Ontario

Superior Court of Justice

Court File No.: CR12-70000551-00

Date: 20130614

B E T W E E N:

HER MAJESTY THE QUEEN

Derek Ishak for the Crown

• and -

MARK JOHNSTON

Mary Cremer for Mark Johnston

Heard: May 6, 7, 8, 9, 10 and 13, 2013.

REASONS FOR JUDGMENT

Corrick J. (orally)

Introduction

[1] Mark Johnston is charged in a five-count indictment with using a forged document, fraud, and three counts of failure to comply with a condition of a recognizance. He was tried by me sitting without a jury.

[2] The fraud and use of forged document charges arise from Mr. Johnston’s 56-day stay at Yonge Suites, a luxury hotel that caters to business executives seeking accommodation for an extended period. The Crown alleges that Mr. Johnston checked into Yonge Suites on March 23, 2011, never intending to pay for his accommodation. He also alleges that on May 2, 2011, Mr. Johnston tendered a forged cheque in the amount of $20,168.43 to Yonge Suites in payment of his hotel bill. When Mr. Johnston was arrested on May 17, 2011, police officers seized a computer, memory sticks, printer, files, and various papers and other documents from his hotel room.

[3] Mr. Johnston claims that his rights guaranteed by s. 8 of the Charter were violated by the warrantless search of his hotel room, and seeks an order pursuant to s. 24(2) of the Charter excluding the evidence seized. With the consent of counsel, the trial on the merits and the Charter application were heard together.

The Charter Application

[4] Dealing first with the Charter application. Many of the facts relevant to the application are not in dispute.

[5] Mr. Johnston checked into the Yonge Suites on March 23, 2011. He said he was the Chief Investment Officer of Front Street Asset Management Inc., a private investment company. The agreement for the accommodation had been negotiated the day before between Ms. Antonacci, the manager of the hotel, and Michael Cirillo, the Senior V.P. Finance of Front Street Asset.

[6] The agreement provided that Front Street Asset would pay for Mr. Johnston’s accommodation and that payment would be made upon receipt of invoices. Four invoices were sent to Mr. Cirillo between March 24 and April 29, 2011. The hotel made numerous unsuccessful attempts to collect the total amount owing of $20,168.43. Finally, on May 2, Mr. Johnston gave Ms. Antonacci a cheque in that amount. The bank did not honour the cheque, and returned it to Yonge Suites on May 16.

[7] On May 17, Ms. Antonacci informed Mr. Cirillo that if the hotel did not receive a minimum payment of $5,000 immediately, Mr. Johnston would be required to vacate the premises. Mr. Johnston paid Yonge Suites $500 in cash on May 17. At this point, Ms. Antonacci believed that Yonge Suites was being defrauded and began to make plans to evict Mr. Johnston.

[8] On May 17, 2011, Ms. Antonacci called the police for advice about evicting Mr. Johnston. She told police that he had an armed bodyguard, who was a former RCMP officer. She was hoping that the police would have an officer on stand by in case there was any problem. Instead, many police officers arrived at the hotel right away, just before 10:20 p.m. After speaking with Ms. Antonacci, six officers and Ms. Antonacci went to Mr. Johnston’s room, Penthouse 11F, on the 11th floor. No one responded to a knock on the door, although an officer heard movement inside the unit. Ms. Antonacci advised the officers that there was an alternative exit from the unit on the 12th floor.

[9] Ms. Antonacci and four officers took the elevator to the 12th floor. As Officer Gilchrist stepped off the elevator, he saw Mr. Johnston leaving the room. He was dressed but was not wearing shoes. The officer grabbed on to Mr. Johnston and placed him in handcuffs, explaining to him that he was doing so because of the concern about the presence of a firearm. Officer Gilchrist patted Mr. Johnston down, and gave him his rights to counsel. Officer Gilchrist noted that Mr. Johnston had been drinking; he was slurring his words and was unsteady on feet. He apologized to the officer for being drunk. Mr. Johnston indicated he did not want to speak to his counsel at that time. Officer Gilchrist cautioned Mr. Johnston because he continued to speak to the officers.

[10] Mr. Johnston told Officer Gilchrist that his bodyguard had left the premises an hour earlier and that she was often armed with a handgun.

[11] Ms. Antonacci opened the door to the room on the 12th floor. Officer Wilson entered to check for an armed person. Officer Gilchrist remained in the 12th floor hallway with Mr. Johnston. Other officers entered the unit from the 11th floor. The police did not have a search warrant. No one was found in the room.

[12] Officer Wilson testified that he was the first officer to enter the room. He found the room tidy, except for an office area on the 11th floor, where there was computer equipment and a big mess of paper on top of a desk. The papers were not covered in any way.

[13] Ms. Antonacci also escorted police officers to room #11C, a second suite Mr. Johnston had rented. Ms. Antonacci testified that it had initially been filled with banker’s boxes, but just prior to May 17, Mr. Johnston had taken a number of the boxes to a Shred-it truck that parked outside the hotel. Officer Wilson testified that Ms. Antonacci informed him of that while he was at the hotel on May 17. Ms. Antonacci unlocked room #11C. The police officers entered the room and looked around. They did not seize anything from it.

[14] On the instructions of a supervisor on the scene, Officer Gilchrist arrested Mr. Johnston for uttering a forged document. Mr. Johnston replied that he wanted to speak to his lawyer. Officer Gilchrist allowed Mr. Johnston to call his lawyer from the washroom inside his room. Mr. Johnston made the call on a speakerphone. During the call, he kept exiting the washroom. Officer Gilchrist reminded him that the call was a private one and advised him to stay in the washroom and not talk on the speakerphone.

[15] Officer Gilchrist turned Mr. Johnston over to other officers for transport to the police station. He and Officer Wilson then seized the following items from the office area: an HP laptop computer, two USB data sticks, a Blackberry, two plastic file boxes containing various papers, and a file that contained blank cheques and computer paper.

[16] Ms. Cremer, on behalf of Mr. Johnston, submits that the warrantless search of Mr. Johnston’s hotel room and subsequent seizure of the computer equipment and papers violated Mr. Johnston’s right to be secure against unreasonable search and seizure protected by s. 8 of the Charter. She further submits that the evidence obtained as a result of the search should be excluded at the trial because its admission would bring the administration of justice into disrepute.

[17] Mr. Ishak, Crown counsel, submits that Mr. Johnston was never in lawful possession of the room and was simply a trespasser. Mr. Johnston’s s. 8 rights were therefore not engaged because he could not assert a reasonable expectation of privacy in the room. Mr. Ishak further submits that if the court finds that s. 8 was violated, the evidence should not be excluded.

[18] I want to deal with Mr. Ishak’s argument first. Mr. Ishak relies on certain documents seized by the police during the search of Mr. Johnston’s room to demonstrate that Mr. Johnston was a trespasser in the room because he never intended to pay for it. This fact distinguishes it from the cases upon which Mr. Ishak relies – R. v. Blazevic, [2011] O.J. No. 6182 and R. v. Lauda, 1998 804 (SCC), [1998] 2 S.C.R. 683. In those cases, evidence seized during the search was not required to prove that the accused was not in lawful possession of the property over which he claimed a privacy interest. The court cannot justify this search on the basis that evidence found during the search demonstrates that Mr. Johnston is guilty of defrauding Yonge Suites because he never had any intention to pay for the accommodation, and thus had no expectation of privacy in the room. I therefore do not accept Mr. Ishak’s argument that Mr. Johnston’s s. 8 rights were not engaged in this case.

[19] I therefore turn to whether Mr. Johnston has established on a balance of probabilities that he had a reasonable expectation of privacy in the hotel room he occupied. If he did, s. 8 is engaged, and the court must then determine whether the search was reasonable. Warrantless searches are presumptively unreasonable, and violate s. 8.

[20] Whether Mr. Johnston had a reasonable expectation of privacy depends on a consideration of the “totality of circumstances.” (R. v. Edwards, 1996 255 (SCC), [1996] 1 S.C.R. 128, at para. 45) As Justice Binnie noted in R. v. Patrick, 2009 SCC 17, [2009] 1 S.C.R. 579, the “assessment always requires close attention to context.”

[21] The Supreme Court of Canada in Edwards listed the following seven factors, which are not exhaustive, that may be considered in assessing the totality of circumstances:

1. presence at the time of the search;

2. possession or control of the property or place searched;

3. ownership of the property or place;

4. historical use of the property or place;

5. the ability to regulate access, including the right to admit or exclude others from the place;

6. the existence of a subjective expectation of privacy; and

7. the objective reasonableness of the expectation.

[22] When viewed in light of these considerations, the circumstances of this case support Mr. Johnston’s assertion of a right to privacy in the room.

[23] He was present in the room when the police knocked on the door and was detained just outside the room while police searched the room.

[24] He had possession and control of the room, and the property inside the room. Yonge Suites gave Mr. Johnston possession of the room on March 23, 2011 pursuant to the terms of the “Accommodation Agreement”. The Accommodation Agreement provided that Mr. Johnston could have possession of the room until April 22, 2011 at the rate of $129 per night. The Agreement also permitted him to extend his stay, which he did. No one else occupied the room. Yonge Suites would not have rented it to another guest while he occupied it.

[25] Mr. Johnston did not own the room, but it is reasonable to infer that he owned the property in the room.

[26] The historical use of the room was as a residence. Paragraph 2 of the Accommodation Agreement provided that Mr. Johnston agreed to use the room as a residential premise and for no other purpose. Mr. Johnston kept his personal property in the room. The modifications to the room that Mr. Johnston requested, such as upgraded cable television service, better Internet service, and different furniture more suited to his taste, indicate that he was using the room as a home away from home. He had the dining area modified to use it as an office.

[27] During his stay, Mr. Johnston regulated access to the room. He had an access card to the room. He requested three further access cards, which he distributed to others. Ms. Antonacci testified that the hotel did not know to whom he gave them. The hotel staff entered his room for housekeeping, in accordance with the terms of the Accommodation Agreement, and to fulfill Mr. Johnston’s request to make modifications to the room. Mr. Johnston was extremely concerned about security during his stay and complained when he thought it had been breached on one occasion. He informed Ms. Antonacci when he was having visitors. He was controlling who could enter his room, and could exclude those he did not want.

[28] Mr. Johnston had a subjective expectation of privacy. When Mr. Johnston checked into the room, and received an access key, he had an expectation of privacy. He would have expected the hotel to honour his expectation of privacy, which it did. He conducted himself in a manner that was consistent with an expectation of privacy. He stored personal items in the room, he used the room as a residence, he expressed concerns about breaches of security, and he controlled who had access keys to the room, and who could enter the room.

[29] Turning then to whether Mr. Johnston’s expectation of privacy was reasonable. Would a reasonable and independent observer conclude that Mr. Johnston’s assertion of a privacy interest was reasonable in all of the circumstances? The Supreme Court of Canada in the decision of R. v. Wong, 1990 56 (SCC), [1990] 3 S.C.R. 36 and the Ontario Court of Appeal in the decision of R. v. Mercer, 1992 7729 (ON CA), [1992] O.J. No. 137 have made it clear that a person has a reasonable expectation of privacy in a hotel room. Justice Arbour in Mercer also concluded that an individual has a reasonable expectation of privacy in the personal documents kept in the individual’s hotel room. I conclude that Mr. Johnston’s expectation of privacy was reasonable.

[30] Considering the totality of the circumstances of this case, it is my view that Mr. Johnston has demonstrated on a balance of probabilities that he had an expectation of privacy in his room on May 17, 2011. The warrantless search of his hotel room thus violated his rights under s. 8 of the Charter.

[31] I turn now to consider whether the breach of Mr. Johnston’s s. 8 rights justifies the exclusion of evidence seized from his room. The Supreme Court of Canada laid down the test for exclusion in R. v. Grant, 2009 SCC 32, [2009] 2 SCR 353. The decision outlines the criteria the court must balance in order to determine whether the admission of the evidence would bring the administration of justice into disrepute.

[32] The first factor to consider is the seriousness of the Charter infringing state conduct. The more serious the state conduct is that led to the Charter violation, the greater the need for the courts to dissociate from the evidence seized as a result. In this case, the officers acted in good faith. They attended Yonge Suites in response to a call from Ms. Antonacci indicating her concern about evicting a guest who had an armed bodyguard. They entered the room to determine if an armed individual was present. They conducted a cursory search of the room. They opened doors to places a person could hide, such as a closet. They did not open drawers and cupboards. The items the police seized were on top of a table, and in plain view. The items seized from the room were not immediately searched. They were stored and searched only after search warrants were obtained. The police officers were courteous with Mr. Johnston, explaining to him why he was being handcuffed in the hallway. They facilitated Mr. Johnston’s right to counsel by allowing him to call his lawyer from his washroom. They reminded him of the importance of having a private conversation with his lawyer when they could overhear him. The officers acted in good faith and were conscientious about protecting Mr. Johnston’s Charter rights. This factor favours inclusion of the evidence.

[33] The second factor to consider in the Grant analysis is the impact of the state conduct on the Charter­-protected interests of Mr. Johnston. This line of inquiry considers the seriousness of the Charter breaches from the perspective of Mr. Johnston. Privacy is the principal interest involved in this case. Although I have determined that Mr. Johnston had a privacy interest in the room, I find that at the time of the search, it was a significantly reduced privacy interest. Ms. Antonacci testified that she had many conversations with Mr. Johnston each day. When the hotel had not been paid after sending a second invoice on April 12, she told Mr. Johnston that the accounting department was wondering when payment could be expected. Mr. Johnston assured her that it was forthcoming. After a third invoice was sent on April 25, Ms. Antonacci testified that she asked Mr. Johnston daily when payment could be expected. Between April 29 and May 2, Ms. Antonacci had a number of conversations with Mr. Johnston about the payment. Mr. Johnston said he was meeting with Mr. Cirillo and would have a cheque on May 2. The pressure was mounting on Mr. Johnston for payment.

[34] When Mr. Johnston checked into the room, he would have had an expectation of privacy. However, as time went on, and his hotel bill remained unpaid well past the agreed-upon terms, his expectation of privacy diminished. He was being asked daily about payment. He must have known that he was facing eviction as a result of his unpaid bill. Certainly on May 16, 2011, when Ms. Antonacci informed Mr. Johnston by email that his cheque had been returned by the bank, and his hotel bill had not been paid since the day he checked in, Mr. Johnston knew he would be facing eviction, and his expectation of privacy was then reduced. Ms. Antonacci had a conversation with Mr. Johnston at approximately 4:30 on May 17. Mr. Johnston was annoyed and irritated that Yonge Suites was insisting that he vacate the room unless it received $5,000.00 that day. Mr. Johnston paid $500.

[35] Also relevant to the second line of inquiry is the fact that the items seized were not searched until a search warrant had been obtained. This second line of inquiry favours somewhat the exclusion of the evidence.

[36] The third line of inquiry I must consider is society’s interest in an adjudication of the case on its merits. As the Supreme Court of Canada noted in R. v. Grant, society has an interest in truth finding, and ensuring that those who breach the law are brought to trial. Of relevance to this line of inquiry are the reliability of the evidence and the importance of it to the Crown’s case. The breach in this case did not affect the reliability of the physical evidence found in the hotel room, and the evidence is integral to the Crown’s case. This consideration weighs in favour of the admission of the evidence.

[37] Balancing these factors, I have concluded that the admission of the evidence would not bring the administration of justice into disrepute. The police acted in good faith. The Charter breach was not flagrant. Although the breach had an impact on Mr. Johnston’s privacy interest in his room, that interest was significantly reduced. The degree of the seriousness of the breach decreases as the expectation of privacy diminishes. The impact was therefore not at the serious end of the scale. And finally, the evidence is reliable physical evidence. In my view, the long-term reputation of the justice system would not suffer from allowing the evidence seized from Mr. Johnston’s hotel room to be admitted in evidence at his trial.

[38] Mr. Johnston’s Charter application is therefore dismissed.

The Trial

[39] Much of the Crown’s case against Mr. Johnston was tendered through the evidence of Ms. Antonacci. The Crown also called two police officers who participated in the search of Mr. Johnston’s room, Luis Tomaz, and Robert Brown, an investigator with the Royal Bank of Canada. Mr. Johnston did not call any evidence.

[40] I do not propose to set out Ms. Antonacci’s evidence in detail, other than the details that provide important context. Ms. Antonacci testified as follows.

[41] Yonge Suites opened for business in June 2010. It is a luxury hotel that caters to business executives who are relocating and need accommodation for extended periods of time. Banks and insurance companies were key clients of Yonge Suites.

[42] On March 22, 2011, Ms. Antonacci received a telephone call from Michael Cirillo, inquiring about the accommodation Yonge Suites offered. He told Ms. Antonacci that he was with Front Street Asset Management, and was seeking accommodation for a key executive of that company, who was currently staying at the Ritz-Carlton Hotel. Mr. Cirillo inquired about the rates, and the possibility of having the hotel invoice the company directly rather than having the guest pay. He also indicated that, although he required immediate accommodation for one executive, he wanted to discuss accommodation for two or three other executives at a later time.

[43] This initial phone call was followed up by an email sent by Mr. Cirillo at 2:50 p.m. to Ms. Antonacci setting out his contact information as follows:

Mike Cirillo
V.P. Finance (Ontario Region)
Front Street Asset Management
Toronto Star Building
1 Yonge Street
Suite 1801
Toronto, Ontario, Canada
M5E 1W7
Telephone # (416) 244-4848
Toll Free # 1-855-244-4848
Facsimile # (416) 244-4814
www.frontstreetasset.com

[44] Ms. Antonacci replied by email that accommodation was available the next day, March 23, at the corporate rate of $129/night, and that the hotel was willing to invoice the company directly.

[45] At 4:00 p.m., Mr. Cirillo emailed Ms. Antonacci that Mr. Johnston would check in on March 23 at 1:00 p.m. for a minimum 30-day stay, possibly extending to 60 days. He reiterated that he wanted the firm invoiced for payment.

[46] The next morning, Ms. Antonacci emailed an Accommodation Agreement and a Credit Information Form to Mr. Cirillo for his signature. It was typical for the hotel to receive these completed forms at least one week prior to the arrival of the guest. In this case, the hotel received the forms about 30 minutes before Mr. Johnston arrived. The Credit Information Form included details about the business, the names of the principals, the nature of the business, the number of years in business, the business’s banking information and the names of business references. The completed form indicated that Front Street Asset Management Inc. had been in the investment banking business for ten years. It was signed by Michael Cirillo.

[47] Because Front Street Asset Management was going to be responsible for the payment of Mr. Johnston’s account, Ms. Antonacci waived the regular security deposit of between $1,000 and $2,000, and did not require Mr. Johnston to provide a credit card or pay in advance for the first 30-day stay.

[48] On March 22, Ms. Antonacci searched the website address Mr. Cirillo provided for Front Street Asset Management. A web page for Front Street Capital opened. When she searched under the “Contact Us” tab, she saw numerous other companies with names that began with “Front Street,” and assumed that Front Street Asset Management was a subsidiary, although she did not see it listed as such.

[49] Ms. Antonacci believed that Front Street Asset Management was a potentially lucrative client for the hotel and she wanted to cultivate the hotel’s relationship with it. Mr. Cirillo said a number of things to her that led her to believe that Front Street Asset Management was a potentially lucrative client. During the initial telephone conversation, Mr. Cirillo said that Mr. Johnston required accommodation for 30 days, possibly 60. On April 12, he extended that to six months. On March 24, he emailed Ms. Antonacci about renting two more units. On April 14, the two had an email discussion about Front Street Asset Management hosting a cocktail reception on the hotel’s terrace. On April 18, Mr. Johnston rented a second suite, room 11C.

[50] Ms. Antonacci testified that she accommodated multiple requests from Mr. Johnston throughout his stay as part of her effort to cultivate this new client. Mr. Johnston moved to a penthouse suite on March 31, 2011. An electrician changed all of the light switches in the room. The cable television and Internet connections were upgraded. The hotel purchased new furniture for the room, and new barware that was more to Mr. Johnston’s taste. It purchased and delivered approximately $2,000 worth of wine to his room.

[51] Following her initial telephone conversation with Mr. Cirillo on March 22, Ms. Antonacci never spoke to him again. They communicated by email. She never spoke to him by telephone. The phone number he gave her was answered by a receptionist, and he never returned her calls. Despite discussions about meeting Ms. Antonacci personally, Mr. Cirillo never followed through.

[52] Ms. Antonacci sent an invoice for $3,870.00 by email to Mr. Cirillo on March 24, 2011. The hotel had extended 30 days for payment to Front Street Asset Management, which was its standard practice for corporate clients with a balance of this amount.

[53] She sent a second invoice for $9,217.78 on April 12. This invoice included charges for changes to the room, and wine and beverages and additional barware purchased for Mr. Johnston. The balance was now due upon receipt. Ms. Antonacci testified that the payment terms were changed due to the balance owing and the fact that the hotel had incurred many charges. Mr. Cirillo replied that he would review it when he was back in town in a few days. On April 21, he professed confusion about the invoice and asked Ms. Antonacci to separate the charges for the wine.

[54] Ms. Antonacci accommodated this request and sent a third invoice on April 25 for $20,297.34, which did not include the charges for the wine. It was also payable upon receipt. Mr. Cirillo replied that day that he would review it with Mr. Johnston mid-week. On April 26, Mr. Cirillo sent a further email requesting separate invoices for the two rooms citing concerns over tax implications, and asking for a reduction in the charges for the electrician.

[55] Ms. Antonacci testified that at this point she became concerned about the payment of the account. She found it strange that Mr. Cirillo was questioning a $320 electrician charge when there was a $20,000 hotel bill outstanding. She believed that Mr. Cirillo’s concerns were a stalling tactic.

[56] On April 29, Ms. Antonacci sent Mr. Cirillo separate invoices for the penthouse and the second room, as well as a statement showing a total balance owing of $20,168.43. This balance did not include the wine Mr. Johnston had ordered, and it reflected a reduction in the electrician charges. Payment was due upon receipt.

[57] On May 2, Mr. Johnston gave Ms. Antonacci a cheque in the amount of $20,168.43. The cheque, which is marked as Exhibit #6, appears to be a Front Street Asset cheque drawn on an account at Caisse Centrale Desjardins. Yonge Suites deposited the cheque into its bank account on May 9.

[58] On May 16, Ms. Antonacci was advised by the hotel’s corporate office that the cheque had not been honoured by the bank. Mr. Cirillo informed Ms. Antonacci that the problem had arisen because the funds were held in an offshore account. Mr. Cirillo offered to either issue a new cheque from Caisse Centrale Desjardins or from an account in Antigua, or issue a draft, which would take about three weeks.

[59] After further email discussion, Ms. Antonacci emailed Mr. Cirillo at 4:34 p.m. on May 17, informing him that if Yonge Suites did not receive a $5,000 payment that day, Mr. Johnston would be required to vacate the room.

[60] Following this email exchange, Mr. Johnston assured Ms. Antonacci that he would obtain some funds that day. He paid $500 cash later that day. It concerned Ms. Antonacci that an executive at Mr. Johnston’s level could only produce $500 and could not even offer payment by a credit card.

[61] At 6:49 on May 17, Ms. Antonacci received an email from Mr. Cirillo, the tone of which was very offensive, which led Ms. Antonacci to believe that she was dealing with a fraudulent situation. She began making plans to evict Mr. Johnston.

[62] Police attended the hotel around 10:20 p.m. in response to Ms. Antonacci’s request for assistance in evicting him. Mr. Johnston was arrested sometime after that on May 17.

[63] Ms. Antonacci received no further communication from Mr. Cirillo or Front Street Asset Management after Mr. Johnston’s arrest.

The Cheque

[64] Evidence regarding the cheque that Mr. Johnston provided to Ms. Antonacci on May 2, 2011, in the amount of $20,168.43 was not disputed by the defence. Robert Brown, an investigator with the Royal Bank of Canada, testified that the following features of the cheque demonstrated that it was counterfeit:

1. The micro encoding line at the bottom of a cheque sets out important identifier numbers. The encoding line on this cheque made no sense. The cheque was drawn on the Caisse Centrale Desjardins, but the bank identification number in the encoding line (00003) was the Royal Bank’s identification number. The solemn declaration of Annie Tremblay-Gauthier, an official with Caisse Centrale Desjardins, which was filed at the trial on consent of the parties, also indicated that the cheque contained the Royal Bank’s identification number;

2. Each financial institution has a transit number that appears in the encoding line. Caisse Centrale Desjardins’ transit number is 98000. It did not appear on this cheque. Ms. Tremblay-Gauthier’s solemn declaration confirmed that the transit number on the cheque did not correspond with that bank’s transit number.

3. A usual account number is six or seven digits and appears in the encoding line. The account number on this cheque appeared to be a seven-digit number followed by a space and two more digits.

[65] A further piece of evidence relevant to the cheque is Exhibit #5, a yellow file folder that was seized from Mr. Johnston’s room. It contained blank cheque paper that was identical to the paper on which the cheque he gave Ms. Antonacci was printed.

Front Street Asset Management Inc.

[66] The Credit Information Form that Mr. Cirillo faxed to the corporate office of Yonge Suites listed Luis Tomas (spelled T-o-m-a-s) as the President of Front Street Asset Management Inc. It is an agreed fact that Front Street Asset Management Inc. was incorporated on March 18, 2011, five days before Mr. Johnston checked into Yonge Suites. Records from the Ministry of Consumer Services indicate that the sole administrator was listed as Luis Tomaz (spelled T-o-m-a-z).

[67] Luis Tomaz testified that, in September 2010, he received a telephone call from his bank indicating that there had been online activity in his bank account. Money had been transferred out of his bank account on two occasions. Mr. Tomaz had not performed those transactions or authorized anyone to do so. Prior to the call from his bank, he had not been aware that he had been a victim of identity theft.

[68] Mr. Tomaz testified that he did not incorporate any companies in 2011, and he has never been the administrator of Front Street Asset Management Inc.

[69] Mr. Tomaz reviewed Articles of Incorporation related to four companies that listed Luis Tomaz as the first director, and as the incorporator. The police seized these documents from Mr. Johnston’s room. The documents included the signature of Luis Tomaz. One of the companies, Bay Street Asset Management, was incorporated on March 18, 2011. The other three companies, ROI Asset Management Limited, ROI Capital Management Limited, and Bay Street Capital Management Limited were incorporated on March 22, 2011. Mr. Tomaz testified that he did not incorporate any of the companies, and that the signature that appeared on the documents was not his.

[70] An affidavit of Linda Hryma, filed on consent of the parties, indicated that she has been employed by Front Street Capital since 2001, and to her knowledge, Front Street Capital had never employed anyone named Michael Cirillo or Mark Andrew Johnston.

[71] Ms. Antonacci testified that she had Mr. Johnston’s “carte blanche” permission to enter his room because of his many requests for changes to his room, she was constantly accompanying trades people to his room. While in his room, she saw numerous Front Street Asset business cards. She identified five different business cards that she had seen in Mr. Johnston’s room with the Front Street Asset logo printed on them. They are contained at Tab 6 of Exhibit #2. The business cards had the following names and titles printed on them:

1. M. Andrew Johnston, Chief Investment Officer

2. M. A. Johnston, Chief Financial Officer

3. Benjamin D. Cammile, Investment Banker

4. Richard R Tomez, Investment Coordinator

5. Richard R. Dawson, V. P. Operations (Ontario)

[72] After the name of each person, the degrees the person held were printed. Every person had a B.A. and a M.B.A. (Hon), including Mr. Johnston.

[73] The Front Street Asset Management logo on the business cards was identical to the Front Street Capital logo Ms. Antonacci had seen on the Front Street Capital web site.

[74] Police located various pieces of stationery, such as paper and post-it notes, in the file boxes seized from Mr. Johnston’s room and later searched pursuant to a warrant. The logo printed on the stationery was identical to Front Street Capital’s logo.

Positions of the Parties

[75] Mr. Ishak submits that the constellation of facts in this case leads to the following conclusions:

1. Mr. Johnston checked into Yonge Suites on March 23, 2011 never intending to pay;

2. there never was a legitimate company known as Front Street Asset Management Inc;

3. there never was a Michael Cirillo;

4. there never was any money to pay Mr. Johnston’s hotel account despite the repeated promises of Mr. Cirillo and Mr. Johnston; and

5. the cheque that Mr. Johnston gave Ms. Antonacci in payment of his account was forged by Mr. Johnston and acted on as if it were genuine.

[76] Mr. Ishak argues that he has proven the offences of fraud and using a forged document beyond a reasonable doubt.

[77] Ms. Cremer, on behalf of Mr. Johnston, argues that the Crown has failed to prove that Mr. Johnston created the forged cheque or that he knew the cheque was forged. She also argues that Mr. Johnston’s behaviour is inconsistent with someone who has given Yonge Suites a cheque that he knows is forged. If he had known this, it does not make sense, according to Ms. Cremer, that Mr. Johnston did not leave the hotel.

[78] Ms. Cremer also argues that much of the evidence Mr. Ishak relies upon does not prove that Mr. Johnston is guilty of fraud. For example, she argues that the fact that Front Street Asset Management was incorporated only five days before Mr. Johnston checked into the hotel is not relevant to whether Mr. Johnston has committed a fraud. The fact that Ms. Antonacci did not see the name “Front Street Asset Management” in the list of subsidiary companies on Front Street Capital’s website does not mean that the company does not exist. The fact that a man named Luis Tomaz, who had been the victim of identity theft in 2010, testified that he did not incorporate Front Street Asset Management does not mean that there is not another Luis Tomaz who did.

Analysis

[79] To prove the offence of fraud, the Crown must prove beyond a reasonable doubt that Mr. Johnston knowingly engaged in a prohibited act, whether it was an act of deceit, falsehood or other fraudulent means, and that he knew that the act could have as a consequence deprivation. This is well established by the Supreme Court of Canada in the cases of R. v. Zlatic, 1993 135 (SCC), [1993] 2 S.C.R. 29 and R. v. Theroux, 1993 134 (SCC), [1993] 2 S.C.R. 5.

[80] To prove the offence of using a forged document, the Crown must prove beyond a reasonable doubt that the cheque made payable to Yonge Suites was forged, that Mr. Johnston knew it was forged, that Mr. Johnston dealt with the cheque, and that he represented the cheque as genuine.

[81] The Crown’s case against Mr. Johnston is based on circumstantial evidence. I therefore instruct myself as follows. To find Mr. Johnston guilty on the basis of circumstantial evidence, I must be satisfied that the only rational inference that can be drawn from the circumstantial evidence is that Mr. Johnston is guilty: R. v. Griffin; R. v. Harris (2009), 2009 SCC 28, 244 C.C.C. (3d) 289 (S.C.C.) In that case, the Supreme Court of Canada held at para. 34 that “the mere existence of any rational, non-guilty inference is sufficient to raise a reasonable doubt.”

[82] I must view the circumstantial evidence as a whole rather than as individual pieces: R. v. Warkentin et al. (1976) 1976 190 (SCC), 30 C.C.C. (2d) 1 (S.C.C.) I may apply human experience and common sense to draw reasonable inferences from primary facts that are established by the evidence: R. v. Figueroa et al., 2008 ONCA 106, [2008] O.J. No. 517 (C.A.)

[83] In my view, when viewed as a whole, there is no rational non-guilty inference that can be drawn from the circumstantial evidence presented by the Crown. Mr. Johnston was the only person who stood to benefit from staying in a luxury hotel for 56 days without paying. He was the only person who benefited from the upgraded cable packages and televisions that were provided for him at his request. He is the only person who benefited from the 120 bottles of wine he ordered during his 56-day stay. Ms. Antonacci testified that Mr. Johnston told her the wine was for his personal consumption.

[84] The evidence supports the conclusion that Mr. Johnston checked into Yonge Suites on March 23, 2011, pretending to be an investment banker, with no intention of paying his hotel bill, and when it appeared that the hotel was running out of patience waiting for payment, he forged the cheque that he gave Ms. Antonacci.

[85] The evidence of the Crown has not been contradicted. There is ample evidence that Front Street Asset Management was a company created to appear to be related to Front Street Capital, a genuine company. The Credit Information Form provided to the hotel indicated that Front Street Asset Management had been in the business of investment banking for ten years – the same number of years that Front Street Capital’s web site indicated it had been in business. Of course, this was false as Front Street Asset Management had been in business only five days at the time. Front Street Asset had the same logo as Front Street Capital. The website address for Front Street Asset automatically directed people to the website of Front Street Capital. Business cards and stationery with the Front Street Asset logo printed on them were seized from Mr. Johnston’s room. Two of the business cards had Mr. Johnston’s name printed on them, with different positions in the company. The company was incorporated on March 18, 2011 and listed Luis Tomaz as its sole administrator. Articles of Incorporation for four other companies, which were seized from Mr. Johnston’s room, also listed Luis Tomaz as the director and incorporator. One of those companies was incorporated on the same day as Front Street Asset Management.

[86] There is no evidence that Michael Cirillo existed. I find that the only reasonable inference to draw from all of the evidence is that Mr. Johnston posed as Mr. Cirillo. Ms. Antonacci never saw Mr. Cirillo in person or spoke to him over the telephone after Mr. Johnston checked into the hotel. The signature of Michael Cirillo on the Accommodation Agreement is the same as the signature of Luis Tomaz on the articles of incorporation for three companies incorporated between March 18 and 22, 2011.

[87] I find that Ms. Antonacci was given false information about Mr. Johnston, Mr. Cirillo and Front Street Asset Management in order to induce the hotel to provide the accommodation and services to Mr. Johnston without taking the usual precautions, such as insisting on payment in advance, or obtaining a credit card imprint, or security deposit. A few examples will suffice to illustrate. Mr. Cirillo informed Ms. Antonacci that Mr. Johnston was vital to Front Street Asset Management because he managed a $300 million portfolio, and the company was willing to do whatever was necessary to make him comfortable. It was made clear to Ms. Antonacci that she was not to bother Mr. Johnston with any billing issues. Mr. Cirillo informed Ms. Antonacci that Mr. Johnston was looking for a home in wealthy neighbourhoods, such as Rosedale and Forest Hill. Mr. Cirillo often used the fact that he was out of the country on business in the Bahamas, Antigua, England, and Milan to avoid paying the hotel bill right away. Finally, Mr. Cirillo often held out the promise of more business to the hotel. I find that these falsehoods were intended to deceive Yonge Suites about who Mr. Johnston was and his ability to pay.

[88] If I accept Ms. Cremer’s submission that there is no evidence that Mr. Cirillo does not exist or that he, on behalf of Front Street Asset Management, did not agree with Yonge Suites to pay Mr. Johnston’s account, I must also accept that Mr. Johnston was in charge of a $300 million investment portfolio, yet was unable to produce a credit card or more than $500 on May 17, 2011, when the hotel threatened to evict him. I would also be left to wonder why Ms. Antonacci never heard from Mr. Cirillo or Front Street Asset Management after Mr. Johnston was arrested.

[89] The Crown has proven that Mr. Johnston defrauded Yonge Suites of a sum of monies of a value exceeding five thousand dollars beyond a reasonable doubt and I find Mr. Johnston guilty of count #2.

[90] I also find that the Crown has proved that Mr. Johnston forged the cheque in the amount of $20,168.43, and delivered it to Ms. Antonacci in payment of his account. The cheque Mr. Johnston gave Ms. Antonacci was printed on the same paper that was discovered by police in Mr. Johnston’s room. Mr. Johnston also had a laptop computer, printer and Internet connection in his room. The evidence of Robert Brown and Annie Tremblay-Gauthier is undisputed. Although the cheque appears to be drawn on an account at Caisse Centrale Desjardins, the transit number encoded on the cheque is that of the Royal Bank. The address of Caisse Centrale Desjardins is incorrect and incomplete. The signature on the cheque matches Mr. Johnston’s signature on the hotel’s registration form (Tab 2 of Exhibit #2). Ms. Antonacci testified that she saw Mr. Johnston sign the registration form when he checked in.

[91] I find Mr. Johnston guilty of count #1.

[92] Mr. Johnston is also charged with three counts of failing to comply with a recognizance. At the time of these offences, Mr. Johnston was bound by a recognizance with the following conditions: that he reside at 4025 Kilmer Road, Suite 107 in Burlington, Ontario; that he not operate a computer; and that he keep the peace and be of good behaviour.

[93] Ms. Cremer properly conceded that if I found Mr. Johnston guilty of the fraud or use forged document charges, the Crown had proved the three fail to comply charges beyond a reasonable doubt. I agree and I find Mr. Johnston guilty of counts 3, 4 and 5.

Corrick J.

Released: June 14, 2013