ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: 2144/07
DATE: 20120313
B E T W E E N:
HER MAJESTY THE QUEEN
Aimee Gauthier , for the Applicant/Crown
Applicant
- and -
DEREK SANKAR
On his own behalf
Respondent
- and -
SNC-LAVALIN PROFAC INC.
KATHRYN J. MANNING AND ERIN HOULT , on behalf of SNC-Lavalin Profac Inc.
A person claiming an interest in property
- and -
PICARD FOODS LTD.
MERVIN L. RIDDELL , on behalf of Picard Foods Ltd.
A person claiming an interest in property
AMENDED RULING #3
RULING ON THE CROWN’S FORFEITURE APPLICATION
Durno J.
Table of Contents
Introduction . 1
The Law . 2
The Onus on an Application pursuant to s. 462.41 . 5
The Parties . 9
The Properties . 11
Chronology . 12
The Evidence on the Application . 15
The Picard Evidence . 15
The ProFac Evidence . 26
The Positions of the Parties . 30
Analysis . 39
Findings of Fact 41
Was Picard a secured creditor in relation to 457-Part 1 and 457-Part 2? . 49
Should the court exercise its discretion and order the return of funds to Picard, and if so, in what amount? . 55
What amount can be recovered on the basis of the mortgage? . 62
What amount can be recovered on the basis of the judgment for breach of contract? . 63
Are the funds from the sale of 561 Dundas St. E. available to be returned to Picard? . 64
Conclusions . 65
Introduction
[ 1 ] Derek Sankar pleaded guilty to defrauding his employer, SNC-Lavalin ProFac Inc. (ProFac), out of 2.8 million dollars and laundering proceeds of crime. As a result of civil proceedings taken by ProFac, roughly $1M is held in court and a lawyer’s trust account.
[ 2 ] During the sentencing hearing the Crown applied to have the funds forfeited to the Crown. This is the third ruling on the Crown’s application. The first examined procedure and onus issues. The second determined that the Agreed Statement of Facts upon which Derek Sankar’s plea and sentencing were based provided an evidentiary basis upon which I could order forfeiture of the funds to the Crown, subject to any order under s. 462.41. Picard Foods Ltd. (Picard) responded to a notice to a person who appeared to have a valid interest in the property the Crown sought forfeited. Picard says they are a secured creditor and should have $248,699.05 plus interest returned to them. The Crown and ProFac say all the funds should go to ProFac.
[ 3 ] This ruling examines the issues raised in relation to Picard and the forfeiture order. While a forfeiture order under s. 462.37(1) is made in favour of the Crown, pursuant to s. 14.6 of the Crown Attorneys Act. , R.S.O. 1990, c. C.49 , the Crown is entitled to use forfeited funds to satisfy the claims of victims of crime. Ms. Gauthier advised that the Crown will provide any forfeited funds to ProFac. In these circumstances, while the Crown is bringing the forfeiture application, the contest in relation to the funds to be forfeited and the amount, if any, that should be returned to Picard is essentially between Picard and ProFac. For that reason, I will refer to the forfeited funds as going to ProFac and not the Crown.
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Released: March 13, 2012
Durno J.