October 25, 2025

Presumption of Resulting Trust in Real Estate: Why Adding Your Children to Your Home Can Be Risky

Many homeowners in Toronto consider adding their children to the title of their property to simplify estate planning or avoid probate. While this may seem like a convenient option, the legal reality is more complicated. A key principle to understand in these situations is the presumption of resulting trust, which can affect real estate ownership in unexpected ways.

Understanding Joint Tenancy and Real Estate Ownership

Joint tenancy is a common way for many people to own property in Toronto. It is often used by spouses or partners because of the automatic right of survivorship. When property is held as joint tenants, the surviving owner automatically acquires the deceased owner’s share, bypassing probate and court approval.

For example, if two spouses own a home as joint tenants and one passes away, the surviving spouse becomes the sole owner of the property regardless of the will. This simplicity is why joint tenancy is commonly chosen by married couples in the city.

The Risks of Adding Children to Your Property Title

Adding a child as a joint tenant may seem like an easy way to transfer ownership and avoid probate. However, under Ontario law, the presumption of resulting trust may apply. This presumption assumes that when a property is transferred without payment, the recipient holds the property for the benefit of the original owner, unless there is clear evidence that the transfer was intended as a gift.

This means that simply adding a child’s name to your property does not automatically give them full ownership. If the transfer is ever questioned, the law may assume that the child is holding their interest in trust for you, which can lead to unexpected complications.

Why the Presumption of Resulting Trust Matters for Toronto Homeowners

The presumption of resulting trust exists to protect property owners from unintended consequences. It can prevent:

Children’s spouses or creditors from claiming full ownership of your home.
Misunderstandings about whether the transfer was a gift or a temporary arrangement.
Family disputes after the original owner passes away.

In practical terms, this means that adding a child to your property title can create legal uncertainty and may not achieve the estate planning outcome you intended.

Safe Estate Planning Alternatives for Toronto Homeowners

To protect your home and ensure your intentions are clear, there are safer alternatives than adding children to the title:

Establishing a trust to clearly outline who will benefit from the property and when.
Drafting a will for your property that specifies how your home should be distributed.
Consulting a Toronto real estate lawyer to discuss options for avoiding probate while maintaining control over your property.

These strategies can prevent disputes, safeguard your property from creditors or spouses of your children, and ensure your estate is handled according to your wishes.

Final Thoughts

While adding children to your property title may seem simple, the presumption of resulting trust makes this approach risky. Without clear legal documentation, ownership may not pass as intended, and disputes could arise. Working with a real estate lawyer in Toronto ensures that your estate planning is secure, legally sound, and aligned with your goals.