By Nancy E. Claridge
March 27th, 2025
Recent court ruling underscores a fundamental lesson for charities involved in property or trust matters: clear, formal documentation is essential.
In a decision dated February 25, 2025, involving the Estate of Qasem Hasan Mahmud, the Superior Court of Justice in Ontario addressed the complexities of charitable trust creation, focusing on a condominium once owned by Mr. Mahmud. The core issue was whether Mr. Mahmud had held the property in trust for the Arabic and Islamic Education Foundation of Ottawa (the “Foundation”).
This case serves as a warning to charities to ensure all trusts are fully documented to avoid legal uncertainties and potential disputes in the future. A casual reference to “trust” in documents, such as tax notices or mortgage agreements, does not establish a valid legal trust without the proper formalities.
The court found that while Mr. Mahmud may have intended to hold the property in trust, the lack of clarity and formal documentation meant that the Foundation had no legal claim to the property. Furthermore, the court determined that the Foundation’s sporadic mortgage payments over the years did not constitute a valid resulting trust because these payments occurred after the property was purchased and did not directly contribute to the property’s initial acquisition.
