Court File and Parties

CITATION: Lambrou v. Voudouris et al., 2015 ONSC 1693
COURT FILE NO.: CV-11-000423520

DATE: 20150330

ONTARIO

SUPERIOR COURT OF JUSTICE

RE: ELIE LAMBROU, Plaintiff

AND:

PETER VOUDOURIS, VOUDOURIS & ZOLLO, LEGEND PROPERTY SERVICES INC., 2204883 ONTARIO LIMITED, PETER TSATSARIS and ROSE TSATSARIS, Defendants

BEFORE: F.L. Myers J.

COUNSEL: Douglas Best and Andrea K. Farkouh for the plaintiff John Polyzogopoulos for the defendants

READ: March 30, 2015

COSTS endorsement

[1] By Endorsement dated February 13, 2015, reported at 2015 ONSC 998, I declined to grant the injunction sought by the plaintiff and I declined to extend the terms that had been granted by Aston J. on August 3, 2012 freezing certain assets of the defendants.

[2] The plaintiff claims that the defendant Voudouris was his accountant and behaved abominably in inducing him into a fraudulent transaction. The plaintiff does not claim fraud against Voudouris because he is trying to access the defendants’ insurance. The claim of breach of fiduciary duties has a significant issue in that the defendant Voudouris says that he too invested in the same deal in his personal capacity. The plaintiff knew this to be Voudouris’s claim. If Voudouris was truly personally in the deal, he would have been conflicted and looking out for his personal position. If that is so, he may not have undertaken to sacrifice his self-interest to protect the plaintiff qua fiduciary. But, if Voudouris’s involvement in the deal was a sham and the cheques upon which he relies to claim investment had other purposes or were repaid otherwise, for example, a very different outcome could appertain.

[3] The fact that the plaintiff is left to fall back on negligence claims may well suffice for him to obtain relief at trial. But without dishonesty, there was no basis to infer a real risk that the defendant Voudouris would dissipate his assets. In an appropriate case, the court can draw an inference of dissipation without evidence to prove that the defendant is actively selling, moving or encumbering assets. See: Sibley & Associates LP v. Ross et al., 2011 ONSC 2951. Here, absent evidence of actual dissipation, the court was not in a position to draw the inference sought by the plaintiff. However, I did order further examinations for discovery and that the defendant Voudouris give 30 days’ notice to the plaintiff before he enters into any commitment to alter his interest in his residence. With evidence developed through discovery and notice of a pending asset transfer, the outcome before another court in future may well be different.

[4] The defendants argue that they won the motion and seek over $100,000 in costs from the plaintiff. They rely on law to the effect that absent extraordinary circumstances, a party who is unsuccessful in a motion for an interlocutory injunction should pay costs forthwith. See: Cana International Distributing Inc. v. Standard Innovation Corp., 2011 ONSC 752 (SCJ) at para 7.

[5] In para 2, of my Endorsement, I wrote, “[e]lements of the evidence of the defendant Voudouris challenge common sense, well-established business practice, and are, quite frankly, phantasmagorical.” The defendant is a professional accountant and would have the court believe that he entered into a substantial transaction for himself and with his longstanding client with no investigation, no due diligence, none of the normal protections for funds advanced pending receipt of promised securities, few legal documents, no correspondence, no notes, and virtually no financial records. He challenges the characterization of the transaction as fraudulent even today despite the “promoter” having gone to jail for this precise type of transaction and despite the utter absence of any performance by the promoter i.e. neither the plaintiff nor the defendant Voudouris have received their promised interests. In fact, Mr. Voudouris advanced funds to the “promoter” after he had been charged. A normal accountant acting as a bona fide third party would not have behaved anything like how Mr. Voudouris behaved and is behaving.

[6] If the plaintiff succeeds at trial, it is quite likely that he will be able to point back at this motion and say that but for the defendants’ deceptiveness, he would likely have succeeded. If the defendants are successful at trial, then they too will be able to point back at the motion and say that it ought not to have been brought.

[7] In exercising my discretion as to costs, it seems to me that this is an exceptional case. The outcome of the case will be most telling as to where the burden of costs should lie for this motion. I fix the costs on a partial indemnity basis at $85,000 all-inclusive and order that costs of this motion in that amount shall be in the cause.

F.L. Myers J.

Date: March 30, 2015