In a decision released in 2023, Justice Vermette of the Ontario Superior Court rejected an application to set aside an arbitration award on procedural fairness and jurisdictional grounds. This decision clarified when Ontario’s International CommercialContinue Reading Ontario Superior Court Rejects Application to Set Aside an Arbitration Award under the Model Law
Michael Nowina’s litigation practice focuses on a broad range of commercial disputes including advising on the recovery from fraudulent investment schemes, mortgage fraud and credit fraud. Michael’s fraud-related and investigations experience includes representing victims of a Canada-wide investment fraud and ultimately securing recovery of a majority of the proceeds from the fraud, advising numerous creditors in proceedings commenced to recover fraudulent conveyances and preferential payments in multi-jurisdictional litigation, and representing financial institutions in identity fraud cases and in proceedings to recover funds from fraudulent borrowers. Michael also frequently advises clients on insolvency matters involving fraud.
In Ontario, as a general rule, partial indemnity, which ranges from approximately 40-60% of the actual costs incurred by a party, is awarded to the successful litigant. Full indemnity, which comprises 100% of the costs…Continue Reading Failure to make full and fair disclosure can result in a full indemnity costs
Can individuals take steps to make themselves ‘creditor proof’ against future creditors, even when there is no such creditor at the time? If there are sufficient “badges of fraud” present, the answer may be no.Continue Reading Fraudulent Conveyances Act – Future Creditors may challenge transfers
In a post last year, we discussed the decision of the British Columbia Court of Appeal in Poonian v. British Columbia (Securities Commission), 2022 BCCA 274 in which the British Columbia Court of Appeal…Continue Reading Update: SCC To Rule On Survival of Securities Sanctions in Bankruptcies
A bankruptcy discharge releases the debtor from pre-bankruptcy debts or liabilities. The purpose is to give the debtor a “fresh start” from excessive debts that cannot be repaid, except in certain situations such as where the debt arises from deceitful or fraudulent conduct. In Poonian v. British Columbia (Securities Commission), the British Columbia Court of Appeal held that securities sanctions are excluded from bankruptcy discharge. This is significant because this decision diverges from other Canadian appellate decisions.
Continue Reading Securities Sanctions Survive Bankruptcy, British Columbia Court of Appeal Rules
Aiden Pleterski, the self-described “Crypto King“, and his company AP Private Equity Limited were petitioned into bankruptcy on August 9, 2022 on application by certain of their creditors. David Gadsden, Michael Nowina and Ben Sakamoto at Baker McKenzie act for the creditors who brought the bankruptcy applications.
Continue Reading “Crypto King” declared bankrupt
A preferential transaction occurs where an insolvent person or debtor makes a transfer of property or a payment that has the effect of favouring one creditor over another. Creditors and bankruptcy trustees can use federal or provincial legislation to attack preferential transactions. A recent Ontario Court of Appeal decision, Golden Oaks Enterprises Inc v Scott, 2022 ONCA 509, upheld the finding that certain transactions were an unlawful preference under section 95(1)(b) of the Bankruptcy and Insolvency Act, RSC 1985 c B-3 (“BIA”). As a result, the Court ordered the monies be repaid to the bankruptcy estate.
Continue Reading Insolvency Remedies Available to Combat Preferential Transactions
In a previous post, we discussed disgorgement as an alternative remedy to compensatory damages in cases where a fraudster has profited from the wrongful acts. In a recent Ontario Superior Court decision, Justice Koehnen granted a $10.2 million disgorgement order to return ill-gotten profits made by a former Canadian National Railway Company (CN) employee in breach of his fiduciary duties. This is noteworthy as most of the profits to be disgorged were gone as they been used up during the course of a long and expensive receivership.
Continue Reading Ontario Superior Court Grants Significant Disgorgement Order in Canadian National Railway v. Holmes
When a plaintiff suffers a loss due to the misconduct of a defendant, the typical approach is to award damages that reflects the loss. However, this does not always fit the circumstances of the breach. In some cases, a plaintiff may have suffered no damages, but the defendant has gained significantly. For example, a wrongdoer who improperly uses trust funds, profits from that breach of trust, and later returns the monies to the trust account, but seeks to keep the gains. Where a wrongdoer’s profits are so intimately connected with the wrong and these profits would not have been earned but for the wrongful acts, a plaintiff may turn to gain-based disgorgement remedy as a more appropriate measure of damages.
Continue Reading Disgorgement instead of Damages?
Business Email Compromise (BEC) also known as email account compromise (EAC) attacks exploit our collective reliance on email to conduct business and personal affairs. While there are many variations on this cyberattack, the most difficult to detect are situations where an attacker gains control over a supplier’s email address and uses it to request a seemingly legitimate business payment. The fraudster will request a payment be sent electronically to a new account that they control. This is what makes it so effective, because to the recipient, the compromised email is authentic since it originates from a known authority figure from a supplier. Many employees will fail to realize that it is a cyberattack.
Continue Reading Electronic Fraud: Responding to a Business Email Compromise (BEC)