Money owed by family members in a case settlement

When “Family Loans” Become Court Battles: Lessons from St. Jean v. Cocks

In St. Jean v. Cocks (Superior Court of Justice; O.J. No. 99-0798), at trial Tony obtained a Judgment in favour of a widow who was owed money by family members. The Ontario Superior Court enforced informal “loans” made by a widow to her adult relatives. Although no formal promissory notes were signed, the widow kept ledgers and exchanged letters referring to the advances as loans. After partial repayments stopped, the relatives claimed the transfers were gifts. The court applied the presumption of resulting trust—meaning that money given without clear evidence of a gift is presumed to be held for the lender—and found that the widow had always intended repayment. On that basis, the court awarded the outstanding principal, accrued interest, and costs. The decision confirms that intra-family transfers will be treated as loans if there is credible contemporaneous evidence of repayment intent, and it underscores that beneficiaries bear the burden of proving any supposed gift. Once judgment is obtained, Ontario’s usual enforcement tools (e.g., garnishment, seizure of assets) become available to collect what is owed.

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Tony is the sole proprietor and manager at Potestio Law. He graduated from the University of Western Ontario's prestigious law program and has been a member of the Upper Canada Law Society since 1984. Tony has over 25 years of experience in Personal Injury and Civil Litigation claims.