By Laroux Peoples, JD (Vice-President Professional Services, PPI)
Beneficiary designations have been found not to be subject to the presumption of resulting trust – they are instead testamentary dispositions.
Advisors and their clients now have one more court case to support the view that beneficiary designations are not the same as joint bank accounts or jointly owned real estate making the presumption of resulting trust that arose out of the Supreme Court of Canada’s Pecore decision and subsequent other conflicting cases* the incorrect framework to use for beneficiary designated assets like TFSAs or RRSPs and RRIFs. This is extremely important for estate planning because when the presumption of resulting trust applies, the asset is seen to be held in trust for the estate unless the person receiving the asset can show that the deceased intended to gift the property to the recipient. This is not always an easy task since the person making the transfer has often passed away.
The Ontario decision of Kukna Estate v. Giasson is welcome news as clients across Canada want to ensure that their testamentary wishes come to fruition instead of ending up in estate litigation. But even though this decision provides some clarity, we can’t celebrate quite yet as the decision is a lower court decision and could be appealed, and we have yet to have the Supreme Court of Canada weigh in on this issue. In addition, please note this discussion does not apply to beneficiary designated assets in Quebec.
Recall that the presumption of resulting trust applies to gratuitous transfers from a parent to an adult child where it is unclear what the intent of the transferor was at the time of adding the adult child to a bank account or to a piece of real estate as joint owner. However, post Pecore, the presumption of resulting trust has been applied more broadly to include all types of relationships (e.g. friend-friend, great nephew-niece) and Courts have applied the presumption of resulting trust analysis beyond joint bank accounts to properly designated RRSPs, RRIFs and TFSAs and even some life insurance products.
It is with welcome relief in the recent Kukna Estate v. Giasson, that the Judge found that the presumption of resulting trust should not be applied to TFSA and RRIF beneficiary designations.
To come to this conclusion the Judge made the following findings:
- Joint accounts under Pecore do not equal TFSA or RRIF beneficiary designations. Unlike for joint accounts, an adult child does not have access to the proceeds of a TFSA or RRIF when they are named as a beneficiary during the lifetime of the account owner, it is only accessible on death.
- A beneficiary designated asset is only available on the death of the asset holder making the intent at the time of the designation crystal clear. When intent is unclear with jointly held assets, the presumption of resulting trust is the framework a Court can use to determine intent. The fact that the asset is only accessible on death also points very specifically to the asset holder’s intent of that asset on their death – it is the very essence of a beneficiary designation. A presumption of resulting trust analysis, in contract, is only necessary when the asset holder’s intent on what happens on their death is unclear when they add the adult child to the joint account.
- RRIFS and TFSAs cannot have joint ownership. While a TFSA can have a successor annuitant, this feature allows the deceased TFSA to transfer into the successor annuitants’ TFSA there is never simultaneous or joint ownership with a RRIF or TFSA, it is not technically possible.
- The Judge highlighted that the account holder of a TFSA or RRIF can change their mind and change or update the beneficiary designation prior to death which is a unique feature of these assets and unlike for joint assets, there is no fiduciary relationship between the asset owner of a RRIF or TFSA and their named beneficiary while the person is alive. In addition, in cases of joint bank accounts or jointly owned real estate, it is possible for the transferor to enter into a situation where the right of survivorship cannot be changed if the Court finds that the transferor intended that the asset pass to the other joint holder on their death at time of transfer. Courts in some provinces have found that an irrevocable “gift” of the right of survivorship occurred, barring the asset holder from changing their mind.
- The argument that the Judge advanced that should provide comfort to life insurance colleagues is that RRIFS and TFSAs are distinguished in the decision by being separate creatures by statute. Under the Succession Law Reform Act beneficiary designation issues are properly subject to provincial legislation and not common law interpretation as is the case with joint accounts. This bodes well for anyone advancing arguments that the presumption of resulting trust analysis should not extend to life insurance products because they are governed by provincial Insurance Acts.
For additional context, read Laroux Peoples’ interview with The Globe and Mail published on April 23, 2026: Ontario court rules registered plans belong to designated beneficiary, not to estate – The Globe and Mail
*We have commented on the conflicting court cases that have dealt with the issue of whether the presumption of resulting trust applies to beneficiary designations in prior articles: Beneficiary Designations – Making Sure Your Money Goes Where You Want and Beneficiary Designations and the Importance of Transparency