CITATION: Joannette v. Alton and Fisher, 2015 ONSC 1997
COURT FILE NO.: C-180-12
DATE: 2015-03-27
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
Nelson Joannette
Simon J. Adler, Counsel for the Plaintiff
Plaintiff
- and -
Josh Alton
Roy A. Fisher, Alysia Alton
Defendants
Kelli Preston, Counsel for the Defendant,
Roy A. Fisher
HEARD: February 9, 10, 11 and 12, 2015
THE HONOURABLE MR. JUSTICE P.J. FLYNN
REASONS FOR JUDGMENT
[1] This four day trial was chiefly concerned with the contest between the Plaintiff and the Defendant, Roy Fisher. Alysia Alton did not defend and on May 29, 2012, the Plaintiff obtained judgment (since satisfied) against her in the amount of $34,857.33, plus interest and costs.
[2] While Josh Alton (Alysia’s brother) did deliver a Statement of Defence, he did not appear at the trial and in the result, for the oral reasons given by me after the evidence and argument were in, I gave judgment against him in the total amount of $103,759.94, plus costs of $15,000 on a full indemnity basis.
[3] It became evident throughout the trial that Mr. Alton was the principal scoundrel in the piece.
[4] So the dispute on display was only between the Plaintiff and the Defendant, Fisher.
[5] Against him, the Plaintiff had claimed:
(i) an accounting of money received for the use, benefit and in trust for the Plaintiff;
(ii) damages for conversion, breach of trust and money had and received to the use of the Plaintiff; and
(iii) punitive, exemplary or aggravated damages.
[6] About half the judgment awarded against Josh Alton was for punitive or exemplary damages.
[7] The Plaintiff alleged that Fisher, then a practicing lawyer in Toronto, acted for him and the lender, Orenstein, on a $90,000 mortgage transaction on the Plaintiff’s recreational property in Brant County.
[8] He claims that the $90,000 in proceeds were first to retire an earlier mortgage for about $20,000 and then to provide the Plaintiff with about $70,000, which was to be invested by Josh Alton in residential properties in Detroit, Michigan.
[9] The $20,000 earlier mortgage was indeed paid out by Fisher, but the Plaintiff never saw the other $70,000.
[10] Instead, Fisher, acting on Mr. Alton’s instructions, paid that money to or for Mr. Alton or his sister, the Defendant, Alysia Alton.
[11] The Plaintiff says that Fisher is strictly liable for the return of the $70,000. He also alleges Fisher was his lawyer and a trustee of the full $90,000. However, because of the Plaintiff’s satisfied judgment against Alysia Alton, the principal amount claimed against Mr. Fisher has been virtually cut in half.
[12] Since November 10, 2014, Fisher no longer has a license to practice law in Ontario. It was revoked because he knowingly participated in fraudulent transactions and failed to be on guard against being duped. However, for the following reasons, the Plaintiff shall not have judgment against Mr. Fisher.
[13] This defrocked solicitor was the most candid and truthful of the witnesses at trial. I find that he did not act for the Plaintiff on the mortgage in question. Rather, in spite of their protestations to the contrary, I find that the Plaintiff’s long time spouse, William Hoskinson, acted for the Plaintiff in this transaction, just as he had done before on many occasions. And, in particular, as he did with respect to the earlier mortgage transaction for $150,000 where Mr. Orenstein was also the lender and Fisher was also his solicitor.
[14] Mr. Hoskinson is also a lawyer, with a mostly commercial practice centered in the home he shares with the Plaintiff. The fax machine there in his office is regularly used by both Mr. Hoskinson and the Plaintiff. Most of the communications between the parties here occurred by the use of that fax machine. Mr. Hoskinson well knows Mr. Alton. So does the Plaintiff. They were friends.
[15] Mr. Hoskinson often had acted on other transactions where Alton was a buyer of real estate and Orenstein was the lender and where both Alton and Orenstein were represented by Fisher. The borrower in transactions was routinely referred to Mr. Hoskinson to act as their solicitor.
[16] I find that this is precisely what happened here: Fisher acted for Orenstein and Hoskinson acted for the Plaintiff, while Alton seemed to be calling the shots.
[17] Mr. Fisher’s letter of October 31, 2008 at Tab 8 of Exhibit 1 to Hoskinson confirms “your instructions on behalf of your client Nelson Joannette that I am to take instructions from Josh Alton as to the disposition of the remainder of the funds” (that is the approximately $70,000).
[18] In spite of a fax transmission report clearly showing that this letter was successfully transmitted to Mr. Hoskinson’s (and the Plaintiff’s) fax machine, Mr. Hoskinson denied ever seeing that letter.
[19] He had to make such a denial if he hoped that his spouse would prevail. That letter corroborates Mr. Fisher’s sworn evidence that he understood Mr. Hoskinson to be the Plaintiff’s solicitor in the transaction and that he was to dispose of the remaining Orenstein mortgage proceeds (other than the $20,000 TD Canada Trust payout) in accordance with Mr. Alton’s instructions.
[20] It became evident to me through this trial that, for the Plaintiff and Mr. Hoskinson, the truth was like a foul wind from a rendering plant – to be avoided whenever they faced it.
[21] Where the evidence of either or both of the Plaintiff and Mr. Hoskinson conflicts with the evidence of Mr. Fisher, I accept Mr. Fisher’s evidence without reservation.
[22] Mr. Hoskinson admitted in his testimony that:
(i) he acted on the estate of the Plaintiff’s mother;
(ii) he represented the Plaintiff on his bankruptcy;
(iii) he acted for the Plaintiff on an earlier Charge on the same property with the same lender;
(iv) he acted for the Plaintiff in OMB proceedings regarding the Brant County property; and
(v) he acted as the Plaintiff’s counsel on a trial regarding the same property as well as on the appeal.
[23] Mr. Joannette told the court that he never spoke to Mr. Fisher at all in regards to the transaction on which he claims Fisher was his lawyer.
[24] It is inconceivable to me that the Plaintiff did not rely on Mr. Hoskinson to see him through the transaction. Mr. Hoskinson acted for Mr. Joannette throughout the transaction – not only after there was trouble with it.
[25] The earlier $150,000 mortgage was a ruse to “puff up” the abstract on the property so as to dissuade Mr. Joannette’s neighbour from pursuing a lawsuit in what was apparently a no-equity situation. Or so the Plaintiff and his spouse testified.
[26] After Mr. Hoskinson had finished testifying, new information from the Plaintiff’s bankruptcy trustee was made available to Ms. Preston (Fisher’s counsel). A document from the trustee became Exhibit 15. This was material that the Plaintiff had refused to produce to the Defendant.
[27] Because of this new information, the Plaintiff was recalled for continued cross-examination by the Defendant. The confrontation of the Plaintiff with this document, Trustee’s Supplemental Report on Bankrupt’s Application for Discharge, produced a whole lot of bobbing and weaving around the truth. The document contained Mr. Joannette’s March 6, 2009 Affidavit, which in many ways is in stark contrast to his evidence given before being recalled. The Affidavit tells a completely different story.
[28] And, it was affirmed by the Plaintiff before Mr. Hoskinson.
[29] Both of them knew that much of it was not true.
[30] Moreover, the appendices to that Affidavit show several accounts for legal services from Hoskinson to Mr. Joannette in significant amounts, meant to explain the reasons for the earlier $150,000 mortgage. Quite a different tale than the one given by Mr. Joannette and Mr. Hoskinson in their evidence here. Mr. Joannette, after all, said that the mortgage only went on for a day and that the Trustee had been made aware of that.
[31] In any event, if the accounts by Mr. Hoskinson to his spouse were anything like reality and would show that Mr. Hoskinson had consistently acted for Mr. Joannette on so many occasions, why not on this one, the one that forms the subject of this lawsuit?
[32] It also defies belief that Mr. Hoskinson did not receive the one piece of Fisher correspondence that cements Mr. Fisher’s position. As they say in these parts of Ontario “something is rotten in Rothsay”.
[33] After Miss Preston had finished with Mr. Joannette, in her cross-examination on his recall, an interesting thing happened: Mr. Adler asked no questions in re-examination. He made no attempt whatsoever to rehabilitate his witness. It may be because he was acting in an ethical fashion realizing that such an effort would be a hopeless task. The Plaintiff is beyond salvage.
[34] Because all credibility has been knocked out of the Plaintiff’s sails and that of his spouse, the Plaintiff’s case must sink. I am satisfied on the balance of probabilities that Fisher was not the Plaintiff’s solicitor, that he did not breach any trust obligations, that he did as he was instructed to do and that there were no monies that were to be or were retained by him.
[35] The Plaintiff’s claim is therefore dismissed.
[36] If I am wrong about liability, I would assess damages against Mr. Fisher in the amount of $33,286.01, with pre-judgment interest in the amount of $217.52, in accordance with the calculations provided by Plaintiff’s counsel.
Costs
[37] I will fix costs, if sought, after I have reviewed submissions sent in accordance with the following directions:
(a) on or before April 17, 2015, the Defendant shall serve and deliver to me at my Kitchener chambers his written submissions, consisting of his Form 57B Costs Outline, augmented by no more than three double-spaced pages, together with his Bill of Costs and any relevant Offer(s) to Settle;
(b) then, on or before May 8, 2015, the Plaintiff shall serve and deliver, in like fashion, his written submissions, consisting of his Form 57B Costs Outline, augmented by no more than two double-spaced pages, plus any relevant Offer(s) to Settle.
P.J. Flynn J.
Released: March 27, 2015
CITATION: Joannette v. Alton and Fisher, 2015 ONSC 1997
COURT FILE NO.: C-180-12
DATE: 2015-03-27
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Nelson Joannette
Plaintiff
– and –
Josh Alton
Roy A. Fisher, Alysia Alton
Defendants
REASONS FOR judgment
P.J. Flynn J.
Released: March 27, 2015
/lr