What is the test for determining whether a party has actual influence over a transaction?

Actual influence requires proof that the transferee actually exerted undue influence, and the onus rests with the challenger of the transaction. Presumed influence arises from the existence of a relationship of dependency between the transferor and transferee which, if established, shifts the burden of proof to the transferee to rebut the presumption: Modonese v. Delac Estate, 2011 BCSC 82 [Modonese] at para. 101, aff’d 2011 BCCA 501.

Where the party challenging a transaction relies on the presumption of undue influence, the first stage of the inquiry involves a determination as to whether the parties to the transaction were in a relationship of dependency. It must be shown that there is the potential for domination inherent in the relationship: Geffen v. Goodman Estate, 1991 CanLII 69 (SCC), [1991] 2 S.C.R. 353 [Geffen] at 378. The test embraces those relationships that equity has already recognized as giving rise to the presumption, such as solicitor and client or guardian and ward, as well as “other relationships of dependency that defy easy categorization”: Geffen at 378.