SUPERIOR COURT OF JUSTICE
NEUTRAL CASE CITATION NO. 6731
SUPERIOR COURT OF JUSTICE
HER MAJESTY THE QUEEN
v.
PERRY HATZIPETRAKOS
R E A S O N S F O R S E N T E N C E
BEFORE THE HONOURABLE MADAM JUSTICE M. FUERST
on AUGUST 13, 2015 at BARRIE, Ontario
Appearances:
M. Levasseur Counsel for the Provincial Crown
D. Northcott Counsel for Perry Hatzipetrakos
superior COURT OF JUSTICE
T A B L E O F C O N T E N T S
WITNESSES
IN-CH
CR-EX
RE-EX
No Witness Examinations
Transcript Ordered....................... August 24, 2015
Transcript Completed..................... October 14, 2015
Ordering Party Notified..................
THURSDAY, AUGUST 13, 2015
R E A S O N S F O R S E N T E N C E
FUERST, J.(Orally):
In an era of busy courts and limited resources, the prosecution of economic crimes is sometimes viewed as less pressing than the prosecution of crimes of violence. As this case illustrates, however, economic crimes have the potential to wreak havoc on the lives of their victims.
Perry Hatzipetrakos pleaded guilty to a global count of fraud over $5,000, which encompassed numerous victims and a total loss of almost $300,000. To date, none of the victims have been repaid.
Counsel for the Crown and for Mr. Hatzipetrakos agree that he should receive a two year penitentiary sentence. Mr. Hatzipetrakos resists, however, the imposition of a period of probation to follow, and in particular opposes a condition requiring him to pay restitution during the currency of the probation order. His counsel submits that a stand-alone restitution order will provide the victims with a vehicle to pursue repayment.
The Circumstances of the Offence
Perry Hatzipetrakos has been a contractor in the Midland area for the past few decades. He is an established businessman. His family has lived in the area for over 30 years.
From September 2008 until approximately September 2011, Mr. Hatzipetrakos owned and operated Midland Décor. The company sold doors and windows on a retail basis. It was also involved in construction and renovation activities.
Mr. Hatzipetrakos admits that between December 1, 2007 and January 31, 2012, he defrauded more than 30 people in the Midland area. His victims ranged in age from 47 to 87 years, but most were seniors.
The facts of the offence are set out in detail in the Agreed Statement of Facts. These Reasons provide a summary only.
Some victims were sought out by Mr. Hatzipetrakos, for example through contacts in construction businesses. Most of the victims met Mr. Hatzipetrakos when receiving an estimate or making a purchase of windows or doors.
In some instances, Mr. Hatzipetrakos received money from victims for the purchase of windows and doors that were not provided as agreed. Sometimes, he provided no product at all. In other cases, he provided a cheaper version of the product that had been ordered, and/or he failed to complete the installation of the product, and/or the work he did was of poor quality or unfinished. On other occasions, he took money in exchange for renovation work that he did not complete.
Mr. Hatzipetrakos approached some victims for loans. If the loan was made, he often issued a promissory note that would establish the amount of money owed, with a promise of repayment in a certain time with interest sometimes as high as 49 per cent, or compensation with products such as windows or doors or renovation work to be done. He told victims that the money would be paid back as he received draws from large construction contracts.
Mr. Hatzipetrakos maintained contact with many of his victims. He made promises to them that the product or their money would come soon. Sometimes he provided cheques, which could not be cashed because of insufficient funds.
Many of the victims had to pay additional money to other contractors to complete the work in respect of which Mr. Hatzipetrakos had received funds.
The total amount of the fraud was $285,234.
Many victims felt that Mr. Hatzipetrakos was trying to keep his business open in hard economic times and that it was their duty to help him. They referred to him as being charming and smooth.
Several Victim Impact Statements were filed. The authors expressed feelings of anger, anxiety, humiliation, and embarrassment because of their victimization by Mr. Hatzipetrakos. Some could not afford the financial loss they suffered.
The Circumstances of Mr. Hatzipetrakos
Mr. Hatzipetrakos is 55 years old. He is married. He and his wife have two children, who are self-supporting adults.
Mrs. Hatzipetrakos is employed in advertising. She remains supportive of her husband.
Mr. Hatzipetrakos did not complete high school. He has worked in the construction and home renovation fields. Before opening Midland Décor, he ran two successive unsuccessful businesses.
He told the author of the pre-sentence report that Midland Décor closed in 2012 because of lack of clientele and an economic recession.
Mr. Hatzipetrakos has been bankrupt twice in the past, most recently in 2000.
Mr. Hatzipetrakos has no prior criminal record. However, in January of this year he was found guilty of the offence of unfair practice under the provincial Consumer Protection Act. He received a suspended sentence plus probation for two years. The conditions of the probation included that he pay $67,500 in restitution in accordance with a specified schedule and that he perform 80 hours of community service. He has largely adhered to the payment schedule, but has yet to perform any community service.
Mr. Hatzipetrakos began working as a carpenter for a Toronto company in February 2012. He became a foreman. He is a member of the United Brotherhood of Carpenters and Joiners of America. He is described as a reliable and hardworking employee. He earned just over $38 per hour and was engaged in work on one or more large projects. After he was laid off for a short period of time between jobs, he chose not to return to work because of the outstanding criminal court proceedings. A letter provided by a representative of the company states that it is willing to employ Mr. Hatzipetrakos in the future and that it is "looking forward to his return".
The house in which Mr. and Mrs. Hatzipetrakos live in Penetanguishene is listed for sale at a price in excess of $300,000. Counsel for Mr. Hatzipetrakos advised that there are liens against the property that reduce the available equity. Mr. Hatzipetrakos asserts that he is struggling financially. He states that he owes money to Canada Revenue Agency. Additionally, he must pay restitution at the rate of $500 per month under the terms of the existing order.
The author of the pre-sentence report observed that Mr. Hatzipetrakos was cooperative during the interview she conducted with him, but that he was not very forthcoming with information.
In court, Mr. Hatzipetrakos expressed that he did not know how things got to where they did, but that he was truly sorry.
The Positions of the Parties
On behalf of the Crown, Mr. Peters seeks a sentence of two years in jail, followed by three years of probation. He also requests a stand-alone restitution order in the amount of the admitted loss, and a DNA order. He submits that deterrence is an important objective of sentencing in fraud cases. The total amount of this fraud was not minimal. The fraud occurred over a span of years, and involved a gross manipulation of well-meaning people. While the financial loss suffered by individual victims was not extraordinary, many were on fixed incomes and the financial impact for them was significant. The guilty plea avoided victims having to testify, but Mr. Hatzipetrakos has demonstrated a lack of insight into the harm he caused. Mr. Peters submits that Mr. Hatzipetrakos should pay some restitution to his victims as part of the conditions of probation. He is employable, and he and his wife own a well-appointed home that is up for sale.
On behalf of the defence, Mr. Northcott agrees that a sentence of two years in jail should be imposed, and that there should be a free-standing restitution order. He opposes the Crown's request for probation and for a DNA order. He agrees that there are aggravating factors, including that a number of the victims were elderly. He emphasizes, however, that Mr. Hatzipetrakos pleaded guilty and accepted responsibility for his offence. He is facing incarceration for a significant period, he is already subject to a probation order that requires him to pay a substantial amount of restitution in respect of another matter, and in the event his home is sold there will be little to no equity to realize. It is not realistic to impose another probation order that requires Mr. Hatzipetrakos to pay restitution to the victims of this offence. A free-standing restitution order will enable the victims to pursue repayment civilly.
The Principles of Sentencing
The objectives of sentencing long recognized at common law have been codified in s. 718 of the Criminal Code. They are: the denunciation of unlawful conduct, deterrence both general and specific, the separation of the offender from society where necessary, rehabilitation, reparation for harm done to the victims or the community, and promotion of a sense of responsibility in offenders and acknowledgement of the harm done.
Section 718.1 provides that a sentence must be proportionate to the gravity of the offence and the degree of responsibility of the offender. Section 718.2 provides that a sentence should be increased or decreased to account for any aggravating and mitigating circumstances. It sets out various aggravating factors. It also requires that a sentence be similar to those imposed on similar offenders in similar circumstances, that the combined duration of consecutive sentences not be unduly long, that an offender not be deprived of liberty if less restrictive sanctions may be appropriate, and that all available sanctions other than imprisonment that are reasonable in the circumstances be considered.
Analysis
The offence of fraud over $5,000 now attracts a maximum sanction of 14 years in jail. In R. v. Bogart (2002), 2002 41073 (ON CA), 61 O.R. (3d) 75, the Ontario Court of Appeal described it as a serious offence, and held that in cases of major fraud, general deterrence is the most important sentencing principle.
There can be no doubt that this is a case of major fraud. Mr. Hatzipetrakos deceived numerous honest members of the community over a long period of time, for his economic benefit and to their economic detriment. He now pleads that he is financially ruined. The suggestion that his victims can pursue him civilly with the assistance of a stand-alone restitution order offers little comfort, given that many of the victims are in their senior years. The fact that in the months since his arrest he offered his victims nothing by way or repayment can fairly be described as appalling.
The offence involves significant aggravating factors. They include:
The amount of the fraud, which totals almost $300,000;
The lengthy period of time of some four years over which the fraud was perpetrated;
The number of victims involved;
The fact that Mr. Hatzipetrakos preyed upon the good faith of members of the community, many of whom were senior citizens;
The calculated nature of his conduct;
The impact on the victims, both financial and emotional;
The fact that no restitution has been made or even offered.
In mitigation, Mr. Hatzipetrakos pleaded guilty, albeit on the eve of trial and in the face of inevitable conviction. Crown counsel fairly acknowledged that the guilty plea spared the necessity for victims to testify or for the Crown to apply to adduce their out-of-court statements. Although this was not an early plea, I take it as a sign of remorse and acceptance of responsibility for the offence. In court, Mr. Hatzipetrakos expressed a measure of remorse in his remarks at the conclusion of the sentencing hearing. I also take into account that he is a first offender, and that he has family support, which will assist him in his reintegration into the community.
Deterrence, both general and specific, is the paramount consideration in fixing the appropriate sentence for Mr. Hatzipetrakos. Denunciation must also be emphasized. Rehabilitation is of lesser significance, although I do not lose sight of it given that Mr. Hatzipetrakos is a first offender.
I am satisfied in the circumstances of the offence and of Mr. Hatzipetrakos that the term of imprisonment of two years jointly recommended by counsel is appropriate.
Section 731(1) of the Criminal Code gives a court discretion to impose a probation order in addition to a jail term not exceeding two years, having regard to the age and character of the offender, the nature of the offence, and the circumstances surrounding its commission. Section 732.1(3)(h) permits the court to order reasonable conditions, in addition to those that are mandatory, for protecting society and facilitating the offender's successful reintegration into the community. Conditions must be reasonable, because probation is not intended to be a punitive sanction.
Mr. Hatzipetrakos is a mature, 55 year old first offender who committed a crime of dishonesty, albeit one that involved multiple acts of deceit. Crown counsel attributed the offence to greed on his part. There is no suggestion that Mr. Hatzipetrakos suffers from a substance abuse or mental health or emotional problem in need of remediation. He is not socially isolated, itinerant, or lacking in family support.
I have concluded that a period of probation would serve no real purpose in the specific circumstances of this offence and this offender. Requiring Mr. Hatzipetrakos to report to a probation officer, or take counselling, or pay a predetermined amount of restitution upon his release from the penitentiary, all as Crown counsel suggested, is not required to protect society or to facilitate the reintegration of Mr. Hatzipetrakos into the community.
I am satisfied that a stand-alone restitution order, as jointly recommended by counsel, is appropriate. Mr. Hatzipetrakos is employable and has the ability to earn a healthy income in the future.
I am not satisfied that a DNA order should be made, given that the offence is an economic crime, there was no issue of identity of the perpetrator, and Mr. Hatzipetrakos is a first offender.
Conclusion
Mr. Hatzipetrakos, please stand. I sentence you to two years in the penitentiary.
I make a stand-alone restitution order in favour of the victims named in Exhibit 1B and in the amounts specified, which total $285,234. You can be seated while we do the paperwork.
Is there anything Ms. Levasseur, Mr. Northcott that needs to be clarified?
MR. NORTHCOTT: No Your Honour it's been covered, thank you.
MS. LEVASSEUR: No thank you.
FORM 2
Certificate of Transcript
Evidence Act, subsection 5(2)
I, Shannon Heryet, certify that this document is a true and
accurate transcript of the recording of R. v. Perry Hatzipetrakos in the Ontario Superior Court of Justice, held at 75 Mulcaster Street, Barrie, Ontario, taken from Recording No.(’s) 3811-02-20150813- 090713-10-FUERSTM which has been certified in Form 1.
October 30, 2015 __________________________________
Shannon Heryet - ACT #3389634078