Ontario Lawyer Steals $2 Million Dollars

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Ontario lawyer, John Findlay, stole almost $2 million dollars from his clients, but decided not to show up for the Law Society hearing to determine the circumstances and his punishment. Somehow, I am not surprised…

Findlay was called to the bar almost 40 years ago, in 1980, and practised civil litigation. Also not surprising, was that he was disbarred for two years in the early 2000’s for misappropriating client monies.

Findlay acted in a class action suit on behalf of property owners and businesses in Caledonia, Ontario, against several parties including the Ontario Provincial Police and the Government of Ontario. The law suit was settled for $20 million dollars, which Findlay was charged to distribute to the successful litigants. He was also ordered to retain $1.5 million dollars in trust, which eventually grew to $2 million dollars, to be held for two years.

Findlay held the funds in a GIC, but began stealing from this fund in a systematic way between March of 2012 and October of 2014, all the while deceiving the beneficiaries of the fund and the Court to believe the fund was intact. Apparently he hoped that the fund would generate sufficient interest allow him to pay back the fund the monies he had used.

Ontario’s Lawyer Compensation Fund received claims from 195 claimants in respect of the missing funds, totalling approximately $1.8 million.

On several occasions Mr. Findlay advised authorities that the funds were held in an interest-bearing trust account, reports that were false.

John Findlay was disbarred and ordered to pay the Compensation Fund approximately $1.750 million and costs of $51,500. The Law Society tribunal did not indicate whether Findlay
has funds to repay the trust funds.

Sadly, the Law Society tribunal noted that the litigants in the class action had previously suffered damages and economic loss. Findlay’s deceit and this fiasco will certainly not increase their confidence in the administration of justice.

Lawdiva aka Georgialee Lang

Law Society Reverses Zoraik Decision: Good Character Established

On October 12, 2018 Malcolm Zoraik applied to be admitted to the Ontario bar. After a 2-day hearing his application was dismissed. But that is not the last word in Mr. Zoraik’s journey to re-establish himself as a member of the bar.

On June 3, 2019 Mr. Zoraik appealed the earlier decision of the Law Society tribunal citing multiple grounds of appeal and presenting fresh evidence, namely, a pardon from the National Parole Board pursuant to the Criminal Records Act. The pardon related to three convictions in British Columbia for public mischief, obstruction of justice, and fabrication of evidence, in relation to a personal injury trial he conducted in Victoria B.C.

His grounds of appeal included:

A. The hearing panel erred in law and misapprehended the evidence by focusing unduly on the appellant’s failure to express remorse for the actions that resulted in his criminal conviction.

B. The hearing panel erred in law in relying on the adverse credibility findings that the courts had made against the appellant in the criminal proceedings.

C. The hearing panel erred in law by requiring the appellant to demonstrate that he had taken the necessary steps to “ensure” that he would not commit professional misconduct if he were licensed.

D. The hearing panel erred in law by drawing adverse inferences against the appellant on two issues despite an absence of evidence to support such conclusions. These issues concerned

i. the timing and circumstances of the appellant’s bankruptcy and his discharge;

ii. the relevant time span over which the appellant had presented evidence of rehabilitation and correction.

E. The hearing panel erred in law by applying the penalty decision of the BC disciplinary panel to discount the appellant’s character evidence in the instant application.

The appeal panel found that the earlier decision focused primarily on Mr. Zoraik’s approach to his previous convictions, noting that the earlier panel referred to Mr. Zoraik’s refusal to discuss the convictions ten times in their reasons. While Mr. Zoraik acknowledged the convictions, he had declined to discuss the underlying events, his version of what occurred, or his sworn testimony in support of his not guilty plea at the B.C. criminal trial. The appeal panel agreed that the earlier panel’s treatment of his approach constituted an error in law.

They also found the earlier panel erred in law by requiring Mr. Zoraik to ensure there would be no recurrence of misconduct, noting that an applicant does not have to guarantee that no future misconduct will occur or predict what may occur in the future.

A further error was related to the panel’s treatment of Mr. Zoraik’s earlier bankruptcy, where adverse findings were found to have been made with no supporting evidence.

In relation to the time that had elapsed since Mr. Zoraik’s difficulties, the appeal panel found that he had provided ample evidence of his rehabilitative efforts, commendable behaviour, and acceptance of the convictions and disbarment during the period since at least 2013. The earlier panel again misapprehended the relevance of this evidence, with their over-reliance on the “remorse” issue.

Finally, the appeal panel found that the earlier panel inappropriately discounted positive character evidence provided by a variety of individuals including two licensees whom he had worked for several years during his extended Ontario articles; a legal assistant; the Executive Director of the Somali Immigrant Aid Organization and Midaynta Community Services, where Mr. Zoraik volunteered in providing guidance and leadership to Somali youth; and clients and former colleagues.

Mr. Zoriak’s appeal was allowed; a finding of good character was recorded; and an exemption from writing any further licensing exams was ordered. Zoraik v. Law Society of Ontario, 2019 ONLSTA 11

Lawdiva aka Georgialee Lang

Judge, Who Finds 10-Week Trial in Children’s Best Interests, Overturned by Court of Appeal

After six years of litigation the parties reached a final settlement of all issues related to the parenting of their three children. With a 10-week trial scheduled for late January 2019, the parties brought their consent order to the trial judge on January 7, 2019 expecting to speak to the order, have it approved by the judge, and adjourn their trial. However, that is not what happened.

The judge declined to approve the consent order, finding that it was not in the best interests of the children, because the parties had not agreed on a counselor for the children, but did agree that their parenting coordinator could select a counselor after receiving submissions from the parties. The judge commented:

“I can tell you I’m not going to sign this order because I don’t think in the circumstances of this case at this moment it serves the best interests of the children. And so I would encourage the parties to resolve the name of the — the name or names of the counsellor or child psychologists and then I’ll sign it.”

The judge also advised counsel that several recent cases did not support the order sought by their clients. Subsequent to the January 7 hearing he sent a memorandum to counsel requesting their submissions with regards to Fleetwood v. Percival 2014 BCCA 502; NRG v. GRG 2017 BCCA 407; and LCT v. RK 2018 BCSC 1016, with respect to the scope of delegation to parenting coordinators.

Counsel reappeared before the judge on January 11, 2019, however, the respondent mother now wanted to proceed with the trial, while the claimant father submitted he would be pursuing a declaration of settlement based on the consent order endorsed by both counsel. At this hearing the judge also stated that based on NRG v. GRG, supra, he did not have the authority to appoint a counselor for the children.

On January 14, 2019 counsel for the father filed a Notice of Appeal of the judge’s order dismissing the consent order, and sought an expedited appeal pursuant to the Court of Appeal Practice Directive dated December 12, 2011. With the trial now seven days away, the father brought an adjournment application to the trial judge, which was argued on the first and second days of the trial.

On January 22, 2019 the judge granted the adjournment application which provided that the appellant father’s factum, appeal books, and transcripts must be filed on January 25, 2019 and that if the appeal was not successful the trial would commence on February 19, 2019.

The Court of Appeal heard and unanimously allowed the appeal on February 12, 2019, with oral reasons from Mr. Justice Tysoe. He discussed several preliminary issues. The first was his confirmation that the judge’s decision not to approve the consent order was a final order appealable pursuant to s. 6 of the Court of Appeal Act.

The second was his observation that the parties appeared in chambers with their consent order without filing a Notice of Application, a practice not to be encouraged, however, the actions of the parties amounted to a waiver of the requirements of the filing and service of a notice of application and for a joint oral application for an order in the form of the consent order.

Finally, given the expedited appeal, the chambers judge had not yet signed his order dismissing the oral application to approve the consent order, although the judge had reviewed the draft orders submitted by each counsel and drafted his own form of order. The court referred to its “normal policy” of declining to hear an appeal in the absence of an entered order but based on the transcripts from the January 7 and 11, 2019 hearings before him, were satisfied that he had dismissed the parties’ joint application to enter the consent order.

The Court held that the chambers judge made two errors when he refused to approve the consent order. While it would have been preferable for the parties to agree on a counselor, the judge erred when he failed to consider whether the consent order was nevertheless in the children’s best interests given that the parties could not agree and the alternative was a 10-week trial:

“ In my view, it was in the best interests of the children to have their parents avoid a ten-week trial over parenting issues: see Stonier v. Stonier, 2004 BCCA 307 at para. 31. Children are generally adversely affected by continuing conflict between their parents, and tensions are usually increased during a trial. As well, counsel for the respondent explained to the judge on January 7 that the trial was going to be costly and that the respondent had to make a decision whether she was going to be able to afford to raise the children.”

The second error was his failure to give sufficient weight to the effect of the selection by the parenting coordinator because he mistakenly believed that the parenting coordinator’s input would be a recommendation only, which could lead to further litigation, instead of allowing the parties to rely on the dispute resolution mechanisms available in the Family Law Act, in order to avoid a lengthy, fractious trial.

The Court referred to the provisions regarding parenting coordinators in the Family Law Act, s. 17 and 18; and in the Regulation to the Family Law Act including s. 6(3) and 6(4), finding that the selection of a counselor fell within s. 6(4) (a)(ix) and that the court should encourage decision-making by parenting coordinators in high-conflict cases to fulfill the mandate of avoiding court intervention in favour of alternate dispute resolution.

The Court also distinguished the case of HCF v. DTF 2018 BCSC 2411, relied on the by respondent mother, which was handed down in late December 2018, where the court held that a parenting coordinator did not have the ability to choose an appropriate therapy regime for a child, noting that in the case at bar the therapy had been determined, leaving only the choice of a counselor to the parenting coordinator.

Finally, the court reviewed the three cases referenced by the chambers judge, holding that none of them were of assistance in determining the principles arising from the appeal.

Sealing Order in Sherman Double Murder Set Aside

crime scene do not cross signage
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The murders of billionaire couple Bernard and Honey Sherman of Toronto shocked Canadians across the country, who tend to believe that the very wealthy lead charmed lives. The case attracted huge attention, not only for the prominence of the Sherman’s and their political connections, but for the initial misstep, when the Toronto Police first pronounced their deaths a suicide. (Donovan v. Sherman Estate, 2019 ONCA 376)

The latest chapter in this story played out in a courtroom on April 29, 2019 when the Toronto Sun newspaper and reporter Kevin Donovan brought an appeal from a motions judge who ordered that the Sherman court files be sealed in order to protect the privacy and dignity of the victims of violence and their loved ones. The court also accepted the argument of the estate of the Sherman’s that without a sealing order, there was a reasonable apprehension of a risk to those who had in interest in the estate.

The Appeal Court confirmed that the lower court had applied the correct legal test which requires a party seeking a sealing order to show that the order is necessary to prevent a serious risk to an important public interest which cannot be protected by other reasonable alternative methods. Secondly, the party seeking an order must establish that the salutary effects of the order outweigh the negative effects on the right of freedom of expression and other public interests served by open, transparent courts.

However, the Appeal Court held that the focus on a risk of harm to the estate administrators and beneficiaries was not proven on the limited evidence before the motions judge. The Appeal Court allowed the appeal and set aside the sealing order finding that the lower court’s analysis was flawed:

“In our view, the motion judge’s analysis comes down to the proposition that because the Shermans were murdered by some unknown person or persons, for some unknown motive, individuals named as beneficiaries in their estates or as administrators of their estates are at risk of serious physical harm. With respect, the suggestion that the beneficiaries and trustees are somehow at risk because the Shermans were murdered is not an inference, but is speculation. It provides no basis for a sealing order.”

The Respondents requested the opportunity to present proposed “redactions” of the file but that too was denied.

The public can expect to learn more about this case when the sealed file is opened in 10 days.

Lawdiva aka Georgialee Lang

Access Contempt Findings Dismissed by Court of Appeal

GeorgiaLeeLang016A high conflict family dispute was the background for an Ontario judge to make contempt findings against a mother who allegedly failed to provide access/parenting time in accordance with a court order dated September 2015. (Ruffolo v. David, 2019 ONCA 385)

The child’s father presented 37 alleged breaches of ten separate access/parenting orders. The application judge found three instances of breaches that warranted contempt findings:

1. The appellant failed to provide the children’s summer activity schedule by May 1, from 2012 to 2015;

2. The appellant did not allow the respondent to have access to the children during the Easter weekend in 2015; and

3. The appellant denied the respondent access to his son, Michael, on his birthday in October 2015.

On appeal, the three contempt findings were dismissed but first, the Court of Appeal considered several principles of law germane to contempt cases.

The Court noted that an appeal of a contempt finding should not usually be heard until the sanction for the contempt has been made. In this case it had been close to three years since the contempt finding had been pronounced, but no sanctions hearing had yet occurred. The Court confirmed that until a chambers judge has disposed of the application, including the sanction, the appeal court will not know how serious the judge considered the contempt to be.

Nonetheless, because both parties, acting on their own, urged the court to hear the appeal, the Court did so.

In considering the merits of the appeal the Court pointed out the “extremely short” reasons and commented that the findings did not appear to be based on affidavit material, but on the appellant’s submissions during the hearing. The Court also addressed the lack of background information in the reasons and the application judge’s failure to include pertinent details, such as the respondent’s repeated failure to regularly exercise access saying:

“This is significant, as there would not have been strict compliance with the terms of the order for much of the period between 2011 and 2015.”

The Court’s dismissal of the contempt findings centred on the lack of an evidentiary foundation to support the allegations made. For example, the Court found there was insufficient evidence that the mother had prevented the father from exercising the access he was entitled to, either by not providing notice to the mother of his intention to see the child, or by the child refusing to see the father with no proof that the mother stood in the way of the scheduled access time.

Finally, the Court emphasized the discretionary nature of contempt proceedings and repeated the time-worn admonition that contempt proceedings are a last resort, particularly where the best interests of a child are paramount.

Far more satisfactory is to rely on the enforcement provisions of provincial legislation, widely expanded in British Columbia’s recent Family Law Act where appropriate punitive remedies can be fashioned without resorting to contempt.

Lawdiva aka Georgialee Lang

Mother Launches Constitutional Challenge to Child Support Provisions of Divorce Act and Family Law Act

BarristerA British Columbia mother has launched a constitutional challenge to the provisions of the Divorce Act, Family Law Act, and Child Support Guidelines dealing with child support.

Claimant M.K. brought forward the legal theory that children have a constitutional right to receive child support from both parents from the date of the child’s birth. She argued that legislation that permits parents to avoid this responsibility infringes a child’s right to support.

The substance of her claim arose from her unsuccessful efforts to obtain a court order for retroactive child support for her 18-year-old son. She had raised her son on her own. It was only in 2013 that her son connected with his father on social media, resulting in her first court application.

In 2015 M. K. obtained an order from the Provincial Court for retroactive child support for her son, from the date of his birth. The Respondent appealed that order to the British Columbia Supreme Court, who substantially reduced the period of retroactivity to the date her application was commenced.

M.K.’s appeal to the B.C. Court of Appeal failed, as did her leave application to the Supreme Court of Canada. The sum total of her efforts brought her only $11,000 in child support, with court costs awarded against her of $13,000.

In September 2017 she filed a Notice of Civil Claim against the Attorney General of B.C. challenging provisions of the Divorce Act, the Family Law Act, and the Child Support Guidelines, alleging that to the extent the law did not provide for child support commencing from a child’s birth, the provisions were contrary to sections 7 and 15 of the Canadian Charter of Rights and Freedoms.

In February 2019 the Attorney General brought an application to strike her Notice of Civil Claim arguing that it constituted a collateral attack on the earlier Supreme Court order and was an abuse of process. The AG also argued that M.K. had neither private nor public standing to maintain her claim. The British Columbia Supreme Court agreed with the Attorney General, pointing out that the time to bring her Charter challenge was in the initial child support court action. M.K. v. British Columbia (Attorney General) 2019 BCSC 166

After filing an appeal, her next step was to apply to the B. C. Court of Appeal for an order that she not be required to pay court fees based on undue hardship. The Court considered her financial circumstances and agreed that her tight financial situation brought her within the test for a waiver of fees. Next the Court considered whether her appeal was of sufficient merit to warrant ordering a waiver of fees.

Mr. Justice Hunter remarked that her appeal would be challenging as she needed to overcome the standing issue and then face arguments that her claim was a collateral attack on previous decisions in the Court of Appeal and in the Supreme Court.

He stated:

“…. it seems to me highly unlikely that she will succeed in overcoming these hurdles. However, I am reluctant to conclude that the appeal is bound to fail. In my view, that concept, for purposes of an order waiving fees that would impose undue hardship on an appellant, must be considered in the context of access to the court that was explained by the Supreme Court of Canada in Trial Lawyers Association of British Columbia v. British Columbia (Attorney General), 2014 SCC 59”

Accordingly, the Court granted her application and waived the applicable fees.
M.K. v. British Columbia (Attorney General) 2019 BCCA 161.

Lawdiva aka Georgialee Lang

Lengthy and Irrelevant Affidavits a Waste of Court’s Time, Says Judge

GeorgiaLeeLang025In a recent Ontario case, the Court considered an application for child support where the parents shared equal parenting of two children. (Carroll v. Carroll, 2019 ONSC 2505) Despite finding that the parties had not provided sufficient information for the Court to make a reasoned decision, the judge decided to make a “temporary temporary” order, which he described as an order that could be varied, with no need to adduce a material change in circumstances.

The interesting part of this decision is the chambers judge’s remarks regarding the content of the parties’ affidavits. In dealing with costs, the Court decried the lengthy and mainly irrelevant contents of their respective affidavits, commenting that the practice of having clients prepare their own affidavits with counsel “simply having those versions type-written and put into affidavit form” was to be discouraged.

The Court also observed that an affidavit in support of an application should focus on the orders sought by the applicant and that “throwing in the kitchen sink” was not helpful. In this case, the parties’ affidavits contained lengthy evidence regarding custody matters, which had already been agreed and resolved.

Ellies J. said:

“None of this evidence was helpful to the court with respect to the issue of support. Indeed, much of it proved to be a waste of the court’s time.”