Mrs. Carrigan's counsel, because she handled the home management and child care responsibilities.

60     As for the availability of the remedy of constructive trust to married persons even in the face of the Family Law Act, counsel for Mrs. Carrigan relied on the case of Rawluk v. Rawluk, [1990] 1 S.C.R. 70 (S.C.C.). While that case is the authority for that proposition, there was no authority cited for the further argument that "there is no basis for the assertion that it would not apply if a married person takes under a will."

61     With respect to the claim that Mrs. Carrigan has a resulting trust over all or part of Mr. Carrigan's pension and/or death benefit, a resulting trust occurs when one party holds legal title to property where the de facto title is shared by others. A resulting trust looks to the common intention of the parties. Counsel for Mrs. Carrigan relied on the decision of Rathwell v. Rathwell, [1978] 2 S.C.R. 436 (S.C.C.) at paragraphs 28 and 29 for the proposition that resulting trusts are firmly grounded in the settlor's intent. However, as opposed to express trusts, intent is inferred or presumed as a matter of law from the circumstances of the case. If one spouse alone holds title to property, it is relevant for the court to ask whether or not there was a common intention or agreement that the other spouse was to take a beneficial interest in the property.

62     Counsel for Mrs. Carrigan also relied on the words of Ritchie J. in his concurring decision in Pettkus v. Becker at para. 59:

I should make it plain at the outset that in my opinion contributions made by one spouse and freely accepted by the other for the acquisition and operation of a common household give rise to a rebuttable presumption that, at the time when the contributions were made and accepted, the parties both intended that there would be a resulting trust in favour of the donor to be measured in terms of the value of the contributions so made.

63     It was counsel's view that Mrs. Carrigan was married to Mr. Carrigan for 34 years, while he was amassing a large pension in his name alone, and both the implied and the express intentions of Mrs. Carrigan and Mr. Carrigan were that they would share equally in the fruits of Mr. Carrigan's pension. The money to fund the pension came from the profits of Electrozad which would ordinarily have been paid out to the shareholders, including Mr. Carrigan. That money would then have been available for the benefit of both Mr. and Mrs. Carrigan and their family. The argument continued that Mr. Carrigan's intention was clear that, should he predecease Mrs. Carrigan, she would enjoy the entire pension by receiving the pension death benefit, as evidenced by the discussions between Mrs. Carrigan and Mr. Carrigan, the fact that Ms. Quinn did not even know of the existence of the pension, and that Mrs. Carrigan along with their daughters, were and always remained the designated beneficiaries of Mr. Carrigan's death benefit.

64     Counsel for Mrs. Carrigan argued that these intentions are potentially frustrated because Mr. Carrigan held legal title to his pension alone, together with the fact that a third party, Ms. Quinn, has claimed an entitlement to the death benefit. All in all, counsel argued that it is appropriate to find that Mrs. Carrigan has a resulting trust in half of the pension, based on Mrs. Carrigan's and Mr. Carrigan's intention that she would share equally in the fruits of the pension.

65     I was not provided with any authority wherein a court imposed a constructive or resulting trust on the underlying pension funds after the death of a member of a pension fund which provides for a death benefit to be paid to a spouse as defined in the legislation. In any event, the facts of this case do not support a finding that Mr. Carrigan was unjustly enriched. He did not benefit from the pension. He died before he was able to reap any benefit. While Mrs. Carrigan may have been deprived of her interest in the pension, it was because, for whatever reason, she did not seek the remedies to which she would have been entitled during Mr. Carrigan's lifetime, pursuant to the Family Law Act.

66     The fact that she said she thought she and Mr. Carrigan might resume cohabitation and that there was a reasonable basis for that belief is not supported by the evidence. While Mr. Carrigan may have made verbal promises to Mrs. Carrigan, his behaviour did not mirror those words. Ms. Quinn was his "spouse" since at least January 2000. They attended work functions together, family events together, vacationed together, he took care of Ms. Quinn while she was ill in ways that clearly demonstrated his devotion to her. In my view, even if Mrs. Carrigan relied on Mr. Carrigan's assurances to her, she had no realistic basis for doing so. Even the death notice she prepared and published bore witness to the reality of Mrs. Carrigan's situation: "Once married to best friend Melodee Carrigan. Loving partner to Jennifer Quinn."

67     In any event, the express provisions of s. 48 of the Pension Benefits Act displace the common law. Mrs. Carrigan cannot, in effect, seek to use the equitable remedies to get around a definite result dictated by the legislature. As stated by Deschamps J. in Buschau v. Rogers Communications Inc., [2006] 1 S.C.R. 973 (S.C.C.), a case which dealt with whether the common law rules apply to a pension regulated by legislation:

It is clear from this explicit legislation that Parliament intended its provisions to displace common law rules, including equitable remedies and principles.

68     In a parliamentary democracy, the legislature is the primary and paramount source of law, and judges must take direction from the legislature. Consequently, the common law (including the principles of equity and equitable remedies) is subordinate to legislation. In the event of a conflict between legislation and the common law, legislation always prevails. Furthermore, by enacting an exhaustive set of rules dealing with a matter, in this case a pension, the legislature has occupied the field and precluded further recourse to the common law. Consequently, any equitable remedy must yield to a specific legislative result.

69     Section 48 provides a complete code for the distribution of death benefits. Sections 48(1) and (3) provide that the death benefit goes to the "spouse" and s. 48(3) provides that a pre-retirement death benefit is only payable to the spouse if the deceased member was not living separate and apart from that spouse on the date of his death. The legislature has made a policy decision that has taken into account all the competing interests of various classes of spouses who survive a plan member. Section 48(6) sets out the rules that apply when the member does not have a spouse on the day the member dies or is living separate and apart from his or her spouse on the date of death. It provides that only in that case is the death benefit paid to a named beneficiary. Section 49(7) directs that the death benefit is paid to the estate of the deceased member if he or she has no eligible spouse on the date of death and has not designated a beneficiary.

70     The situation that arises as a result of these provisions is summarized succinctly by Ari N. Kaplan in his authoritative text on Pension Law:

In considering spousal rights under the PBA, it is important to point out that merely being a spouse of an employee at the relevant time is not sufficient, in and of itself, to become entitled to spousal benefits. In most jurisdictions, a married spouse will be disentitled to a spousal benefit if the employee and the spouse were separated at the relevant time when a determination of spousal status must be made. In this respect, it can be said that there is priority given to spouses who are cohabitating at the relevant time over married persons who may be spouses in name, but not in practice." (Ari N. Kaplan, "Pension Law" (Canada: Irwin Law Inc, 2006) at p. 287-288.) [Emphasis added.]

71     That is, if living separate and apart, a married spouse no longer qualifies for the benefit; if living together at the relevant time, a common law spouse of over three years is the eligible recipient. Nonetheless, the Pension Benefits Act does anticipate and address the rights of a former spouse to the employee's pension. A former spouse has rights conferred by the Pension Benefits Act during the years of cohabitation. These are determined at marriage breakdown. Importantly, upon death of an employee, section 48(13) stipulates that an entitlement to a benefit is subject to any prior interest in the benefit set out in a domestic contract or court order on marriage breakdown. Therefore in this case, had Mrs. Carrigan obtained a domestic contract or court order prior to Mr. Carrigan's death, it would take priority, after which the residue would determine the pre-retirement death benefit to which Ms. Quinn is entitled.

72     That there was no domestic contract or court order in favour of Mrs. Carrigan appears to be the nub of the conflict. The Pension Benefits Act does confer rights with respect to an employee's pension on spouses, and former spouses. Sadly for Mrs. Carrigan, she no longer qualifies as the spouse entitled to the death benefits under the Pension Benefits Act. Rights as a former spouse depend upon the date of the marriage breakdown. If Mr. Carrigan and Mrs. Carrigan had entered into a domestic contract or there was a court order which identified a portion of the pension to which Mrs. Carrigan would have been entitled, that portion would have been deducted from the total pension and would have affected the value of the death benefit. Also, upon Mr. Carrigan's death, Mrs. Carrigan had the opportunity to elect to take an equalization payment instead under the will, however, after letting the court extension lapse, she was deemed, pursuant to s. 6(11) of the Family Law Act, to have taken under the will.

73     While Mrs. Carrigan could have exercised certain rights pursuant to the Family Law Act to establish and confirm her entitlement to her interest in Mr. Carrigan's pension prior to this death, she did not. The relevant sections of the Family Law Act are as follows:

4.(1) In this Part,

"court" means a court as defined in subsection 1(1), but does not include the Ontario Court of Justice; ("tribunal")

"matrimonial home" means a matrimonial home under section 18 and includes property that is a matrimonial home under that section at the valuation date; ("foyer conjugal")

"net family property" means the value of all the property, except property described in subsection (2), that a spouse owns on the valuation date, after deducting,

(a) the spouse's debts and other liabilities, and

(b) the value of property, other than a matrimonial home, that the spouse owned on the date of the marriage, after deducting the spouse's debts and other liabilities, other than debts or liabilities related directly to the acquisition or significant improvement of a matrimonial home, calculated as of the date of the marriage; ("biens familiaux nets")

"property" means any interest, present or future, vested or contingent, in real or personal property and includes,

(a) property over which a spouse has, alone or in conjunction with another person, a power of appointment exercisable in favour of himself or herself,

(b) property disposed of by a spouse but over which the spouse has, alone or in conjunction with another person, a power to revoke the disposition or a power to consume or dispose of the property, and

(c) in the case of a spouse's rights under a pension plan that have vested, the spouse's interest in the plan including contributions made by other persons; ("bien")

"valuation date" means the earliest of the following dates:

1. The date the spouses separate and there is no reasonable prospect that they will resume cohabitation.

2. The date a divorce is granted.

3. The date the marriage is declared a nullity.

4. The date one of the spouses commences an application based on subsection 5(3) (improvident depletion) that is subsequently granted.

5. The date before the date on which one of the spouses dies leaving the other spouse surviving. ("date d'Èvaluation") R.S.O. 1990, c. F.3, s. 4 1); 2006, c. 19, Sched. C, s. 1(2); 2009, c. 11, s. 22 (1-3); 2009, c. 33, Sched. 2, s. 34(1).

...

Equalization of net family properties

Divorce, etc.

5.(1) When a divorce is granted or a marriage is declared a nullity, or when the spouses are separated and there is no reasonable prospect that they will resume cohabitation, the spouse whose net family property is the lesser of the two net family properties is entitled to one-half the difference between them. R.S.O. 1990, c. F.3, s. 5(1).

Death of spouse

(2) When a spouse dies, if the net family property of the deceased spouse exceeds the net family property of the surviving spouse, the surviving spouse is entitled to one-half the difference between them. R.S.O. 1990, c. F.3, s. 5 (2).

...

Election

Spouse's will

6.(1) When a spouse dies leaving a will, the surviving spouse shall elect to take under the will or to receive the entitlement under section 5. R.S.O. 1990, c. F.3, s. 6(1).

Spouse's intestacy

(2) When a spouse dies intestate, the surviving spouse shall elect to receive the entitlement under Part II of the Succession Law Reform Act or to receive the entitlement under section 5. R.S.O. 1990, c. F.3, s. 6(2).

Spouse's partial intestacy

(3) When a spouse dies testate as to some property and intestate as to other property, the surviving spouse shall elect to take under the will and to receive the entitlement under Part II of the Succession Law Reform Act, or to receive the entitlement under section 5. R.S.O. 1990, c. F.3, s. 6(3).

Property outside estate

(4) A surviving spouse who elects to take under the will or to receive the entitlement under Part II of the Succession Law Reform Act, or both in the case of a partial intestacy, shall also receive the other property to which he or she is entitled because of the first spouse's death. R.S.O. 1990, c. F.3, s. 6(4).

Gifts by will

(5) The surviving spouse shall receive the gifts made to him or her in the deceased spouse's will in addition to the entitlement under section 5 if the will expressly provides for that result. R.S.O. 1990, c. F.3, s. 6 (5).

Amounts to be credited

(6) The rules in subsection (7) apply if a surviving spouse elects or has elected to receive an entitlement under section 5 and is,

(a) the beneficiary of a policy of life insurance, as defined in the Insurance Act, that was taken out on the life of the deceased spouse and owned by the deceased spouse or was taken out on the lives of a group of which he or she was a member;

(b) the beneficiary of a lump sum payment provided under a pension or similar plan on the death of the deceased spouse; or

(c) the recipient of property or a portion of property to which the surviving spouse becomes entitled by right of survivorship or otherwise on the death of the deceased spouse. 2009, c. 11, s. 23.

Same

(7) The following rules apply in the circumstances described in subsection (6):

1. The amount of every payment and the value of every property or portion of property described in that subsection, less any contingent tax liability in respect of the payment, property or portion of property, shall be credited against the surviving spouse's entitlement under section 5.

2. If the total amount of the credit under paragraph 1 exceeds the entitlement under section 5, the deceased spouse's personal representative may recover the excess amount from the surviving spouse.

3. Paragraphs 1 and 2 do not apply in respect of a payment, property or portion of property if,

i. the deceased spouse provided in a written designation, will or other written instrument, as the case may be, that the surviving spouse shall receive the payment, property or portion of property in addition to the entitlement under section 5, or

ii. in the case of property or a portion of property referred to in clause (6)(c), if the surviving spouse's entitlement to the property or portion of property was established by or on behalf of a third person, either the deceased spouse or the third person provided in a will or other written instrument that the surviving spouse shall receive the property or portion of property in addition to the entitlement under section 5. 2009, c. 11, s. 23.

Effect of election to receive entitlement under s. 5

(8) When a surviving spouse elects to receive the entitlement under section 5, the gifts made to him or her in the deceased spouse's will are revoked and the will shall be interpreted as if the surviving spouse had died before the other, unless the will expressly provides that the gifts are in addition to the entitlement under section 5. R.S.O. 1990, c. F.3, s. 6(8).

Idem

(9) When a surviving spouse elects to receive the entitlement under section 5, the spouse shall be deemed to have disclaimed the entitlement under Part II of the Succession Law Reform Act. R.S.O. 1990, c. F.3, s. 6(9).

Manner of making election

(10) The surviving spouse's election shall be in the form prescribed by the regulations made under this Act and shall be filed in the office of the Estate Registrar for Ontario within six months after the first spouse's death. R.S.O. 1990, c. F.3, s. 6(10).

Deemed election

(11) If the surviving spouse does not file the election within that time, he or she shall be deemed to have elected to take under the will or to receive the entitlement under the Succession Law Reform Act, or both, as the case may be, unless the court, on application, orders otherwise. R.S.O. 1990, c. F.3, s. 6(11).

Priority of spouse's entitlement

(12) The spouse's entitlement under section 5 has priority over,

(a) the gifts made in the deceased spouse's will, if any, subject to subsection (13);

(b) a person's right to a share of the estate under Part II (Intestate Succession) of the Succession Law Reform Act;

(c) an order made against the estate under Part V (Support of Dependants) of the Succession Law Reform Act, except an order in favour of a child of the deceased spouse. R.S.O. 1990, c. F.3, s. 6(12).

Exception

(13) The spouse's entitlement under section 5 does not have priority over a gift by will made in accordance with a contract that the deceased spouse entered into in good faith and for valuable consideration, except to the extent that the value of the gift, in the court's opinion, exceeds the consideration. R.S.O. 1990, c. F.3, s. 6(13).

Distribution within six months of death restricted

(14) No distribution shall be made in the administration of a deceased spouse's estate within six months of the spouse's death, unless,

(a) the surviving spouse gives written consent to the distribution; or

(b) the court authorizes the distribution. R.S.O. 1990, c. F.3, s. 6(14).

Idem, notice of application

(15) No distribution shall be made in the administration of a deceased spouse's death after the personal representative has received notice of an application under this Part, unless,

(a) the applicant gives written consent to the distribution; or

(b) the court authorizes the distribution. R.S.O. 1990, c. F.3, s. 6(15).

Extension of limitation period

(16) If the court extends the time for a spouse's application based on subsection 5(2), any property of the deceased spouse that is distributed before the date of the order and without notice of the application shall not be brought into the calculation of the deceased spouse's net family property. R.S.O. 1990, c. F.3, s. 6(16).

...

Application to court

7.(1) The court may, on the application of a spouse, former spouse or deceased spouse's personal representative, determine any matter respecting the spouses' entitlement under section 5. R.S.O. 1990, c. F.3, s. 7(1).

Personal action; estates

(2) Entitlement under subsections 5(1), (2) and (3) is personal as between the spouses but,

(a) an application based on subsection 5(1) or (3) and commenced before a spouse's death may be continued by or against the deceased spouse's estate; and

(b) an application based on subsection 5(2) may be made by or against a deceased spouse's estate. R.S.O. 1990, c. F.3, s. 7(2).

Limitation

(3) An application based on subsection 5(1) or (2) shall not be brought after the earliest of,

(a) two years after the day the marriage is terminated by divorce or judgment of nullity;

(b) six years after the day the spouses separate and there is no reasonable prospect that they will resume cohabitation;

(c) six months after the first spouse's death. R.S.O. 1990, c. F.3, s. 7(3).

74     Prior to Mr. Carrigan's death, Mrs. Carrigan could have settled the pension issue by obtaining a direct equalization payment in a domestic contract or court order. Mrs. Carrigan's and Mr. Carrigan's separation date was (at the latest) 2000; by 2006 Mrs. Carrigan was at the end of the six year period within which to bring a claim for equalization as stipulated by section 7(3) of the Family Law Act. However, despite being outside of the limitation period, Mrs Carrigan could have applied to the court for an extension under section 2(8), and attempted to obtain an equalization claim. This she never did and the right expired on Mr. Carrigan's death.

75     Had she received an extension, Mrs. Carrigan could also have pursued the imposition of a "trust," a common method to attain a pension equalization. As a result of such a "trust" upon the employee, the employee is required to pay over a portion of the "pension payment directly to the spouse, once the employee retires under the pension plan and begins receiving the pension" (Kaplan, at p. 307). This is referred to as an "if and when" approach which is linked to the life of the employee; if the employee dies prior to retirement the spouse will not receive any payment at all. For this reason such a trust is very risky unless paired with a designation of the spouse as a beneficiary of a life insurance policy of sufficient value to cover the total amount of the spouse's entitlement to the pension.

76     The reason to identify and protect the pension to which a spouse is entitled as a result of the marriage breakdown is because upon the death of the employee, the pension no longer exists; that is, the funds which would have been available to the spouse upon retirement never materializes, and, instead, a pre-retirement death benefit arises. This leads to the conclusion that there can be no finding of a resulting or constructive trust on a pension after the death of the employee, as there is no longer any "pot" of money to draw from, quite irrespective of the absolute inability to find either unjust enrichment or a corresponding deprivation at the case at bar.

77     Alternatively, upon marriage breakdown Mrs. Carrigan could have come to a settlement by splitting the pension at source. Another option still was "to divide and assign an employee's pension "credits" to the former spouse, who will then receive a separate pension annuity from the plan attributable to those credits, or alternatively, be able to transfer an equivalent lump sum amount into a locked-in retirement savings vehicle" (Kaplan, at p. 308). Both pension splitting and credit splitting are orders directed at the plan administrator and require their involvement. However, credit splitting creates a separately valued annuity from the plan. These are the types of settlements envisioned by the not yet proclaimed amendments to the Pension Benefits Act which enables an eligible spouse to apply for a transfer of a lump sum from the plan to another pension plan, to a prescribed retirement savings arrangement, or to leave the lump sum in the plan to the credit of the eligible spouse; these options are only available if the administrator agrees.

78     Pertinently, valuation of the pension, in accordance with the definition in section 4(1) of the Family Law Act, would be on the earliest of the date the spouses separate and there is no reasonable prospect that they will resume cohabitation, the date of divorce, the date the marriage is declared a nullity, the date an application is commenced which is subsequently granted, or the date before the date on which one of the spouses dies leaving the other spouse surviving. For Mrs. Carrigan, this means that the valuation of Mr. Carrigan's pension would be on the date of separation, not on the day before Mr. Carrigan's death. Thus, the value of the pension would have been calculated as of, at latest, 2000, and would have been significantly less than the pension at the date of death.

79     Therefore, Mrs. Carrigan had options, but prior to Mr. Carrigan's death. There were available methods by which Mrs. Carrigan could have secured a right to a share of Mr. Carrigan's pension. Most unfortunately for Mrs. Carrigan, she does not appear to have sought or received advice to this end, and instead relied upon Mr. Carrigan's assurances to her. As the eligible spouse, Ms. Quinn is entitled to the pre-retirement death benefit. Upon Mr. Carrigan's death, any ability Mrs. Carrigan had to lay claim to the underlying pension was extinguished.

Issue 3:

Does the designation by Mr. Carrigan of Mrs. Carrigan and his daughters as beneficiaries under the pension plan have any effect on Ms. Quinn's entitlement to the death benefits pursuant to s. 48(1) of the Pension Benefits Act?

80     Section 48(6) provides that if there is no eligible spouse of a member of a pension plan at the time of his or her death, only in that circumstance does the death benefit go to a designated beneficiary. In this case, Ms. Quinn is the eligible spouse and, therefore, the designation of Mrs. Carrigan and her daughters as beneficiaries is of no force and effect. Had Mr. Carrigan also been separated from Ms. Quinn on the day he died, the designation would have been effective. That, however, is not the circumstance in this case. The other circumstance in which the beneficiary designation would have been effective was if Ms. Quinn had waived her entitlement to any claim to the pension, as she might have done, had Mr. Carrigan followed through with his aborted plan to enter into a cohabitation agreement with Ms. Quinn in 2006.

Issue 4:

Can a claim for support pursuant to the Succession Law Reform Act as against the death benefit entitlement under s. 48 of the Pension Benefit Act succeed?

81     The Succession Law Reform Act provides in s. 72 that if a dependant of a deceased has not been properly provided for by the deceased, that dependant can make a claim against the assets of the estate. For the purpose of determining the assets of an estate for support purposes, certain assets such as proceeds of insurance policies and death benefits by way of a beneficiary designation are included. In the facts of this case, Mrs. Carrigan is the beneficiary of all Mr. Carrigan's life insurance policies, she obtained both the house and condominium by the right of survivorship, as well as all the other assets of his estate.

82     Because Ms. Quinn is entitled to the death benefit as "the spouse" and not as a designated beneficiary, the death benefit does not form part of the estate. As a result, there are no other assets that could be accessed for support by Mrs. Carrigan. She, therefore, is not entitled to claim support as a dependant.

83     Ms. Quinn's application for support pursuant to the Succession Law Reform Act is also dismissed because she will receive the death benefit, thus she does not have a need for support.

84     After the litigation began with Ms. Quinn's application for support pursuant to the Succession Law Reform Act, the parties entered into a consent without prejudice order. The order provided that Ms. Quinn was permitted to reside in the condominium for which the estate would be responsible for the payment of the mortgage, utilities, condo fees and municipal taxes. As well, she would receive $2,500 per month in support from the estate commencing September 1, 2008.

85     By the time of trial, Ms. Quinn had received a total benefit of approximately $150,000. It was established that the estate had not paid for a Windsor Star subscription or a gym membership. It was the position of counsel for Mrs. Carrigan that these funds should be paid back to the estate in the event that Ms. Quinn received all or some of the death benefit. Counsel for Ms. Quinn suggested that since Mrs. Carrigan did not comply with the orders of either Ducharme J. or Quinn J. and acted inappropriately in regard to providing Ms. Quinn with details of the pension in a timely way, repayment was not necessarily appropriate in all of the circumstances of this case. I disagree. The order for support and other benefits was made on a without prejudice basis until all the issues could be resolved by the parties or determined by the court. Ms. Quinn will receive all of the death benefit. Had she received it earlier, she would not have been entitled to support. While it could be argued that Ms. Quinn did not receive the death benefit in a timely way because of the actions or directions of Mrs. Carrigan, it was clear at trial the parties and/or their representatives can each take some responsibility for the contentious route this litigation took. Accordingly, it is appropriate that Ms. Quinn pay back to the estate the funds that she has received from it but without any interest.

Issue 5:

Is Mrs. Carrigan in contempt of the prior orders of the court respecting the preservation of assets and disclosure by way of a full accounting of the assets of the estate?

86     It was the position of counsel for Ms. Quinn that Mrs. Carrigan was in contempt of orders given by the court respecting the preservation of assets of the estate and providing a full accounting of the assets.

87     Much trial time was taken up with detailed examinations related to the accounting of the assets of the estate and in particular, the withdrawals and reporting made by Mrs. Carrigan. In particular, a significant amount of time was spent reviewing the various inventories of the assets of the estate that had been prepared throughout the almost two and a half years of litigation. In particular, on December 17, 2008 Quinn J. ordered that Ms. Quinn would receive a full accounting of the estate from May 26, 2008 and that the estate assets would be preserved. The manner in which those assets would be preserved, particularly the R.L. Carrigan Holdings account was specified in that order. The bank account that was to be established under the control of Mrs. Carrigan's current counsel and Ms. Montello was never, in fact, set up.

88     There is no doubt that Mrs. Carrigan dealt with various of the assets in apparent violation of the order of Quinn J. At the same time, counsel for Ms. Quinn was critical of counsel for Mrs. Carrigan and the estate in relation to not being forthcoming with details of the pension. It is my view that counsel for Ms. Quinn could have requested a copy of the executive pension documents directly from Electrozad. Ms. Quinn was an employee of Electrozad, she was known at that company as being the "spouse" of Mr. Carrigan. There was no evidence presented that detailed any attempt to obtain the pension documents directly from Electrozad. Instead, counsel for Ms. Quinn continued to seek the material from Mrs. Carrigan's counsel.

89     To be fair to Ms. Quinn, however, it appears that various persons involved in this estate were aware that there was a significant issue related to the pension and the death benefits. I make that comment based on the letter of Mr. Roberts dated July 11, 2008 in which the waiver Ms. Quinn was being requested to sign in return for receiving the condominium or the value of the condominium plus $100,000.00, mentioned, for the first time, a release including a release against the pension. As well, the August 12th letter from Mr. Roberts to Mrs. Carrigan's new counsel also made reference to the pension. Whether Mrs. Carrigan was aware of the problems with the pension and whether she appreciated those problems as early as others did is not clear.

90     The test that must be met to find a person in contempt in a civil context is set out succinctly in Bell ExpressVu Limited Partnership v. Torroni et al. (2009), 94 O.R. (3d) 614. At paragraphs 20-22 the court said the following:

A finding of contempt of court is a serious matter that is quasi-criminal in nature. It is "first and foremost a declaration that a party has acted in defiance of a court order": Pro Swing Inc. v. Elta Golf Inc., [2006] 2 S.C.R. 612, [2006] S.C.J. No. 52, at para. 35. The potential penal sanctions facing a contemnor underscore the seriousness of such a finding. ...

The three constituent elements of the test for civil contempt were summarized by this court in Prescott-Russell Services for Children and

Adults v. G.(N.) (2006), 82 O.R. (3d) 686, [2006] O.J. No. 2488 (C.A.), at para. 27:

The criteria applicable to a contempt of court conclusion are settled law. A three-pronged test is required. First, the order that was breached must state clearly and unequivocally what should and should not be done. Secondly, the party who disobeys the order must do so deliberately and wilfully. Thirdly, the evidence must show contempt beyond a reasonable doubt. Any doubt must clearly be resolved in favour of the person or entity alleged to have breached the order.

See, also, Hobbs v. Hobbs, [2008] O.J. No. 3312, 54 R.F.L. (6th) 1 (C.A.), at paras. 26-28. In relation to the first of these elements, it must be clear to a party exactly what must be done to be in compliance with the terms of an order: Pro Swing, at para. 24. In relation to the third element, the requirement of proof beyond a reasonable doubt ensures that the potential penal consequences of a finding of contempt are not ordered lightly: Chiang, [2009] O.J. No. 41, at paras. 10-11.

91     Although Mrs. Carrigan withdrew and moved estate funds following the order of Quinn J. in ways that would seem to be a violation of that order, I am not satisfied beyond a reasonable doubt that the three prong test set out in Prescott-Russell Services for Children and Adults v. G. (N.), supra, has been met. I am not satisfied beyond a reasonable doubt that the actions she took were deliberate and wilful. I, therefore, am unable to find that the evidence has established beyond a reasonable doubt that she is in contempt and I dismiss that claim.

M.J. NOLAN J.

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