The forms and procedures required in Alberta\u2019s and Saskatchewan\u2019s provincial \u201chomestead legislation\u201d create dower rights, which act as safeguards to protect spouses who do not own their homes (the non-owning spouse) from having their homes sold without their consent. However, these same requirements also create ample opportunities for fraud to occur in the dower context. This article discusses dower and the various ways by which people have attempted to bypass homestead legislation through fraud and forgery.<\/p>\n\n\n\n
Dower rights were originally created by statute to protect married women from losing their homes in cases where they were abandoned by their husband or where their son inherited the family home and attempted to evict them. Dower rights are no longer gendered but they continue to protect spouses who do not own their homes against non-consensual sale, mortgage, or other disposition of their home by their spouse. Dower legislation creates this protection by requiring the non-owning spouse to sign a consent and to be examined separately from the owning spouse before the home can be disposed of.<\/p>\n\n\n\n
Alberta\u2019s dower law is the Dower Act.<\/em>[1]<\/a> Saskatchewan has a similar statute, The Homesteads Act, 1989<\/em>[2]<\/a>. These statutes are sometimes referred to as \u201chomestead legislation,\u201d which hearkens back to their original intention of protecting a married woman\u2019s interest in the family homestead. Dispositions of a homestead in Alberta include: selling or mortgaging it, leasing it for a term of more than three years, and giving it to someone in a will. In Saskatchewan the term disposition specifically includes a profit \u00e0 prendre<\/em>, easement or quit claim in addition to the types of dispositions listed in Alberta\u2019s Dower<\/em> Act.<\/em><\/p>\n\n\n\n The protections in the Dower Act <\/em>and The<\/em> Homesteads Act, 1989 <\/em>vary slightly but both require the completion of forms showing either that spousal consent is not needed for the disposition (e.g., the property is not a homestead or the seller has no spouse) or that spousal consent has been given.[3]<\/a> The spouse consenting to the disposition must acknowledge, in front of an officiating officer or lawyer as outlined in the applicable legislation, that they are aware of the nature of the disposition, they understand their dower rights and give up those rights, and they give the consent freely and voluntarily.[4]<\/a> The other spouse must not be present during the acknowledgement.[5]<\/a><\/p>\n\n\n\n The following cases provide a glimpse into the complexities of dower law and the various ways by which individuals in Alberta and Saskatchewan have attempted to bypass the application of these protections through fraud or forgery.<\/p>\n\n\n\n In 1954, the Saskatchewan Court of Appeal decided the Friess <\/em>case, <\/em>involving forged dower documents related to a lease of petroleum and natural gas rights. The plaintiffs, Matt and Matilda Friess, were seeking an order to declare a lease null and void due to a failure to comply with the version of The Homesteads Act <\/em>that was in place at the time.[7]<\/a><\/p>\n\n\n\n At the time when Matilda ought to have signed the required form indicating her consent to the lease, she was ill and unable to do so. Instead, at the request of the lessee\u2019s agent, the Friess\u2019 14-year-old daughter, Minnie, signed her mother\u2019s name on the form and the attendant justice of the peace completed the required certificate. However, the certification was fraudulent because Matilda never actually signed the certificate and was not examined \u201cseparate and apart\u201d from Matt regarding the disposition. In fact, Matilda was not even in the room at the time the documents were completed. Minnie later informed Matilda that she signed in her place.<\/p>\n\n\n\n The appeal was granted and the lease was declared null and void regarding the part of the Friess\u2019 land constituting the homestead. This was primarily based on the fact that Matilda did not provide the required consent for the disposition, which according to the Court made the disposition invalid.[8]<\/a> Additionally, Matt, the lessee\u2019s agent, and the justice of the peace all knew that Matilda had not properly consented to the disposition, as required by the homestead legislation.[9]<\/a> Under the statute, knowledge on the part of a transferee, purchaser, lessee, etc. that they were obtaining rights in land which was a homestead and that the non-owner spouse had not consented to the disposition constituted fraud and the non-owner spouse was therefore entitled to bring an action to have the disposition set aside and cancelled.[10]<\/a><\/p>\n\n\n\n The Court also considered whether the Friess\u2019 claim was barred by estoppel because Matilda ratified the forgery or acquiesced to the lease by remaining silent and accepting rent for years after Minnie told her she forged her signature. The Court dismissed this argument, inferring that Matilda was silent simply because she was unaware of her dower rights until her husband decided the lease should be declared invalid.[11]<\/a><\/p>\n\n\n\n Notably, under modern homestead legislation, lack of consent from the non-owning spouse does not on its own make any disposition of a homestead null and void; instead, it depends on the type of disposition that occurred. This is explored further in this article in the discussion regarding Inland Financial Inc. v Guapo<\/em>, below. However, Friess<\/em> is mentioned here to illustrate that, in Saskatchewan, knowledge of dower fraud on the part of a transferee voids a disposition of a homestead.[12]<\/a><\/p>\n\n\n\n The Voolstra <\/em>case illustrates that in cases of fraud by an owner spouse, an innocent purchaser\u2019s right to title of a home can outweigh a non-owner spouse\u2019s claim to dower rights in the homestead. Voolstra <\/em>also clarifies that dower rights must still be considered even where a married couple is separated.<\/p>\n\n\n\n This case was decided under the current version of The Homesteads Act, 1989<\/em>. Justice Currie of the Saskatchewan Court of Queen\u2019s Bench considered the validity of a sale of an acreage by Joy Voolstra\u2019s husband, Mark, to a neighbour named Linda Duvall. At the time of the sale, the Voolstras were separated but not divorced. Mark fraudulently swore an affidavit in the form required by The<\/em> Homesteads Act, 1989<\/em> stating that he had no spouse at the time of the sale, despite the fact that he was still married to Joy. Joy brought an action to have the sale set aside after Linda had already registered her title to the acreage.<\/p>\n\n\n\n A key issue in this case was whether Linda knew Mark and Joy were married at the time of the disposition. Linda testified that she never met Joy before the sale and had no idea that Mark was still married at the time of the sale because he had told her that his matrimonial issues were settled.[14]<\/a> Justice Currie found that Linda reasonably concluded that Mark no longer had a spouse with a homestead interest in the property at the time of the sale and that she reasonably relied on his purported compliance with dower legislation.[15]<\/a><\/p>\n\n\n\n Linda\u2019s knowledge was an important consideration in this case because under section 9(2) of The Homesteads Act, 1989<\/em>, a disposition purporting to be completed in accordance with the Act<\/em> will be considered valid and binding. Applying this section, Justice Currie held the sale to be valid and enforceable despite the fact that Joy never provided consent.[16]<\/a> In doing so, Justice Currie distinguished the facts of Voolstra<\/em> from other cases where the purchaser is <\/em>aware of the non-owner spouse\u2019s interest in the property at the time of the purchase.[17]<\/a> In such cases, as discussed in Friess<\/em>, the purchaser will be found to be engaging in fraud and the disposition may be set aside in an action by the non-owner spouse, under section 12 of The Homesteads Act, 1989<\/em>.<\/p>\n\n\n\n While the Court protected Linda\u2019s right to the homestead as a purchaser for value, Joy was still entitled to bring a separate action against her husband for damages regarding his unlawful disposition of the homestead.<\/p>\n\n\n\n In Guapo<\/em>, the Alberta Court of Appeal highlights how the type of disposition at issue will affect the application of dower law. While Voolstra<\/em> shows that an innocent purchaser of land will be protected from application of a wronged spouse\u2019s dower rights, in Guapo<\/em> the dower rights prevailed over those of an innocent mortgagee.<\/p>\n\n\n\n Jose Guapo Sr. and Maria Guapo owned their home in joint tenancy and their adult son, Jose Jr., lived with them. Jose Jr. persuaded his mother to apply to Inland Financial for loans to be secured by a mortgage on his parents\u2019 home on over ten occasions. Jose Jr. impersonated his father and fraudulently signed the mortgage documents and required dower consent forms. It was unclear whether Maria understood the nature of the transactions because she did not speak English, had a Grade 4 level education, and only did what her son instructed her to do.[19]<\/a><\/p>\n\n\n\n Like Friess<\/em>, Guapo <\/em>is a case of a child signing dower documents on behalf of a parent. However, unlike in Friess<\/em>, where everyone was at least aware of the forgery (though Matilda did not find out until soon after the fact), the fraudulent activity in Guapo<\/em> occurred without the knowledge of Jose Sr., Inland Financial, and possibly without the knowledge of Maria. Jose Sr. only became aware of the fraud when foreclosure proceedings began.<\/p>\n\n\n\n In holding that the mortgage was invalid, the Court discussed some of the history of Alberta\u2019s dower legislation. Where prior to 1948, any disposition by a husband of the homestead without a wife\u2019s consent was null and void, this was later changed to avoid conflicts with the Land Titles Act<\/em> so that the transfer of a homestead without spousal consent will not be rendered null and void after the new owner registers title.[20]<\/a> Instead, under the Dower Act<\/em>, the dower rights of the wronged spouse are \u201cconverted\u201d into a claim for damages, as was the case in Voolstra<\/em>.[21]<\/a> However, the Court noted that this rule does not apply to the registration of encumbrances, such as mortgages.[22]<\/a> By contrast, the registration of a mortgage obtained by fraud is completely invalid and the mortgage will be removed from title.[23]<\/a> Upon reaching this conclusion, the Court noted that the inconsistent remedies available for breach of dower rights across types of dispositions may cause unfairness, but emphasized that binding precedent from the Supreme Court of Canada[24]<\/a> tied its hands and any change would require overturning the Supreme Court\u2019s precedent or amending legislation.[25]<\/a> The mortgage was struck from the title to the home and the foreclosure action was dismissed. Inland Financial was, however, granted judgment against Jose Jr.[26]<\/a><\/p>\n\n\n\n The cases discussed above demonstrate how the courts might balance the interests of various parties in cases of dower fraud ranging from forging signatures to false claims of divorce to full-on impersonation of family members. The apparent inconsistencies in the effect of non-compliance with dower law in different contexts underscores the importance of requiring strict adherence to dower legislation. Taking careful steps to prevent and detect fraud is essential when dealing with real property that may constitute a homestead in jurisdictions with this type of legislation.<\/p>\n\n\n\n ***Miller Thomson employs experienced lawyers who can help you navigate dower rights in your province and provide you with legal advice and assistance regarding the sale, lease, mortgage, or other disposition of your property.***<\/em><\/p>\n\n\n\n [1]<\/a> RSA 2000, c D-15 [Dower Act<\/em>].<\/p>\n\n\n\n [2]<\/a> SS 1989-90, c H-5.1 [Homesteads Act<\/em>].<\/p>\n\n\n\n [3]<\/a> Dower Act<\/em>, supra <\/em>note 1, s 2; Homesteads Act<\/em>, supra <\/em>note 2, ss 6, 8.<\/p>\n\n\n\n [4]<\/a> Dower Act<\/em>, ibid<\/em>, s 5; Homesteads Act<\/em>, ibid<\/em>, s 7.<\/p>\n\n\n\n [5]<\/a> Dower Act<\/em>, ibid<\/em>, s 5; Homesteads Act<\/em>, ibid<\/em>, s 7.<\/p>\n\n\n\n [6]<\/a> 1954 CanLII 208 (Sask CA) [Friess<\/em>]<\/p>\n\n\n\n [7]<\/a> The <\/em>Homesteads Act<\/em>, RSS 1940, c 101.<\/p>\n\n\n\n [8]<\/a> Fries<\/em>s, supra <\/em>note 6 at para 12.<\/p>\n\n\n\n [9]<\/a> Ibid <\/em>at para 15.<\/p>\n\n\n\n [10]<\/a> Ibid <\/em>at para 20.<\/p>\n\n\n\n [11]<\/a> Ibid<\/em> at para 16.<\/p>\n\n\n\n [12]<\/a> This principle is entrenched in section 12 of Saskatchewan\u2019s The Homesteads Act, 1989. <\/em>In Alberta, the disposition will remain valid but the non-consenting spouse is entitled to sue their spouse for damages (Dower Act<\/em>, supra <\/em>note 1, s 11).<\/p>\n\n\n\n [13]<\/a> 2012 SKQB 20 [Voolstra<\/em>].<\/p>\n\n\n\n [14]<\/a> Ibid<\/em> at paras 17, 20.<\/p>\n\n\n\n [15]<\/a> Ibid <\/em>at paras 21-27.<\/p>\n\n\n\n [16]<\/a> Ibid<\/em> at para 27.<\/p>\n\n\n\n [17]<\/a> Ibid<\/em> at para 26.<\/p>\n\n\n\n [18]<\/a> 2020 ABCA 381 [Guapo<\/em>].<\/p>\n\n\n\n [19]<\/a> Ibid<\/em> at para 5.<\/p>\n\n\n\n [20]<\/a> Ibid<\/em> at paras 15-18.<\/p>\n\n\n\n [21]<\/a> Ibid<\/em>.<\/p>\n\n\n\n [22]<\/a> Ibid<\/em>.<\/p>\n\n\n\n [23]<\/a> Ibid<\/em>.<\/p>\n\n\n\n [24]<\/a> British American Oil Co v Kos<\/em> (1963), [1964] SCR 167.<\/p>\n\n\n\nFriess v Imperial Oil Limited (1954)<\/a><\/em><\/strong>[6]<\/a><\/h2>\n\n\n\n
Voolstra v Duvall (2012)<\/a><\/em><\/strong>[13]<\/a><\/h2>\n\n\n\n
Inland Financial Inc. v Guapo (2020)<\/em><\/a><\/strong>[18]<\/a><\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\n