ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
OMAR SARHAN, DR. SARHAN DENTISTRY PROFESSIONAL CORPORATION and DR. R. DIWAN DENTISTRY PROFESSIONAL CORPORATION
Applicants
– and –
RICHARD CHOJNACKI, JEMIS INVESTMENTS INC., MARYANN CAMBRUZZI, ROSEMARIE DINADIS, GARVEY AND GARVEY LLP, JOHN CREDITOR, JANE RECIPIENT, TD CANADA TRUST and ROYAL BANK OF CANADA
Respondents
Michael Simaan, for the Applicants
Jeffrey Larry, for the Respondents, Maryann Cambruzzi and Rosemarie Dinadis
HEARD: January 11-13, 2012
BACKGROUND
1Richard Chojnacki is a lawyer and a fraudster. Under the guise of providing short-term bridge financing to one of his clients, he obtained $250,000 from the plaintiff, (styled as the “Applicant”), Omar Sarhan. Understanding that other clients of Richard Chojnacki would lose their home without it, Omar Sarhan provided the lawyer with another $200,000. Omar Sarhan is not the only person to suffer at the hands of Richard Chojnacki. He had been asked to look after two family trusts. The beneficiaries were two sisters: the defendants (styled as the “Respondents”) Maryann Cambruzzi and Rosemarie Dinadis. The trusts were valued at $3 million. Richard Chojnacki used some of the money for his own purposes and, it would seem, (the evidence was not clear) placed the rest in speculative and poor investments while advising the respondents that it had been used to purchase a guaranteed income certificate (“GIC”). In an attempt to placate the demands of Maryann Cambruzzi and Rosemarie Dinadis, he gave them the money he had received from Omar Sarhan. In this trial, Omar Sarhan seeks the return of the $450,000 from Maryann Cambruzzi and Rosemarie Dinadis.
2The parties agree that the money should remain with Maryann Cambruzzi and Rosemarie Dinadis, unless they were complicit in the fraud through which the money was obtained from Omar Sarhan. In this case, complicity would be measured by whether the two sisters accepted the money knowing or being wilfully blind to the fact that it had been obtained by fraud. The question can be answered by coming to an understanding of what the sisters knew or should have known and when they knew or should have known it.
FACTS
3This matter proceeded as a summary trial (see: Rule 76.12 of the Rules of Civil Procedure), which is to say, the evidence was presented by way of affidavits sworn by each of the witnesses supplemented by viva voce (oral) evidence and cross-examination.
4Omar Sarhan is an orthodontist. At present, he owns offices and operates practices in Brampton, Trenton, St. Catherines, Hamilton and Welland. Over the years, Omar Sarhan had cause to utilize the services of Richard Chojnacki to help him seek the return of a questionable investment, resolve a dispute with a landlord and sell one of his offices. Omar Sarhan was impressed with Richard Chojnacki. His only complaint was that the lawyer’s fees were high. Omar Sarhan trusted Richard Chojnacki in a complete and fundamental way.
5In May 2009, Richard Chojnacki approached Omar Sarhan. He had a client who was to be paid a judgment of $500,000. In the interim, the client was facing “a cash flow crunch” and was looking for a short-term bridge loan. The term of the loan would be one week, after which it would be re-paid, including 15% for legal fees, origination fees and interest. Richard Chojnacki advised that, if the loan was made, Omar Sarhan would receive, as his return, the 15% that had been set aside for legal fees. Omar Sarhan was not prepared to loan $500,000. Any money he lent would have to be borrowed through the line of credit held by his business. He agreed to lend $250,000, to be re-paid in one week, together with the 15% return.
6The loan was not re-paid. Two weeks after it had been made, Richard Chojnacki attempted to pay Omar Sarhan $40,000 in cash, representing the 15% return plus an extra $2,500. Omar Sarhan was uncomfortable receiving the money in this way and asked to be paid by cheque. Later the same day