



COURT OF APPEAL FOR ONTARIO

CITATION: Moore v. Sweet, 2017 ONCA 182

DATE: 20170302

DOCKET: C61017

Strathy C.J.O., Blair and Lauwers JJ.A.

BETWEEN

Michelle Constance Moore

Applicant

(Respondent)

and

Risa Lorraine Sweet

Respondent

(Appellant)

Jeremy R. Opolsky, for the appellant

David M. Smith, for the respondent

Heard: May 12, 2016

On appeal from the judgment of Justice Herman J.
    Wilton-Siegel of the Superior Court of Justice, dated June 17, 2015.

R.A. Blair J.A.:

OVERVIEW

[1]

The issue on this appeal is whether the appellant, Risa Lorraine Sweet,
    or the respondent, Michelle Constance Moore, is entitled to the proceeds of a
    policy of insurance on the life of Lawrence Anthony Moore. The proceeds of the
    Policy have been paid into court pending resolution of these competing claims.

[2]

The Moores were married for more than 20 years and Ms. Moore was the
    named beneficiary of the Policy during their marriage. She was not designated
    as an irrevocable beneficiary, however. Following the separation, Mr. Moore
    established a relationship with Ms. Sweet. They lived together in Ms. Sweets
    apartment until his death 13 years later. Shortly after Mr. Moore and Ms. Sweet
    began living together  and contrary to an oral agreement he had with Ms. Moore,
    who continued to pay the premiums  Mr. Moore revoked the designation of Ms.
    Moore as beneficiary and executed a change in beneficiary form designating Ms.
    Sweet as the irrevocable beneficiary under the Policy. The change of
    beneficiary was properly recorded with the insurer.

[3]

The application judge ruled in favour of Ms. Moore. He held that the
    Policy proceeds of $250,000 plus interest were held in trust and that Ms. Moore
    was entitled to recover them on the basis of unjust enrichment. Ms. Sweet
    appeals.

[4]

For the reasons that follow, I would allow the appeal.

FACTUAL BACKGROUND

[5]

Ms. Moore and Mr. Moore were married in 1979. They have three children
    together, born in 1983, 1984 and 1988. Although they were minors at the time
    the oral agreement was made, all were adults by the time of Mr. Moores death
    in 2013.

[6]

In October 1985, Mr. Moore applied for and obtained a policy of
    insurance on his life in the principal amount of $250,000 from a predecessor of
    RBC Life Insurance Company. He was named as the owner of the Policy. Ms. Moore
    was named as a beneficiary, but not as an irrevocable beneficiary. Annual
    premiums of $507.50 were paid from the Moores joint account prior to their separation.
    Thereafter, the premiums were paid by Ms. Moore alone. The Policy remained in
    effect until Mr. Moores death on June 20, 2013. His estate has no significant
    assets.

[7]

According to Ms. Moore, [t]he Policy was entered into due to the
    Deceaseds financial irresponsibility and the understanding the Deceased and
    [she] shared, which was that the Policy was required in order to support
    [their] Children in the event of the Deceaseds passing.

[8]

The Moores separated in December 1999. Ms. Moore says that shortly
    thereafter the deceased told her and the children that he would ensure we were
    taken care of. Without stating whether the agreement occurred at the time the
    Policy was taken out, or at the time of separation, or on some other occasion,
    she deposed that:

It was expressly agreed between the Deceased and I that in
    paying for the Policy premiums, I would be entitled to receive the Policy
    benefits upon his death.

[9]

On the basis of this evidence, the application judge found that there
    was an oral agreement between the Moores made in 2000 to the effect that [Ms.
    Moore] would pay the premiums and be entitled to the proceeds of the Policy on [Mr.
    Moores] death. This finding is not contested on appeal.

[10]

Mr. Moore and Ms. Sweet met when they were both attending the Donwood
    Institute, an addiction treatment centre. He was being treated at the time for
    a history of drug, alcohol and substance abuse problems and mental health
    issues. She also had a history of medical issues including substance abuse. They
    became supportive of each other and soon developed a close relationship.

[11]

The application judge found that Ms. Sweet and Mr. Moore began living together
    in the summer of 2000. However, according to Ms. Sweet and her sister, Ann
    McAdam, it was sometime in 1998 after they met at the Donwood Institute. In any
    event, they lived together in Ms. Sweets apartment until his death.

[12]

Contrary to his agreement with Ms. Moore, Mr. Moore changed the
    beneficiary under the Policy in September 2000 from Ms. Moore to Ms. Sweet by executing
    a change of beneficiary form that designated Ms. Sweet as an irrevocable
    beneficiary under the Policy pursuant to the
Insurance Act
, R.S.O.
    1990, c. I.8. He filed the form with the insurer, which recorded the change of
    beneficiary a few days later. He did not advise Ms. Moore of this change and
    she continued to pay the Policy premiums.

[13]

That said, the change in beneficiary was not carried out surreptitiously
    without consultation. It was effected through the offices of, and after
    discussions with, Ms. Moores brother-in-law, a life insurance broker who is
    married to Ms. Moores sister. The sister also works for a life insurance
    company.

[14]

According to Ms. Sweet, who was present when the decision was made at
    the brokers office, the rationale for the change in beneficiary was that:

Mr. Moore did not want me to worry about how I was going to pay
    the rent or buy my medications in the unlikely event he passed away before me.
    He wanted to make sure I was able to live my remaining years in the building
    where I have resided for the past 40 years.  And he wanted me to live worry and
    debt free.

[15]

In May 2002  some time after the oral agreement and the subsequent
    change in beneficiary status  the Moores entered into a separation agreement.
    Mr. Moore agreed to convey his one-half interest in the matrimonial home to Ms.
    Moore. Each waived and released the other from all equalization of net family
    property claims (with a minor exception regarding household contents). Mr.
    Moore agreed to pay child support in accordance with the Federal Guidelines.
    Ms. Moore waived and released outstanding child support arrears.

[16]

The separation agreement was silent about the Policy or anything related
    to it.

[17]

The Moores were divorced in October 2003.

[18]

It is evident from the materials that the marriage breakdown between the
    Moores was related to Mr. Moores struggles with chronic pain and his alcohol
    and substance abuse issues which no doubt contributed to what Ms. Moore refers
    to as his financial irresponsibility and build-up of debts burdening them both.
    They clearly went through a very difficult time. In fact, the financial
    difficulties  including a very substantial debt of Mr. Moore to Revenue Canada
    of over $70,000  led to both declaring bankruptcy in early 2000.

[19]

Between 1999 and 2000, Mr. Moore lost his drivers license and his job,
    for medical reasons, and for the rest of his life his source of income was a
    long-term disability pension from his former employer in the gross amount of
    $5,000 per month (with some indexing). We do not know much about Ms. Moores
    financial circumstances post-separation, except that it appears she continues to
    reside in the former matrimonial home in Mississauga. We also know that there
    were disputes post-separation about the payment by Mr. Moore of child support, that
    arrears accumulated, and that beginning in 2005 the Family Responsibility
    Office (FRO) was garnishing his disability payment. After an additional
    deduction for income tax, Mr. Moore was left with a net disability amount of
    $2,125 per month, with the latest information available.

[20]

Ms. Moore says that Mr. Moore made an offer to settle the arrears of
    child support in January 2005, but that arrears in the amount of over $10,000
    remained at the time of his death. There is some dispute in the materials, however,
    over whether this amount has been paid.

[21]

Ms. Sweet and Mr. Moore cared for each other during their 13 years of
    cohabitation. She is disabled as well. She suffers from chronic pain, is on
    numerous medications, requires the use of a walker and cannot travel by public
    transit. Her sister, Ms. McAdam, has been given Power of Attorney over her
    personal property. According to Ms. Sweet, Mr. Moore helped out with the rent
    and assisted with chores and running errands for her; when Mr. Moores
    disability income was garnished by FRO it caused them financial hardship and
    led to them borrowing from friends and relatives to make ends meet.

THE ISSUES

[22]

As noted, Ms. Sweet does not contest the application judges finding
    that there was an oral agreement between Ms. Moore, the respondent, and her
    former husband, the deceased Larry Moore, to the effect that Ms. Moore would
    continue to pay the premiums on the Policy and would be entitled to the proceeds
    on his death. Nor is it disputed that she paid the premiums and that he did not
    tell her of the change in beneficiary.

[23]

The two central issues raised on the appeal relate to equitable
    assignment and unjust enrichment, although Ms. Moores end position is that a
    constructive trust in her favour is justified on the basis of good conscience.

[24]

In the result, there are four questions for consideration:

(i) Did the application judge err in
    relying on the doctrine of equitable assignment, which was not pleaded or
    argued before him?

(ii) If he were entitled to rely on
    the doctrine, did the application judge err in finding that the contract here
    constituted an equitable assignment of the deceaseds interest in the policy
    proceeds?

(iii) Did the application judge err in
    failing to hold that there was a valid juristic reason for Ms. Sweets receipt
    of the Policy proceeds and therefore in holding that the proceeds were
    impressed with a trust in Ms. Moores favour based on unjust enrichment?

(iv) Is there some other good
    conscience basis for the creation of a remedial constructive trust in Ms.
    Moores favour?

[25]

For the reasons that follow, my answer to questions (i), (ii) and (iii)
    is yes, and to (iv) is no.

[26]

In summary, I am satisfied that:

(i) because it was neither placed in
    issue nor argued before him, the application judge erred in relying on the
    doctrine of equitable assignment and applying it on his own initiative;

(ii) because the record was not
    created on the basis that the parties had joined issue on the ground of equitable
    assignment, the application judges findings with respect to it are unreliable
    and must therefore be set aside;

(iii) absent equitable assignment or
    another exceptional circumstance to a similar effect, the provisions of the
Insurance
    Act
,
pursuant to which Ms.
    Sweet was designated an irrevocable beneficiary operate to provide a valid
    juristic reason for her receipt of the insurance proceeds, making a finding of
    unjust enrichment unavailable; and

(iv) there is nothing in the
    circumstances of this case that would provide the basis for a good conscience
    constructive trust when the facts do not support such a trust based on unjust
    enrichment or wrongful act, and it is therefore unnecessary to determine
    whether such a third category of remedial constructive trust continues to be
    available in view of the Supreme Court of Canadas decision in
Soulos v.
    Korkontzilas
, [1997] 2 S.C.R. 217.

DISCUSSION AND ANALYSIS

Equitable Assignment

[27]

The application judge held that the oral contract described took the
    form of an equitable assignment to Ms. Moore of Mr. Moores equitable interest
    in the proceeds of the Policy, or alternatively of his entire interest in the
    Policy, in return for her agreement to pay the premiums in the future.

[28]

Respectfully, he erred in doing so. I say this for two reasons.

[29]

First, it was procedurally unfair to found his decision on a principle
    that was neither put in play nor relied on by Ms. Moore on the application, and
    on which the parties had not joined issue.

[30]

Secondly, in addition to the fairness concerns arising from the
    foregoing, the introduction of a new theory of liability in the reasons for
    decision raises concerns about the inherent unreliability of any finding based
    on that untested theory: see
Rodaro v. Royal Bank of Canada
(2002), 59
    O.R. (3d) 74 (C.A.), at paras. 60-63;
Labatt Brewing Company Limited v. NHL
    Enterprises Canada, L.P.
, 2011 ONCA 511, 106 O.R. (3d) 677, at paras. 5-7.
    In respect of this analysis, it is not a matter of determining whether the
    application judge made a palpable and overriding error in his findings of fact
    or of mixed fact and law regarding the assignment. By introducing the equitable
    assignment issue himself in the course of arriving at his decision, he erred in
    law by depriving the parties  and Ms. Sweet in particular  of the ability to
    make a proper record relating to it, thereby rendering the result unreliable
    and justifying appellate intervention.

Procedural
    Fairness

[31]

Equitable assignment was not before the Court on the application. Ms.
    Sweet had no notice that it was in play. It was not asserted in the Notice of Application.
    It was not pleaded in any other way or raised as such in the evidence
    presented or other materials filed by Ms. Moore. It was not addressed or in any
    way argued by counsel on her behalf. Not surprisingly, it was not met or
    addressed by Ms. Sweet either.

[32]

Ms. Moores position was essentially that (i) there was a contract, and
    (ii) she was entitled to the funds based on the equitable principle of unjust
    enrichment. The concept of equitable assignment was introduced by the
    application judge in his reasons for decision.

[33]

None of this is contested by Ms. Moore on the appeal. She argues,
    however, that there was no procedural unfairness because (i) the facts are
    capable of supporting an assignment, and (ii) the agreement itself entailed an
    equitable assignment of the policy.

[34]

I disagree.

[35]

I shall return to these submissions below when dealing with the
    substantive issues relating to equitable assignment. Suffice it to say here
    that neither addresses the procedural unfairness created by resting the
    decision, at least in significant part, on that doctrine. Indeed, as I shall
    explain, the concerns are reinforced by the factors raised by those submissions.

[36]

Equitable assignment is not a straightforward concept to understand or
    apply, procedurally or substantively, even when a party is represented by
    counsel. It raises many questions. Here are some, for example. Does the transaction
    in question constitute an equitable assignment of a legal right of action? Or
    is it an equitable assignment of an equitable right of action? Are there
    procedural implications arising out of the difference? Would Ms. Moore, as the
    equitable assignee, be required to add Mr. Moores estate as a co-applicant
    (something she did not do)? What evidence is required to establish the
    assignors intention to assign the property interest or right of action in
    question? What exactly is it that was intended to be assigned  here, the
    Policy in its entirety or the right to the proceeds? Was the assignment to be
    absolute or something else? Was there consideration? What form of consideration
    is necessary?

[37]

None of this was touched upon in Ms. Moores application materials or in
    argument.

[38]

Ms. Sweet was unrepresented at the hearing. She is disabled. Although
    the Public Guardian and Trustee was satisfied that she was capable of
    representing herself at the hearing, she requires her sister, Ms. McAdam, to
    act as her Power of Attorney in respect of her personal property. Where is the
    appearance of fairness when a party in such circumstances learns for the first
    time, on receipt of the decision, that she has lost what she thought was her
    entitlement to $250,000 needed to sustain her for the rest of her life, on a
    basis that she had no way of knowing would affect the outcome or that she had
    to meet? To pose the question, in my opinion, is to answer it.

[39]

This Court has made it clear on a number of occasions that lawsuits are
    to be decided within the boundaries of the pleadings (i.e., the documents
    framing the issues), and based on findings and conclusions that are anchored
    in the pleadings, evidence, positions or submissions of any of the parties. Otherwise,
    they are inherently unreliable and procedurally unfair, or contrary to
    natural justice. When a judge steps outside of the case as it was developed
    by the parties to decide a given issue, the parties are deprived of the
    opportunity to make submissions and to address that issue in the evidence.
    See
Rodaro
, at paras. 60-63;
Labatt Brewing
, at paras. 5-7;
460635
    Ontario Ltd. v. 1002953 Ontario Inc.
(1999), 127 O.A.C. 48 (C.A.), at
    para. 9;
A-C-H International Inc. v. Royal Bank of Canada
(2005), 254
    D.L.R. (4th) 327 (Ont. C.A.).

[40]

The circumstances of this case affirm those very risks and lead to the
    second concern, the inherent unreliability of the findings.

The
    Inherently Unreliable Findings

[41]

With respect to the oral agreement and equitable assignment, the
    application judge held that:

(i) each of Mr. and Ms. Moore had an
    equitable interest in the proceeds of the Policy from the time it was taken out
    in 1985;

(ii) the oral agreement in 2000 took
    the form of an equitable assignment by Mr. Moore to Ms. Moore of his equitable
    interest in the proceeds in return for her agreement to pay the ongoing
    premiums;

(iii) if he were wrong in finding that
    Ms. Moore had an equitable interest in the proceeds of the Policy from 1985,
    with the result that Mr. Moore had the entire equitable interest in the
    proceeds until 2000, the effect of the 2000 oral agreement was to assign his
    entire interest in the Policy to her at that time, in exchange for her
    commitment to pay the ongoing premiums.

[42]

The bases for these conclusions are set out in the application judges
    reasons at paras. 18-23.  In summary, he found that:

(i) the Moores jointly took out the
    policy in 1985 to provide for Ms. Moore and the children in the event of his
    death and, because the premiums were paid out of their joint account, they each
    had an equitable interest in the proceeds which [a]s a practical matter  took
    the form of a right to determine the beneficiary of the Policy (para. 18);

(ii) the agreement had a significant,
    continuing purpose when it was made, namely allowing Mr. Moore to fulfill his
    obligations to his children and provide for Ms. Moore (para. 20);

(iii) Ms. Moore paid the premiums
    until Mr. Moores death and would not have done so if she had not obtained an
    equitable assignment of the insurance proceeds (para. 21);

(iv) Mr. Moore had no assets in 2000 and
    relied on disability benefits to cover his living expenses. He was aware the
    Policy was kept in force by virtue of Ms. Moore paying the premiums and could
    not reasonably have expected [Ms. Moore] to continue to pay the premiums on the
    Policy unless it was for the benefit of [her] and their children (para. 22);
    and

(v) the 2002 separation agreement was
    silent with respect to the Policy, even though both parties were aware of its
    existence. The most probable explanation for the silence is that the parties
    had already reached, and implemented, the agreement respecting the Policy (para.
    23).

[43]

In
Fraser v. Imperial Bank of Canada
(1912), 47 S.C.R. 313, at p.
    329, Davies J. (concurring) stated that:

No form of words is necessary to create [an equitable]
    assignment. It is always a question of fact and of the intention of the parties
    to be gathered from what they said and did and from all the surrounding
    circumstances.

[44]

It may be that, on a record properly developed on the basis that the
    parties had joined issue on the question of equitable assignment, the foregoing
    findings would have been open to the application judge. But the parties did not
    join issue on this question and, with respect to the application judge, many
    questions needed to be addressed and remained open and unanswered on the
    record. As this Court stated in
Rodaro
, at paras. 62-63:

In addition to fairness concerns which standing alone would
    warrant appellate intervention, the introduction of a new theory of liability
    in the reasons for judgment also raises concerns about the reliability of that
    theory. We rely on the adversarial process to get at the truth. That process
    assumes that the truth best emerges after a full and vigorous competition
    amongst the various opposing parties. A theory of liability that emerges for
    the first time in the reasons for judgment is never tested in the crucible of
    the adversarial process. We simply do not know how [the trial judges theory]
    would have held up had it been subject to the rigours of the adversarial
    process.

[The trial judge] erred in finding liability on a theory never
    pleaded and with respect to which battle was never joined at trial. This error
    alone requires reversal.

[45]

Consider the following areas of potential controversy, for example.

[46]

First, what exactly were the intentions of Mr. Moore and Ms. Moore at
    the time the oral agreement was entered into, or at the time the Policy was
    taken out, or at any time between? The only evidence presented on the
    application was contained in three affidavits and attached exhibits. There was
    no cross-examination on the affidavits. From these materials, there is nothing to
    indicate that Mr. Moore and Ms. Moore put their minds to the concept of an
    assignment of the Policy or of its proceeds. There is no evidence of what words
    were actually spoken between the Moores to express Mr. Moores intention to
    assign, or, if there were, to express whether the purported assignment was to
    be absolute or conditional (something that could affect the priorities in a
    subsequent dispute over the proceeds between Ms. Moore, as assignee, and any
    subsequent assignee or beneficiary without notice of the earlier assignment). Unlike
    unjust enrichment, a finding of an assignment requires evidence of intention. See,
    generally,
Fraser v. Imperial Bank of Canada
;
Bank of Nova Scotia
    v. Newfoundland Rebar Co.
(1987), 65 Nfld. & P.E.I.R. 165 (S.C.), at para.
    12;
Chudy v. Merchant Law Group
, 2008 BCCA 484, 85 B.C.L.R. (4th) 237,
    at paras. 41 and 47, leave to appeal to S.C.C. refused, [2009] S.C.C.A. No. 7;
Nadeau
    v. Caparelli
, 2016 ONCA 730, 132 O.R. (3d) 721, at para. 19.

[47]

Counsel for Ms. Moore did not argue that she had an equitable interest
    in the proceeds of the Policy from its inception. Nor did he submit that Mr.
    Moore had assigned his equitable interest in the Policy entirely, or at all,
    pursuant to the 2000 oral agreement, or that Ms. Moores equitable interest took
    the form of Ms. Moores right to determine the beneficiary of the Policy.

[48]

Ms. Moore did not state that the Policy had been taken out jointly, as
    the application judge finds it was. It was not her evidence that the Policy was
    taken out in 1985 to provide for the children and for her. Her evidence was
    that the Policy was taken out to provide for the children:

The Policy was entered into due to the Deceaseds financial
    irresponsibility and the understanding the Deceased and I shared, which was the
    Policy was
required in order to support our Children
in the event of the Deceaseds passing. [Emphasis added.]

[49]

Ms. Moore did not require an equitable ownership interest in the Policy
    to achieve that purpose. She is not named as the applicant on the Policy application.
    Or the owner.

[50]

There was no evidence that, from the outset, she would have a right to
    determine the beneficiary of the Policy, as the application judge observed.
    What would the insurer have done had she purported to file a designation of someone
    as a beneficiary? Could she herself, for example, have designated someone from
    her family as a revocable, or even an irrevocable, beneficiary under the Policy
    in her stead? At any time? With or without Mr. Moores permission? We do not
    know the answers to such questions because no evidence was led directed to this
    issue.

[51]

An assignment involves the transfer of a proprietary right, including a
    right of action. As noted above, although there is no particular form required
    for an equitable assignment, it is essential that there be sufficiently clear
    evidence to establish the intention of the assignor to make such an assignment,
    that is, to establish that the assignor clearly
intended
    the contractual right to become the property right
of the assignee: see
Nadeau
,
    at para. 19. The application judge did not direct his mind to the question of
    Mr. Moores intention, however. He seems to have leaped directly from the fact
    there was an oral agreement that if Ms. Moore continued the payments she would
    continue as a beneficiary, to the conclusion that Mr. Moore intended to make an
    absolute assignment of the property in the Policy or its proceeds. There is
    little, if any, other evidence to support such an intention.

[52]

A further example may assist in highlighting the frailty in making the
    direct analytical jump in terms of whether Mr. Moore had the necessary intention
    to make an assignment. Suppose that, in breach of the oral agreement, Ms. Moore
    paid no premium, or stopped after paying one or two; and assume the children
    still needed and were entitled to support at that point. Mr. Moore would have
    been faced with two options in such an event, assuming he assigned his rights
    as the application judge found.

[53]

First, he could continue to pay premiums in order to keep the Policy
    alive, but if he died Ms. Moore would receive the proceeds even though
she
was in breach of the agreement. Would Mr. Moore have
    said but of course I accept that would be the case, if he had been asked that
    question at the time the agreement was made?

[54]

Secondly, he could let the policy lapse, in which case the children
    would be deprived of the protection they would have in the event of his death. Would
    he have accepted such a turn of events if asked during the discussion leading
    up to the oral agreement? We do not know the answers to these questions because
    nobody considered the need to examine them, or to consider other potentially
    similar questions, at the time of the application, and one might wonder if Mr.
    Moores answers would have been positive if faced with those choices.

[55]

I make two final observations before leaving the subject of equitable
    assignment.

[56]

There is some authority to suggest that payment of premiums by an
    assignee may not, of itself, constitute valuable consideration for the assignment
    of a policy and that such cases may be treated as assignments by way of a gift,
    in which case it must be shown that the assignor has done everything possible
    to make the transfer of the rights under the policy irrevocable: see Craig
    Brown & Thomas Donnelly,
Insurance Law in Canada
, loose-leaf
    (Toronto: Thomson Reuters, 2016), at para. 15.2(b). Without determining whether
    the law is truly to that effect  because it is not necessary to do so  I
    observe only that this potential difficulty was not considered by the
    application judge and, of course, was not addressed by any of the parties.

[57]

Finally, there are provisions in the
Insurance Act
that may
    bear on the assignment issue as well, but were not addressed.

[58]

It is not clear, even if the oral agreement did constitute an equitable
    assignment, that Ms. Moore would have been protected as an assignee, in a
    contest with Ms. Sweet, the designated irrevocable beneficiary. Had the issue
    of equitable assignment been in play, and had it been brought to the application
    judges attention, s. 200(1)(b) of the
Insurance Act
may well have
    affected his determination on this point. Section 200(1)(b) states:

Where an assignee of a contract gives notice in writing of the
    assignment to the insurer at its head or principal office in Canada, the
    assignee has priority of interest as against a beneficiary other than one
    designated irrevocably as provided in section 191 prior to the time the
    assignee gave notice to the insurer of the assignment in the manner prescribed
    in this subsection.

[59]

This provision would appear to indicate that, as an assignee of the
    Policy or of its proceeds, Ms. Moore would have had to give the insurer notice
    in writing of her assigned interest in order to obtain a priority of interest
    against another named beneficiary, much less as against an irrevocable
    beneficiary. She did not give any such notice. While there may be an argument
    that s. 200(1)(b) relates to the effectiveness of an assignment as against the
    insurer, and not as between competing beneficiaries, the
Insurance Act
does not say this is the case, and, there was no argument on this point either,
    since equitable assignment was not made an issue on the application.

[60]

For all the foregoing reasons, the application judges finding that the
    oral agreement constituted an equitable assignment cannot stand, in my opinion.
    Absent equitable assignment or some other basis upon which it could be said
    that Mr. Moore had placed the policy or its proceeds out of his control and
    into the hands of Ms. Moore, Ms. Moore must look to a remedial constructive
    trust for relief.  On the application, she focussed on unjust enrichment in
    this regard.

[61]

I turn to the trust issues raised on the appeal now.

Constructive Trust

[62]

I begin this portion of the analysis with the observation that this is
    not one of those cases  in spite of what it may seem at first impression 
    where the equities are heavily weighted in favour of one party or the other.

[63]

It is the case that Ms. Moore had an oral agreement with Mr. Moore that if
    she paid the premiums she would receive the proceeds of the Policy. It is the
    case that she paid the premiums. And it is the case that Mr. Moore breached the
    agreement by designating Ms. Sweet as the irrevocable beneficiary under the
    Policy.

[64]

On the other hand, Mr. Moore was a man of limited means, living in the
    post-separation period on a disability pension, and suffering from the
    disabilities associated with his physical, mental and substance abuse issues. Ms.
    Sweet  who is herself disabled  took care of Mr. Moore and, for practical
    purposes, provided him with a home, a place to live, and a supportive family
    during the 13 years of their relationship.

[65]

There is little, if any, evidence on the record as to Ms. Moores
    present financial needs. She continues to live in the former matrimonial home
    after Mr. Moores transfer of his one-half interest at the time of separation.
    Ms. Sweet would appear from the record to be in financial need. Indeed, her
    evidence is that she was made a beneficiary of the Policy because Mr. Moore
    wanted to ensure that she would be able to remain in the apartment home that
    she had occupied for 40 years by the time of his death.

[66]

On these facts, it cannot be said that Ms. Sweet is no more than a
    volunteer who gave nothing in exchange for being named irrevocable beneficiary,
    or that she is simply the recipient of a windfall. She was a 13-year spouse
    with heavier than normal caregiving duties (both she and Mr. Moore were
    disabled in varying degrees) and was the person primarily responsible for the
    home that they lived in.

[67]

On the application, Ms. Moores position was that she was entitled to
    the Policy proceeds on the basis of unjust enrichment. On appeal, her approach
    was more nuanced. She continued to rely on unjust enrichment but embraced the
    application judges finding of equitable assignment in support of the claim, as
    well. She submitted that the application judge was correct in holding that the
    irrevocable designation of beneficiary provisions in the
Insurance Act
did not provide a juristic reason for Ms. Sweets receipt of the proceeds. In
    the end, she fell back upon the more expansive view that a constructive trust
    may be imposed where good conscience requires it.

[68]

I have already concluded that, on the way the case was framed and argued
    before the application judge and on the record as it currently exists, it is
    not open for the court to determine whether the oral agreement constituted an
    equitable assignment. I turn, then, to a consideration of whether the claim for
    unjust enrichment can otherwise stand or, if not, whether a remedial
    constructive trust should be found on some other good conscience basis in
    these circumstances.

[69]

In my view, Ms. Moores claim cannot succeed on either basis.

Unjust
    Enrichment

[70]

The elements of a claim for unjust enrichment are well-known and were
    addressed by the application judge. The claim requires that there be: (a) an
    enrichment; (b) a corresponding deprivation; and (c) the absence of any
    juristic reason for the enrichment:
Pettkus v. Becker
, [1980] 2 S.C.R.
    834, at p. 848;
Kerr v. Baranow
, 2011 SCC 10, [2011] 1 S.C.R. 269, at
    para. 32.

[71]

Here, the application judge found that there was an enrichment (Ms.
    Sweets receipt of the Policy proceeds), a corresponding deprivation (Ms. Moore
    would not receive them and, yet, there was a causal link between her payment of
    the premiums and the availability of the proceeds), and that the provisions of
    the
Insurance Act
did not provide a juristic reason for Ms. Sweets
    retention of the Policy proceeds. Ms. Sweet argues that he applied both the
    corresponding-deprivation and the juristic-reason parts of the test
    incorrectly.

Corresponding Deprivation

[72]

Ms. Sweet is right when she says that the application judges finding of
    a corresponding deprivation to the extent of the full value of the Policy
    proceeds  as opposed to simply the extent of the premiums she paid  is rooted
    in his finding that the oral agreement constituted an equitable assignment. Since
    I have concluded that the equitable assignment finding must be set aside, the
    finding of a corresponding deprivation based on it must fail as well.

[73]

However, there may be other grounds on which it could be said that Ms.
    Moore suffered a corresponding deprivation to Ms. Sweets enrichment. Ms. Moore
    did continue to pay the premiums following the separation, unaware that she had
    been replaced as beneficiary by Ms. Sweet, to a total amount of approximately
    $7,000. Each payment kept the Policy alive. It might be said that since she
    paid the final premium before death, Ms. Moores deprivation corresponded to
    Ms. Sweets enrichment to the extent of the full Policy proceeds.

[74]

Ms. Sweet argues, on the other hand, that the deprivation elements of
    an unjust enrichment claim are measured on the basis of a straightforward
    economic approach, and that other considerations, such as moral and policy questions,
    are appropriately dealt with at the juristic reason stage of the analysis:
Kerr
,
    at para. 37;
Garland v. Consumers Gas Co.
, 2004 SCC 25, [2004] 1 S.C.R.
    629, at para. 31;
Peel (Regional Municipality) v. Canada
, [1992] 3
    S.C.R. 762, at p. 803. She contends that any corresponding deprivation suffered
    by Ms. Moore is limited to the loss of the monies she paid ($7,000); that Ms.
    Moore is not entitled to count her expectation losses (a breach of contract
    concept) as deprivation, for purposes of unjust enrichment (see
Pacific
    National Investments Ltd. v. Victoria (City)
, 2004 SCC 75, [2004] 3 S.C.R.
    575) and that the amount of the premiums paid ($7,000) is sufficiently
    insignificant, compared to the amount of the insurance proceeds ($250,000) to
    warrant the imposition of a constructive trust:
Richardson Estate
, 2009 ONCA 403, 96 O.R. (3d) 65, at para. 40.

[75]

In the end, I do not find it necessary to resolve this issue. In my
    view, on the record here, Ms. Moores unjust enrichment claim must fail because
    the irrevocable beneficiary designation provisions of the
Insurance Act
provide a juristic reason justifying the receipt by Ms. Sweet of the insurance
    proceeds.

A
    Valid Juristic Reason

[76]

Respectfully, the application judge made two errors in his assessment of
    the juristic reason element of unjust enrichment. First, he failed to recognize
    the significance of Ms. Sweets designation as an irrevocable beneficiary.
    Secondly, he failed to apply the two-step analysis to the juristic reason
    assessment that has been mandated by the Supreme Court of Canada in
Garland
,
    at paras. 44-45, and in
Kerr
, at para. 43-45.

The Irrevocable Beneficiary Designation

[77]

Mr. Moore designated his second partner, Ms. Sweet, as the irrevocable
    beneficiary under the Policy. Ms. Moores designation as beneficiary, on the
    other hand, was revocable. The change of beneficiary form was properly executed
    and filed with the insurer pursuant to s. 191(1) of the
Insurance Act
.

[78]

There is a significant difference between the status of a revocable and
    an irrevocable beneficiary, in my view. The former may be altered or revoked by
    the insured at any time; the latter may not, except with the consent of the
    named irrevocable beneficiary. Part V of the
Insurance Act
has within
    it a specific regime governing the manner in which a person may be designated as
    an irrevocable beneficiary  a statutory framework for the benefit of the
    insured, the insurer and beneficiaries. The designation must be done either in
    the life insurance policy itself
[1]
or by way of a declaration.
[2]
It must be filed with the insurer. And the effect of attempting to designate
    someone as an irrevocable beneficiary without complying with the provisions of
    the
Insurance Act
is that the designation is revocable.

[79]

This is clear from the relevant provisions of the
Insurance Act
.
    Section 190 stipulates that:

(1)
Subject to subsection (4)
[3]
, an insured may in a contract or
    by a declaration designate  a beneficiary as one to whom or for whose benefit
    insurance money is to be payable
;

(2) Subject to section 191, the insured may from time to time alter
    or revoke the designation by a declaration.

[80]

Section 191 provides that:

(1) An insured may in a contract, or by a declaration  filed
    with the insurer at its head or principal office in Canada during the lifetime
    of the person whose life is insured, designate a beneficiary irrevocably, and
    in that event the insured, while the beneficiary is living, may not alter or revoke
    the designation without the consent of the beneficiary and the insurance money is
    not subject to the control of the insured, is not subject to the claims of the
    insureds creditor and does not form part of the insureds estate.

(2) Where the insured purports to designate a beneficiary
    irrevocably  in a declaration that is not filed as provided in subsection (1),
    the designation has the same effect as if the insured had not purported to make
    it irrevocable.

[81]

As this Court has observed, a beneficiary designation in a life
    insurance policy is normally unassailable absent exceptional circumstances
    and may provide a juristic reason for the named beneficiarys enrichment:
Richardson
    Estate
, at paras. 28 and 61. This is even more forcefully the case, in my opinion,
    where the designation is irrevocable (which was not the case in
Richardson
    Estate
).

[82]

Once an irrevocable designation is made in compliance with the
Insurance
    Act
 as it was here, in Ms. Sweets favour  the legislation imposes a
    regime over the policy and its proceeds that gives rights and protection to
    both the insurer and the named irrevocable beneficiary: the insurer is protected
    in making payment to the beneficiary, the irrevocable beneficiary by the
    statutory right to remain as the named beneficiary entitled to receive the
    insurance monies unless he or she consents to being removed. The regime is
    designed to provide an element of certainty and predictability for those
    statutory rights and protections, which are reinforced by the Legislatures decision,
    reflected in s. 191(1), that, once an irrevocable designation is properly
    effected, the insured loses control over the insurance monies and the monies
    are immune from attack by the insureds creditors and do not form part of the
    insureds estate, and in s. 191(2) that a purported attempt to designate an
    irrevocable beneficiary without complying with s. 191(1) renders the
    designation revocable.

[83]

Simply put, I read this legislative regime as leaning heavily in favour
    of payment of the proceeds of life insurance policies to those named as
    irrevocable beneficiaries, whereas it continues to recognize the right of an
    insured, at any time prior to such a designation, to alter or revoke a
    beneficiary who does not fall into that category. In short, on the record here,
    it provides a juristic reason for Ms. Sweets receipt of the Policy proceeds.
    Disposition of law is well-established as a category of juristic reason:
Garland
,
    at para. 49.

[84]

Authorities holding that the
Insurance Act
regime may be superseded
    by provisions in a separation agreement or in some other contract requiring an
    insured to name the other party as a designated beneficiary, must be read with
    this in mind. As must authorities pre-dating the Supreme Court of Canadas
    decisions in
Soulos
and
Garland.

[85]

Although it was not put this way in argument, a number of these
    authorities might be explained on the basis of a theory somewhat akin to the
    equitable assignment argument  namely that there was a contractual arrangement
    which was tantamount to an irrevocable beneficiary designation, thereby
    effectively depriving the insured of any further ability to deal with the
    policy.

[86]

Given the foregoing discussion, I believe that proposition to be
    questionable at best. However, authorities such as
Shannon v. Shannon
(1985), 50 O.R. (2d) 456 (H.C.), may be open to that interpretation.

[87]

Shannon
is frequently referred to for the proposition that
    courts are willing to override a beneficiary designation on the basis of a
    prior contract. There, the deceased specifically agreed in the prior separation
    agreement that he would continue to name his former wife as beneficiary and
    agreed not to revoke that beneficiary designation at any time in the future. He
    subsequently removed her as beneficiary, however, and named his nephew and
    niece as revocable beneficiaries, without their having provided any
    consideration for his act. McKinlay J. (as she then was) held that the wife was
    entitled to the proceeds. In an oft-cited passage, she said, at p. 461:

The
Insurance Act
does not specifically preclude the
    existence of rights outside its provisions. It would go against all conscience
    to hold that because of the provisions cited, the plaintiffs clear rights
    under an agreement with her husband for good consideration can be taken away in
    favour of a niece and nephew who have given no consideration for those rights.

The plaintiff is entitled to a declaration that the proceeds of
    the policy are impressed with a trust in her favour.

[88]

McKinlay J. did not say whether the trust she found was express or
    constructive. Either might be inferred from her analysis. An important factor
    in the case, however, was the fact that the separation agreement provided that
    the wifes designation would not be revoked (or, to put it positively, that it
    was to be irrevocable). Here, we have no evidence suggesting that the oral
    agreement contained such a stipulation.

[89]

Bielny v. Dzwiekowski
, [2002] I.L.R. I-4018 (Ont. S.C.), affd
    [2002] O.J. No. 508 (C.A.) and
Fraser v. Fraser
(1995), 16 R.F.L.
    (4th) 112 (B.C.S.C.), at para. 18, could also be explained on the basis that
    there was an agreement to name the plaintiff as an irrevocable beneficiary. That
    said,
Shannon
and
Fraser v. Fraser
pre-date the decision of
    the Supreme Court of Canada in
Soulos
 a seminal case dealing with
    remedial constructive trusts that will be discussed below  and
Bielny
did not refer to
Soulos
.

[90]

Moreover, in none of the authorities to which we have been referred, or
    which my research has unearthed, has the unsuccessful competing beneficiary
    been designated as the
irrevocable
beneficiary of the policy proceeds.
    To the extent that
Shannon
and other similar authorities may be read
    as suggesting that a simple contractual promise to make someone a beneficiary
    under a life insurance policy, albeit a promise for valuable consideration, is
    sufficient to circumvent the clear statutory requisites for an irrevocable
    beneficiary designation, I respectfully disagree.

[91]

I need not go so far as to say that the designation of a beneficiary as
    an irrevocable beneficiary under the
Insurance Act
invariably trumps a
    prior claimant. There may be cases where the insured, by agreement, has placed
    the policy or its proceeds beyond his or her ability to deal with them, and,
    therefore, beyond his or her ability to make the purported irrevocable
    designation. This, however, is not one of those cases.

The
    Two-Step Analysis

[92]

Further, the application judge failed to apply the required two-step
    analysis to the juristic reason assessment. There is no dispute that [a]t the
    heart of the doctrine of unjust enrichment lies the notion of restoring a
    benefit which justice does not permit one to retain:
Kerr
, at para.
    31, citing
Peel
, at p. 788.  Courts, however, have been careful to
    guard against the remedial constructive trust turning into a completely
    unprincipled, open-ended remedy, the application of which depends on a
    particular judges subjective view of what is unjust or goes against good
    conscience  or, to put it in its classic formulation, that is dependent upon
    the length of the Chancellors foot. In Canada, the Supreme Court has
    developed the absence of juristic reason as a mechanism for instilling a
    principled approach to the remedy.

[93]

Iacobucci J. addressed this point in
Garland
, at para. 40:

It is not of great use to speculate on why Dickson J. in
Rathwell,
    supra
,
[4]
expressed the third condition as absence of juristic reason but I believe that
    he may have wanted to ensure that the test for unjust enrichment was not purely
    subjective in order to be responsive to Martland J.s criticism in his reasons
    that application of the doctrine of unjust enrichment contemplated by Dickson
    J. would require immeasurable judicial discretion (p. 473). The importance of
    avoiding a purely subjective standard was also stressed by McLachlin J. in her
    reasons in
Peel, supra
, at p. 802, in which she wrote that the
    application of the test for unjust enrichment should not be case by case palm
    tree justice.

[94]

In continuing with his careful analysis of the juristic reason element
    of unjust enrichment in
Garland
, Iacobucci J. acknowledged the need
    for courts to be able to expand the categories of juristic reason in order that
    the concept not become too inflexible. At para. 43 he wrote:

As McLachlin J. wrote in
Peel, supra,
at p. 788, the
    Courts approach to unjust enrichment, while informed by traditional categories
    of recovery, is capable, however, of going beyond them, allowing the law to
    develop in a flexible way as required to meet changing perceptions of justice.
    But at the same time there must also be guidelines that offer trial judges and
    others some indication of what the boundaries of the cause of action are. The
    goal is to avoid guidelines that are so general and subjective that uniformity becomes
    unattainable.

[95]

In the following paragraphs, Iacobucci J. then articulated the two-step
    analysis that Canadian courts are required to engage in when considering the
    juristic reason element. At paras. 44-46, he said:

The parties and commentators have pointed out that there is no
    specific authority that settles this question.  But recalling that this is an
    equitable remedy that will necessarily involve discretion and questions of
    fairness, I believe that some redefinition and reformulation is required.
Consequently, in my view, the proper approach to the juristic
    reason analysis is in two parts.
First, the plaintiff must show that no
    juristic reason from an established category exists to deny recovery. By
    closing the list of categories that the plaintiff must canvass in order to show
    an absence of juristic reason, Smiths objection to the Canadian formulation of
    the test that it required proof of a negative is answered. The established
    categories that can constitute juristic reasons include a contract (
Pettkus,
    supra
),
a disposition of law
(
Pettkus, supra
),
    a donative intent (
Peter, supra
), and other valid common law,
    equitable or
statutory obligations
(
Peter, supra
).
    If there is no juristic reason from an established category, then the plaintiff
    has made out a
prima facie
case under the juristic reason component of
    the analysis.

The
prima facie
case is rebuttable, however, where the
    defendant can show that there is another reason to deny recovery. As a result,
    there is a
de facto
burden of proof placed on the defendant to show
    the reason why the enrichment should be retained.
This
    stage of the analysis thus provides for a category of residual defence in which
    courts can look to all of the circumstances of the transaction in order to
    determine whether there is another reason to deny recovery.

As part of the defendants attempt to
    rebut, courts should have regard to two factors: the reasonable expectations of
    the parties, and public policy considerations.
[Emphasis added.]

[96]

This approach was re-affirmed in
Kerr
, at paras. 43-44, and in
Pacific
    National
, at paras. 22-26.

[97]

Here, however, the application judge did not conduct that requisite
    two-step analysis. A review of his reasons demonstrates that his analysis was focussed
    on the more sweeping principles underlying equitable trusts without first
    considering whether there was an existing category of juristic reason  a
    disposition of law or statutory obligation  that would justify Ms. Sweets
    receipt of the Policy proceeds. He appears to have overlooked that the juristic
    reason was developed to inject a measure of discipline into a courts analysis
    and to avoid the dangers of immeasurable judicial discretion and the
    determination of an unjust enrichment analysis in a way that involves case by
    case palm tree justice.

[98]

Instead, the application judge began by referring to Cromwell J.s
    comment in
Kerr
, at para. 50, that the constructive trust is a broad
    and flexible equitable tool used to determine beneficial entitlement to
    property, without acknowledging that Cromwell J. had already re-affirmed
Garland
s
    two-step approach, at paras. 43-44. Later in his reasons, after distinguishing
Richardson
    Estate
and other authorities, he noted that [o]f greater relevance [than
    those authorities] is the more general principle that the test for a juristic
    reason requires a flexible contextual approach in the particular circumstances
    of each case, and  again citing
Kerr
, at paras. 44 and 41  that [o]verall,
    the test for juristic reason is flexible, and the relevant factors to consider
    will depend on the situation before the court, and that consideration may also
    be given to the legitimate expectation of the parties, the right of parties to
    order their affairs by contract, and that, the test for a juristic reason is
    flexible and involves discretion and questions of fairness.

[99]

All of these principles are correct, in their proper context. However,
    in relying only on them the application judge lost sight of the need to
    consider first whether there is an existing category of juristic reason that
    precludes recovery on the basis of unjust enrichment. As I have indicated
    above, absent exceptional circumstances, the existence of the statutory regime
    relating to revocable and irrevocable beneficiaries outlined above falls into
    an existing recognized category of juristic reason: it constitutes both a
    disposition of law and a statutory obligation, in my view.

Good Conscience Trusts

[100]

There
    has been considerable debate in the jurisprudence and in academia about whether
    resort to the remedial constructive trust in Canada is now limited to two
    categories since the Supreme Court of Canadas decision in
Soulos

    unjust enrichment and wrongful acts  thereby eliminating resort to a more
    elastic good conscience trust, i.e., one based on no more than a sense of
    fairness to the effect that it would be against all good conscience to deny a
    plaintiff recovery in the circumstances of a particular case. At the end of the
    day, Ms. Moore submits that good conscience is satisfied by giving effect to
    the oral agreement without which the Policy would not have continued to exist.
[5]

[101]

It has long been
    accepted that equity is quintessential never-say-never terrain, and that concepts
    respecting its application develop with the times and to meet the needs of
    particular circumstances. This long-standing principle may work against
    establishing a completely closed set of categories as the foundation for imposing
    a remedial constructive trust.

[102]

At the same
    time, McLachlin J. was pretty clear in
Soulos
that, while a
    constructive trust may be imposed where good conscience so requires (para.
    34), [t]he situations which the judge may consider in deciding whether good
    conscience requires imposition of a constructive trust may be seen as falling
    into two general categories (unjust enrichment and situations where property
    had been obtained by a wrongful act) (para. 36). It was her view that 
[w]ithin
these two broad categories, there is room for
    the law of constructive trust to develop and for greater precision to be
    attained, as time and experience may dictate (para. 43). Rothstein J.
    re-affirmed this view in
Professional Institute of the Public Service of
    Canada v. Canada (Attorney General)
, 2012 SCC 71, [2012] 3 S.C.R. 660, at
    paras. 144-145.

[103]

I do not think
    it is necessary to resolve this debate for purposes of this appeal.

[104]

Most of the
    authorities in which courts have been willing to override a beneficiary
    designation can be explained on the basis of an agreement between one of the
    claimants and the insured that removed the insureds ability to designate a
    later beneficiary.
[6]
As noted earlier,
Shannon
involved a separation agreement in which the
    insured undertook to name his first spouse as a beneficiary irrevocably. In
Bielny
,
    the separation agreement required the insured to name the children of the first
    marriage as irrevocable beneficiaries. In
Fraser v. Fraser
, the trial judge
    found on the facts that the terms of the separation agreement requiring the
    insured to maintain the plaintiff as beneficiary were tantamount to an
    irrevocable designation.

[105]

Whether these
    authorities need to be re-examined in light of
Soulos
, as suggested in
    some authorities  see, for example,
Love v. Love
, 2013 SKCA 31, 359
    D.L.R. (4th) 504  is not something that need be determined here. As I have
    concluded above, it was not open to the application judge on this record to
    hold that the oral agreement between the Moores constituted an equitable
    assignment, or that it was tantamount to an irrevocable beneficiary
    designation.

[106]

Absent those
    considerations, I do not see anything in the circumstances of this case that
    would place it in some other good conscience category not caught with the
    rubric of either wrongful act (not asserted here) or unjust enrichment. For
    that reason, I do not see the need to resolve the foregoing debate about
    whether
Soulos
has restricted the categories for imposing a remedial
    constructive trust to unjust enrichment or wrongful act or whether there
    remains some additional good conscience basis.

[107]

Simply because
    wrongful act is not asserted, and unjust enrichment is unsuccessful, does not
    mean that some other good conscience basis must exist on the facts. To engage
    in such an exercise, on this record at least, it seems to me, would undermine
    the rationale for creation of the juristic reason element in the first place.

DISPOSITION

[108]

For the above
    reasons, I would allow the appeal and set aside the judgment below. With the
    exception of the disposition in the following paragraph, I would dismiss the
    application, and order that the proceeds of the policy of insurance on the life
    of Lawrence Anthony Moore, and accrued interest, be paid out of court to the
    appellant.

[109]

The appellant
    argued that, at most, Ms. Moore was entitled to the return of the $7,000 in
    premiums that she paid following the separation. I agree that she should
    receive that amount, with interest, out of the proceeds held in court. I would
    not extend this to include the premiums paid prior to separation. Those
    premiums were paid from the joint account she held with Mr. Moore prior to
    their separation. She and the children received the protection that the payment
    of those premiums afforded them during that period  she was the designated
    beneficiary in the event of his death  and he was as entitled to the money in
    the account as she was.

[110]

In my view, this
    is an appropriate case for the parties to bear their own costs. Accordingly, I
    would make no order as to costs, here or below.

R.A. Blair J.A.

I agree G.R.
    Strathy C.J.O.

Lauwers J.A. (dissenting):

[111]

I take a
    different view of the law regarding unjust enrichment and constructive trusts
    than my colleague, and therefore dissent.

[112]

As my colleague notes,
    this case is about who should receive the $250,000 proceeds of a life insurance
    policy on the life of Lawrence Anthony Moore who died in 2013. Should the
    proceeds be paid to the appellant, Risa Lorraine Sweet, with whom the deceased
    lived from the summer of 2000 until his death? Or should they be paid to his
    former spouse, the respondent Michelle Constance Moore?

[113]

The application
    judge decided that the respondent should receive the life insurance proceeds
    and ordered that the life insurance proceeds be impressed with a trust in
    favour of the respondent. I would dismiss the appeal for the following reasons.

A.

The Factual and Legal Context

[114]

The life
    insurance policy was issued in 1985 by a predecessor of RBC Life Insurance
    Company. From its inception until the breakup of their marriage in 2000, the
    deceased and the respondent paid the insurance premiums on the policy from
    their joint account. Thereafter, the respondent paid the premiums under what
    the application judge found, at para. 47, to be an oral agreement with the
    [respondent] in 2000 to ensure that the premiums payable in respect of the
    policy would be paid and the proceeds would be available to support his former
    spouse and children on his death.

[115]

On September 21,
    2000, despite his oral agreement with the respondent, the deceased signed an
    irrevocable change of beneficiary form in favour of the appellant and then sent
    it to the insurer. The appellant signed as a witness. The deceased did not tell
    the respondent he had changed the beneficiary designation on the policy, and
    thus she continued to pay the premiums.

[116]

The deceased and
    the respondent entered into a separation agreement dated May 1, 2002 dealing
    with the distribution of assets and child support. It was silent about the life
    insurance policy. Except for net equalization property claims, the separation
    agreement did not contain a general release of any property claims by each
    party against the other.

[117]

The deceased and
    the respondent divorced on October 3, 2003.

[118]

The respondent
    did not learn the deceased had changed the beneficiary designation on the life
    insurance policy in favour of the appellant until she received correspondence
    from the insurance company on July 5, 2013, several weeks after his death.

[119]

This case is the
    regrettable outcome of the fact, noted by the application judge, that: Each of
    the parties trusted the Deceased, who betrayed that trust by acting
    duplicitously. Neither is at fault. My colleague points out that: Ms. Sweet 
    who is herself disabled  took care of Mr. Moore and, for practical purposes,
    provided him with a home, a place to live, and a supportive family during the
    13 years of their relationship.  True enough, but these benefits to the
    deceased would not be as significant if he had died the day after signing the irrevocable
    designation in the appellants favour. In my view they are not equities that
    are relevant to the outcome.

[120]

The effect of an
    irrevocable beneficiary designation is set out in s. 191(1) of the
Insurance
    Act
, R.S.O. 1990, c. I.8. The appellant submits the application judge
    should have given effect to the irrevocable designation signed in her favour by
    the deceased, despite the oral agreement the deceased made with the respondent
    by which she paid the premiums in the expectation she would receive the proceeds
    on his death.

B.

The Decision under Appeal

(1)

The proceeding below:

[121]

The respondent
    stated in her affidavit: It was expressly agreed between the Deceased and I
    that in paying for the Policy premiums, I would be entitled to receive the
    Policy benefits upon his death. She added:

The Policy was entered into due to the Deceaseds financial
    irresponsibility and the understanding the Deceased and I shared, which was
    that the Policy was required in order to support our Children in the event of
    the Deceaseds passing.

[122]

According to the
    respondent, the financial irresponsibility of the deceased, including borrowing
    against the respondents credit, related to his history of medical issues
    including substance abuse, which led to the respondents bankruptcy in March
    2000. She was not cross-examined on this evidence.

[123]

The issue before
    the application judge expressed in the notice of application was whether [t]he
    Deceased and the Applicant entered into an express, valid and binding contract
    where for consideration of the Applicant paying all Premiums for the Policy,
    the Applicant would receive the Benefits. However, nothing in the notice of
    application addressed the remedial route to recovery, via constructive trust,
    express trust, equitable assignment, perfectionary trust or some other
    equitable mechanism.

[124]

In the court
    below, the respondent simply asserted the appellant would be unjustly enriched
    if she receives the deceaseds life insurance policy. The respondent asked the
    court to impose a constructive trust on the proceeds of the insurance policy in
    her favour, and invoked the doctrine of unjust enrichment developed in a line
    of cases including
Soulos v. Korkontzilas
, [1997] 2 S.C.R. 217.

(2)

The Application Judges Findings

[125]

As requested by
    the respondent, the application judge imposed a constructive trust on the
    proceeds of the insurance policy in her favour.

[126]

He found there
    was a valid and binding oral agreement between the deceased and the respondent
    under which the respondent would pay the premiums and would be entitled to the
    proceeds of the insurance policy on the deceaseds death. The application judge
    gave four reasons for this finding. First, he found there was a significant
    continuing purpose for the agreement, which was to provide for the children
    of the Applicant and the Deceased as well as the Applicant, since the deceased
    continued to have obligations to his children at the time of the agreement.

[127]

Second, the
    application judge noted the respondent started paying the premiums herself and
    continued to do so until the date of the deceaseds death. He found she would
    not have paid the premiums out of her own account if she had not obtained an
    equitable assignment of the proceeds of the policy in her favour from the
    deceased.

[128]

Third, the
    evidence was that the deceased had no assets in 2000 and was dependent upon
    disability payments for his own living expenses. He was not paying the
    insurance premiums and he knew full well the respondent was. The application
    judge found:

The Deceased was aware that the [Policy] was being kept in
    force at the time that he signed the designation in favour of the Respondent.
    Otherwise, his execution of the change in designation of beneficiary form would
    have been meaningless.

[129]

Fourth, the
    application judge found the separation agreements silence about the life
    insurance policy, even though both parties were aware of its existence,
    further confirms the existence of an agreement respecting the Policy that was
    implemented by the Applicant and the Deceased in 2000.

[130]

This lawsuit
    arose because the deceased made two incompatible promises before his death, as
    the application judge noted adding that: Each of the parties trusted the Deceased,
    who betrayed that trust by acting duplicitously.

(3)

The Application Judges Legal Determinations

[131]

The application
    judge pointed out that there would have been no insurance proceeds but for the
    Applicant's performance of her obligations under the agreement. He held:

Equity should enforce the agreement that the Deceased made assigning
    his interest in the Policy in the absence of any other agreement between the Respondent
    and the Deceased and in the absence of any evidence that the Respondent gave any
    consideration for the Deceased's change of designation in her favour.

[132]

The application
    judge held: the Deceased agreed to an equitable assignment of his interest in
    the proceeds of the Policy to the Applicant in 2000 in exchange for her
    commitment to pay the premiums of the Policy. He repeated this holding and
    found the oral agreement between the deceased and the respondent functioned as
    an equitable assignment that thwarted the deceaseds irrevocable beneficiary
    designation under the
Insurance Act,
because the designation was made
    in breach of the agreement.

[133]

The application
    judge imposed a constructive trust on the life insurance proceeds in favour of
    the respondent. I note that he did not mention
Soulos
in his decision
    even though it was referred to in the applicants factum before him. However,
    he did refer to
Kerr v. Baranow
, 2011 SCC 10, [2011] 1 S.C.R. 269,
    which was built on the
Soulos
foundation:  see
Kerr
, at para.
    71.

C.

The Positions of the Parties

[134]

The parties take
    radically different positions on the interpretation and application of the
    Supreme Courts decision in
Soulos
.

[135]

The appellant argues
Soulos

limits the remedy of constructive trusts to unjust enrichment and
    wrongful acts. Therefore the case abolished the doctrine of good conscience as
    a general source of equitable jurisdiction. In her view, since the facts do not
    substantiate either unjust enrichment, or wrongful acts as the basis for a
    constructive trust, one should not have been imposed in this case.

[136]

Further
, the
    appellant takes the position that, as a matter of law, the respondent is not
    entitled to a proprietary interest in the insurance proceeds, but has only an
    action in damages against the estate based on the deceaseds breach of his oral
    agreement with the respondent. (This would be an empty remedy since the estate
    has no assets.)

[137]

Accordingly, the appellant asserts the application judge erred in finding that the doctrine of unjust enrichment permitted him to craft an equitable remedy to defeat the appellant's entitlement to the life insurance proceeds as the named irrevocable beneficiary under s. 191(1) of the Insurance Act. She argues doing so was not consistent with this court's decision in Richardson Estate, which was binding on the application judge
.

[138]

The respondent argues
,
    to the contrary, that in view of the plainly duplicitous and inequitable
    conduct of the deceased on the facts as found,
the court has
    equitable jurisdiction, recognized in
Soulos
, to impose a constructive
    trust over the insurance proceeds in the respondents favour, despite s. 191 of
    the
Insurance Act.
The respondent
    also submits
Richardson Estate
is distinguishable. Further, the respondent relies on a group of
    similar cases in which the court imposed a remedial constructive trust that I
    will describe as the disappointed beneficiary cases. These cases were wrongly
    decided, the appellant argues, since
Soulos

abolished the doctrine
    of good conscience constructive trusts
.

[139]

As framed by the
    parties, this appeal raises squarely, for the first time in this court, whether
    the Supreme Court intended in
Soulos
to confine the availability of remedial constructive
    trusts to instances of unjust enrichment and wrongful gains only.
[7]
Although the facts are simple, the law is not.

D.

The Issues

[140]

The appeal
    raises the following issues:

1. What is the correct interpretation
    and application of the Supreme Courts decision in
Soulos
?

2. Did the application judge err in
    finding the respondent had made out her claim in unjust enrichment?

3. Did the application judge err in
    finding that the deceased had made an equitable assignment of the insurance
    proceeds to the respondent?

[141]

I address the third
    issue briefly. I agree with my colleague, for the reasons he gives, that the
    application judge erred in finding that the deceased made an equitable
    assignment of the policy and its proceeds to the respondent. But, in my view
    the error does not affect the outcome. As I will explain, once the application
    judge found unjust enrichment, it was open to him to immediately impose a
    remedial constructive trust on the life insurance proceeds. He did not need to
    find some other equitable mechanism like equitable assignment before doing so.

E.

Analysis

[142]

The application
    judges critical findings are very clear and well supported by the evidence:
    the deceased and the respondent entered into an oral agreement by which she
    would pay the premiums on the life insurance policy and receive the proceeds
    upon his death; and the deceased behaved duplicitously in irrevocably
    designating the appellant as the beneficiary of the policy.

[143]

I begin with
    some observations on the underlying policy tension in this area of the law,
    which in my view suffuses the analysis of the substantive issues. I then
    consider the
Soulos
decision and the issues in sequence.

The Tension between Law and Equity

[144]

In order to
    contextualize the ruling in
Soulos
, it is necessary to acknowledge a
    perennial tension in the common law tradition between, on the one hand, the
    formal demands of the law as dispensed by the old common law courts, and, on
    the other hand, the mercies of equity dispensed by the old chancery courts.
    (Indeed, this tension helps explain some of the differences between my
    colleague and me.)

[145]

The way equity
    operated is well known. When the common law courts reached a particularly harsh
    result flowing from the demands of formality and rigorous logic, chancery
    courts could intervene and mitigate the result in certain circumstances by
    exercising authority over the defendants conscience and compelling the
    defendant not to act on his or her full legal rights.

[146]

Law claims the
    virtues of certainty and predictability, while equity claims the virtues of
    doing justice and upholding fairness in particular cases. As my colleague
    observes, the ancient criticism of equity is that its mercies varied
    arbitrarily with the length of the Chancellors foot.
[8]
The fundamental tension lives on, even though law and equity have been fused in
    Ontario since the late 19th century.

[147]

The constructive
    trust cases show this tension. Judges imposing constructive trusts sometimes
    cite the magnanimous words of Lord Denning in
Hussey v. Palmer
,
[1972] 3 All E.R. 744 (C.A.), who spoke
    of a constructive trust, at p. 747, as:

[A] trust imposed by law whenever justice and good conscience
    require it. It is a liberal process, founded on large principles of equity, to
    be applied in cases where the defendant cannot conscientiously keep the property
    for himself alone, but ought to allow another to have the property or a share
    in it.

[148]

The tension
    between the legal and equitable impulses is evident in
Pettkus v. Becker
,
    [1980] 2 S.C.R. 834. Dickson J., at pp. 847-848, speaking for the majority,
    described the attributes of a remedial constructive trust:

The principle of unjust enrichment lies at the heart of the
    constructive trust. Unjust enrichment has played a role in Anglo-American
    legal writing for centuries. Lord Mansfield, in the case of
Moses v.
    Macferlan
[(1760), 2 Burr. 1005] put the matter in these words: " the
    gist of this kind of action is, that the defendant, upon the circumstances of
    the case,
is obliged by the ties of natural justice and equity to refund
the money". It would be undesirable, and indeed impossible, to attempt to
    define all the circumstances in which an unjust enrichment might arise....
The great advantage of ancient principles of equity is their
    flexibility: the judiciary is thus able to shape these malleable principles so
    as to accommodate the changing needs and mores of society, in order to achieve
    justice.
The constructive trust has proven to be a useful tool in the
    judicial armoury. [Citations omitted and emphasis added.]

[149]

However,
    Martland J., in dissent, saw the majoritys extension of the constructive trust
    remedy in
Pettkus
as undesirable, because he found, at p. 859, that:
    It would clothe judges with a very wide power to apply what has been described
    as palm tree justice without the benefit of any guidelines. He then asked:
    By what test is a judge to determine what constitutes unjust enrichment? He
    answered: The only test would be his individual perception of what he
    considered to be unjust. This was what he resisted.

[150]

Justice
    McLachlin (as she then was) said that the tension between the legal and
    equitable impulses was jurisprudential in nature, and described it in
Peel
    (Regional Municipality) v. Canada
;

Peel (Regional Municipality) v. Ontario
, [1992] 3 S.C.R. 762, at para.
    34 (p. 785), as follows:

I refer to the tension between the need for certainty in the
    law and the need to do justice in the individual case; the tension between the
    need for predictable rules upon which people can predicate their conduct and
    the desire to allow recovery where, and only where, retention of the benefit
    would in all the circumstances be unjust. This jurisprudential tension
    corresponds to the doctrinal tension discussed above. An approach based on
    traditional categories has the advantage of being predictable. Its supporters conjure
    up frightful images ... of judges roaming willy-nilly over the restitutionary
    landscape with only their inner voices to guide them. (McInnes,
    Incontrovertible Benefits and the Canadian Law of Restitution (1990) 12
Advocates
'
    Q. 323, at p. 352). Those advocating the approach of general principle, on the
    other hand, are more ready to concede that in some cases, the court may have to
    make decisions based on the equities of the particular case before them.

[151]

In
Garland
    v. Consumers Gas Co
., 2004 SCC 25, [2004] 1 S.C.R. 629, at para. 40,
    Iacobucci J. noted this concern as he provided an explanation for the way
    Dickson J. articulated the juristic reason element of the test for unjust
    enrichment in
Rathwell v. Rathwell
,

[1978] 2 S.C.R. 436:

I believe that he may have wanted to ensure that the test for
    unjust enrichment was not purely subjective in order to be responsive to
    Martland J.'s criticism in his reasons that application of the doctrine of
    unjust enrichment contemplated by Dickson J. would require immeasurable
    judicial discretion (p. 473). The importance of avoiding a purely subjective
    standard was also stressed by McLachlin J. in her reasons in
Peel, supra
,
    at p. 802, in which she wrote that the application of the test for unjust enrichment
    should not be "case by case 'palm tree' justice".

[152]

Other Supreme
    Court cases raising this tension include:
Pacific National Investments Ltd.
    v. Victoria (City)
,
2004
    SCC 75, [2004] 3 S.C.R. 575, at para. 13; and
Kerr
, at para. 43. As
    will be seen, the tension between the legal and equitable impulses burbles up
    occasionally in the analysis of the substantive issues, like an underground
    stream.

F.

Issue One: What is the CORRECT interpretation and application of the
    Supreme Courts decision in
Soulos
?

[153]

Both parties
    proceeded on the basis that
Soulos
was the governing precedent and
    that unjust enrichment was the basis of any possible constructive trust claim
    in this case. But their positions on the proper interpretation and application
    of
Soulos
, described above, could not be further apart
.

[154]

For the reasons that follow, I would reject the
    appellants argument that
Soulos

limits the remedy to
    the two defined situations of unjust enrichment and wrongful acts, and
    otherwise abolished the doctrine of good conscience constructive trusts as a
    general source of equitable jurisdiction.

(1)

The Fact Situation in
Soulos

[155]

In
Soulos
,
    a real estate broker entered into negotiations to purchase a commercial
    building on behalf of his client, but then arranged for his wife to purchase
    the building instead. The client brought an action to compel the broker to
    convey the property to him on the basis that the broker breached his fiduciary
    duty and that breach gave rise to a constructive trust. However, in the
    meantime, the propertys value had declined so that the client had suffered no
    financial loss from the brokers perfidy. Nonetheless, the Supreme Court
    affirmed this courts decision requiring the broker to convey the property to
    the client.

(2)

The Issue Determined in
Soulos

[156]

The specific
    legal issue determined by the Supreme Court in
Soulos
was whether a
    constructive trust over property may be imposed in the absence of enrichment of
    the defendant and corresponding deprivation of the plaintiff, as McLachlin J. stated,
    writing for the majority, at para. 1. She delineated, at para. 45, the
    circumstances in which a court could impose a constructive trust based
    specifically on wrongful acts including fraud and breach of loyalty.

[157]

The debate about
    the intended reach of
Soulos
often focuses on paras. 43 and 45 of the
    decision, which I set out here for convenience. Justice McLachlin stated, at
    para. 43:

I conclude that in Canada, under the broad umbrella of good
    conscience, constructive trusts are recognized both for wrongful acts like
    fraud and breach of duty of loyalty, as well as to remedy unjust enrichment and
    corresponding deprivation. While cases often involve both a wrongful act and
    unjust enrichment, constructive trusts may be imposed on either ground: where
    there is a wrongful act but no unjust enrichment and corresponding deprivation;
    or where there is an unconscionable unjust enrichment in the absence of a
    wrongful act, as in
Pettkus v. Becker
,
supra
. Within these
    two broad categories, there is room for the law of constructive trust to
    develop and for greater precision to be attained, as time and experience may
    dictate.

[158]

She then set out
    the prerequisites for a constructive trust based on wrongful conduct, at
    para. 45. I omit them because this appeal does not involve a constructive trust
    based on a wrongful act.

(3)

The Appellants View of
Soulos

[159]

The appellant argues that
Soulos

limits the remedy to the two defined situations of unjust
    enrichment and wrongful acts, and otherwise

abolished the doctrine
    of good conscience constructive trusts as a general source of equitable
    jurisdiction. She
draws support for
    her argument from
a line of cases starting with
Soulos
and
    continuing with
Gorecki v. Canada (Attorney General)
,

[2006] O.J. No. 1130 (C.A.),
Professional Institute of the Public Service of Canada v. Canada (Attorney
    General)
,
2012 SCC 71, [2012]
    3 S.C.R. 660
(
PIPSC
)
, and
Sun Indalex Finance, LLC v.
    United Steelworkers
, 2013 SCC 6,
[2013] 1 S.C.R. 271
(
Sun
    Indalex
)
. The appellant also relies
    on several disappointed beneficiary cases I will consider later.

[160]

I note by way of
    preface that all three cases involve a party pursuing a remedial constructive
    trust, based on unjust enrichment or wrongful acts. None of the cases raised
    squarely or addressed the issue of whether remedial constructive trusts are
    confined to these two bases. However, the appellant quotes snippets of each in
    support of her argument to that effect.

[161]

First, the
    appellant cites
Gorecki.
This was a proposed class action in which the
    class members sought interest payments from the Federal Government on
    retroactive lump sum disability pension payments under the Canada Pension Plan.
    This court agreed with the motion judges conclusions (reported at [2005] O.J.
    No. 3465), that the Government did not owe the plaintiff a fiduciary duty and
    that there was no basis for an unjust enrichment claim, leaving only the claim
    for a constructive trust based on a wrongful act. However, this court disagreed
    with the motion judges conclusion that, since the constructive trust is an evolving
    remedy, it would be wrong to dismiss the wrongful act claim on a pleading
    motion. Sharpe J.A., writing for the court, dismissed the wrongful act claim,
    explaining, at para. 11:

As I have already explained, the Crown is under no equitable
    obligation in relation to CPP benefits. Nor, for reasons already explained,
    does the Crown owe the appellant any equitable obligation or duty of loyalty.
    As the claim for interest relates to a claim for a statutory benefit, it is
    difficult to see any basis for the assertion of a proprietary remedy. Finally,
    it would be unjust to impose a constructive trust in the face of a
    comprehensive statutory scheme that precludes the award of interest.

[162]

The appellant
    relies on a single sentence of the decision, where, after citing para. 43 of
Soulos
,
    Sharpe J.A. stated, at para. 9:

Accordingly, there are two possible ways of acquiring a
    constructive trust: first, by establishing unjust enrichment; and, second, by
    demonstrating the type of wrongful conduct by the defendant that is capable of
    giving rise to a constructive trust.

[163]

However, there
    is no suggestion in
Gorecki
that any other basis for a constructive
    trust was advanced, so I do not see this language as determinative.

[164]

Second, the appellant
    cites
PIPSC.
Certain
    unions and employee associations were beneficiaries of defined benefit pension
    plans administered by the Federal Government as the employer. They sued to
    recover $28 billion in pension surplus the Government had debited from the
    actuarial surplus. Justice Rothstein, writing for the court, noted, at para.
    144:

Since this Court's decision in
Soulos
there have been
    two grounds on which a court can impose a constructive trust: (1) breach of an
    equitable obligation, and (2) unjust enrichment. The appellants have argued both
    in this appeal.

[165]

Candidly, I see
    this statement not so much as prescriptive, but more as descriptive of the
    basis of the appellants case in
PIPSC
.

[166]

The court in
PIPSC
rejected a wrongful act as the basis for a constructive trust on the basis that
    the Government did not owe its employees a fiduciary duty (para. 147). The
    court rejected unjust enrichment because there was no property and no transfer
    of wealth to the Government, and therefore no link between the alleged
    deprivation and the property right they seek (paras. 157-158). The reason was
    that: the Superannuation Accounts are mere accounting records, and do not
    contain assets in which the appellants have an interest, [therefore] no
    enrichment and corresponding deprivation can be found, as Rothstein J. noted
    at para. 154. As in
Gorecki
, there was no issue raised about imposing
    a constructive trust outside of unjust enrichment and wrongful act.

[167]

Third, the appellant cites
Sun Indalex.
It

was
    an infernally complicated case about
the respective priorities of
    creditors and pension beneficiaries when an enterprise is no longer operating
    in the ordinary course of business, but is under the
Companies Creditors
    Arrangement Act
, R.S.C. 1985, c. C-36 (
CCAA
) and heading for
    bankruptcy.

[168]

It is important
    to note that the claim in
Sun Indalex
proceeded under the wrongful
    acts branch of
Soulos
, particularly the criteria laid out in para. 45.
    These criteria have no application to this appeal. I note that the prospect of
    another basis for imposing a constructive trust was not in issue.

[169]

Indalex
sought protection from its
    creditors under the
CCAA
. Indalex was both the corporate employer and
    the administrator of two employee pension plans. Such a dual role is
    permissible under s. 8(1)(a) of the
Pension Benefits Act
, R.S.O. 1990,
    c. P.8, which also provides, in s. 22(4), that a plan administrator must not
    permit its interests to conflict with its duties in respect of the pension
    fund.

[170]

Indalexs
    decision to seek protection under the
CCAA
gave rise to the prospect
    that its financial interests could conflict with the interests of the pension
    beneficiaries, thus jeopardizing its ability to discharge its fiduciary duties
    properly as the plan administrator.

[171]

All three
Sun
    Indalex
opinions in the Supreme Court acknowledged that the permissible
    dual role could potentially morph into a conflict of interest: Deschamps J., at
    para. 64; Cromwell J., at paras. 196-98; and LeBel J., at para. 272. The issue
    that divided the Supreme Court was the point at which Indalex was required to
    address the prospect of this conflict between its corporate duties and its
    duties as pension administrator, and what it ought to have done to address the
    conflict.

[172]

The pension
    beneficiaries argued that Indalex had breached its fiduciary duties, and
    claimed a constructive trust over the proceeds of the companys sale in
    priority to other creditors. This court agreed with the pension beneficiaries
    (2011 ONCA 265), but the majority of the Supreme Court reversed.

[173]

Cromwell J.
    observed, at para. 228 of
Sun Indalex
: As the Court of Appeal
    recognized, the governing authority concerning the remedial constructive trust
    outside the domain of unjust enrichment is
Soulos
. The claim to a
    remedial constructive trust foundered on the lack of a causal connection:
    There is no evidence to support the contention that Indalexs breach of its
    fiduciary duty as pension administrator resulted in the assets retained in the
    reserve fund.

[174]

I do not read
Gorecki, PIPSC
, or
Sun Indalex
as
    ruling definitively that

Soulos

abolished the
    doctrine of good conscience constructive trusts beyond the two defined
    situations of unjust enrichment, and wrongful acts. The issue was not squarely
    before the courts and its determination was not necessary to the decisions.
    Further, such a reading would be inconsistent with the words of McLachlin J. in
Soulos.

(4)

The Reach of
Soulos

[175]

In
Soulos
,
    McLachlin J. worked through the history of constructive trusts in order to
    discern whether and how to recognize a remedial constructive trust for wrongful
    acts, which was the particular problem in the case before her. In my view she
    did not purport to restate and reframe the law of constructive trusts for all
    purposes, and she said nothing to close the categories of constructive trusts.
    Had she intended to abolish
good conscience constructive
    trusts beyond the categories of unjust enrichment and wrongful acts, then one
    would have expected clear and definitive language to that effect, but there is
    none.
Instead, McLachlin J.s choice of language justifies the
    conclusion that the court expected constructive trust law to continue to
    develop beyond the categories of unjust enrichment and wrongful act.

[176]

Justice
    McLachlin disagreed with the position that a constructive trust cannot be
    imposed where there has been no unjust enrichment, at para. 16, which was the
    real issue in the case. She stated, at para. 17:

The history of the law of constructive trust does not support
    this view. Rather, it suggests that the constructive trust is an ancient and
    eclectic institution imposed by law not only to remedy unjust enrichment, but
    to hold persons in different situations to high standards of trust and probity
    and prevent them from retaining property which in "good conscience"
    they should not be permitted to retain.

[177]

Justice
    McLachlin made several other pertinent observations of more general
    application, at paras. 20-22:

Canadian courts have never abandoned the principles of
    constructive trust developed in England. They have, however, modified them.



This Court's assertion that a remedial constructive trust lies
    to prevent unjust enrichment in cases such as
Pettkus v. Becker

should not be taken as expunging from Canadian law the
    constructive trust in other circumstances where its availability has long been
    recognized
. The language used makes no such claim. A. J. McClean, 
    describes the ratio of
Pettkus v Becker
as a a modest enough proposition.
    He goes on: 
It would be wrong ... to read it as one
    would read the language of a statute and limit further development of the law
.

Other scholars agree that
the
    constructive trust as a remedy for unjust enrichment does not negate a finding
    of a constructive trust in other situations
. [Emphasis added.]

[178]

Justice
    McLachlin also noted, at para. 17, that the law of England and Canada could
    well be diverging:

In England, the trust thus created was thought of as a real or
    "institutional" trust. In the United States and recently in Canada,
    jurisprudence speaks of the availability of the constructive trust as a remedy;
    hence the remedial constructive trust.

She embarked on a review of English law, noting, at
    para. 24: In sum, the old English law remains part of contemporary Canadian
    law and guides its development.

[179]

Justice
    McLachlin was well aware that English law was evolving. She described the
    opposition in England to Lord Dennings expansive view of constructive trust,
    at paras. 30-31. She added, at para. 37, that: In England the law has yet to
    formally recognize the remedial constructive trust for unjust enrichment,
    although many of Lord Denning's pronouncements pointed in this direction.
[9]
She also surveyed the law in New Zealand
[10]
and the United States.

[180]

Justice
    McLachlin expressed a critical conclusion, at para. 25:

I conclude that the law of constructive trust in the common law
    provinces of Canada embraces the situations in which English courts of equity
    traditionally found a constructive trust as well as the situations of unjust
    enrichment recognized in recent Canadian jurisprudence.

[181]

This led
    McLachlin J. to the heart of the matter, at paras. 34-35:

It thus emerges that a constructive trust may be imposed where
    good conscience so requires.
The inquiry into good
    conscience is informed by the situations where constructive trusts have been
    recognized in the past.
It is also informed by the dual reasons for
    which constructive trusts have traditionally been imposed: to do justice
    between the parties and to maintain the integrity of institutions dependent on
    trust-like relationships. Finally, it is informed by the absence of an
    indication that a constructive trust would have an unfair or unjust effect on
    the defendant or third parties, matters which equity has always taken into
    account.
Equitable remedies are flexible; their award is
    based on what is just in all the circumstances of the case
.

Good conscience as a common concept unifying the various
    instances in which a constructive trust may be found has the disadvantage of
    being very general. But any concept capable of embracing the diverse
    circumstances in which a constructive trust may be imposed must, of necessity,
    be general.
Particularity is found in the situations in
    which judges in the past have found constructive trusts.

A judge faced with a claim for a constructive trust will have
    regard not merely to what might seem "fair" in a general sense, but
    to other situations where courts have found a constructive trust.
The
    goal is but a reasoned, incremental development of the law on a case-by-case
    basis. [Emphasis added.]

[182]

These
    statements, in my view, decisively refute the appellants argument that a court
    can impose a constructive trust now in only two categories of cases: to remedy
    an unjust enrichment or a wrongful act.

[183]

I acknowledge
    that McLachlin J. then turns, at para. 36, to address specifically the two
    dominant categories of unjust enrichment and wrongful acts as bases for
    imposing a constructive trust. She innovated somewhat by more firmly establishing
    remedial constructive trusts as a remedy for wrongful acts, at para. 45, which
    was the basis on which she decided
Soulos
itself.

[184]

The Supreme
    Court plainly knew
Soulos
was carving out new ground. This was
    acknowledged by Sopinka J., in dissent, who criticized the majoritys decision,
    at para. 72, because it fails to refer to a single Canadian case where a
    constructive trust was ordered despite the absence of unjust enrichment.

[185]

But I note that
    nowhere did McLachlin J. abandon as spent the continuing development of the law
    of constructive trusts: see paras. 20-25, and 34-35 of
Soulos
quoted
    above.

(5)

Concluding Observations on
Soulos

[186]

In my view, the
    Supreme Court left open four routes by which a court could impose the ancient
    and eclectic institution of a constructive trust: (1) unjust enrichment; (2)
    wrongful acts or wrongful gain; (3) circumstances where its availability has
    long been recognized (para. 21), such as situations where a constructive
    trusts have been recognized in the past (para. 34) or other situations where
    courts have found a constructive trust (para 35); and (4) otherwise, where
    good conscience requires it. In relation to this last point, the
Soulos
court anticipated that the law of remedial constructive trusts would continue
    to develop, consistent with the words of Dickson J. in
Pettkus
, at p.
    847-848: the judiciary is thus able to shape these malleable principles so as
    to accommodate the changing needs and mores of society, in order to achieve
    justice.

[187]

I see no other
    way to give meaning to the words of McLachlin J. in
Soulos
, at para.
    21: This Court's assertion that a remedial constructive trust lies to prevent
    unjust enrichment in cases such as
Pettkus
should not be taken as
    expunging from Canadian law the constructive trust in other circumstances where
    its availability has long been recognized. See also
BNSF Railway Company
    v. Teck Metals Ltd.
, 2016 BCCA 350, 89 B.C.L.R. (5th) 274, at paras.
    45-55.

[188]

I observe that McLachlin
    J. expected the tension between the legal impulse and the equitable impulse to
    be reconciled and disciplined in specific instances by considering and
    analogizing to past situations in which the courts have imposed constructive
    trusts.

[189]

As a roadmap to
    what follows, I begin with the first route to a constructive trust: to remedy
    unjust enrichment. The case was argued on this basis. (The second route,
    wrongful act or wrongful gain, is not engaged.) But I am alive to the ambiguous
    way the concept of unjust enrichment is sometimes used in the authorities to
    describe, on the one hand, restitution for unjust enrichment, that is, the idea
    of giving back what was taken, and, on the other hand, disgorgement, that is,
    the idea of giving up a gain that properly belongs to another. I would enlist
    both the third route to a constructive trust  circumstances where the
    availability of a trust has previously been recognized  and the fourth route 
    where good conscience otherwise demands it  to resolve the ambiguity.

[190]

I now turn to
    the specific issues in this appeal.

G.

Issue Two: Did the application judge err in finding the respondent had
    made out her claim in unjust enrichment?

[191]

I begin by
    reviewing the elements of an unjust enrichment claim, and then turn to the
    appellants arguments that the application judge erred in finding the
    respondent made out her claim in unjust enrichment
. Finally, I consider the jurisprudence in the disappointed beneficiary
    cases, which are similar.

(1)

The Elements of Unjust Enrichment and the Application Judges Findings

[192]

For the court to
    find unjust enrichment three elements must be present, as the Supreme Court
    held in
Pettkus
:

first,
    the defendants enrichment; second, the plaintiffs corresponding deprivation;
    and third, the absence of any juristic reason for the defendants enrichment. 
    To succeed on the first element, the plaintiff must demonstrate that the
    defendant was enriched. For the second element, the plaintiff must show that he
    or she sustained a corresponding deprivation. Finally, the plaintiff must show
    that the defendants enrichment occurred without a juristic reason. If there
    are no existing categories of juristic reason that can justify the defendants
    enrichment, then the court may take into account the legitimate expectations
    of the parties [] and moral and policy-based arguments about whether particular
    enrichments are unjust:
Kerr
, at para. 44.

[193]

The application
    judge had no difficulty in finding the respondent met the first two elements of
    the test. He noted:

The Respondent is enriched to the extent of the proceeds of the
    Policy.The Applicant has suffered a corresponding deprivation not only to the extent
    she paid the premiums but also, more fundamentally, to the extent the proceeds of
    the Policy were paid to the Respondent notwithstanding the prior equitable assignment
    of such proceeds to her.

[194]

As for the third
    element, the absence of a juristic reason for the enrichment, the application
    judge found:

[W]hile the designation of a beneficiary [under the
Insurance
    Act
] may be a juristic reason in some cases, the issue for the Court is whether
    the designation of the Respondent is a juristic reason in the particular circumstances
    of this case.

On the basis of the foregoing, I conclude that a court is not precluded
    from imposing a constructive trust on proceeds of an insurance policy paid to a
    named beneficiary based on the principle of unjust enrichment merely because the
    deceased policyholder executed a designation in favour of the named
    beneficiary.

[195]

In reaching this
    conclusion, the application judge distinguished this courts decision in
Richardson
    Estate.
He found it was not a useful authority and was not dispositive.

(2)

The Appellants Arguments

[196]

The appellant
    does not contest the first element of unjust enrichment: her enrichment. She
    does contest the second element, the respondents deprivation, and the third,
    the absence of a juristic reason for her enrichment.

(a)

The Deprivation Element

[197]

The appellant
    disputes the deprivation finding on three grounds, which I address in the
    sequence in which she makes her arguments.

[198]

First, the
    appellant submits the deprivation must be measured using a straightforward
    economic approach, drawing on the Supreme Courts language in
Pacific
    National Investments
, at para. 20. The appellant submits that the
    respondents deprivation, in restitutionary terms, should be limited to the
    premiums she paid from 2000 until the deceaseds death, which is about $7,000.
    She asserts this is too small an amount to justify the remedy of a constructive
    trust, drawing on this courts observation in
Richardson Estate
, where
    the amount of premiums paid was $1161.

[199]

I would reject
    this submission. I observe that the respondents contribution to maintaining
    the policy since separation was more than $7,000. From its inception in 1985,
    the respondents contribution was considerably greater, about $30,000 according
    to the evidence. It is not reasonable to discount her contribution on the basis
    that she had the benefit of the policy during her marriage. On either amount,
    this would not be a minimal deprivation unworthy of the courts attention.

[200]

Second, the
    appellant argues that the remedy for the deprivation is not to give the
    insurance proceeds to the respondent, since that would wrongly reward her
    expectation interest, not her restitutionary interest, which is to be
    measured by the direct expenditures made. Third, the appellant makes the
    related argument that the respondent is not entitled to a proprietary remedy
    for the deceaseds breach of the oral agreement.

[201]

I would reject
    both arguments. This is not, contrary to the appellants argument, a simple
    case of breach of contract.

[202]

I pause here to
    address a lurking concern that is found in some of the disappointed beneficiary
    cases, which I analyze more intensely below, and in my colleagues reasons.
    This is the fear described by Professor McInnes of: judges roaming
    willy-nillywith only their inner voices to guide them, quoted by McLachlin J.
    in
Peel
. It is also reflected in the statement, with which I agree, that
Soulos
counselled courts to be careful to avoid inviting judges to
    impose such trusts whenever and wherever they believe justice requires, in
Love
    v. Love
, 2013 SKCA 31, 359 D.L.R. (4th) 504, para. 47. There is a fear,
    which I do not share, that granting a constructive trust remedy to the former
    spouse whose claim was rooted in breach of contract only would make it
    difficult to resist the migration of the concept to the general law of
    contract: see
Ladner v. Wolfson
, 2011 BCCA 370, 341 D.L.R. (4th) 299,
    at para. 52, leave to appeal refused, [2011] S.C.C.A. No. 475. These
    expressions simply reflect the tension I referred to earlier between law and
    equity.

[203]

To be clear, I
    do not take the position that any breach of contract would or should lead to
    the imposition of a constructive trust. In my view the disappointed beneficiary
    cases must be treated differently than ordinary breach of contract cases. I
    discuss this in detail below, but a useful starting point is to recognize that
    the court must take into account the family context within which the dispute
    arose, as Cromwell J. noted in
Kerr
, at para. 34. Although the
    principles behind imposing a constructive trust are meant to apply to all kinds
    of cases, with no special modifications for family cases, he noted in
Kerr
that the family context affects the application of the principles.
[11]

[204]

The oral
    agreement in this case came about in the context of a marriage unravelling in
    dire economic circumstances, in which the deceaseds addiction-fuelled spending
    habits had forced the respondent into bankruptcy. The respondent and the
    deceased were salvaging the best they could for their family from a desperate
    situation. As the application judge observed, the purpose of their agreement
    was to create an asset that would eventually assist the respondent and the
    children, and would be free of attachment by the deceaseds creditors. It is
    clear that the deceased had no money to pay the premiums; had the respondent
    not done so, there would have been no policy.

The Domestic Cases Provide a Useful Analogy

[205]

This case can be
    analogized somewhat to the domestic cases such as
Kerr
. These cases
    engage the dichotomy referred to earlier between a restitutionary giving
    back, and giving up a wrongful gain, although the cases are understandably
    not framed quite that way. In that case, Cromwell J. began his discussion of the
    jurisprudence at para. 46 of
Kerr
, by observing that: Remedies for
    unjust enrichment are restitutionary in nature; that is, the object of the
    remedy is to require the defendant to repay or reverse the unjustified
    enrichment. However, he noted, at para. 50, that where property is involved,
    it is appropriate for the court to consider a constructive trust remedy where
    there is a link between the acquisition of the asset in the defendants hands
    and the plaintiffs contribution. In such circumstances, giving the plaintiff a
    share of the property proportionate to her contribution could be appropriate.

[206]

The general rule in the domestic cases is that a plaintiff must
    establish that a monetary award would be insufficient in the circumstances:
Kerr
,
    at para. 52; and
Peter v. Beblow
, [1993] 1 S.C.R. 980, at para. 31 (p.
    999). In
Peter
, McLachlin J. noted at para.31 that: in looking at
    whether a monetary award is insufficient the court may take into account the
    probability of the awards being paid as well as the special interest in the
    property acquired by the contributions. In deciding whether to grant a
    proprietary remedy instead of a monetary award, the court may take into
    account the probability of recovery, as well as whether there is a reason to
    grant the plaintiff the additional rights that flow from recognition of
    property rights:
Kerr
, at para. 52. There is no doubt that, if the
    respondent is not given the proceeds of the insurance policy in this case, she
    will get nothing, since the estate has no assets to pay a damages award for
    breach of contract.

[207]

In my view,
    consideration of these factors supports the imposition of a remedial
    constructive trust in this case. Contrary to the appellants argument, the
    respondents financial contribution is not the correct measure of her
    deprivation. The appellants entitlement under the designation crystallized at
    the moment of the deceaseds death under the beneficiary designation. At that
    moment, both had a claim to the same asset. In my view, the deprivation the
    respondent would suffer if the appellant were successful is the full payout of
    the life insurance proceeds, not the amount of the premiums she paid. That is
    the asset  the chose in action  for which she paid, of which she stands
    deprived, and which she seeks to have restored to her. The appellant
    contributed nothing to the acquisition of the asset in dispute.

[208]

In my view the
    deprivation element of the unjust enrichment test has been met to the full
    extent of the insurance payout in the respondents favour. In the context, the
    relevant enrichment is to be measured by the possible benefit to the appellant,
    and the deprivation to the respondent must correspondingly be measured in the
    same terms:
Kerr
, at para. 39. That is the full value of the life insurance
    proceeds. To use that measure would be to take the relevant straightforward
    economic approach required by the Supreme Court in
Pacific National
    Investments,
as adapted by the court in
Kerr
.


(b)

The Juristic Reason Element

[209]

According to the
    appellant, the application judges most serious error is his finding there was
    no juristic reason for the appellants enrichment. The appellant argues this
    case turns on the application of one of the accepted categories of juristic
    reasons that justify the respondents enrichment, being a disposition of law,
    referred to in
Rathwell,
at p. 455 and
Garland
, at para. 44.
    The irrevocable designation in her favour under s. 191 of the
Insurance Act
was just such a juristic reason, the appellant asserts, based on this courts
    decision in
Richardson Estate
,
    which

is binding and
    is sufficient to dispose of the appeal
.

[210]

I would reject
    this submission, for three reasons: First, a purposive approach to the
    interpretation and application of s. 191 of the
Insurance Act
does not
    lead to the conclusion that it was intended to operate as a juristic reason for
    the appellants enrichment on the facts of this case. Second, the application
    of the principled approach to unjust enrichment leads to the contrary
    conclusion. Third,
Richardson Estate
does not drive the outcome of
    this case and should be distinguished. I explain each in turn, after a short
    description of the juristic reason analysis.

(i)

The Juristic Reason Element of the Unjust Enrichment Test

[211]

The juristic
    reason element has evolved since it was first expressed by Dickson J. in
Rathwell
,
    and repeated by him in
Pettkus
. In
Garland
, Iacobucci J., at
    para. 46, acknowledged that this area is an evolving one and predicted that
    new cases will add additional refinements and developments: see also
Pacific
    National Investments
, per Binnie J., at paras. 23-24. To succeed, it must
    be shown that: there is no reason in law or justice for the defendants
    retention of the benefit conferred by the plaintiff, making its retention
    unjust in the circumstances of the case, as Cromwell J
.
noted in
Kerr
,
    at para. 40.

[212]

In
Garland
,
    the court established a two-step analysis for the absence of juristic reason,
    taking its lead from the decision of McLachlin J. in
Peel
, at para.
    32, p.782, where she contrasted the old categorical approach to claims for
    unjust enrichment with the new principled approach the court took in
Pettkus
.
    At the first step, the court considers the established categories of juristic
    reasons. If none applies, then at the second step the court assesses the
    reasonable expectations of the parties and public policy considerations to
    assess whether recovery should be denied:
Kerr
, at para. 43.

[213]

Justice Cromwell
    listed the categories of juristic reasons in
Kerr
, at para. 41, as the
    existence of a contract or a donative intent, and a disposition of law such as
    common law, equitable or statutory obligations. The appellant invokes
    disposition of law as the relevant juristic reason.

[214]

Justice Cromwell
    elaborated on the second step of the juristic reason analysis, at para. 44 of
Kerr
:
    [I]f the case falls outside the existing categories, the court may take into
    account the legitimate expectations of the parties and moral and policy-based
    arguments about whether particular enrichments are unjust. He added that, the
    test for juristic reason is flexible, and the relevant factors to consider will
    depend on the situation before the court. Finally, he noted, at para. 45:
    questions regarding how (and when) factors relating to the manner in which the
    parties organized their relationship should be taken into account.

(ii)

The Disposition of Law Category of Juristic Reason Does Not Apply To
    This Case

[215]

In
Kerr
,
    Cromwell J. included common law, equitable and statutory obligations in the
    category of disposition of law. This category operates, he noted, where: the
    enrichment of the defendant at the plaintiffs expense is required by law, such
    as where a valid statute denies recovery (para. 41). The appellant argues this
    is precisely how s. 191 of the
Insurance Act
was intended to operate
    in the circumstances presented by this case. I do not agree.

The First Step of the Juristic Reason Analysis is Purposive

[216]

It is necessary to carefully consider the relevant purpose
    of the legislation that is asserted to constitute a juristic reason for
    refusing equitable relief, in this case ss. 190 and 191 of the
Insurance
    Act
, which I reproduce for
    convenience:

[217]

Section 190
    provides:

(1)
[A]n insured may in a
    contract or by a declaration designate  a beneficiary as one to whom or for
    whose benefit insurance money is to be payable
;

(2) Subject to section 191, the insured may from time to time
    alter or revoke the designation by a declaration.

Section 191 provides:

(1) An insured may in a contract, or by a declaration  filed
    with the insurer at its head or principal office in Canada during the lifetime
    of the person whose life is insured, designate a beneficiary irrevocably, and
    in that event the insured, while the beneficiary is living, may not alter or
    revoke the designation without the consent of the beneficiary and the insurance
    money is not subject to the control of the insured, is not subject to the
    claims of the insureds creditor and does not form part of the insureds
    estate.

[218]

The task at the
    first step of considering whether a juristic reason exists to deny the
    plaintiffs recovery is not a mere exercise in mechanical pigeon-holing.
For example, i
n
Peter
, it was
    argued that the legislative decision to exclude unmarried couples from property
    division legislation was the juristic reason that prevented the court from
    using the equitable doctrine of unjust enrichment to address their property
    dispute. The Supreme Court rejected the argument in
Peter
, where
    McLachlin J., said, at p. 994: It is precisely where an injustice arises
    without a legal remedy that equity finds a role. As Cromwell J. explained in
Kerr
, at para. 45, this argument misapprehended the role of equity.

[219]

The purpose of what
    are now ss. 190 and 191 of the
Insurance Act
was discussed i
n
Shannon v. Shannon
(1985), 50 O.R. (2d) 456 (H.C.J.), [1985] O.J. No. 1129. Justice McKinlay (as
    she then was) imposed a trust in circumstances somewhat similar to those in
    this case. The deceased was obliged under a separation agreement to continue
    to name his wife a beneficiary, and not to revoke such beneficiary
    designation at anytime in the future. A year later the deceased filed a new
    revocable beneficiary designation form under the
Insurance Act
naming
    the defendants. He died shortly thereafter. The assets in his estate would not
    have satisfied a judgment in favour of his former spouse for breach of
    contract.

[220]

The plaintiff
    took the position that by virtue of the provision in the separation agreement:

[T]he insurance policy and the proceeds became impressed with
    a trust, and that the designation by the insured of [the defendants] as
    beneficiaries constituted a disposition of trust property to volunteers who
    could not take the trust property in the face of a prior trust for value in
    favour of the wife of the deceased. (Para. 5)

[221]

Justice McKinlay
    found, at para. 10, that language in a separation agreement could function as a
    revocable designation under what is now s. 190 of the
Insurance Act
. 
    She then addressed the defendants argument, described at para. 14 (p. 461):
    that any finding of the court of a trust in favour of the plaintiff would have
    the effect of the courts attempting to overrule a clear statutory provision,
    being the insureds right to change the designation under the predecessor to s.
    190 of the
Insurance Act
.

[222]

Justice McKinlay
    rejected this argument. She accepted, at para. 15 (p. 461), that: the
Insurance
    Act
provides a statutory framework for the protection of the insured, the
    insurer and beneficiaries. She explained, at para. 16 (p. 461): There is no
    doubt that had the insurer paid the proceeds to the [defendants] before
    receiving notice of the claim of the plaintiff, the insurer would have been
    protected by the provisions of the Act.

[223]

But McKinlay J.
    acknowledged that this was not the issue before her. Instead, the contest was
    between the defendants, who were designated as revocable beneficiaries under
    the predecessor section to s. 190 of the
Insurance Act,
and the
    plaintiff, whose claim to the insurance proceeds was by way of a separation
    agreement entered into before the deceased made the beneficiary designations.

[224]

Justice McKinlay
    found the
Insurance Act
had nothing to say about that contest,
    especially since the
Insurance Act
did not specifically preclude the
    type of claim contemplated by the plaintiff. Consequently, she noted at para.
    17: Any rights of the niece and nephew as volunteers are in equity subject to
    the prior rights of the plaintiff to the proceeds. She explained the
    relationship between the
Insurance Act
and equity, at para. 15 (p.
    461):

[E]quity imposes duties of conscience on parties based on their
    relationship and dealings one with another outside the purview of the statute.
    When he concluded the separation agreement with his wife, the deceased bound
    himself to maintain the policy in good standing, which he did; he also bound
    himself to maintain it for the benefit of his wife, which he did not.

[225]

In declaring
    that the proceeds of the policy were impressed with a trust in the plaintiffs
    favour, McKinlay J. did precisely the task that equity set before her. She
    explained the outcome, at para. 18 (p. 461):

The
Insurance Act
does not specifically preclude the
    existence of rights outside its provisions. It would go against all conscience
    to hold that because of the provisions cited, the plaintiff's clear rights
    under an agreement with her husband for good consideration can be taken away in
    favour of a niece and nephew who have given no consideration for those rights.

[226]

This court cited
Shannon
with approval in
Stewart v. Ryerson
, [1998] O.J. No.
    5277 (C.A.), and dismissed the appeal in
Bielny v. Dzwiekowski
, [2002]
    O.J. No. 508 (C.A.), without reasons, affirming the decision below, which
    relied on
Shannon
:
Bielny v. Dzwiekowski
,
[2001] O.J. No. 1187 (S.C.).

[227]

As I see it, the
    purposes of an irrevocable designation under s. 191  of the
Insurance Act
are to creditor-proof the insurance proceeds, to permit them to pass outside
    the deceaseds estate, to prevent the deceased from controlling the proceeds of
    the insurance policy and to prevent the deceased from making another
    designation.

[228]

The critical
    point to observe is that the Act assumes the deceased had the right to
    irrevocably designate in the first place. By entering into a binding agreement
    with the appellant, the deceased relinquished his ability to designate another
    party as either a revocable or irrevocable beneficiary under his insurance
    policy, since a person cannot give what he does not have.

[229]

I conclude that
    a purposive approach to the interpretation and application of s. 191 of the
Insurance
    Act
does not lead to the conclusion that the
Act
provides a
    juristic reason for the appellant to retain the insurance proceeds, contrary to
    the view of my colleague. As in
Shannon
, the respondents right to the
    insurance proceeds was created by an agreement that preceded the designation
    and existed outside the provisions of the
Insurance Act
. The result is
    that, on the facts, the respondents entitlement to the insurance proceeds as
    against the appellant is neither precluded nor affected by the operation of the
Insurance Act
. The case therefore falls outside the category of disposition
    of law as a juristic reason to permit the appellant to retain the life
    insurance proceeds.

The Second Step of the Juristic Reason Analysis

[230]

In view of that
    conclusion, I must move on to consider the second step of the
Garland
analysis, in which, as Cromwell J. explained in
Kerr
at paras. 43-44,
    the court assesses: (1) the reasonable expectations of the parties and public
    policy considerations to assess whether recovery should be denied; (2) the
    moral and policy-based arguments about whether particular enrichments are
    unjust; and, (3) questions regarding how (and when) factors relating to the
    manner in which the parties organized their relationship should be taken into
    account.

[231]

I need not
    repeat the facts that led the application judge to find the oral agreement
    between the deceased and the respondent, which the appellant seeks to obviate.
    Neither the reasonable expectations of the parties nor public policy reasons
    support the appellants success. Since both the appellant and respondent have a
    claim to the proceeds, this court must determine the outcome on equitable
    principles. In equity, the appellant, having provided no consideration for her
    designation as beneficiary, is merely a volunteer. Indeed, as McKinlay J.
    observed in
Shannon
, equity will not prioritize a gratuitously
    benefited volunteer like the appellant over a party with a prior right to an
    asset like the respondent. I would conclude that these factors favour the respondent,
    not the appellant.

(iii)

This Courts Decision in
Richardson Estate
Does Not Determine the
    Outcome of this Appeal

[232]

The appellant
    relies on this courts decision in
Richardson Estate
. There the
    deceased had designated his former spouse as the beneficiary of a life
    insurance policy. Their separation agreement obliged the deceased to maintain
    her as the beneficiary under the policy until February 28, 1995. He told his
    second spouse that he would re-designate her as the beneficiary at a later date
    but he never did. The second spouse continued to pay the insurance premiums
    from the joint bank account she held with the deceased, wrongly believing she
    was the beneficiary.

[233]

When the former
    spouse in
Richardson Estate
refused to release her claim to the death
    benefit, the second spouse brought a motion claiming a constructive trust over
    the death benefit. The motion judge found there was no unjust enrichment
    because the first spouses designation as a beneficiary under the policy was a
    juristic reason for the second spouses enrichment:
Richardson Estate

v.
    Mew
(2009), 93 O.R. (3d) 537 (S.C.). He recognized he had the power to
    rectify the policy, but he was not satisfied the evidence established the
    deceaseds failure to change the beneficiary designation was the result of a
    mistake.

[234]

This court found
    the separation agreement was not dispositive, since it only obliged the
    deceased to maintain the policy until the end of February, 1995. The agreement
    contemplated that the amount of life insurance the deceased was to hold in
    favour of his first spouse in the future was to be determined in a later
    variation proceeding, but that never happened. Based on the case law, Gillese
    J.A., writing for this court, found, at para. 55:

A former spouse is entitled to proceeds of a life insurance
    policy if his or her designation as beneficiary has not changed. This result
    follows even where there is a separation agreement in which the parties
    exchange mutual releases and renounce all rights and claims in the other's
    estate. General expressions of the sort contained in releases do not deprive a
    beneficiary of rights under an insurance policy because loss of status as a
    beneficiary is accomplished only by compliance with the legislation. The
    general language used in waivers and releases does not amount to a declaration
    within the meaning of the
Insurance Act
.

[235]

This court
    agreed with the motion judge that it would not be unjust for the first spouse
    to take the death benefit, noting, at para. 61: There is a juristic reason for
    Ms. Mews enrichment  she was the named beneficiary of the Policy.

[236]

I would
    distinguish this case from
Richardson Estate
on several grounds, despite some factual similarities
.
    First, and most importantly, there was no contractual obligation in
Richardson
    Estate
to his second spouse that he would change the beneficiary
    designation on the life insurance policy. Indeed, the motion judge in
Richardson

Estate
stated specifically at para. 61:

I am unable to say, with anything approaching the level of
    confidence necessary to grant rectification, that the evidence establishes that
    the continuation of Stephenie as the beneficiary of the policy was a mistake
    and that Michaels true intent was to name Anne as the beneficiary.

The motion judge added, at para. 64, that the evidence
    does not satisfy me that the designation of Stephenie was a result of a mistake
    or that Michael had a contrary intent.  This is a long way from the
    application judges conclusion in this case that there was an oral contract.

[237]

Second, there
    was no impediment to a re-designation of the beneficiary in
Richardson
    Estate
, such as the oral agreement in this case.

[238]

Third, the
    respondent made a much more robust contribution to the life insurance policy by
    way of premiums than her counterpart in
Richardson Estate
.

[239]

Accordingly, I
    would not consider the outcome of
Richardson Estate
as dispositive of
    the matter in the appellants favour.

[240]

In my view, s.
    191 of the
Insurance Act
does not provide a juristic reason to oust
    the availability of a constructive trust over the life insurance proceeds based
    on the Supreme Courts decision in
Soulos
, despite the
Richardson
    Estate
decision.

(iv)

The Disappointed Beneficiary Cases

[241]

In this section
    of the reasons I consider the disappointed beneficiary cases. They are not on
    all fours with this case, but resemble it in material details. Many of them
    have taken the unjust enrichment route to a constructive trust, so it is not
    surprising that this case proceeded as it did.

[242]

I begin with two
    pertinent observations. First, I note that the disappointed beneficiary cases
    fit rather awkwardly into the structure of the unjust enrichment analysis. The
    typical pattern in familial unjust enrichment cases involves a dispute between
    spouses in which the plaintiff seeks to acquire a property interest in
    something owned by the defendant. This is a two-party structure that makes the
    plaintiffs restitutionary claim especially compelling, since the plaintiff
    seeks a remedy directly from the defendant who has been enriched at the
    plaintiffs expense. These cases include
Pettkus
,
Sorochan v.
    Sorochan
, [1986] 2 S.C.R. 38,
Rathwell
,
Peter
, and
Kerr
.

[243]

However, this
    case falls into a set of fairly common disappointed beneficiary cases
    concerning the right to life insurance proceeds. Typically the plaintiff
    pursues the life insurance proceeds on the death of the deceased former spouse,
    in a situation where the deceased had named a new beneficiary, often a new
    spouse, who is the defendant. The disappointed beneficiary cases are different
    in that they take effectively a three-party structure: the plaintiffs target
    is the defendant beneficiary and not the deceased. The claim against the
    defendant, who is often innocent of any involvement in the deceaseds actions,
    seems less compelling than it does in the normal two-party dispute between
    spouses.

[244]

I observe that
    in none of the disappointed beneficiary cases, except for
Love
,

at para 42,

did the court advert
    to the fact that what was at issue was not the typical two-party relationship
    in an unjust enrichment case between the plaintiff and the defendant, but a
    three-party relationship. The cases utilize the rubric of unjust enrichment,
    but the structural difference is glossed over.

[245]

Second, the
    disappointed beneficiary cases constitute a type of case that, to my mind, fits
    comfortably with those in the third and fourth categories I mentioned earlier,
    described in
Soulos
, as situations where constructive trusts have
    been recognized in the past, or other situations where courts have found a
    constructive trust, or circumstances where its availability has long been
    recognized: paras. 21-22, and paras. 34-35. I return to this discussion below
    after discussing the cases in order to better set the context.

The Categories of Disputed Beneficiary Cases

[246]

In general
    terms, the disappointed beneficiary cases fall into three categories. The first
    are those in which the plaintiff succeeds in securing a constructive trust over
    the insurance proceeds. These include:
Steeves v. Steeves
(1995), 168 N.B.R.
    (2d) 226 (Q.B.);
Roberts v. Martindale
, [1998] B.C.J. No. 1509 (C.A.);
Bielny
;
Mitchell v. Clarica Life Insurance Co.
, [2005] O.J.
    No. 6122 (S.C.);
Schorlemer Estate v. Schorlemer
, [2006] O.J. No. 5049
    (S.C.); and
Holowa Estate v. Stell-Holowa
, 2011 ABQB 23, 506 A.R. 260.
    The list is not exhaustive.

[247]

The second
    category are those dismissing the plaintiffs claim to a constructive trust,
    taking
Soulos
into account. This category includes:
Ladner v. Wolfson
and
Milne Estate v. Milne
, 2014 BCSC 2112, 54 R.F.L. (7th) 328, which
    followed
Ladner.


[248]

The third
    category of disappointed beneficiary cases are those in which the plaintiff was
    unsuccessful in securing a constructive trust, largely on the basis that the
    deceaseds intention to benefit the plaintiff was not sufficiently clear. These
    include:
Kang v. Kang et al.
, 2002 BCCA 696, [2002] B.C.J. No. 2918;
Richardson Estate; Chanowski v. Bauer
, 2010 MBCA 96, 258 Man. R. (2d) 244;
    and
Love
. This category of cases is not relevant.

[249]

The appellant
    argues that the cases in the first category have been overtaken by
Soulos
and are not good law. I will attend to this argument after describing cases
    from each category.

Cases Granting a Remedial
    Constructive Trust

[250]

Shannon
is a pre-
Soulos
decision. The details were discussed above. Despite
    what she implicitly found was a revocable insurance designation, McKinlay J.
    imposed a trust on the life insurance proceeds, relying on a provision in the
    separation agreement. I see no meaningful difference between the effects of the
    words used in the separation agreement in
Shannon
and the oral
    agreement found by the application judge in this case.

[251]

In
Steeves
,
    the husband was ordered by the court to maintain a life insurance policy in
    favour of his former wife. Before his death, he designated his second wife as
    the beneficiary of the policy. Since the policy was provided as an employment
    benefit to the deceased, the plaintiff had not contributed to it.
Steeves
is also pre-
Soulos
, but the trial judge invoked the Supreme Court
    jurisprudence that led to
Soulos
including
Rathwell
,
Pettkus
and
Peter
, in reaching the conclusion that a constructive trust was
    warranted.

[252]

Creaghan J. noted,
    at para. 31, that the deceaseds failure to comply with the courts order was
    wrongful. The estate lacked assets, pointing to the absence of an adequate
    remedy to the plaintiff at law. He also noted that the defendant: is not a
    bona fide purchaser for value, but rather, is in the nature of what has been
    referred to at law as an innocent volunteer. He concluded, at para. 35, that
    the three part test for unjust enrichment from
Pettkus
was met.
    Finally, at para. 36, he described the constructive trust impressed on the
    policy proceeds:

The constructive trust that arises in this instance is that
    Roger Steeves held the inchoate proceeds of the insurance policy in the event
    of his death in trust for the Plaintiff and that upon his death, where the
    proceeds could be traced and had not come into the hands of a bona fide
    purchaser for value, an equitable lien attached to them in the hands of the
    Defendant Dorilla Harper Steeves.

[253]

The facts
    giving rise to a constructive trust in
Roberts
differ. The husband
    renounced his rights in his former wifes property. He remained the policy
    beneficiary when his former wife died because she did not take steps to change
    the designation to her sister and care-giver, Ms. Roberts, whom she wished to
    be the beneficiary. The British Court of Appeal did not permit the insurance
    designation to stand in the way of imposing a constructive trust. Speaking for
    the court, Southin J.A. stated, at paras 24- 27:

Constructive trusts have been imposed in many cases where the
    defendant has done nothing which could properly be characterized as
    "fraudulent". There was no fraud, for instance, in
Pettkus v.
    Becker
, [1980] 2 S.C.R. 834, or in
Hussey v. Palmer
, [1972] 3 All
    E.R. 744, in which Lord Denning spoke of imposing a trust "whenever
    justice and good conscience require it".

There is in this proposition the very great danger of judges
    invoking their personal predilections. "Good conscience" is an
    infinitely variable concept upon which reasonable men and women, and therefore
    reasonable judges, may have widely divergent opinions.

But I am comfortable in this case in saying that it would be
    against good conscience for the appellants to keep this money because Mr.
    Martindale had, by the separation agreement, surrendered any right he might
    have had to the property of the deceased. A policy of life insurance is a
    species of property of the insured, albeit the amount payable under the
    contract of insurance does not fall into possession until the insured's death,
    and, by law, cannot be taken by the insured's creditors.

For the appellant, Mr. Martindale, to claim from the insurer
    the proceeds was a breach of the separation agreement and such a breach is
    sufficient, in my opinion, to call in aid the doctrine of the remedial
    constructive trust. To put it another way, it is not the mistaken belief of
    Mrs. Martindale which gives rise to a remedy; it is the bargain which Mr.
    Martindale made.

[254]

The court did
    not refer to
Soulos
.

[255]

The Alberta
    Court of Queens Bench reached a similar result in
Holowa Estate
. Ms.
    Hanrahan was the estranged spouse of the deceased. She was defined
    legislatively as his pension partner under the applicable pension plan and
    was entitled to the proceeds on his death. The deceased had failed to get a
    matrimonial property order that would have changed Ms. Hanrahans status. The
    application judge found, at para. 50, that:

[Ms. Hanrahan] could hardly have more explicitly waived her
    right to the [Local Authorities Pension Plan], she did it both in the context
    of the 2001 agreement during her marriage, and again in the 2003 agreement on
    separation, where she expressly released any rights arising on death, or out of
    any Act of the Province of Alberta.

[256]

There was also
    evidence that the deceased attempted to designate his two children as his
    beneficiaries for the pension, who were also his estate beneficiaries.

[257]

The application
    judge undertook a lengthy exposition of the law of constructive trust,
    including
Soulos.
He imposed a constructive trust on the pension
    benefit in favour of the estate on the basis of unjust enrichment. He then went
    on to consider the alternative claim advanced, as he said, at para. 62, under
    constructive trust principles, independent of unjust enrichment. He considered
    para. 43 of
Soulos
, where he noted: Expansive language is used in
    relation to the ability of this equitable remedy to develop. He concluded at
    para. 65:

Surely it would be against good conscience for Hanrahan to
    retain this benefit, when there is no evidence to show any equitable basis for
    her to receive the benefit, or be entitled to it in contravention of the two
    matrimonial contracts between the parties. She specifically waived her right to
    the LAPP, it was a specific contractual agreement, during the marriage,
    affirmed again on separation.

[258]

There are
    several Ontario Superior Court cases that follow
Shannon
and do not
    mention
Soulos
. These are
Bielny
(separation agreement
    prevails over designation),
Mitchell
(original common intention
    respecting beneficiaries prevails), and
Schorlemer Estate
(separation
    agreement prevails). Remedial constructive trusts were imposed in these cases.
[12]


Cases Refusing a Remedial Constructive Trust



[259]

Ladner
is
    unusual, in that it was a lawyers negligence case. The wife sued her lawyer
    and the law firm handling her case for failing to pursue a trust claim for a
    remedial constructive trust against her former husbands estate at the same
    time as a damages claim. The trust claim was merged in the damages claim, but
    by that time the husbands estate was insolvent. The defendants asserted that a
    trust remedy would not have been available in the action against her husbands
    estate, so the lawyer had not been negligent. The trial judge found that a
    constructive trust claim would have succeeded, but the court of appeal reversed
    the decision.

[260]

In the
    underlying fact situation, the husband failed to keep in good standing the
    existing life insurance policies designating his former spouse, as he was
    obliged to do under a separation agreement. Instead he purchased other life
    insurance policies and designated his estate as the beneficiary. The court of
    appeal considered the former spouses claim to fall under the wrongful act
    aspect of
Soulos
. The trial judge had found there was no fiduciary
    relationship between the spouses, and the court of appeal accepted that
    finding. The result, Garson J.A. noted, at para. 47, was that: the first of
    the
Soulos
conditions for the imposition of a good conscience trust
    [resulting from a wrongful act] cannot be fulfilled.

[261]

Justice Garson
    went on to find, at para. 53, there was an insufficient proprietary connection
    between the wrongful act and the existing life insurance policies. The life
    insurance proceeds at issue were not proven to be generated from the policies
    referred to and required under the separation agreement. As a result, there was
    an insufficient proprietary connection between the wrongful act and the
    existing life insurance policies. Garson J.A. considered a proprietary
    connection to be essential, since to grant the remedy of a constructive trust
    without such a connection would risk extending equitable remedies to almost
    any common law breach of contract:
Ladner
, at para. 52.

[262]

The trial judge,
    said Garson J.A. at para. 57, had wrongly relied on
Roberts
as having
    extended the law as enunciated in
Soulos
so as to permit the
    imposition of a constructive trust in Ms. Ladners favour. This was in error,
    since
Soulos
was not cited in
Roberts
, and for this reason he
    cast doubt on its correctness:
Ladner
, at paras. 58-59. She then
    distinguished
Roberts
on the basis that, having surrendered any claim
    to the property of his former wife, the husband in
Roberts
was
    therefore not entitled to receive the property over which the remedy of
    constructive trust was sought.

[263]

In
Love
,
    the contest was between the former wife who was designated under his insurance
    policy, and the deceaseds son, whom the deceased had wanted to designate. The
    Saskatchewan Court of Appeal found sufficient evidence to support
    rectification. In
obiter
, Richards J.A. reflected on the appellants
    unjust enrichment argument that was based on the British Columbia Court of
    Appeals decision in
Roberts
. He observed, at para. 45, that
Roberts
had not been followed by any other appellate-level court, including this court
    in
Richardson Estate.
He noted, at paras. 46- 47, that his difficulty
    with
Roberts
is that it made no reference to
Soulos
, which
    had not invited judges to impose constructive trusts whenever and wherever
    they believe justice requires.

[264]

In
Milne
    Estate
, the deceased husband disobeyed a court order requiring him to
    maintain a life insurance policy with the wife as beneficiary. Instead, he
    designated his new partner. The court followed
Ladner
and found no
    basis for a remedial constructive trust based on breach of fiduciary duty, as
    there was no such relationship between the spouses. Instead he granted judgment
    against the estate for the full value of the policy.

Analysis

[265]

The disappointed
    beneficiary cases utilize the rubric of unjust enrichment but gloss over the
    structural difference. This approach exemplifies the common laws inclination
    to use old tools for new tasks, even if they do not quite fit. We will always
    be feeling our way. As McLachlin J. noted in
Soulos
at para. 35: The
    goal is but a reasoned, incremental development of the law on a case-by-case
    basis. That method is part of the genius of the common law.

[266]

In managing the
    deployment of remedial constructive trusts in aid of good conscience, the
    discipline of particularity is important, as McLachlin J. noted. To repeat her
    words in para. 35 of
Soulos
: Particularity is found in the situations
    in which judges in the past have found constructive trusts. She noted:  A
    judge faced with a claim for a constructive trust will have regard not merely
    to what might seem fair in a general sense, but to other situations where
    courts have found a constructive trust. She saw this careful approach as
    essential to a reasoned, incremental development of the law on a case-by-case
    basis.

[267]

I recapitulate
    the findings that must be made for a court to impose a constructive trust on
    life insurance proceeds, which have emerged so far in the cases involving
    disappointed beneficiaries. These serve as limits to discipline judicial
    discretion. First, the defendant has been enriched and the plaintiff deprived
    in a family context, not in the market world. Second, the deceaseds ruling
    intent, before resiling, was to benefit the plaintiff. That intent can be found
    in an oral agreement, a separation agreement or in a court order, but it must
    comprise an obligation. Third, there is a proprietary link between the
    plaintiff and the life insurance proceeds. It is this life insurance policy
    that is in issue, not some other. Finally, providing the plaintiff with the
    remedy of a constructive trust does not breach any law. Experience with
    constructive trusts in the disappointed beneficiary context would undoubtedly
    add other refinements.

[268]

The disappointed
    beneficiary cases represent a distinct type of case in which the constructive
    trust remedy is disciplined by the common structure and elements of the
    dispute, which ought to serve to assuage the concern that equity is off on a
    frolic of its own, paying no attention to the law. Equity follows the law; the
    imposition of a constructive trust does not block the laws operation, which in
    this case is the operation of the
Insurance Act
; it imposes an
    obligation in conscience on the appellant the moment her entitlement to the
    proceeds attaches, one that requires her to hold the proceeds in trust for the
    respondent.

[269]

To my mind, the
    disappointed beneficiary cases constitute a genus in which a constructive trust
    can be imposed on life insurance proceeds consistently with the reasoning of
    McLachlin J in
Soulos
. They are situations in which courts have found
    a constructive trust.

[270]

I do not agree
    with the appellants argument that those disappointed beneficiary cases in
    which the court granted a remedial constructive trust have been overtaken by
Soulos
and are not good law, for several reasons.

[271]

First, I am not
    persuaded by the
obiter
in
Ladner
and
Love
that the
    British Columbia Court of Appeals reasoning in
Roberts
is to be
    doubted in light of
Soulos
. Neither court explained the basis for the
    doubt apart from the lack of a mention of
Soulos
in the decisions
    under review.

[272]

Second, I would
    distinguish
Ladner
itself on two bases. The case proceeded under the
    rubric of wrongful act, which has a detailed set of elements according to
Soulos
that do not apply to the unjust enrichment rubric. Further, the proprietary
    connection between the new and old insurance policies that was missing in
Ladner
was very much present in this case between the policy and the payment of the
    premiums by the respondent.

[273]

Finally, in
    light of the limits I discussed earlier, I do not share the
Ladner
courts underlying concern that constructive trusts would become unmanageable.

[274]

Equity asks a
    pertinent question in the difficult dilemma posed in the disappointed
    beneficiary cases: which of the two claimants has the superior claim to the
    life insurance proceeds? Equitys answer, all things being equal, is to assist
    the one with the superior right in equity, as McKinlay J. pointed out in
Shannon.
In this case, that is the respondent, as the application judge
    found.

(3)

Conclusion on Unjust Enrichment

[275]

In my view, the
    application judge did not err in finding that the respondents deprivation
    consisted of the life insurance proceeds. He also did not err in finding that
    the deceaseds irrevocable designation in the appellants favour under s. 191
    of the
Insurance Act
, given his
    prior oral agreement with the respondent,
did not provide a
    juristic reason to oust the availability of a constructive trust over the life
    insurance proceeds, despite the
Richardson Estate
decision.

[276]

But I would go further
    and add that, to the extent that they fit awkwardly under the rubric of unjust
    enrichment, the disappointed beneficiary cases are perhaps better understood as
    a genus of cases in which a constructive trust can be imposed via the third
    route in
Soulos
 circumstances where the availability of a trust has
    previously been recognized  and the fourth route  where good conscience
    otherwise demands it, quite independent of unjust enrichment.

H.

Disposition

[277]

I would dismiss
    the appeal with no order as to costs.

Released: March 2, 2017

P. Lauwers J.A.





[1]
Contract, as defined in s. 171(1) of the
Insurance Act
, means a
    contract of life insurance.



[2]
A declaration, as defined in s. 171(1) means an instrument signed by the
    insured, containing certain specific information and in which the insured
    designates, or alters or revokes the designation of  a beneficiary.



[3]
This subsection is not relevant to the issues on the appeal.



[4]

Rathwell v. Rathwell,
[1978] 2 S.C.R. 436.



[5]
It is not clear that this position is accurate.  There is nothing in the record
    to establish that, if she had ceased paying the premiums, Mr. Moore would not
    have found a way to keep the Policy alive.  Although he was of limited means,
    and on a disability pension, the premiums of $507.50 per year were not unduly
    significant.



[6]

There is a second line of authorities arising in situations
    where claims are made under the
Succession
    Law Reform Act
, R.S.O. 1990, c. S.26, or similar
    legislation.  See, for example,
Barton
    v. Barton Estate
(1991), 37 R.F.L. (3d) 330 (Ont. Gen.
    Div.).  The present case does not attract such considerations, however.



[7]
There is academic support for both views. The view that
Soulos
is
    restrictive is implicitly supported by
Donovan W.M. Waters, Q.C. et al,
Waters Law of Trusts in Canada
,
    4th ed.

(Toronto: Carswell, 2012), at pp. 494 -500. For the view that
Soulos
was not restrictive, see
Robert Chambers, 
Constructive
    trusts in Canada (1999) 37 Alta. L. Rev. 173; A. H. Oosterhoff et al.,
Oosterhoff
    On Trusts: Text, Commentary and Materials
, 8th ed. (Toronto: Carswell,
    2014), pp.735-36; Eileen E. Gillese,
Law of Trusts
, 3rd ed. (Toronto:
    Irwin Law Inc, 2014), at pp. 123-44.



[8]
Mitchell
McInnes,
The Canadian Law of Unjust Enrichment and
    Restitution
, (Markham: LexisNexis Canada, 2014), at p. 46.



[9]
It would appear that Lord Dennings approach has since run aground in England:
    See
Westdeutsche Landesbank Girozentrale v. Islington LBC
, [1996] UKHL
    12,
[1996] A.C. 669
;
Re
    Polly Peck International Plc
, [1998] EWCA Civ 789, [1998]
3 All E.R. 812
;
Thorner
    v. Major
, [2009] UKHL 18, [
2009]
All E.R. 945;
    and
FHR European Ventures LLP v. Cedar Capital Partners LLC
, [2014] UKSC
    45, [2015] A.C. 250.



[10]
In her judgment, McLachlin J. notes the New Zealand Court of Appeals decision in
Elders Pastoral Ltd. v. Bank of New Zealand
(1989), 2 N.Z.L.R. 180. It is
    important to note that the Supreme Court of New Zealand affirmed the
    availability of the remedial constructive trust in its 2008 decision of
Regal
    Casting Ltd v. Lightbody
, [2008] NZSC 87, [2009] 2 N.Z.L.R. 433; The
    remedial constructive trust has also been accepted in Australia:
Muschinski
    v. Dodds
, [1985] HCA 78, [1985] 160 C.L.R. 583.



[11]
While the usual remedy for breach of contract is damages, equity will grant
    specific performance where damages would be inadequate. It is therefore
    instructive to note that the usual remedy where a spouse fails to get life
    insurance when obliged to do so under a separation agreement is specific
    performance, unless the defaulting party is unable to do so due to a medical
    condition:
Tidy v. Alexander
, 2010 ONSC 6889, at paras. 10, and 35-38.
    Decisions outside Ontario including
Gaudet v. Mainville
, 2014 NBQB 88, 418
    N.B.R. (2d) 273.



[12]

In the United States, certain jurisdictions have held that a
    remedial constructive trust will be imposed on insurance proceeds where an
    insured breaches a separation agreement to designate a former spouse a
    beneficiary on an insurance plan. New York is one such jurisdiction:
Simonds
    v. Simonds
(1977), 58 A.D.2d 305 (Sup. Ct. App. Div.), aff'd,(1998), 45
    N.Y.2d 233 (Ct. App.).


