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July 13th, 2017

During their childhood and teen years, the plaintiffs performed unpaid work on their parents’ dairy farm. They continued to work on the farm at various times during their early adulthood. Originally the farm assets were owned by their parents but the assets were later transferred into a corporation. Several years after their father’s death, they learned that their parents transferred the shares in the corporation to their brother, except for redeemable preferred shares representing about 10% of the farm’s value. Their own inheritances were to be limited to those preferred shares. The plaintiffs commenced an action against their mother, their father’s estate and the corporation for unjust enrichment in respect of work they had performed on the farm. The judge accepted that they had valid claims in unjust enrichment, but only for the unpaid work they performed as teenagers. The trial judge awarded each of the plaintiffs $350,000, less any amount they received in preferred shares. The defendants appealed.

Held: appeal allowed. The work performed by the plaintiffs was in the nature of chores. As a matter of public policy, chores performed by children in a family setting do not, absent indicia of exploitation, attract a right to compensation under the doctrine of unjust enrichment. In any event, the judge’s assessment of damages was the product of palpable and overriding error. Properly assessed, the transfer of the preferred shares would fully compensate the plaintiffs even if the judge’s unjust enrichment analysis were sustainable.

The full case, McDonald v. McDonald 2017 BCCA 255 can be found here.

The link to the Vancouver Sun article can be found here: http://vancouversun.com/news/local-news/old-mcdonalds-farm-inheritance-blues-e-i-e-i-oh

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