Court File and Parties

COURT OF APPEAL FOR ONTARIO DATE: 20220317 DOCKET: C69164

van Rensburg, Nordheimer and Harvison Young JJ.A.

BETWEEN

Caja Paraguyaya De Jubilaciones Y Pensiones Del Personal De Itaipu Binacional Plaintiff/Moving Party (Respondent)

and

Eduardo Garcia Obregon a.k.a. Eduardo Garcia a.k.a. Eddie Obregon, Claudia Patricia Garcia a.k.a. Patricia Garcia a.k.a. Claudia Patricia De Garcia a.k.a. Claudia Santisteban, Ligia Ponciano, Managed (Portfolio), Corp, Genesis (LA), Corp. (Ontario Corporation Number 1653094, Genesis (LA), Corp. (Alberta Corporate Access Number 2013145921), FC Int, Corp., First Canadian INT, Corp., Union Securities Limited, Scott Colwell, Marty Hibbs, Hibbs Enterprises Ltd., Columbus Capital Corporation, Antonio Duscio, Leanne Duscio, Leanne Duscio carrying on business as The Queen St. Conservatory, Catan Canada Inc., Vijay Paul, Greg Baker, Bradley F. Breen, Lou Maraj, 2138003 Ontario Inc., Mackie Research Capital Corporation, First Canadian Capital Markets Ltd., First Canadian Capital Corp, FC Financial Private Wealth Group Inc., Jason C. Monaco, Daniel Boase, Paolo Abate, Nikolaos Stylianos Tsimidis, Genesis Land Development Corporation, Limited Partnership Land Pool (2007), and GP LPLP 2007 Inc. Defendants/Responding Party (Appellants)

Counsel: Justin W. Anisman, for appellant, Antonio Duscio John De Vellis and Jacqueline King, for the respondents

Heard: March 10, 2022 by video conference

On appeal from the order of Justice Markus Koehnen of the Superior Court of Justice, dated February 5, 2021, with reasons at 2021 ONSC 632.

Reasons for Decision

[1] Mr. Duscio appeals from the order of the motion judge finding him in contempt. At the conclusion of the hearing, we dismissed the appeal with reasons to follow. We now provide our reasons.

[2] In February 2021, the appellant was found guilty of several acts of contempt for disposing of assets contrary to the non-dissipation order of Dunphy J., dated May 2018. He appeals on the basis that the motion judge erred in fact and in law.

[3] A brief summary of the factual background will suffice.

[4] In April 2018, the appellant was found liable for defrauding the respondent, a Paraguayan pension fund: Caja Paraguaya de Jubilaciones Y Pensiones Del Personal De Itaipu Binacional v. Garcia, 2018 ONSC 5379. In May 2018, Dunphy J. issued a non-dissipation and disclosure order which froze the appellants assets worldwide (but for his employment income) and directed him to swear an affidavit respecting all of his “current and historical worldwide assets, whether in [his] own name or not, and whether solely or jointly owned” (emphasis in original). In December 2018, Dunphy J. convicted the appellant of contempt of court for specific violations of the non-dissipation order and sentenced him to 12 months in jail: Garcia, 2018 ONSC 7771. This was the appellant’s first conviction for contempt of the non-dissipation order. He was released on parole in November 2019 after serving seven months of his sentence.

[5] This appeal arises from the respondent’s second motion to have the appellant found in contempt of court for violating the non-dissipation and disclosure order. The respondents allege that the appellant engaged in additional acts of contempt by misleading Dunphy J. and by dissipating assets while in jail or while on parole for his first conviction of contempt.

[6] The appellant argues that the motion judge committed errors of law as well as palpable and overriding errors of fact. We do not agree.

[7] The first argument is that the motion judge erred in finding the appellant in contempt for failing to disclose his beneficial interest in two life insurance policies: the Vealey and Lovell policies. The appellant argues that the motion judge erred in law by finding him in contempt even though the policies were not specifically pleaded. He also contends that the Vealey policy did not exist at the time the appellant was compelled to swear the April 2, 2019 affidavit because it had matured in 2014.

[8] There is no merit to this argument. The non-dissipation order refers to “any assets, whether solely or jointly owned, wherever situated in the world”. Clearly, these terms include the policies. The order further required the appellant to disclose “current and historical worldwide assets, whether in [his] own name or not, and whether solely or jointly owned” (emphasis in original). Evidence that he no longer had an interest in a policy that had matured as of April 2, 2019 does not respond to the fact that the appellant had not disclosed a historical asset that, on the evidence, had a total value of $1.7 million, of which the appellant had already received $500,000 from the Vealey policy. There is no question that the Lovell policy existed and was not disclosed at the time the affidavit was sworn. The fact that this was not pleaded as a specific act of contempt is, in the circumstances of this case, immaterial. The insurance policies were addressed in argument and, in any event, the motion judge found that there were two other serious acts of contempt. We turn now to the appellant’s arguments respecting those findings.

[9] The appellant also argues that the motion judge erred in finding that he knew the whereabouts of a missing Ferrari in contravention of the disclosure order. The record indicates that the Ferrari was one of the appellant’s prized possessions. When the Sheriff visited the appellant’s residence pursuant to a writ of seizure and sale to seize the Ferrari shortly after he had listed the Ferrari and its whereabouts in his April 2 affidavit, the Ferrari was not there. The appellant claimed that it had been stolen. The motion judge rejected the appellant’s evidence on that issue, concluding that the appellant’s “Ferrari was not stolen and that [he] knows where it is.”

[10] The appellant argues that the motion judge had no direct evidence on whether the Ferrari was missing or stolen because the appellant exercised his right to silence and his wife invoked spousal privilege with respect to their communications. He maintains that, on this evidence, the theory that his wife stole the Ferrari was just as reasonable. Therefore, the motion judge erred by drawing an impermissible inference of guilt against the appellant for exercising his right to silence.

[11] We reject this argument. Not only was the motion judge’s drawing of the inference well-grounded in the evidence, he specifically acknowledged that the evidence relating to the appellant’s knowledge of the whereabouts of the Ferrari was circumstantial, and that the test from R. v. Villaroman, 2016 SCC 33, [2016] 1 S.C.R. 1000 applied. He found the defence theory that the car had been out for a drive when the sheriff attended (which was raised by the appellant’s counsel at first instance and again on appeal) to be “irrational and fanciful”.

[12] The conclusion that the Ferrari was not stolen and that the appellant knows where it is was well supported by the evidentiary record. As the motion judge explained, “[i]t is entirely implausible that a prized car would be stolen without [the appellant and his wife] discussing the issue…. At the very least, one would expect [the appellant] to tell his wife to report the missing Ferrari to the police or to his insurer.” Therefore, the motion judge found that the “idea that the Ferrari was supposed to be in the garage but was missing and that no one would report it stolen is consistent only with the fact that [the appellant] made arrangements to hide the Ferrari.” We see no error of law or principle here.

[13] In addition, the appellant submits that the motion judge relied on inadmissible evidence: a screenshot and the appellant’s affidavit. The motion judge relied on the screenshot of one Ms. Segarra’s bank statement to show that the appellant gave instructions to disburse $114,822 USD of his funds while he was in prison in an express breach of his non-dissipation order. The appellant claims that the statement is hearsay evidence that does not meet the tests for necessity or reliability.

[14] We disagree. These issues were fully argued before the motion judge and we see no reviewable error on his part. He applied the correct test of necessity and reliability and, in any event, the conclusion that the appellant had breached the non-dissipation order by making the payment was well supported by other evidence including the testimony of the appellant’s business associate that he would soon receive a large cash deposit from the appellant. The bank statement shows a transfer to this very same business associate.

[15] Finally, there is no merit to the complaint that the use of the appellant’s affidavits violated his right against self-incrimination. The motion judge clearly and correctly explained why the appellant’s affidavit did not fall within the scope of that protection, and we see no basis to interfere.

[16] The appeal is dismissed. Costs of the appeal to the respondent in the amount of $20,000.

“K. van Rensburg J.A.”

“I.V.B. Nordheimer J.A.”

“A. Harvison Young J.A.”