WARNING
The court hearing this matter directs that the following notice be attached to the file:
A non-publication and non-broadcast order in this proceeding has been issued under subsection 517(1) of the Criminal Code. This subsection and subsection 517(2) of the Criminal Code, which is concerned with the consequence of failure to comply with an order made under subsection (1), read as follows:
- ORDER DIRECTING MATTERS NOT TO BE PUBLISHED FOR SPECIFIED PERIOD — (1) If the prosecutor or the accused intends to show cause under section 515, he or she shall so state to the justice and the justice may, and shall on application by the accused, before or at any time during the course of the proceedings under that section, make an order directing that the evidence taken, the information given or the representations made and the reasons, if any given or to be given by the justice shall not be published in any document, or broadcast or transmitted in any way before such time as
(a) if a preliminary inquiry is held, the accused in respect of whom the proceedings are held is discharged; or
(b) if the accused in respect of whom the proceedings are held is tried or ordered to stand trial, the trial is ended.
(2) FAILURE TO COMPLY — Everyone who fails, without lawful excuse, to comply with an order made under subsection (1) is guilty of an offence punishable on summary conviction.
A non-publication and non-broadcast order in this proceeding has been issued under subsection 486.4(1) of the Criminal Code. This subsection and subsection 486.6(1) of the Criminal Code, which is concerned with the consequence of failure to comply with an order made under subsection 486.4(1), read as follows:
486.4 Order restricting publication — sexual offences. — (1) Subject to subsection (2), the presiding judge or justice may make an order directing that any information that could identify the victim or a witness shall not be published in any document or broadcast or transmitted in any way, in proceedings in respect of
(a) any of the following offences:
(i) an offence under section 151, 152, 153, 153.1, 155, 160, 162, 163.1, 170, 171, 171.1, 172, 172.1, 172.2, 173, 213, 271, 272, 273, 279.01, 279.011, 279.02, 279.03, 280, 281, 286.1, 286.2, 286.3, 346 or 347, or
(ii) any offence under this Act, as it read from time to time before the day on which this subparagraph comes into force, if the conduct alleged would be an offence referred to in subparagraph (i) if it occurred on or after that day; or
(b) two or more offences being dealt with in the same proceeding, at least one of which is an offence referred to in paragraph (a).
(2) MANDATORY ORDER ON APPLICATION — In proceedings in respect of the offences referred to in paragraph (1)(a) or (b), the presiding judge or justice shall
(a) at the first reasonable opportunity, inform any witness under the age of eighteen years and the victim of the right to make an application for the order; and
(b) on application made by the victim, the prosecutor or any such witness, make the order.
486.6 OFFENCE — (1) Every person who fails to comply with an order made under subsection 486.4(1), (2) or (3) or 486.5(1) or (2) is guilty of an offence punishable on summary conviction.
ONTARIO COURT OF JUSTICE
CITATION: R. v. Nygard, 2022 ONCJ 20
DATE: January 19, 2022
BETWEEN:
HER MAJESTY THE QUEEN
— AND —
PETER NYGARD
Before Justice of the Peace J. Scarfe
Heard on January 6, 7 and 14, 2022
Reasons for Judgment released on January 19, 2022
Golwalla N. ................................................. Counsel for the Attorney General of Canada
Greenspan B., Weinstein S., Biddulph M. ..Counsel for the accused, Peter NYGARD
REASONS FOR JUDGMENT
JUSTICE OF THE PEACE J. SCARFE:
[1] Mr. Nygard applies for an order of Judicial Interim Release. He faces a new set of allegations (the “Toronto charges”), in addition to the previous set of charges for which he is the subject of an extradition request by the United States of America (the “New York charges”). He is currently the subject of a detention order in respect of the New York charges, having been ordered detained in custody at his extradition bail hearing in Manitoba.
[2] He is in a Crown onus position. The Crown seeks his detention on the primary, secondary and tertiary grounds.
[3] He is 80 years old and has no criminal record. He proposes a Release Order with a cash deposit of $325,000.00, along with strict conditions including an innovative plan involving three forms of electronic monitoring, but notably, he proposes no surety. As Mr. Nygard is not ordinarily resident in Ontario, s. 515(2)(e) of the Criminal Code permits (but does not require) a cash deposit component as part of any release order this court may consider.
ALLEGATIONS:
The New York Charges:
[4] Mr. Nygard was arrested pursuant to a provisional arrest warrant from United States of America on December 14, 2020. He has been in custody ever since. On February 5, 2021, Justice Greenberg of the Manitoba Queen’s Bench ordered his detention on the secondary and tertiary grounds after conducting an extradition bail hearing.
[5] The defence sought a review of Justice Greenberg’s decision in the Manitoba Court of Appeal and an order of judicial interim release. On March 26, 2021, Justice Pfuetnzer dismissed the application. Mr. Nygard then sought leave to the Supreme Court of Canada for a further review. The application for leave to appeal was dismissed (without reasons) on September 9, 2021.
[6] On October 1. 2021, Mr. Nygard consented to his committal before the Honourable Chief Justice Joyal of the Queen’s Bench of Manitoba on the charge of sex trafficking, following the issuance by the Minister of Justice of the Authority to Proceed on the corresponding Canadian offence of ‘Trafficking in persons’, contrary to section 279.01(1)(b) of the Criminal Code. Upon his surrender, he would likely face an indictment that would include multiple counts of sex trafficking, given the underlying alleged facts.
[7] At the time of the hearing before Justice Greenberg, the United States had yet to certify the Record of the Case (“ROC”) pursuant to the Extradition Act SC 1999, c. 18. Instead, Justice Greenberg relied on two letters from the office of the United States Attorney for the Southern District of New York (dated January 5 and 6, 2021), and the affidavit of Sgt. Stefane Nicolas of the RCMP that was filed in support of the application for the provisional arrest warrant. Based on those two letters and the affidavit of Sgt. Nicolas’, she summarized the evidence underlying the New York charges as follows:
8 Insofar as the sex trafficking charges are concerned, it is alleged that Mr. Nygard, along with multiple co-conspirators,"... used force, fraud and coercion to recruit and entice female victims, both adults and girls ages 14 to 17, to engage in paid sex with NYGARD, and, on occasion, with NYGARD's business and personal associates" (Affidavit of Stefane Nicolas, December 14, 2020, para. 7(c)). Victims were often promised modelling and fashion industry jobs on condition that they provide sex or were threatened with the loss of a job if they did not submit to sex. Some victims were drugged or forcibly assaulted. Mr. Nygard used employees or girlfriends to recruit victims. Some of these "recruiters" were themselves victims. He would hold "pamper parties" to which potential victims were invited if they met certain body types. It is alleged that some victims were held captive on Mr. Nygard's properties, unable to leave without his consent. Mr. Nygard used his companies to finance recruitment events, pay the victims and their travel expenses, and to pay for plastic surgery and abortions for victims. It is alleged that Mr. Nygard engaged in a course of predatory conduct over decades, using other people, including family members and employees, to support his criminal conduct. (See United States v Nygard, 2021 MBCA 42)
[8] Justice Greenberg relied on the letters and affidavit as credible and trustworthy despite finding the allegations to be somewhat “general in nature” and despite protestations by defence counsel urging her to give the contents of these documents little weight, based on his inability to cross-examine the author of those letters.
[9] In contrast, the ROC has now been certified by an Assistant U.S. Attorney with the U.S. Attorney’s Office of the Southern District of New York and is before me in evidence. As Justice Greenberg predicted, it’s seventy-nine paragraphs provide significantly more detail than the letters and affidavit (which were also filed in this proceeding) with respect to the individual experiences of each of the alleged victims, as well as how much of the information was sourced. It also added details pertaining to a seventh victim, although it is unclear when the events described by that victim are alleged to have happened.
[10] In contrast to the Toronto charges, which are all historical (1997-2005), the ROC describes events from as early as 2007 and as recent as 2019 relating to incidents that took place in California and New York. If true, they paint a picture of a sexual predator who repeatedly uses the prospect of employment, money and power to coerce women to have sex with him, sometimes through his use of physical force, and through partner-swapping at various sex clubs.
[11] The ROC also includes additional details relating to the results of search warrants at various properties owned or controlled by Mr. Nygard in New York and California, as well as further details pertaining to the execution of search warrants on Mr. Nygard’s phone, the company email as well as various Facebook accounts, which corroborate many of the surrounding circumstances contained in the narratives of the US victims.
The Toronto Charges:
[12] On the same day that Mr. Nygard consented to his committal on the New York charges in Manitoba (October 21, 2021), Toronto Police detectives travelled to Manitoba and arrested Mr. Nygard on the Toronto charges. He was picked up from the Headingly Correctional Centre in Manitoba and flown to Toronto. He participated in a lengthy interview with detectives, against the advice of counsel, which was exculpatory in nature. He also provided details pertaining the layout of the office at the former Nygard headquarters at 1 Niagara Street in Toronto where all the sexual assaults are alleged to have occurred. This is his initial bail hearing on these charges.
[13] Mr. Nygard faces nine charges on the Toronto Information. There are six sexual assault charges, as well as three charges of forcible confinement. Each of the six complainants describes being lured into a bedroom on an upper level of the Nygard headquarters at 1 Niagara Street, following which Mr. Nygard would pin the victim using his body weight against a wall or onto the bed. In all but one case, where the assault was interrupted, the victim was subjected to forced vaginal intercourse. Three complainants describe being led to believe that they were locked in the bedroom prior to the sexual assaults and had to ask to be ‘let out’ following the incident.
[14] In addition to the six victims referred to in the synopsis, Mr. Golwalla, counsel for the Attorney General of Canada, advised that a seventh complainant came forward during the Toronto investigation and described a similar experience that took place at Mr. Nygard’s home in the Bahamas in December of 1995. As the assault took place outside of Canada, Mr. Nygard does not face any charges in relation to this complainant. Mr. Golwalla advises she will be called as a similar fact witness at Mr. Nygard’s trial on the Toronto charges.
THE ACCUSED:
[15] As previously stated, Mr. Nygard is 80 years old with no criminal convictions in Canada or anywhere else in the world. He has distinguished himself as a businessman and a worldwide fashion mogul. A New York Times article filed by the defence notes that in 2014, Canadian Business magazine reported Mr. Nygard to have an estimated net worth of 750 million dollars. (How a Neighbour’s Feud in Paradise Launched an International Rape Case – New York Times – Published February 22, 2020. Updated January 21, 2021 – By Kim Barker, Catherine Porter and Grace Ashford)
[16] He is a person of considerable accomplishments. Written submissions filed by Mr. Greenspan and his colleagues read as follows:
The Applicant was born in Finland in 1941 and immigrated to Canada in 1952 with his parents and younger sister. His family settled in the small community of Deloraine, Manitoba, where his father worked as an assistant baker and the family lived in an unused coal bin with no running water or electricity. They moved to Winnipeg the following year. The Applicant completed high school in Winnipeg, where he excelled in academics and athletics. He attended the University of North Dakota, graduating with a degree in business and finance. Upon his return to Winnipeg, he accepted a job with the T. Eaton Co. The Applicant then entered the women’s apparel manufacturing industry, where he grew his business from a small regional manufacturer to a worldwide operation. The NYGARD label became one of the most recognizable brands in the world.
The market focus of the Nygard brand was mature working women, and the models hired reflected the target consumers. The brand was headquartered in Winnipeg, and primarily sold its products to department store chains in Canada and the United States such as Sears, The Bay, Dillards, Walmart, and Costco.
The Applicant has spent his life dedicated to philanthropy and community service. He lost both his sister and mother to breast cancer, and has committed personal and corporate resources to raise money to support cancer research. Over the past 20 years, he has raised over $20,000,000 for cancer research. He has undertaken a number of initiatives to advocate for breast cancer awareness, prevention, and to seek a cure. These initiatives include the establishment of the Nygard Tumor Bank at the Winnipeg Health Sciences Centre, sponsoring mobile clinics to provide cancer screening services in rural and remote areas of Manitoba, and featuring breast cancer survivors as models in his fashion shows worldwide. He has also contributed a significant amount of money and energy into the global research and development of stem cell treatments, resulting in recognition as a pioneer in the field of biomedical gerontology.
The Applicant has received a number of community service recognition awards, including the Golden and Diamond Queen Elizabeth II Commemorative Jubilee Medals; the Commemorative Medal for the 125th Anniversary of the Confederation of Canada, awarded by the Governor General of Canada; Recognition as an Outstanding Canadian, presented by the Lieutenant Governor of Manitoba; the Patriot Award from the Royal Military Institute of Manitoba; the Badge of Merit from the Federation of Finnish War Veterans; the Key to the City of Winnipeg; and the City of Winnipeg Award.
[17] Mr. Nygard’s fortunes changed, in part, because of the New York investigation and because of a highly publicized class action lawsuit brought by a number of female plaintiffs in the United States. Several of his Canadian companies are now in receivership and he has sought bankruptcy protection in the United States. Through his counsel, he claims that most of his assets have been frozen and are currently unavailable to him. He claims he is only able to offer this Court a cash deposit in the amount of $325,000.00.
[18] He is involved in an ongoing complex web of civil litigation involving numerous lawsuits and civil actions around the world, including Canada, the United States, the Bahamas, England, Hong Kong and India. He has been found guilty of contempt of court in the Bahamas and sentenced to a fine and 90 days in jail in absentia. There is at least one arrest warrant outstanding for him there.
[19] The suggestion that he has very little money available to him is challenged by Mr. Golwalla. According to a supplemental letter from the United States Department of Justice dated January 5, 2021 (which was before Justice Greenberg at Mr. Nygard’s extradition bail hearing), Mr. Nygard appears to have made at least some monetary provisions for himself and his most senior employees:
In or about March 2020, days after the Company announced it was seeking bankruptcy protection, Company emails and attached wire transfer records show that Nygard, Fenske, and Dyborn initiated multiple large-scale transfers between Nygard Group entities, including Nygard International Partnership, Edson’s, and Topanga, another American Nygard group entity.
[20] The ROC provides additional information suggesting that around the same time, Mr. Nygard, Mr. Fenske and another employee took sizable cash advances from their corporate credit cards. Pre-paid cash cards worth $15,000 were purchased, and Mr. Fenske took steps to increase the limits on several corporate credit card accounts.
[21] Mr. Golwalla filed transcripts from two family law proceedings in 2001 and 2004 pertaining to the issue of child support where adverse findings were made against Mr. Nygard in relation to questionable accounting practices and unethical litigation tactics in his role as defendant in an action for child support. Justice Paisley, as part of his ruling on a motion to have Mr. Nygard cited in contempt of court for failing to provide documentation proving his income within the time required, quoted a prior endorsement of Justice Campbell which read in part:
“This appears to be one more attempt by the father to evade his responsibility to the Court through delay, lawyer-switching, strategic non-participation and ‘peek-a-boo now you see me, now you don't' litigation tactics. (see Pakka v Nygard, [2001] O.J. No. 2934)
[22] The other family law judgment submitted by Mr. Golwalla relates to the same action (Pakka v Nygard), but later in the process as part of motion for costs against Mr. Nygard. Justice Mesbur stated at paragraph 8:
8 I set all of this out in some detail because Mr. Niman takes the position that the request for an adjournment was not about trying to resolve the issue of costs. Rather, it was for Mr. Nygard to "buy time" to produce all this paper. Given that the parties contemplated a summary disposition of the issue, and given they agreed on a timetable that would give Mr. Nygard between noon, March 19 and the hearing on March 23 to prepare, I cannot help but agree with Mr. Niman. It appears to me that Mr. Nygard's conduct in relation to this costs issues is yet another example of what Mr. Niman described as his "scorched earth" policy in relation to this litigation. (see Pakka v Nygard, [2004] O.J. No. 2121)
[23] Justice Mesbur further stated, as part of her final disposition on the costs issue at paragraph 62:
62 There is no question that the plaintiff's overall costs and disbursements are staggeringly high. It must be remembered, however, that the fees and disbursements cover four years of professional services, in what was an all out battle between the parties. There were 36 interlocutory orders made. Mr. Nygard challenged everything, from the jurisdiction of the Ontario courts, to the validity of the Guidelines themselves. Mr. Nygard even refused, or was unable, to give a figure for his income for child support purposes until just before the trial, and then put the number in the negative millions. Although his own expert had earlier suggested his income was in the range of $2.5 million (the figure used on the interim motion), he resiled from this number. As a result, the plaintiff's experts were left with the task of coming up with what they believed was Mr. Nygard's income for child support purposes under the Guidelines. Needless to say, the onus was on Mr. Nygard to prove his income for child support purposes. I mention all of this to put the fees and disbursements into some perspective. This case was unique. The costs must be viewed as unique as well. (see Pakka v Nygard, supra at para 62)
[24] It cannot be forgotten that Mr. Nygard and his employee Mr. Fenske tried to ‘pull a fast one’ on the Court at his original extradition bail hearing. Mr. Fenske, no doubt at the behest of Mr. Nygard, misrepresented the provenance of the funds used to buy the house in Manitoba which he proposed to use as security for his pledge of $900,000, the same house where Mr. Nygard proposed to live. While Mr. Nygard has no criminal convictions, these allegations, as well as the documents from the courts in the Bahamas and the family courts in Canada reflect poorly on his credibility.
THE PLAN OF RELEASE:
[25] Mr. Nygard proposes a similar plan to the one he proposed to Justice Greenberg at his extradition bail hearing, except this time, he proposes to be released without a surety. The crux of the plan involves a strict house arrest bail with few exceptions, enhanced by an innovative combination of three forms of electronic monitoring.
[26] Stephen Tan of Recovery Science Corporation testified as to the suitability of the home in Winnipeg for the purposes of GPS ankle monitoring. As the cell signal there is strong, GPS monitoring would work well at that location. Mr. Tan has testified in Courts across Canada literally hundreds of times. Recovery Science Corporation has developed an excellent reputation with Canadian courts over the years. Over 500 people across Canada are currently using this technology, having been ordered by various courts across Canada to do so. Electronic monitoring for persons on bail is the core business of Recovery Science. The business is dependent for its very survival on its reputation for consistency and accountability while providing this service. While electronic monitoring has its limits in that it cannot prevent a breach of conditions, or the flight of the accused, it has been found to be an important enhancement to many bail plans, and has led to the release of many persons who would have otherwise been unreleasable.
[27] The Court heard from Matthew Musters, a forensic investigator with Computer Forensic Inc. which is a digital investigative firm in Oakville, Ontario. He proposes to install unique software called “Accountable2you” on all of Mr. Nygard’s electronic devices. This software would monitor his call history, SMS messages, email communications, browsing history and GPS location data. Reports would be generated and uploaded to a secure website that could be accessed by the police via login credentials supplied by Mr. Musters.
[28] Contact information and key words can be uploaded to the program such that real time alerts would be created and transmitted in the event Mr. Nygard attempted to communicate with anyone he is prohibited from contacting. In his affidavit, Mr. Musters stated that he would be prepared to notify the Winnipeg and Toronto police services should he become aware of anything that might raise a reasonable suspicion that he was violating any of the terms of his release order.
[29] He would also install additional software capable of monitoring the contents of every email Mr. Nygard sends or receives and make it available to the police, again by providing login credentials, if ordered by the Court. Mr. Musters also has additional software available that would record the contents of every phone call Mr. Nygard makes or receives from his cell phone.
[30] He indicated in his affidavit he had “a duty to assist the Court and not be an advocate for any party”, and that if he had to terminate the relationship for non-payment or any other reason, he would give sufficient notice to the Crown and the Court such that the Crown could seek a revocation of Mr. Nygard’s bail on a review prior to the service being terminated.
[31] Mr. Musters conceded he is neither a peace officer nor a regulated professional. When asked from where his stated ‘duty to the court’ was derived, he said he was an expert witness. Apparently, having testified as an expert witness a few times in the past, he now feels he has a special duty to the court in all matters, which while commendable, is not grounded in reality such that I would be comfortable relying on it.
[32] Transcripts were filed of the testimony of Mr. William Dietterle of BIL Security Services in Winnipeg from Mr. Nygard’s extradition bail. His company has installed 17 motion sensitive thermal imaging cameras around the home Mr. Nygard proposes to live in. The server is locked in a military grade compartment in the basement and is sufficiently secure so as to prevent anyone from tampering with, or unplugging the system.
[33] His company conducts video surveillance of many commercial and residential properties and runs a monitoring centre with a rotating staff of 22 employees. The video monitoring software utilizes artificial intelligence which ‘hunts’ for people and triggers an alarm at the monitoring centre every time movement is detected so that the employees are alerted and can view any relevant activities at the subject site in real time.
[34] Mr. Dietterle testified that his company is prepared to monitor Mr. Nygard’s property 24 hours a day and report any unauthorized comings and goings to the police. Although not included in the materials filed, Mr. Greenspan assures this Court that Mr. Nygard is also prepared to employ a live security guard to be present at his residence 24 hours a day, should I choose to order that as a condition of his release.
[35] This is an impressive plan. A similar approach was taken in the unusual case of R v B.A., 2021 ONSC 6278, a decision by Justice Boswell of the Superior Court, In that case, the accused’s conditions included GPS monitoring, but also a requirement (proposed by the defence) that he pay for and maintain two security guards at his residence 24 hours a day, 7 days per week. Said security would maintain a visitors log to discourage visits by persons for nefarious or criminal purposes. The cost for this was approximately $72,000 per month, to be born entirely by the accused, an option that is clearly out of financial range for most people.
[36] In that case, the accused faced a 111-count indictment alleging possession of carfentanil for the purpose of trafficking and possession of a variety of restricted or prohibited firearms. The allegations were that the accused owned a second home with a basement suite. The upstairs tenant had smelled carbon monoxide coming from the unit below and called the fire department. Fire services attended and found a drug lab in the basement suite. Further investigation by police revealed the presence of 42 kilograms of carfentanil, 31 vacuum sealed semi-automatic handguns, two rifles, extended magazines and ammunition. Police estimated the street value of the carfentanil to be somewhere between 4-16 million dollars. At the time, this was touted as the largest seizure of carfentanil in Canadian history.
[37] The accused in R v B.A., 2021 ONSC 6278 had originally been released on $100,000 cash deposit bail but had breached that bail shortly thereafter. He was subsequently detained. He brought a bail review before Justice Leibovitz of the Superior Court and that application was denied. He had a prior, related criminal record and was subject to a weapons prohibition at the time of the alleged offences.
[38] After a significant passage of time in custody, and with the trial date looming two months hence, he brought a further bail review, citing in part, a breach of his right to make full answer in defence which was compounded by ongoing difficulties communicating with his counsel while in custody, no doubt exacerbated by the pandemic health measures at the jail, frequent lockdowns and difficulties meeting with counsel through the Access Defence service. Mr. Nygard’s counsel makes a similar argument.
[39] Justice Boswell commenced his analysis on the three grounds as follows:
73 B.A. is a poor candidate for release. He is charged with a litany of extremely serious offences. The case against him is a formidable one. He has a prior criminal record for related offences. He is undoubtedly a flight risk. When previously released on bail on these charges he breached after only 18 days. And he has a record of disciplinary issues while in remand facilities awaiting his trial, raising questions about his governability.
Justice Boswell went on to conduct a considered analysis on all three grounds and ultimately determined, based on the comprehensive nature of the plan, that the accused had met his onus on all three grounds. He was released on stringent terms in accordance with the proposed plan.
[40] Plans of release involving private security firms raise important public policy issues relevant to the proper functioning of the bail system. First, there is something slightly absurd about a business relationship whereby you pay someone to watch you and report you to the police in the event you do certain things. Before ordering a release based on such a proposal it is important to remember that the arrangement is based purely on a business relationship between the client (accused) and the private security firm. The service provider is not a peace officer and owes no special duty to the Court. While the security industry is a regulated profession to some extent, the governing regulatory scheme offers little in the way of minimum standards for completing a contract of this nature. The possibility of corruption, and the temptation to turn a blind eye to preserve a lucrative contract is a very real concern.
[41] Mr. Tan and Recovery Science Corporation have spent years refining their systems to make them increasingly more accountable through lessons learned and many hours in the witness stand answering ‘what if’ questions by Crown Attorneys opposing release at bail hearings and bail reviews. Recovery Science Corporation has built a solid reputation in Canadian courts which continue to sanction their service in large part no doubt attributable to the fact that this is the only service they provide, and the survival of the business is entirely dependent on their carrying out their obligations consistently.
[42] The same cannot be said for BIL Security or Computer Forensic Inc. Their core business is not supervising persons on bail. This is simply something that they are willing and able to do as an adjunct to the other services they offer. Neither company is dependent for their survival on an impressive reputation with the courts. Neither company has developed a track record in this area. While these services may be appropriate as an enhancement to a strong plan with a surety, relying on these arrangements without any real on-site human supervision can be problematic for many reasons.
[43] Secondly, plans predicated on a service whereby a private security firm offers to gather evidence of every move the accused makes and every keystroke he enters on his computer or cell phone, and then make that available to the police via reports accessed through login credentials, are difficult to reconcile with the case of R v Zora, supra, a decision of the Supreme Court of Canada addressing the appropriateness of various types of conditions. At paragraph 98, Justice Martin, writing for the majority stated:
98 Finally, I note that some bail conditions may impact additional Charter rights of the accused, beyond their right to be presumed innocent, liberty rights (s. 7), and right to reasonable bail (s. 11(e)). Principles of restraint and review require that judicial officials rigorously examine these conditions and determine whether they do infringe the Charter. For example, some accused are subject to bail conditions that require them to submit to searches of their person, vehicle, phone, or residence on demand without a warrant (see, e.g., R. v. Delacruz, 2015 MBQB 32; R. v. Tithi, 2019 SKQB 299, [2019] S.J. No. 299, at para. 14 (QL); R. v. Sabados, 2015 SKCA 74, 327 C.C.C. (3d) 107). As noted by this Court in Shoker, in the context of probation conditions, a judge does not have jurisdiction to impose a condition that subjects an accused to a lower standard for a search than would otherwise be required, unless Parliament creates a Charter-compliant statutory scheme for the search or the accused consents to the search (paras. 22 and 25; see also R. v. Goddard, 2019 BCCA 164, 377 C.C.C. (3d) 44, at para. 53; R. v. Nowazek, 2018 YKCA 12, 366 C.C.C. (3d) 389, at para. 128). These types of conditions are effectively enforcement mechanisms that "facilitate the gathering of evidence", "do not simply monitor the [accused's] behaviour", and are not linked to an accused's risk under s. 515(10) (Shoker, at para. 22). As such conditions are not supported by the enumerated conditions for bail in s. 515, nor is there a scheme set by Parliament for the searches, they are constitutionally suspect.
[44] Imagine the circuitous absurdity of Mr. Nygard proposing these very invasive conditions; a court releasing him on those same conditions; evidence gathered by the private security firm revealing a breach is disclosed to the police, and the police charge him with breaching the terms of his Release Order. The accused pleads not guilty at his trial on that breach charge and successfully argues that the conditions he proposed are unconstitutional, resulting in his acquittal.
[45] A third issue with the plan is one of public policy regarding who should be responsible for the considerable task of reviewing the data created by the private security service. In the case of BIL’s video surveillance, Mr. Nygard pays for the monitoring, however with Computer Forensics Inc., the data is simply uploaded to the cloud and the police become responsible for reviewing it.
[46] The police perform many functions as part of their law enforcement role in society. One of those functions is bail compliance. The defence takes the position that by making security reports such as the ones provided by Computer Forensics Inc. available to the police, they are making the police work related to bail compliance easier. On the other hand, the more comprehensive the software, the more voluminous the data and the longer it takes to review the reports thoroughly. Taken to its extreme, the task of wading through mountains of data becomes onerous and may go well beyond what would be an appropriate expenditure of public resources monitoring Mr. Nygard’s compliance.
[47] Finally, it should be noted that the plan proposed by Mr. Nygard, and the plan that was before Justice Boswell in B.A., supra, are financially out of reach for most people. Releasing persons on bail simply because the plan is thorough and the accused can afford it risks creating a two-tier bail system where a person of enormous wealth can obtain a release order where a similarly situated person of meagre or even average means would be detained. There is an element of elitism and social inequality that may not be in the public interest and could compromise confidence in the administration of justice in the eyes of reasonable Canadians.
GENERAL PRINCIPLES:
[48] A sea-change has occurred in recent years in the bail system in Canada. Four seminal cases from the Supreme Court of Canada have led to a reset – or at least a re-affirmation – of the fundamental tenets underlying the Court’s approach to pre-trial detention (see R v St-Cloud, 2015 SCC 27, [2015] 2 S.C.R. 328, R v Antic, 2017 SCC 27, [2017] 1 S.C.R. 509, R v Myers, 2019 SCC 18, [2019] 2 S.C.R. 105, R v Zora, [2020] SCC 14). These cases represent a clarion call for a more consistent, progressive and enlightened approach to the application of the primary, secondary and tertiary grounds in deciding release, and where release is ordered, the extent to which conditions restricting the accused’s liberty ought to be imposed.
[49] In R v St-Cloud, 2015 SCC 27, [2015] 2 S.C.R. 328, Wagner J. writing for the majority, stated as follows:
70 Finally, it is important not to overlook the fact that, in Canadian law, the release of accused persons is the cardinal rule and detention, the exception: Morales, at p. 728. To automatically order detention would be contrary to the "basic entitlement to be granted reasonable bail unless there is just cause to do otherwise" that is guaranteed in s. 11(e) of the Charter: Pearson, at p. 691. This entitlement rests in turn on the cornerstone of Canadian criminal law, namely the presumption of innocence that is guaranteed by s. 11(d) of the Charter: Hall, at para. 13. These fundamental rights require the justice to ensure that interim detention is truly justified having regard to all the relevant circumstances of the case.
[50] In R v Antic, supra, the Supreme Court of Canada recognized that the law of bail was being applied inconsistently across the country. Reference was made to several studies referencing a growing remand population and an over-reliance on sureties in Ontario and the Yukon. At paragraphs 65 and 66, Wagner J. writing for the majority stated as follows:
65 Despite the fact that the Code applies uniformly across the country some have suggested that courts are applying the pre-trial forms of release differently in different provinces and territories. For instance, Rosenberg J.A., writing for a unanimous five-judge panel of the Court of Appeal for Ontario, recognized that "[t]here may now be an over reliance on sureties" in that province: Mirza, at para. 47; see also Canadian Civil Liberties Association and Education Trust, Set Up to Fail: Bail and the Revolving Door of Pre-trial Detention, by A. Deshman and N. Myers (2014) (online), at p. 36 ("CCLA Report"); M. L. Friedland, "The Bail Reform Act Revisited" (2012), 16 Can. Crim. L.R. 315, at p. 321; R. v. Rowan, 2011 ONSC 7362, at para. 16 (CanLII). Surety release may also be relied on heavily in Yukon: CCLA Report, at pp. 35-36. In Alberta, some judges and justices are improperly imposing cash bail without seeking the consent of the Crown even though doing so is prohibited by the Code: R. v. Folkes, 2007 ABQB 624, 430 A.R. 266, at paras. 2 and 13; Brost, at para. 32; N. L. Irving, Alberta Bail Review: Endorsing a Call for Change (2016) (online), at p. 20. These examples suggest a divergence in the law of bail across this country.
66 It is time to ensure that the bail provisions are applied consistently and fairly. The stakes are too high for anything less. Pre-trial custody "affects the mental, social, and physical life of the accused and his family" and may also have a "substantial impact on the result of the trial itself": Friedland, Detention before Trial, at p. 172, quoted in Ell v. Alberta, [page538] 2003 SCC 35, [2003] 1 S.C.R. 857, at para. 24; see also Hall, at para. 59. An accused is presumed innocent and must not find it necessary to plead guilty solely to secure his or her release, nor must an accused needlessly suffer on being released: CCLA Report, at p. 3. Courts must respect the presumption of innocence, "a hallowed principle lying at the very heart of criminal law [that] confirms our faith in humankind": R. v. Oakes, 1986 CanLII 46 (SCC), [1986] 1 S.C.R. 103, at pp. 119-20.
The Court then went on to summarize the ladder principle and the necessity for restraint with respect to the imposition of excessive and unnecessary bail conditions. Two years later, Parliament enacted legislation codifying this principle in s. 493.1 of the Criminal Code:
Principle of restraint
493.1 In making a decision under this Part, a peace officer, justice or judge shall give primary consideration to the release of the accused at the earliest reasonable opportunity and on the least onerous conditions that are appropriate in the circumstances, including conditions that are reasonably practicable for the accused to comply with, while taking into account the grounds referred to in subsection 498(1.1) or 515(10), as the case may be.
[51] While I find the judgment of Justice Greenberg persuasive in many ways, it is important to remember that this is a de novo hearing and that Mr. Nygard is entitled to a fresh consideration of all the relevant circumstances, based on the evidence before this Court. While Justice Greenberg’s decision is worthy of deference, it is important to note that there are two significant differences in the analysis on the primary, secondary and tertiary grounds in the context of an extradition bail hearing. First, as Justice Greenberg noted in her ruling at paragraph 21, considering Canada’s mutual obligations to its extradition treaty partners, a court evaluating the risk of flight must be more cautious than in a domestic bail hearing.
[52] Second, when evaluating the strength of the Crown’s case in an extradition bail hearing, which is a factor in both the secondary ground and tertiary ground analysis, albeit in different ways, the test is not whether the accused will ultimately be convicted, but whether the accused will be committed (and ultimately surrendered) to the extradition partner. The test for committal is a much lower standard of proof requiring only ‘some evidence’ as opposed to evidence beyond a reasonable doubt. In a domestic context, the evaluation of the strength of the Crown’s case is more stringent. In both these respects, it stands to reason that it is more difficult to for the accused to obtain release in the extradition context, than in a domestic bail.
PRIMARY GROUNDS:
[53] Justice Greenberg found that Mr. Nygard was a flight risk, but that the plan proposed satisfied her concerns on the primary ground. I reach a different conclusion for two reasons. First, Mr. Nygard faces greater legal jeopardy than he did at his extradition bail hearing by virtue of the new Toronto charges. He now faces the possibility of significant jail sentences in two separate jurisdictions. His incentive to flee has increased.
[54] Second, he comes before this court with no surety. Although the Supreme Court of Canada noted a general tendency towards an over-reliance on sureties in bail courts in Ontario and the Yukon in Antic, supra, given the seriousness of the charges and the specific concerns that Mr. Nygard will attempt to flee or interfere with witnesses, the absence of a surety is a gaping hole in his proposed plan of release.
[55] While Mr. Greenspan submits that a significant cash deposit is equivalent to a surety, I respectfully disagree. While a significant cash deposit can be a strong deterrent to fleeing or breaching the conditions of a release order, it has no supervisory component. A cash deposit doesn’t call everyday to see how the accused is doing. It doesn’t notice if he suddenly has four brand new I-Phones. It makes no regular assessment of the accused’s mental health; it does not engage in regular conversations that might reveal the accused’s anxiety about the outcome of the charges coupled with a mounting temptation to flee the jurisdiction or to influence a witness. A cash deposit doesn’t drop by the house unannounced to see what the accused is ‘up to’, nor does it notice if his bags are packed and in the front hall waiting for a taxi.
[56] While a cash deposit can be a significant deterrent to fleeing, that only works if the cash deposit is an amount that is truly significant to the accused. Given Mr. Nygard’s behaviour towards the court in the Bahamas, and Mr. Fenske’s lack of transparency regarding the provenance of the funds used to purchase the house in Winnipeg (no doubt at the behest of Mr. Nygard), I find it difficult to believe that $325,000.00 is all he can raise for a cash deposit.
[57] I agree with Mr. Golwalla that this is a ‘drop in the bucket’ for someone whose net worth was estimated in 2014 to be 750 million dollars. The material submitted by the United States with respect to the flurry of cash advances and large transfers around the time Mr. Nygard sought bankruptcy protection is cause for concern. Mr. Nygard’s current access to cash is very difficult to evaluate, as it was in his family law proceeding in 2001 and 2004. Snipping the bracelet and heading for a private airport would be a simple matter for someone with his means and connections; and by the time the police were informed and on their way to the house, he would be long gone. For these reasons, I find the Crown has met its onus on the primary ground.
SECONDARY GROUNDS:
[58] Before engaging in a risk assessment, as I am required to do in assessing the secondary ground concerns, it is of utmost importance to begin with the proposition that Mr. Nygard is presumed innocent. The Canadian Charter of Rights and Freedoms guarantees Mr. Nygard both the right to be presumed innocent, and the right not to be denied reasonable bail without just cause
[59] In weighing the concerns on the secondary ground, the Supreme Court of Canada noted in R. v. Morales (1992), 1992 CanLII 53 (SCC), 3 S.C.R. 711 that it is impossible to make exact predictions about future dangerousness, and that, before ordering detention, I must find that there is a “substantial likelihood” that he will commit further offences or interfere with the administration of justice.
[60] As Justice Watt stated in R. v. Manasseri, 2017 ONCA 226:
[86] First, to determine whether the secondary ground controls the release/detention decision, requires a consideration of all the circumstances. A relevant circumstance, neither exclusive, nor dispositive, is the substantial likelihood of recidivistic conduct ("commit a criminal offence") or an interference with the administration of justice.
[87] Second, in connection with the specified circumstances encompassed by the clause "including any substantial likelihood that the accused will, if released from custody, commit…", the italicized words refer to a probability of certain conduct, not a mere possibility. And the probability must be substantial, in other words, significantly likely (emphasis added).
[61] Any analysis of both the secondary and tertiary ground necessarily involves an assessment of the strength of the Crown’s case. In the context of the secondary ground, the evaluation of the strength of the case is a necessary part of assessing the future risk to public safety should the accused be released. Where the case is strong, concerns for public safety are accentuated. Where the case is weak, it is often more difficult to conclude that there remains a significant risk to the safety and protection of the public given it is more likely the accused may be factually innocent of the crimes with which he or she is charged.
[62] I agree wholeheartedly with the conclusions reached by Justice Greenberg on the secondary ground. If the allegations are true, Mr. Nygard has a long history of using force while sexually assaulting women, and then paying them off. The concerns on the secondary ground in Mr. Nygard’s case are not rooted so much with the risk of re-offending, but rather the risk that he will tamper with witnesses, either directly or indirectly. The letter from the US Department of Justice that was before Justice Greenberg, as well as the ROC before me, set out three different allegations where Mr. Nygard is alleged to have taken steps to conceal his actions. The four relevant paragraphs from the ROC with respect to the allegations that Mr. Nygard tampered with witnesses in the past are reproduced here:
C. Evidence of Efforts to Conceal the Illegal Activity:
Victim-6 is expected to testify about NYGARD’s attempts to obstruct investigations into his criminal conduct. By 2016, NYGARD became embroiled in civil litigation that included allegations that NYGARD had trafficked minor girls. U.S. authorities had also began investigating this conduct. Victim-6 will testify that in approximately June 2016, NYGARD had asked her to come to New York to provide testimony about Minor Victim-1. In communications contained in the Nygard Email, NYGARD told Victim-6 that he needed her to come to New York to provide “testimonials.” Victim-6 agreed to travel to New York and attended a civil deposition concerning whether Minor Victim-1 was an adult at the time that she had traveled with NYGARD. At the deposition, Victim-6 stated that Minor-Victim-1 was an adult when she had traveled with NYGARD, which she believed to be true at that time. Afterwards, however, NYGARD paid her a $2,000 cash bonus – more cash than he had ever paid her before – which led her to suspect that Minor Victim-1 was not eighteen at the time of the travel. Victim-6 later learned that Minor Victim-1 was under eighteen during the relevant period. Victim-6 will further testify that federal agents working for the U.S. Authorities investigating NYGARD visited Victim-6’s family home looking for Victim-6 and spoke with her mother. Victim-6 was traveling with NYGARD at the time and spoke to one of the agents on speakerphone while NYGARD listened. NYGARD eventually hung up the call. He then drafted a false statement purporting to be from Victim-6 and emailed it to her and his attorney. The email, which Victim-6 provided to the U.S. authorities and is also dated from June 2017, claimed that the agents had harassed Victim-6’s mother and that NYGARD had engaged in no illegal conduct. Victim-6, who has maintained a copy of that email, had no role in drafting the statement ostensibly in her name and knows it to contain false information.
The Nygard Phone also contains messages from in or about December of 2019 between NYGARD and a witness who had been lawfully served by the FBI with a subpoena (“Female-2”). In a phone message, Female-2 sent NYGARD a photograph of the business card of the FBI agent who had served her. NYGARD indicated that he would make inquiries about the agent and about 20 days later, he sent Female-2 another message falsely telling her that the agent was a “fake.”
The Nygard Phone also contains messages from in or about November of 2018 between NYGARD and a longtime “girlfriend” and employee of the Company (“Female-7”). In phone messages, Female-7 reported to NYGARD that a friend of hers had been contacted by a journalist with the New York Times who was writing a story about NYGARD. NYGARD instructed Female-7 to have her friend contact the police and make a claim of harassment (“make it sound that it’s a scary dangerous people.”). In the same conversation, Female-7 solicited money from NYGARD to assist with her divorce and custody proceedings, and he agreed to give financial help.
[63] Mr. Greenspan argues a number of facts that he submits point to a weak Crown case. He filed the previously referred to New York times article which describes a feud between Mr. Nygard and his former neighbour in the Bahamas, Louis Bacon, a hedge fund billionaire. According to the article, Mr. Bacon was instrumental in locating alleged victims of Mr. Nygard and helping facilitate the organization of a civil class action against Mr. Nygard in the United States. Two of those witnesses who were part of that class action told the New York times that they had lied about the allegations they had made against Mr. Nygard at the behest of Mr. Bacon. While I understand Mr. Greenspan’s reasons for submitting the article, and the real possibility that Mr. Bacon may have inappropriately encouraged female complainants to come forward against Mr. Nygard, the article does not paint a positive picture of Mr. Nygard.
[64] Mr. Greenspan also notes that all but one of the complainants in the Toronto investigation are plaintiffs in that same class action. Given the sheer volume of complainants who have come forward and given statements to the police, both as part of the New York and Toronto investigations, it is hard to accept that they have all made false allegations against Mr. Nygard simply because Mr. Bacon encouraged them to do so. It should be noted that all the Toronto sexual assaults are alleged to have occurred long before the feud between Nygard and Bacon began. At least one of the Toronto complainants approached the Toronto police and provided a statement in 1998, long before Mr. Nygard and Mr. Bacon were neighbours.
[65] While the Toronto prosecution is in its infancy, there is a striking similarity in the various allegations including the location and the modus operandi of the sexual assaults. Perhaps, as the prosecution progresses, the influence (or not) by Mr. Bacon will become more apparent. At this point, it seems like a far-fetched conspiracy theory to suggest that he has successfully arranged for so many different complainants to make false allegations against Mr. Nygard, both in Canada and the United States.
[66] At this point, the Crown’s case appears to be very strong. However, I appreciate, given the limited information available at this early stage, the evidence before me may make the Crown’s case appear stronger than it actually is.
[67] Of course, the corollary may also be true; there are many cases where the Crown’s case becomes stronger with time. In the New York investigation, information seized from the company email, various Facebook accounts and information obtained from Mr. Nygard’s telephone tended to corroborate the circumstances surrounding the allegations of the witnesses. Based on the evidence before me, and taking into account Mr. Greenspan’s submissions with respect to the alleged shenanigans of Mr. Bacon, and the fact that most of the Toronto victims are plaintiffs in the class action, I am nevertheless left with the conclusion that the Crown appears to have a strong case on the Toronto charges.
[68] While it is important to consider both the strengths and weaknesses of the Crown’s case based on the allegations as they are presented at the bail hearing, the judicial officer must avoid speculating on what may develop as the investigation progresses. It is also important not to adopt the role of the trial judge when evaluating the strength of the Crown’s case.
[69] Balancing the concerns regarding both the commission of further offences as well as a significant likelihood of witness tampering by Mr. Nygard against his proposed plan of release, this Court recognizes that women live with obvious vulnerabilities in society and must be protected from sexual predators. There is a public interest in encouraging victims of crime to come forward when acts of sexual assault occur. Disbelieving women, or finding that the Crown has a weak case, simply because a complainant chose to pursue her legitimate claims in a civil action is unacceptable.
[70] Changing attitudes in Canadian society demand that female victims of sexual assault not be intimidated or coerced to retract their allegations. For too many years women have justifiably feared making reports to police against rich and powerful men. For too many years, allegations like the ones made against Mr. Nygard have been swept under the carpet, hushed up or ignored, leaving the victim feeling like coming forward was a big mistake. The protection of the public and the need to prevent interference with the administration of justice must take precedence in this case.
[71] When victims are brave enough to come forward and disclose acts of sexual assault, legitimate concerns pointing to the significant likelihood of witness tampering weigh strongly in favour of detention. For these reasons, I find that the Crown has met its onus on the secondary grounds.
TERTIARY GROUNDS:
[72] In determining if Mr. Nygard’s detention is necessary to maintain public confidence in the administration of justice, I must consider all the circumstances, paying special attention to the four enumerated factors set out in s. 515(10)(c).
[73] Turning first to the assessment of the strength of the Crown’s case, I have already noted that I find the Crown’s case to be very strong at this early stage. I base this finding, of course, on the standard of proof beyond a reasonable doubt given this is a domestic, and not an extradition bail. The offences are very grave and carry with them a maximum sentence of ten years, with the very real possibility of consecutive sentences.
[74] The circumstances surrounding the commission of the offence are deeply disturbing. Forced sexual intercourse is one of the greatest violations of human dignity possible. Repeated instances revealing a pattern, as opposed to a one-off single accusation, is a significant factor the Court must consider under this branch of the analysis. Paying off a victim of a sexual assault to coerce their silence is a very serious circumstance.
[75] If convicted, even as a first offender, Mr. Nygard would most likely receive a significant penitentiary sentence if found guilty of even half the allegations on which the Toronto charges are based. Of course, the analysis does not end there, although prior to the Supreme Court of Canada’s guidance in R v St-Cloud, supra, and the reset of the law of bail in Antic, Myers and Zora, supra, it often did.
[76] Mr. Nygard’s age, health concerns and lack of any criminal record weigh significantly in favour of release. Mr. Greenspan’s characterization of Mr. Nygard as a “frail octogenarian” is hard to accept, based on his appearance and his demeanor before this Court.
[77] The defence filed an unusual amount of material in support of its argument that Mr. Nygard’s access to counsel was being limited significantly because of the jail conditions at the Toronto South Detention Centre. While I agree that significant challenges exist in preparing for trial with any in-custody accused, through the determined and persistent advocacy of Mr. Hartman, Mr. Nygard’s prison lawyer, he has been accorded privileges far and beyond what the average inmate housed in that facility experiences. He has his own cell in the medical wing and has liberal access to the telephone as well as daily access to video conferencing. He also has access to email as he stated himself during the hearing. This greatly exceeds the opportunities afforded to the average inmate. I note that access to counsel does not mean unlimited access. Having said that, I also note that this particular institution has been the subject of adverse judicial comments when it comes to ensuring reasonable living conditions and fair access to a telephone, especially during the pandemic.
[78] While I am not a doctor or a trained medical professional, the medical conditions outlined in Dr. Lee’s affidavit do not strike me as particularly dangerous, or unusual for a man of 80 years. I do not accept that these conditions, when confined in a Canadian jail, are ‘a death sentence’ as submitted by the defence in the extradition bail hearing before Justice Greenberg. Those conditions include a pacemaker that was inserted to treat coronary heart disease; Type-2 diabetes, which is controlled by medication and a very strict diet; orthostatic hypotension (low blood pressure); hyperlipidemia (high cholesterol) as well as sleep apnea.
[79] Mr. Nygard’s health concerns have not changed significantly since his extradition bail hearing and those conditions were carefully considered by Justice Greenberg as a factor in her tertiary ground analysis. She balanced those concerns against the factors weighing in favour of detention and found the Crown had met its onus on the tertiary ground. I agree and adopt her analysis in this case. In the final analysis, I agree that Mr. Nygard’s detention is necessary to maintain confidence in the administration of justice.
[80] A detention order will issue in respect of the Toronto charges.