Court File and Parties

COURT FILE NO.: CV-18-603484

DATE: 20201130

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: ANNE WOODS, Plaintiff

-and-

ABBAS PETER JAHANGIRI, VICTOR SRADJOV, SEEMA PODDAR, JOHN DOE, JANE DOE and DOE CORPORATIONS, Defendants

BEFORE: Sanfilippo, J.

COUNSEL: Norman Groot, lawyer for the Plaintiff

Robert Kligerman, as agent for the self-represented Defendant, Abbas Peter Jahangiri

No one appearing for the Defendant Seema Poddar (not served) and Victor Sradjov (noted in default)

HEARD: November 30, 2020

ENDORSEMENT

Overview

[1] The Plaintiff, Anne Woods, brought this Motion today against the Defendant Abbas Peter Jahangiri (the “Responding Defendant”), without notice, for broad injunctive relief, primarily in the nature of a Mareva injunction.

[2] I addressed first the issue of notice as the Plaintiff had not served the Responding Defendant. The Plaintiff initiated this action over two years ago, on August 16, 2018, claiming damages against Mr. Jahangiri in the amount of $327,000 based on alleged fraud, breach of trust, breach of fiduciary duty, conversion, conspiracy, unjust enrichment and breach of contract. She also claimed liquidated, special, punitive, aggravated and exemplary damages. I will not address the relief that the Plaintiff seeks against Victor Sradjov and Seema Poddar because it is not material to this Motion.

[3] Mr. Jahangiri defended this action by statement of defence delivered on September 29, 2018 and continues in his defence of the claims advanced by Ms. Wood. He delivered his Affidavit of Documents, sworn September 13, 2019, and was examined for discovery by the Plaintiff on November 11, 2019. He is currently self-represented but has at times been represented in this Action by counsel.

[4] The first issue that I heard today was whether the Plaintiff was required to provide notice of this Motion to Mr. Jahangiri. For reasons rendered in another Endorsement earlier today (Woods v. Jahangiri, 2020 ONSC 7401), I determined that the Plaintiff must provide notice to Mr. Jahangiri of the relief sought in this Motion. I adjourned this Motion to 2:00 pm today to allow the Plaintiff an opportunity to provide notice to Mr. Jahangiri and to counsel retained on his behalf, and to allow Mr. Jahangiri an opportunity to participate and be heard on this Motion, either directly or through counsel.

[5] At the continuation of this Motion, Mr. Robert Kligerman appeared on behalf of Mr. Jahangiri, not as litigation counsel but as Mr. Jahangiri’s commercial and real estate lawyer. Mr. Kligerman confirmed that Mr. Jahangiri had been notified of this Motion but would not be attending. Mr. Kligerman asked, on Mr. Jahangiri’s behalf, for an adjournment and made submissions regarding the relief sought by the Plaintiff.

[6] For the reasons that follow, I grant Mr. Jahangiri’s adjournment request on all aspects of this Motion except for the Mareva Order sought to preserve the net sale proceeds of the sale pending today of a property owned by Mr. Jahangiri and known municipally as 81 Nelson Street, Hensall, Ontario (“the Hensall Property”). I order that these net sale proceeds be preserved by the lawyer acting for Mr. Jahangiri on that sale until December 8, 2020, on which day this Order shall expire unless extended by a further Order of this Court. The Plaintiff shall provide an undertaking as to damages. The remainder of the relief sought by the Plaintiff on this Motion shall be adjourned to the civil motion list of December 8, 2020.

I. THE RELIEF SOUGHT ON THIS MOTION

[7] I set out in my earlier Endorsement the relief sought on this Motion and will reproduce it here for ease of reference. The Plaintiff seeks the following injunctive relief as against the Responding Defendant:

(a) An interim and interlocutory Mareva injunction, restraining the Responding Defendant from disposing of or dealing with any assets, worldwide, that have a value up to $327,000, pending final disposition of this Action, or engaging in any transaction that has the effect of transferring assets out of Ontario, or instructing anyone from doing so on his behalf; and

(b) As an ancillary order to the Mareva injunction, that the Responding Defendant prepare and provide to counsel for the Plaintiff, within seven days, a sworn declaration describing the nature, value and location of all his assets, worldwide; and

(c) As an ancillary order to the Mareva injunction, that the Responding Defendant provide an accounting of the transfers affecting funds received from the Plaintiff; and

(d) An Order that a non-party, the Toronto-Dominion Bank, produce and provide to counsel for the Plaintiff information and documents to confirm where three bank drafts provided by the Plaintiff to the Responding Defendant were deposited, including the specific institution, full bank account number and account holder name, in regard to three cheques drawn by the Plaintiff on her bank account at the TD Bank on April 30, 2016, June 13, 2016 and June 17, 2016; and

(e) An Order requiring the Responding Defendant to appear before this Court, by video conference, within 10 days to respond to the Plaintiff’s request to extend the terms of any Order provided.

[8] Additionally, the Plaintiff sought, as alternative relief, an Order that her counsel termed a “Payplus Order”, referred to as such further to terms provided in an unreported decision by that name. By this term, the Plaintiff intended an Order that this Motion be adjourned, and the Responding Defendant be ordered to provide an accounting and a sworn declaration describing the “nature, value and location of all assets, wherever situated in the world, whether in his own name or not and whether solely or jointly held”. I saw no connection between this alternative relief and the urgency said by the Plaintiff to arise from the pending sale of the Hensall Property.

[9] The moving party Plaintiff sought expansive relief, much broader than the issue that gives rise to the urgency and certainly well-beyond the scope of submissions that can be made in the time estimate committed to by the Plaintiff at Civil Practice Court for argument of this Motion: thirty minutes. The extensive evidentiary record showed that the recent development that grounds the Plaintiff’s claim of urgency in the midst of this two-year action is that the Responding Defendant has contracted to sell the Hensall Property. The Plaintiff submitted that the sale of the closing of the Hensall Property is pending for today.

[10] In these circumstances, I will address the Plaintiff’s submission, made in urgent circumstances, that there is the potential for dissipation of the sale proceeds from the sale of the Hensall Property if a Mareva injunction is not issued. The remainder of the relief sought in this Motion is adjourned to December 8, 2020.

II. ANALYSIS

A. Principles Pertaining to the Interim Interlocutory Injunctive Relief

[11] Section 140 of the Courts of Justice Act, R.S.O. 1990, c. C43, sets out the Court’s authority to grant injunctive relief:

In the Superior Court of Justice, an interlocutory injunction or mandatory order may be granted or a receiver or receiver and manager may be appointed by an interlocutory order, where it appears to a judge of the court to be just or convenient to do so.

[12] Rule 40.01 provides that an interlocutory injunction may be obtained on motion to a judge by a party to a pending or intended proceeding:

An interlocutory injunction or mandatory order under section 101 or 102 of the Courts of Justice Act may be obtained on motion to a judge by a party to a pending or intended proceeding.

[13] The test for granting an interlocutory injunction is well known. The Supreme Court of Canada adopted it in RJR-MacDonald Inc. v. Canada (Attorney General), 1994 117 (SCC), [1994] 1 S.C.R. 311, at p. 344, and developed it further in R. v. Canadian Broadcasting Corp., 2018 SCC 5, [2018] 1 S.C.R. 196, at paras. 17-18. The Supreme Court stated that the Court must assess the following:

(a) whether the moving party has demonstrated a strong prima facie case that it will succeed at trial;

(b) the moving party must demonstrate that irreparable harm will result if the relief is not granted; and

(c) the moving party must show that the balance of convenience favours granting the injunction.

[14] These inquiries are not a checklist. They are not “independent hurdles”. Rather, “[t]hey should be seen in the nature of evidence relevant to the central issue of assessing the relative risks of harm to the parties from granting or withholding interlocutory relief”: Catalyst Capital Group Inc. v. Moyse, 2014 ONSC 6442, 122 O.R. (3d) 741, at para. 75, citing Robert J. Sharpe, Injunctions and Specific Performance, looseleaf, (Toronto: Canada Law Book, 2013), at para. 2.630.

[15] In 2092280 Ontario Inc. v. Voralto Group Inc., 2018 ONSC 2305 (Div. Ct.), at para. 16, the Ontario Divisional Court set out five requirements for a Mareva injunction:

(a) The plaintiff must make full and frank disclosure of all material matters within his or her knowledge;

(b) The plaintiff must give particulars of the claim against the defendant, stating the grounds of the claim thereof, and the points that could fairly be made against it by the defendant;

(c) The plaintiff must give grounds for believing that the defendant has assets in Ontario;

(d) The plaintiff must give grounds for believing that there is a real risk of the assets being removed out of Ontario or disposed of within Ontario or otherwise dealt with so that the plaintiff would be unable to satisfy a judgment awarded to her;

(e) The plaintiff must give an undertaking as to damages.

[16] I analysed these requirements on the evidence filed as they pertain to the urgency said to arise from the pending sale of the Hensall Property.

B. The Evidence Supporting the Relief Sought

[17] Ms. Woods testified by affidavit sworn November 23, 2020 (the “Woods Affidavit”). The Plaintiff also tendered the affidavit evidence of Daina Slenys, a law clerk in the office of the Plaintiff’s lawyers. Each affidavit contained numerous exhibits. The evidentiary record on this Motion comprised some 472 pages.

(i) Strong Prima Facie Case

[18] In R. v. CBC, at para. 17, the Supreme Court instructed that a “strong prima facie case” necessitates that the motion judge must be satisfied that, “on a preliminary review of the case”, there is a strong likelihood “on the law and the evidence presented” that at trial the moving party would be ultimately successful in proving the allegations pleaded.

[19] Ms. Woods deposed that she is a seventy-year-old retired school teacher who met Mr. Jahangiri in 2009 through school-related activities. Ms. Woods stated that Mr. Jahangiri presented to her his charitable work in Haiti and the Dominican Republic. Ms. Woods deposed that in early 2015, Mr. Jahangiri represented to her that he had purchased beach front property in the Dominican Republic, to assist local children in need. Thereafter, he is alleged to have told Ms. Woods that she had an opportunity to purchase land of her own in the Dominican Republic.

[20] Ms. Woods deposed that Mr. Jahangiri offered to sell to Ms. Woods property that Mr. Jahangiri owned in the Dominican Republic, representing the he had good title to the property, that he had built a home for special needs children on the property and that he owned some 22 other properties in the Dominican Republic. Ms. Woods deposed that Mr. Jahangiri promoted to her that through buying the Dominican Property, she would be able to live a dream retirement on the beach while assisting children in need.

[21] Ms. Woods stated that she forwarded the following monetary transfers to Mr. Jahangiri through bank drafts issued by her banker, the Toronto-Dominion Bank: on April 30, 2016, the sum of $50,000; on June 13, 2016, the sum of $140,000; on June 17, 2016, the sum of $100,000. Ms. Woods deposed that on June 18, 2016, Mr. Jahangiri forwarded to her an email stating that for her investment of $290,000, she was the new owner of a Dominican Property, which he would hold in trust for her until the legal transfer was completed.

[22] Ms. Woods stated that in October 2016, she transferred a further amount of $37,000 (bank drafts of $22,000 and $15,000) to Mr. Jahangiri “to make the Dominican Property suitable for my accommodation”. This increased the amount of funds transferred by Ms. Woods to $327,000.

[23] Ms. Woods stated that in January 2017, after months of requests, Mr. Jahangiri provided her with what he represented was an original copy of the title deed for the Dominican Property, dated January 18, 2017. Ms. Woods deposed that on investigation conducted in the Dominican Republic, she has been advised that she does not have an ownership interest in any property in the Dominican Republic. Specifically, Ms. Woods deposed that, further to investigations conducted on her behalf by local agents, she was advised on January 22, 2018 that she is not registered as an owner of any property in the central Registry of Titles in the Dominican Republic. Ms. Woods testified that on November 20, 2017, Mr. Jahangiri offered to transfer to her the Hensall Property to resolve her claim for the funds that she had provided to him for the purchase of a property in the Dominican Republic.

[24] The Plaintiff has tendered evidence, in this record, that Mr. Jahangiri has admitted to the receipt of funds from Ms. Woods and has admitted to representing that he was holding property in the Dominican Republic in trust for Ms. Woods. The evidence in this record also showed that Ms. Woods has not received title to any property for the funds that she advanced in furtherance of acquisition of a foreign property interest.

[25] On the motion record filed, I am satisfied that, upon a preliminary review of the evidence presented, the Plaintiff has demonstrated a strong prima facie case.

(ii) Irreparable Harm

[26] “Irreparable harm” means harm to the moving party that cannot be monetarily quantified, or which cannot be cured, usually because one party cannot collect damages from the other: RJR-MacDonald, at p. 341; Christian-Philip v. Rajalingam, 2020 ONSC 1925, at para. 33. In Amphenol Canada Corp v. Sundaram, 2020 ONSC 328 (Div. Ct.), at paras. 37-39, F.L. Myers J. stated that “the defendants’ ability to pay is very much a part of the interlocutory injunction calculus”. In Sibley & Associates LP v. Ross, 2011 ONSC 2951, at para. 63, Strathy J. (as he then was) found that “the risk of removal or dissipation of assets can be established by inference, as opposed to direct evidence, and that inference can arise from the circumstances of the fraud, itself.”

[27] The evidence established that this action did not progress procedurally from January to November 2020 because Mr. Jahangiri was in the Dominican Republic and was unable to return to Canada. He declined to conduct litigation steps on a virtual platform, as proposed by the Plaintiff. On the evidence in this motion, the Plaintiff submitted that Mr. Jahangiri’s ability to pay a judgment rendered in favour of Ms. Woods is contingent on the net sale proceeds from the Hensall Property. Ms. Woods and Ms. Slenys deposed that they have only been able to identify one other property in Ontario in which Mr. Jahangiri has an interest, and that it has modest value. Ms. Woods submitted that she will be irreparably harmed if Mr. Jahangiri transfers out of Ontario the net sale proceeds from the sale of the Hensall Property.

[28] Mr. Kligerman submitted that he understands that Mr. Jahangiri intends to be in Ontario for the foreseeable future and that he believes that Mr. Jahangiri has a good defence to the claim advanced by Ms. Woods. Mr. Kligerman stated that if a judgment were rendered against Mr. Jahangiri, he is entirely confident that it would be paid. He does not consider that the sale of the Hensall Property is indicative of any dissipation of assets by Mr. Jahangiri and submitted the there is no indication that Mr. Jahangiri intends to remove the net sale proceeds from the jurisdiction. None of these submissions were grounded in evidence in the record before me, and so could not factor in my analysis of this motion. If this evidence is filed in admissible form on the next hearing of this Motion on December 8, 2020, it can be considered by the Court at that time, in its discretion.

[29] The risk of asset flight or dissipation can be reasonably inferred from the material facts supporting a strong prima facie case of fraud having been committed against the plaintiff: 663309 Ontario Inc. v. Bauman, 2000 22640, 190 DLR (4th) 491, at para. 41; Mills and Mills v. Petrovic, 1980 1871, 30 O.R. (2d) 238; Sibley & Associates v. Ross, 2011 ONSC 2951, at paras. 63-65. In the absence of any evidence of a means to satisfy any judgment if the single asset identified by the Plaintiff of sufficient value to meet her claim is transferred out of Ontario, the Plaintiff has, in my determination established irreparable harm through the serious risk of dissipation of the net sale proceeds from the sale of the Hensall Property.

(iii) The Balance of Convenience

[30] The balance of convenience analysis requires a determination of which party will suffer greater harm from the granting or the refusal of the remedy sought: RJR-MacDonald, at p. 342, citing Manitoba (Attorney General) v. Metropolitan Stores (MTS) Ltd., 1987 79 (SCC), [1987] 1 S.C.R. 110, at p. 129.

[31] The Plaintiff contended that the balance of convenience favours granting the interim Mareva Order as Ms. Woods could otherwise be deprived of any asset against which to enforce her claim, based in breach of trust and fraud. Mr. Klingerman submitted that it is unfair for Mr. Jahangiri to be deprived of the use of the net sale proceeds from the sale of the Hensall Property while the Plaintiff has not proven her case.

[32] I have concluded that the balance of convenience favours granting an Order for the interim preservation of the net sale proceeds, but only until December 8, 2020, consistent with Rule 40.02(1) which provides as follows:

An interlocutory injunction or mandatory order may be granted on motion without notice for a period not exceeding ten days.

[33] Although Mr. Jahangiri was notified of this Motion during the hearing day, I found earlier that he ought to have been served with this Motion Record in advance, in accordance with Rule 37.07(1). Accordingly, I will treat this interim interlocutory order as having been issued without notice and this Order will thereby be valid for a “period not exceeding ten days”: in this case, until December 8, 2020.

[34] In addition to ensuring compliance with Rule 37.07(1), I am satisfied that the eight-day duration of this Order balances the risk of harm identified by Ms. Woods with the ability of Mr. Jahangiri to file evidence in support of his position that the relief granted by this Order ought not to be extended beyond December 8, 2020.

(iv) Undertaking as to Damages

[35] Rule 40.03 provides as follows:

On a motion for an interlocutory injunction or mandatory order, the moving party shall, unless the court orders otherwise, undertake to abide by any order concerning damages that the court may make if it ultimately appears that the granting of the order has caused damage to the responding party for which the moving party ought to compensate the responding party.

[36] Ms. Woods deposed to the provision of an undertaking as to damages, as follows: “By way of this affidavit, I provide an Undertaking As to Damages for any damages that Jahangiri may incur as a result of this Court issuing a Mareva injunction in this Action, should it later be decided that the injunction should not have been granted and Jahangiri has suffered damages as a result.” (Woods Affidavit, para. 115).

[37] As a term of my Order, the Plaintiff shall provide an undertaking as to damages, in accordance with Rule 40.03

C. Conclusions

[38] I conclude that the moving party Plaintiff has established an entitlement to a Mareva Order preserving the net sale proceeds from the sale of the Hensall Property, to the maximum amount of $327,000, being the amount claimed by the Plaintiff. This Order will expire on December 8, 2020 unless extended by a further Order of this Court.

[39] All expenses and disbursements resulting from the closing of the sale of the Hensall Property may be deducted and thereby paid from the funds received on closing. These include the real estate agent’s commissions, the lawyer’s fees and all other routine adjustments from the closing proceeds. The net sale proceeds shall be held by the lawyer acting for Mr. Jahangiri on the real estate transaction up to the maximum amount of $327,000. Mr. Kligerman will provide this Endorsement, and its resultant Order, to his client Mr. Jahangiri, and they will provide this Endorsement, and its resultant Order, to the real estate lawyer acting on Mr. Jahangiri’s behalf in the closing of the sale of the Hensall Property. As a motion brought without notice, the moving party Plaintiff shall comply with Rule 37.07(4).

[40] All other relief sought by the moving party Plaintiff in this Motion shall be adjourned to December 8, 2020. I am not seized of this Motion.

III. DISPOSITION

[41] I order as follows:

(a) An interim interlocutory injunction in the nature of a Mareva Order shall issue against the Defendant Abbas Peter Jahangiri requiring the preservation, by the lawyer acting on behalf of this Defendant in the sale of property known municipally as 81 Nelson Street, Hensall, Ontario (the “Hensall Property”), of the adjusted net sale proceeds resulting from the sale of the Hensall Property up to the maximum amount of $327,000.

(b) The interim interlocutory injunction shall be in effect until December 8, 2020, at 4:30 pm, at which time it will expire, subject to further Order of this Court.

(c) The Plaintiff shall comply with Rule 37.07(4).

(d) The Plaintiff shall provide an undertaking as to damages, in accordance with Rule 40.03.

(e) All other relief sought by the Plaintiff in this Motion is adjourned to December 8, 2020.

(f) The costs of this Motion shall be reserved to the Judge hearing this Motion on December 8, 2020.

Sanfilippo, J.

Date: November 30, 2020