A mother who paid the entire $1.2-million purchase price of a Coquitlam home remained its beneficial owner, despite registering the property in her adult son’s name. The Supreme Court of British Columbia ordered the son to transfer title to her after finding that she had not intended to make an immediate gift.
In Han v. Han, 2026 BCSC 1812, the Court applied the presumption of resulting trust and examined competing evidence of ownership, including an informal IOU, a registered mortgage and rental income reported on the son’s tax returns.
Why the Mother Retained Control of the Property
In 2018, Jeong Sook Han purchased a Coquitlam home for $1.2 million and registered it in the name of her adult son, Jae Kyu Han. She intended to provide him with a place to live upon his return to Canada but was concerned that he might sell or mortgage the property.
To retain control, Mrs. Han arranged for her lawyer to hold the duplicate certificate of title. In 2019, she also registered a purported $3.5-million mortgage against the property to discourage further borrowing secured against it.
The Court found that these arrangements were inconsistent with an intention to make an immediate gift. Although Mrs. Han contemplated transferring beneficial ownership to her son in the future, she had not made that decision when the property was purchased.
Why the IOU and Mortgage Failed
An $811,000 handwritten IOU became central to the dispute. The amount corresponded to funds Mrs. Han had withdrawn from her holding company toward the purchase price.
Mr. Han argued that the IOU established an enforceable repayment obligation, meaning the property had not been transferred to him without consideration. If accepted, that position would have undermined the basis for applying the presumption of resulting trust.
The Court rejected the argument. Mrs. Han had prepared the document as an attempted safeguard against her son disposing of the property, rather than to create a genuine debt. The Court also found that Mr. Han had neither understood nor agreed to the purported obligation when he signed it.
Without a genuine agreement between the parties, the IOU was unenforceable. Mr. Han’s subsequent willingness to acknowledge the debt could not establish an agreement that had not existed when the document was signed.
The purported $3.5-million mortgage had also been found invalid because no money was advanced under it. At the second trial, Mrs. Han no longer relied on the mortgage, and the Court declared both documents void from the outset.
Registered Title Did Not Establish Beneficial Ownership
The Court applied the principles established in Pecore v. Pecore, 2007 SCC 17. When a parent gratuitously transfers property to an adult child, the law generally presumes that the child holds it on a resulting trust for the parent. The child may rebut that presumption by establishing that a gift was intended.
Mrs. Han funded the entire purchase, while her son contributed nothing. The IOU did not establish an enforceable repayment obligation, and the evidence did not demonstrate an intention to make an immediate gift. The Court therefore found that Mr. Han held legal title on a resulting trust for his mother.
The Court also considered rental income from the property, which Mrs. Han initially collected but which was reported on her son’s tax returns. Although Mr. Han relied on those records as evidence of ownership, the Court found that they did not outweigh the evidence concerning the original transaction and Mrs. Han’s intentions. It also recognized that the tax-reporting discrepancy would need to be addressed with the relevant authorities.
The Court declared Mrs. Han the sole beneficial owner and ordered her son to transfer the property to her.
The decision illustrates the distinction between registered ownership and beneficial ownership in family property arrangements. Neither registration in an adult child’s name nor documents purporting to establish financial obligations necessarily determine ownership. The parties’ intentions and the substance of their arrangements remain central to the analysis.
The way in which the court arrived at the result appears somewhat onerous in that the court had to find that both the IOU and the mortgage were unenforceable, and further that there was an intention of the mother to assign rental income to the son, contrary to what would be expected under the Income Tax Act.
We surmise that the result may have been different had the son engaged counsel to argue his case, rather than arguing it himself.
ATAC LAW represents property owners and investors in real estate litigation, including disputes involving beneficial ownership, resulting trusts and competing interests in real property.
