COURT FILE NO.: CV-18-59210300CL
DATE: 20210408
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
COMFORT CAPITAL INC., THE BANK OF NOVA SCOTIA TRUST COMPANY, E. MANSON INVESTMENTS LTD., FENFAM HOLDINGS INC., 593651 ONTARIO LTD., 1031436 ONTARIO LTD., ALRAE INVESTMENTS INC., BARRY SPIEGEL, SHARON NIGHTINGALE, DAVID SUGAR, PHYLLIS SUGAR, NATIONAL TIRE LTD., 1119778 ONTARIO LIMITED, 1415976 ONTARIO LIMITED, ALRAE INVESTMENTS INC., BAMBURGH HOLDINGS LTD., BEVERLY GORDON, DIANE GRAFSTEIN, RICHARD GRUNEIR, B. & M. HANDELMAN INVESTMENTS LTD., RIDGEWAY OCCUPATIONAL CONSULTANTS INC., YERUSHA INVESTMENTS INC., MIHAL TYLMAN, A. ELIEZER KIRSHBLUM, 593651 ONTARIO LIMITED, THE BANK OF NOVA SCOTIA TRUST COMPANY IN TRUST FOR BAILEY LEVENSON, THE BANK OF NOVA SCOTIA TRUST COMPANY IN TRUST FOR ROSEMONDE KELLY, ANNE HANDELMAN, YERUSHA INVESTMENTS INC., CELMAR INVESTMENTS CORP., BEVERLY GORDON, PHILGOR INVESTMENTS LTD., 2227046 ONTARIO LIMITED, DAST PROPERTIES LIMITED, TOVA MARKOVZKI, JOSEPH SUCKONIC and B. & M. HANDELMAN INVESTMENTS LIMITED
Applicants
– and –
ANNIE YERETSIAN, 2399029 ONTARIO INC., 2457674 ONTARIO INC., MOSS DEVELOPMENT LTD. and TERRY WILSON
Respondents
No one appearing for the Applicants
Adam J. Wygodny, for Morteza Katebian, Plaintiff
P. James Zibarras, for Respondent/Defendants, 2399029 Ontario Inc., 2399194 Ontario Inc., and 2435045 Ontario Limited
HEARD: March 3, 4, 5, 11, 12, 13, 2020; September 2, 3, 4, 2020; and October 22 and 23, 2020
dietrich j.
reasons for JUDGMENT
Overview
[1] A trial was ordered in this receivership application to determine the ownership of three corporations, incorporated pursuant to the laws of Ontario. They are the respondent/defendant 2399029 Ontario Inc. (“029”), and the defendants 2399194 Ontario Inc. (“194”) and 2435045 Ontario Limited (“045”) (collectively, the “Corporations”).
[2] The plaintiff, Morteza Katebian, also known as Ben Katebian (“Katebian”), claims to be the owner of the Corporations. Laila Alizadeh (“Alizadeh”) claims that the defendant Corporations form part of a group of companies that she refers to as the “Laila Group of Companies” (the “Laila Group”), and that the Corporations are subsidiaries of World Corporation Inc. (“World Corp.”), of which she is the sole shareholder.
[3] Each of the Corporations had or has an interest in real property, either as an owner or as a mortgagee. 029 owned a commercial building, municipally known as 65 Malmo Court, in the City of Vaughan, Ontario (“65 Malmo”). 045 held a mortgage against a condominium property, municipally known as Suite 1410, 2 Toronto St., in the City of Barrie, Ontario (the “Barrie Condo”). 194 owned a 75 percent interest in a second mortgage against a real property, municipally known as 7 High Point Road, in the City of Toronto (“7 High Point”). 65 Malmo and 7 High Point have been liquidated by Rosen Goldenberg Inc., the court-appointed receiver (the “Receiver”) in this application.
[4] The Receiver distributed the net proceeds from the liquidation of the 65 Malmo and 7 High Point in satisfaction of the first priority secured claims. Surplus funds remained. The Laila Group, through its alleged ownership of the Corporations, claimed to be entitled to the surplus funds as a secured creditor. A number of unsecured creditors challenged the Laila Group’s entitlement to the funds, one of whom was Katebian. He claims entitlement to the surplus funds as the owner of the Corporations.
[5] For the reasons that follow, I find that Katebian is the legal owner of 029, but it is beneficially owned by World Corp. World Corp. is the legal and beneficial owner of 194 and 045.
Factual Background
[6] Prior to the receivership, 029 owned 65 Malmo, which had a value of approximately $3 million. 194 owned a 75 percent interest in a $5.5 million second mortgage secured against 7 High Point. 045 held a $300,000 mortgage secured against the Barrie Condo.
[7] Katebian had, at various times commencing in 2013, served as a director of each of 029, 194 and 045.
[8] It is alleged that Katebian had also served as a trustee, holding two residential properties, namely, 133 Boake Trail, in the City of Richmond Hill (“Boake”), and 11 King High, in the City of Vaughan (“King High”), on trust for Hazelton Homes Corporation, a subsidiary of World Corp. It is also alleged that Katebian served as a trustee of the shares of Liberty & York Corporation, a U.S. corporation that held all of the Laila Group’s U.S. assets, which Alizadeh claimed to have a value in excess of $50 million.
[9] Around 2013 and 2014, Katebian also worked as a licensed mortgage broker at Money Gate Corporation (“Money Gate”), a brokerage founded by Bita Ghaffari. Katebian also served as a director of Money Gate. In 2014, Ms. Ghaffari, Katebian and Katebian’s son Payam Katebian founded Money Gate Mortgage Investment Corporation (“Money Gate MIC”), a private lender. Both Money Gate companies had office space in the same building in the City of Toronto where the Laila Group had its offices.
[10] Katebian was also a friend of Alizadeh’s husband Arash Missaghi (“Missaghi”) and of Missaghi’s father Hosseingholi Missaghi (“Missaghi Sr.”). Katebian had done business with Missaghi Sr. in the past, including a joint venture in the food distribution business. Katebian, Alizadeh, Missaghi, the now late Missaghi Sr., and his late wife Parichar Missaghi (“Mrs. Missaghi”) were all part of the same ethnic community.
Positions of the Parties
[11] Katebian submits that he is the owner of each of the Corporations either because he is the equity owner or because he controls the company. He submits that he incorporated all of the Corporations, and that when the totality of the evidence is considered, it is obvious that Alizadeh’s version of events is internally inconsistent, not supported by the witnesses, and not supported by reliable documentary evidence, but, rather, documents that have been falsified or forged. Katebian submits that his version of events leading to the conclusion that he is the owner of the Corporations should be preferred because it is supported by credible testimony, including testimony from disinterested witnesses.
[12] Alizadeh asserts that Katebian was never a shareholder of any of the Corporations and never contributed financially to the acquisition or maintenance of the assets held by the Corporations or any expense of the Corporations. She asserts that he used his position of trust and familiarity with the assets of the Laila Group to commit a major fraud against it, which has caused irreparable damages and harm. She further asserts that Katebian has a long history of failed ventures that led to financial distress and bankruptcy, and that he could not have financed the purchase of the assets held by the Corporations.
Katebian’s Evidence
[13] Katebian asserts that he is the owner of 029. He has bank records for 029 from the Canadian Imperial Bank of Commerce (the “CIBC”) that show him to be a “Principal” of 029 as well as an equity owner, director and signing officer. The bank records he produced matched the records held by the CIBC. He further asserts that Missaghi Sr. lent funds to him, which were deposited into the CIBC account for 029, and that Katebian and his son Payam repaid the loan to Missaghi Sr., making the deposited funds Katebian’s funds. Katebian further asserts that all documents regarding 029’s acquisition of 65 Malmo were executed by him, and that a lawyer, Salma Sheikh, who acted for 029, testified that it was her understanding that Katebian owned 029.
[14] Katebian also asserts that he is the owner of 194 because he incorporated the company and served as its director. He also relies on the fact that two of the lawyers who acted for 194 testified that they understood 194 to be Katebian’s company. He asserts that he funded the purchase of the mortgage on 7 High Road with money he raised from investors.
[15] Katebian also asserts that he is the owner of 045 because he served as director of that company, and he executed the documents in relation to the mortgage transaction in 2014 and the postponement of that mortgage in 2015. He further asserts that he incorporated 045. He also asserts that he funded the purchase of the Barrie Condo mortgage because the funds flowed through the bank account for 029, which was his company, and he had raised funds from investors.
[16] Katebian challenges the authenticity of the trust agreements relating to his alleged trusteeship over Boake and King High. The trust agreements are the subject of separate proceedings before this court, in which Katebian asserts that he owns those properties and does not hold them on trust.
Alizadeh’s Evidence
[17] Alizadeh asserts that Katebian has a long history of engaging in fraudulent activities and that his dishonesty is the basis of his claim to be the owner of the Corporations. In her testimony, Alizadeh described a number of such activities in support of her view as follows.
Boake and King High
[18] Alizadeh testified that in February 2014 after Mrs. Missaghi died, Katebian was asked to become a trustee of Boake and King High. Alizadeh testified that Boake had been Missaghi Sr.’s home, and that Mrs. Missaghi had entered into an agreement to purchase the King High property, but died before the purchase was completed. Alizadeh testified that she completed purchase of King High and she lived there with her daughter. Katebian, at the request of the Missaghi family, was registered as the legal owner of both properties.
[19] Alizadeh testified that written trust agreements were entered into on April 15, 2014 and April 22, 2014, in which Katebian agreed to hold each of these residences on trust for the benefit of Hazelton Homes Corporation, a corporation of which Alizadeh was the sole officer and director. Alizadeh also testified that Katebian did not pay for the properties or any expenses relating to them.
[20] Alizadeh testified that Katebian was selected as a trustee because he was a friend, a business neighbour, a licensed mortgage broker and someone whom Alizadeh and her husband Missaghi trusted.
[21] Alizadeh’s evidence was that when Missaghi did not accede to Katebian’s request for $50,000 in compensation for acting as trustee of each of the properties, on March 29, 2017, Katebian extracted over $1 million of equity from the properties without the consent of either Missaghi or Alizadeh.
[22] Alizadeh rejected Katebian’s assertions that he purchased the Boake and High King properties and that he owned them legally and beneficially, and was, therefore, entitled to extract equity from them. She testified that Boake was worth about $1.6 million in 2014/15 and King High was worth about $2 million in 2014, the years in which Katebian claimed to have purchased these properties. Alizadeh testified that Katebian’s reported gross annual income was $18,750 in 2014 and $31,250 in 2015, and that he could not have afforded to purchase these properties.
[23] Alizadeh testified that the mortgage payments for both these properties came from a Royal Bank of Canada (“RBC”) bank account into which she made deposits to cover the mortgage payments. She testified that these payments were not rent, as Katebian alleged, despite the fact that she was living in the King High property. Katebian did not produce any evidence of a rental agreement, nor did he include any rental income in his tax returns.
The U.S. Assets
[24] Alizadeh’s evidence was that Troy Wilson was engaged by the Laila Group to create a corporate structure for holding U.S. real estate assets and to assist the Laila Group in an advisory role with respect to its Canadian assets.
[25] Alizadeh testified that on the advice of lawyers and Troy Wilson, the Laila Group structured its holdings such that a) a separate company was incorporated for each commercial building or mortgage, the director of which would be someone with a background in real estate or mortgages; b) a trust would be created for each residential acquisition, the trustee of which would be an individual whom the Laila Group trusted, and the beneficiary of which would be a corporation owned by the Laila Group; c) all U.S. assets and companies “connected back” to Liberty & York Corporation, which was owned by Alizadeh as the sole shareholder; and d) all Canadian assets “connected back” to World Corp., of which Alizadeh was the sole shareholder after 2012.
[26] Alizadeh testified that in 2012, with the assistance of Troy Wilson, the Laila Group began investing in rental properties in the U.S., and entered into lucrative lease agreements that caused the value of these properties to increase significantly. She testified that the significant gains in the U.S. allowed the Laila Group to fund many of its investments in Canada.
[27] Alizadeh testified that, in 2016, Katebian was made a trustee over Laila Group’s U.S. assets pursuant to a written trust agreement. Alizadeh stated that Katebian’s involvement was necessary to guarantee a $20 million loan to replace the financing then in place, which would expire on January 1, 2017. As part of the arrangement, the lender required a guarantor with a U.S. social security number, which Katebian had. Alizadeh testified, as did Troy Wilson, that Katebian’s personal income and assets were irrelevant to the U.S. lenders. According to Troy Wilson, the U.S. lenders were only looking for someone “with a pulse and a U.S. social security number.”
[28] Alizadeh testified that in 2017, after Katebian had extracted over $1 million from Boake and King High, he threatened to claim beneficial ownership in other assets held by him as trustee or over which he had authority as a director, unless he was paid more money by the Laila Group. According to Alizadeh, when the Laila Group did not respond to his demand, Katebian commenced litigation in the U.S. in which he claimed to be the legal and beneficial owner of the Laila Group’s assets in the U.S. The shareholder conflict that arose as a consequence of Katebian’s assertions impeded the Laila Group from signing lease agreements, renewing mortgages and making upgrades. Eventually a receiver was appointed, and the U.S. real estate was liquidated.
The assets in this proceeding
[29] Alizadeh testified that the Corporations in this proceeding, of which Katebian claims to be the owner, are companies in which he served as a director as appointed by the Laila Group. She testified that Katebian: a) was not involved in the negotiations to purchase the underlying assets; b) did not contribute any of his own money to the purchase of the assets; and c) did not pay any of the expenses associated with the assets after they were acquired.
Analysis of Ownership of the Corporations
029 and 65 Malmo
[30] According to Alizadeh’s evidence regarding 029, in 2013, the Laila Group learned that 65 Malmo would be sold under power of sale by Canada Investment Corporation (“CIC”). Alizadeh testified that CIC was a company owned by Missaghi Sr., and therefore was outside of the Laila Group. On October 25, 2013 World Finance Corporation (“WFC”), one of the Laila Group, requisitioned an appraisal of 65 Malmo. On November 18, 2013, 2389303 (“303”), a company incorporated by the Laila Group entered into an agreement of purchase and sale with CIC. 303 purchased the property on trust for a company to be incorporated. That company was 029.
[31] Katebian admitted that he had nothing to do with the appraisal and that he played no part in the agreement of purchase and sale.
[32] Regarding the incorporation of 029, Alizadeh testified that the sole shareholder of 029 was World Corp.; and that she had asked Katebian to be a director of 029 because he was a friend of Missaghi and her. Alizadeh had asked him to serve as a director of other companies she owned directly or indirectly.
[33] Alizadeh testified that Katebian was only ever a director, and not a shareholder, of 029, and that after 65 Malmo was purchased, she paid for everything relating to 65 Malmo.
[34] Katebian testified that he was not only a director of 029, but is also the sole shareholder of 029. Based on reliable documentary evidence before the court, it appears that Katebian is the shareholder of 029.
[35] Katebian produced a Business Account Application Agreement dated June 11, 2014 in which “Morteza Katebian” is shown as the “Principal” and an “Equity Owner”, and “100%” is entered in the box for “Percentage of Equity Ownership.” The Agreement only requires details of “Principals” with 25% or more equity ownership. Only Katebian’s details are included on the Agreement. The Agreement appears to have been signed on June 11, 2014 by all of Morteza Katebian, Laila Alizadeh, and Stylanianos Hantzaridis, who signed on behalf of the CIBC. Mr. Hantzaridis’ signature appears above the words “Branch Authorized Signature.” The CIBC’s stamp is imprinted on page 1 of the Agreement.
[36] Attached as an exhibit to Laila Alizadeh’s affidavit, sworn February 11, 2020 was an alternative version of the Business Account Application Agreement. The information contained on page one of the Alizadeh version of the Agreement is virtually identical to the version produced by Katebian, except it describes Morteza Katebian as a “Director” as opposed to an “Equity Owner”, and there is no CIBC stamp. Otherwise, there are no differences in the information included on page 1 between the two versions. The Alizadeh version includes the details of Katebian as a “Principal” and the “Percentage of Equity Ownership” for Katebian remains at “100%.” On the second page of the Agreement, new information is added in respect of Laila Alizadeh. A title of “Equity Owner/President” is added (where there was a blank on the Katebian version), and two additional boxes are ticked to show her as an “Officer” and “Director” in addition to a signing officer. The Alizadeh version contains the signature of Alizadeh only, and the signature boxes for each of Morteza Katebian and the Branch Authorized Signature are left blank. On the page containing the “Certificate Regarding Corporate Banking Resolution”, the words “Owner-President” have been added after Laila Alizadeh’s name and the word “Director” has been added after Morteza Katebian’s name. This Certificate and the Certificate of Officers and Directors are only signed by Alizadeh and not by Katebian.
[37] David Aggio, the current branch manager for the CIBC branch where 029 opened a bank account, testified that the records of the CIBC were consistent with Katebian’s version of the Application Agreement and not consistent with Alizadeh’s version. According to Mr. Aggio, the CIBC file that he brought with him to court did not include a copy of the Alizadeh’s version of the Agreement. Alizadeh testified that she had obtained the copy of her version of the Agreement from the CIBC. Mr. Aggio observed that the Alizadeh version had an extra page, a “Borrowing By-law”, which, as far as he was aware, the bank did not have. Mr. Aggio conceded that he had no personal knowledge of the account and was not there when it was opened.
[38] Alizadeh was cross-examined on the version of the Application Agreement that she produced. She was asked to produce the original, as opposed to the scanned version included in her affidavit, but she could not. She testified that she could not find it and that it might be in a warehouse. She was then reminded that on an earlier examination on her affidavit she deposed that she had given the original to her lawyer. When asked how she came into possession of the Application Agreement, she testified that she went to the CIBC and that the Agreement was the exact copy that the bank had given her. When asked why it did not contain the signatures of either Katebian or a bank representative, she testified that she is known to the CIBC staff at the branch at which she attended, and that it was not necessary for Katebian and her to attend at the same time. She testified that she had told Katebian to go to the CIBC branch to finish the application.
[39] Alizadeh testified that Katebian’s version of the Application Agreement, which was consistent with the version that Mr. Aggio confirmed was on file with the CIBC, was “foreign” to her. She testified that she would not have signed an Agreement that described Katebian as the “Equity Owner.” She could not explain why then her own version of the Agreement also showed Katebian as the only “Principal” having a 100% equity ownership, other than to say that she did not know why the bank had set it up that way. Alizadeh became rather shaken and agitated at this point in the cross-examination. She accused Katebian of lying and changing his affidavits, when all she was trying to do was defend what belonged to her. She testified that her “story was more credible than his.”
[40] I found Mr. Aggio to be a credible witness who had no business or personal relationship with any of the parties. He had no stake in these proceedings. I have no hesitation in accepting his evidence over Alizadeh’s evidence with respect to the Application Agreement. I find that the Application Agreement produced by Katebian, which is consistent with the bank records for 029, is the document that evidences the agreement among the parties to the Agreement on June 11, 2014 and reflects the positions that each of Katebian and Alizadeh had in 029 at that time.
[41] Also attached to Alizadeh’s affidavit was a copy of a Transaction Record dated September 25, 2014 showing a withdrawal from the CIBC account for 029 of $298,907.70. The Transaction Record appears to be initialed by someone and signed by “Layla Alizadeh.” Alizadeh’s version of the Transaction Record is inconsistent with the version of what appears to an identical Transaction Record included in the documents that Mr. Aggio brought to court. Mr. Aggio confirmed that the version on file at CIBC was identical in every way to Alizadeh’s version, except that the bank’s version included the signature of Katebian between the initial and Layla Alizadeh’s signature. Mr Aggio admitted that he did not know the full circumstances of the transaction reflected in Transaction Record, but observed that the bank’s records included Katebian’s signature, and it appeared to him that Katebian’s signature had been removed from Alizadeh’s version of the Transaction Record. Alizadeh could not explain why Katebian’s signature was not on the copy attached as an exhibit to her affidavit.
[42] I find that it is more likely than not that Alizadeh created an alternative version of the Application Agreement and the Transaction Record in an attempt to prove that Katebian was not an equity owner in 029 and that he did not participate in the transaction referred to in the Transaction Record.
[43] Alizadeh’s evidence was that on November 15, 2016, Katebian replaced himself as a director of 029 with Hosseini Sahebdivani, who was Katebian’s then girlfriend’s father. In my view, this is further evidence of Katebian’s status as the shareholder of 029. Katebian would not have been able to replace himself as director if he were not the shareholder of 029.
[44] In Alizadeh’s affidavit dated October 15, 2018, she includes as an exhibit the Certificate of Incorporation for 029, dated December 9, 2013, and signed by the Director of the Business Corporations Act, but she does not include the Articles of Incorporation. When it is suggested to her in cross-examination that she did not include them because they show Katebian to be the incorporator, she stated that she did not believe this statement to be truthful.
[45] In Katebian’s affidavit, sworn August 28, 2018, he includes the same Certificate of Incorporation as well as the Articles of Incorporation, which show him to be the only director and incorporator. Alizadeh testified that she did not believe that these Articles of Incorporation filed with the Ministry when 029 was created were true.
[46] As between the evidence of Katebian and the evidence of Alizadeh with respect to the equity ownership in 029, I prefer the evidence of Katebian, as corroborated by the CIBC records. I do not find Alizadeh’s evidence credible. On a balance of probabilities, I find that Katebian is the sole shareholder of 029. Alizadeh permitted him to hold all of the shares of 029 because she trusted him at the time 029 was incorporated. When she no longer trusted him, she attempted to eliminate him as the shareholder by altering corporate records.
[47] However, based on the evidence before the court, it is apparent that while Katebian owned the shares of 029 legally, he was not the beneficial owner of the shares. Rather, he held them on a resulting trust for 029’s parent company, World Corp. There is no credible evidence that Katebian made any financial contribution, or contributed any equity, to 029.
[48] On his cross-examination, Katebian admitted that he did not know where the funds came from that were deposited into the CIBC account and used to purchase 65 Malmo. When asked to bring bank statements for 029 to his examination for discovery, Katebian did not mention the CIBC account. He only mentioned 029’s RBC account and its Toronto-Dominion Bank account. There is also evidence of an email exchange between Missaghi and Katebian in which Katebian asks Missaghi whether he can open an RBC account for 029 so that he could “build his credit.” While this exchange supports Katebian’s position that he is the shareholder/owner of 029, it also suggests that his ownership is a legal ownership, as opposed to a beneficial ownership. His conduct in seeking permission from Missaghi to open another bank account is inconsistent with the rights of a sole shareholder. Katebian had no plausible explanation for why, if he owned 029 legally and beneficially, Alizadeh would also have signing authority on the bank account.
[49] Katebian could provide no proof of having contributed any funds to 029. He testified that Missaghi Sr. had lent him funds that he deposited into 029 and that it was Missaghi Sr. who suggested that Alizadeh be added to the account as an authorized signatory until the loan was repaid. Katebian testified that he and his son Payam repaid the loan to Missaghi Sr. in instalments. There is no documentary evidence to support the alleged loan from Missaghi Sr. or the repayment of that loan in whole or in part.
[50] By contrast, Alizadeh produced evidence of multiple deposits made by her into 029’s bank account in 2014, 2015 and 2016. Title to 65 Malmo was transferred to 029 on March 2, 2019. Katebian admitted that, at that time, he had had no previous involvement with 65 Malmo. Katebian conceded that he, personally, did not put any money into the purchase of 65 Malmo. He also conceded that after 029 purchased 65 Malmo, all expenses (including utilities, tax payments, legal fees and mortgage interest) were paid by the Laila Group.
[51] Mr. Aggio, from the CIBC, offered evidence to corroborate Katebian’s legal ownership of 029, but no witness testified as to Katebian’s beneficial ownership of 029. Salma Sheikh, who acted for 029 on the acquisition of 65 Malmo, testified that it was her understanding that 029 was owned by Katebian; he signed all of the documents relating to the transaction. However, there is no evidence that her understanding was based on having seen a shareholder register or that she had otherwise satisfied herself of his share ownership. Ms. Sheikh’s recall of the acquisition generally was not strong.
[52] Ashok Madan (“Mr. Madan”), the owner of Quikcorp, testified that his work in incorporating 029 was done on Missaghi’s instruction. Gary Grunier, who provided financing to 029 testified that he mainly dealt with Missaghi and that he was introduced to the 65 Malmo property and to Katebian by Missaghi, who remained involved in 65 Malmo at all times. According to Mr. Grunier’s evidence, if there was a missed payment, Katebian would direct Mr. Grunier to Missaghi. At the trial, Katebian himself testified that he did not have decision-making authority for 029.
[53] Troy Wilson testified that he had no involvement in the incorporation of 029, but was appointed as director of 029 in 2017 to replace Katebian’s then girlfriend’s father. Troy Wilson’s evidence was that the Laila Group paid for all of the expenses on the 65 Malmo property.
[54] Because Katebian has not proved that he raised or contributed any funds for the purchase of assets held by 029, and he did not pay any expenses associated with 029 or its assets, I find that he had no beneficial ownership in 029. The beneficial ownership in 029 is held by World Corp.
194 and a $4.4 million mortgage on 7 High Point
[55] Alizadeh’s evidence is that in 2011, the Laila Group entered into negotiations to purchase a second mortgage on 7 High Point, in the City of Toronto. The mortgage was owned by 1567935 Ont. Inc. (“156”), the principals of which were Mahammad Punjani and his son Shafiq Punjani. The second mortgage was purchased on December 11, 2011 for $4.4 million, which was to be paid in instalments, and once the final instalment was paid, the mortgage would be assigned. The agreement was entered into between World Finance Corporation, a Laila Group company, and 156. The closing was extended a number of times resulting in additional fees and interest owing by the Laila Group.
[56] On June 20, 2014, the Laila Group made the final instalment payment of $2,400,007.50 and, according to the evidence of Alizadeh and Troy Wilson, these funds were transferred from the CIBC bank account for Mansteel New Liskeard Inc. (“Mansteel”), another Laila Group company, into 029’s CIBC account, and then transferred from 029 to 156 to make the final payment. According to Troy Wilson’s evidence, Mansteel had these funds on hand because a property in Texas had been sold and the sale proceeds were repatriated to Canada to Mansteel, which had provided the funding for the purchase of the property in Texas.
[57] Katebian admitted that the bank statements for Mansteel’s CIBC account and 029’s CIBC account showed that on June 20, 2014, $2,240,000 was withdrawn from Mansteel and transferred into 029’s CIBC account to purchase the second mortgage on 7 High Point. Katebian also admitted that the money from Mansteel was not his money.
[58] Alizadeh testified that prior to payment of the final instalment on the second mortgage on 7 High Point, 194 was incorporated by Mr. Madan in 2013 for the purposes of acquiring and holding the second mortgage. Katebian was the incorporator and the director of 194 and World Corp. was the sole shareholder. Alizadeh further testified that Katebian had no involvement until he was appointed a director, and that he was appointed as a director because he was familiar with mortgages and the Missaghi family trusted him.
[59] Katebian admitted that he did not pay for the incorporation of 194. He did, however, assert that he funded the purchase of the second mortgage on 7 High Point, though not with his own money. He also asserted that he was the owner of 194.
[60] To corroborate his assertion that 194 is his company, Katebian relied on the evidence of Richard Quance, a litigation lawyer who had been involved in a dispute relating to 194 and the second mortgage. Mr Quance testified that Katebian had retained him to act on behalf of 194 and that he had understood 194 to be Katebian’s company. However, Mr. Quance also testified that he had received instructions from Missaghi and had received payments from the Laila Group. Mr. Quance testified that he had reported to Katebian, Missaghi and Grant Erlick (“Erlick”), who had also worked for the Laila Group, and that Missaghi had been heavily involved in the litigation. Mr. Quance confirmed that his fees were paid by Canada Capital Corporation Inc. (“CCCI”) and Top Natural Foods Inc. and not by Katebian.
[61] Katebian admitted that he had altered emails to Mr. Quance. Katebian also provided Mr. Quance with the minute book that Katebian had asked Fogler Rubinoff to prepare that showed Katebian as the owner of 194. This led Mr. Quance to write a letter confirming that there was conflict with respect to his representation of 194 and that he would not be able to act.
[62] Gary Hodder, another lawyer who acted for 194, testified that he took instructions and received payments from Katebian and understood that 194 was Katebian’s company. However, Gary Hodder also confirmed that his legal fees were paid by the Laila Group. If his fees were not being paid, he would raise the issue with Katebian, who would advise that Missaghi would be paying his fees.
[63] In each of the five affidavits that Katebian submitted in this proceeding (dated June 26, 2018, August 28, 2018, February 21, 2019, April 5, 2019 and February 19, 2020), he stated that he was both the legal and the beneficial owner of 194. However, none of these affidavits offer any explanation of how he funded the purchase of the second mortgage on 7 High Point, the purchase price of which (with extension fees and interest) amounted to $5,522,251.
[64] When cross-examined on his affidavits, Katebian deposed that the funds for the second mortgage came from investors, whose identity he refused to disclose. Katebian undertook to deliver the agreements he had made with the investors with respect to these supposed investments, but he never did.
[65] Katebian further deposed that he had five investors for 194, who got involved in this investment in 2013 and 2014, and that their investments were deposited into 029’s RBC account. The agreements with those investors, according to Katebian’s evidence, were all oral agreements. Katebian did not call on any party to these oral agreements to corroborate his testimony.
[66] Katebian’s evidence in respect of 194 was that the cost of the second mortgage was $2.4 million, but according to Alizadeh’s evidence, the cost of the second mortgage, including fees and interest was $5,522,251.
[67] After learning that $2.24 million had been transferred from Mansteel to 194, Katebian abandoned his earlier evidence about investors, and he attempted a new narrative in which he claimed that the money that had been transferred from Mansteel to 029 was deposited into 029 by Missaghi Sr. for Katebian’s benefit. He explained that Missaghi Sr. provided the money to him, via his company 029, because “we were in a rush and it was a large amount of money.” Katebian testified that he agreed to put Alizadeh on the account for 029 at Missaghi’s request, to make sure that the money would be used to purchase the assignment of the second mortgage. Katebian testified that the money received from Missaghi Sr. was a loan to him.
[68] This evidence is not only inconsistent with Katebian’s evidence on his earlier cross-examination, but also, Katebian makes no reference to a loan from Missaghi Sr. in any of his five affidavits. Further, there is no evidence to suggest that Missaghi Sr. had any involvement in Mansteel, from where the second mortgage funds originated. Katebian’s explanation of the funding for the second mortgage fails to explain how the balance of the second mortgage, being more than $3 million was funded by 194, of which he claims to be the owner. Katebian was not able to produce any documentation in support of this funding theory.
[69] On March 15, 2017, Katebian resigned as a director of 194. Katebian admitted that, following his resignation, he engaged the law firm of Fogler Rubinoff to prepare a minute book showing him to be the shareholder of 194.
[70] I find that there is no credible evidence to support Katebian’s claim that he is the owner of 194, and that the owner of 194 is its parent company World Corp.
045 and the Barrie Condo
[71] Alizadeh testified that, in September 2014, Troy Wilson told his sister, Terry Wilson, about the Barrie Condo that was being sold under power of sale. Terry Wilson then approached Alizadeh for mortgage financing so that Terry could purchase the Barrie Condo. Alizadeh testified that she lent Terry Wilson $300,000 at an interest rate of 10 percent, but Alizadeh agreed that she would not collect any principal or interest on the loan until the Barrie Condo was sold. She claimed that she did this as a favour to Terry Wilson, because she was the sister of their business associate Troy Wilson. Each of Alizadeh, Troy Wilson and Terry Wilson testified that Katebian was not involved in the mortgage financing.
[72] Alizadeh testified that she incorporated 045 to own the Barrie Condo mortgage and Katebian was appointed the director because she trusted him. She testified that she asked Rasik Mehta, an in-house counsel for the Laila Group to use Mr. Madan, of Quikcorp, to incorporate the company. Her evidence is that Mr. Mehta did so, paid the $450 fee to Quikcorp using his personal credit card and sent an invoice to Alizadeh, for reimbursement by the Laila Group. She testified that Katebian was not involved. Alizadeh produced a Quikcorp invoice, dated September 23, 2014, that showed “World Corporation Inc.” as the “Customer” and “2435045 Ontario Inc. Director. Morteza Katebian” as the entity requesting the service.
[73] However, Katebian also produced a nearly identical copy of a Quikcorp invoice bearing the same date and invoice number. In the second version, the “Customer” is Rasik Mehta Lawyer” and the entity requesting the service is “Ontario Inc./Morteza Katebian.”
[74] Mr. Mehta testified that he was retained by Katebian to incorporate 045 and that he used Quikcorp to incorporate it. He also testified that Katebian instructed him on this incorporation, and he sent the related invoice for legal services to Katebian. Mr. Mehta testified that he could not produce a copy of his retainer letter with Katebian. He testified that he was not able to access all of his files because Missaghi and Troy Wilson removed them from the office where he had been working.
[75] When the conflicting copies of the invoice for the incorporation of 045 were put to Mr. Mehta, he reviewed them closely and commented that it was “funny how they [referring to Missaghi and Alizadeh] think they can just alter documents and put them before the court.”
[76] Mr. Mehta also testified as to the circumstances relating to his work for the Laila Group as a new lawyer who had recently completed his articles. He testified that he responded to an advertisement in the Ontario Reports placed by a company described as “Landmark”, but that when it was discovered that the Laila Group was wrongfully trading off this name of a large Michigan real property company, it changed the name in the advertisement to “Skymark.” This evidence was not refuted. At the trial, Mr. Mehta was presented with a document purporting to be his “acceptance” of an employment contract, which he testified was a forged document, and called it a “joke” and a “fabrication.” He testified that the alleged agreement was with “Skymark Financial”, a company he had never heard of. Further, he testified that contrary to the alleged agreement, which said he would be supplied with a phone and a computer, he supplied his own phone, computer and printer, and he did not share intranet facilities with the Laila Group. Also contrary to the alleged agreement, he testified that he paid his own professional insurance, and it was not paid by “Skymark Financial.” Further, the alleged agreement described him as in-house counsel, which he testified was not accurate. His evidence was that he billed the Laila Group as clients. He paid rent for space in the Laila Group offices; and, contrary to the alleged agreement, he did not receive a regular salary. Mr. Mehta testified that he had been looking for an in-house position and the advertisement to which he responded was for an in-house position; however, he testified that Missaghi, Troy Wilson and Erlick, who interviewed him, persuaded him to open up his own firm, in the offices of the Laila Group, with a trust account. They assured him that they would retain him for their legal work and that he could work for other clients as well. Mr. Mehta testified that they also told him that another lawyer in their offices, Jonathan Ricci, would help him and act as his principal.
[77] Mr. Mehta was given examples of copies of invoices that purported to show that he was paid a monthly salary of $5,000. Mehta did not recognize the invoices and questioned their authenticity. Mr. Mehta was not persuaded by the copies of the CIBC bank statements that appeared to match alleged payments made to him as salary. His testimony was that Missaghi would routinely write cheques, leaving the cheque stub blank, and then later include a description to suit a particular purpose. Mr. Mehta, who testified that he has a background in information technology, stated that the invoice, like other documents he had seen, while working with the Laila Group, was doctored, likely with the assistance of Adobe Photoshop. The Laila Group did not produce any copies of cheques allegedly cashed by Mr. Mehta as salary.
[78] Mr. Mehta’s evidence was inconsistent with Katebian’s insofar as Mr. Mehta testified that Katebian paid for the incorporation of 045, but Katebian testified that he did not pay anything for 045. Mr. Mehta also acknowledged that the Laila Group is suing his father for an alleged breach of trust, but that he is not a party to that litigation.
[79] Notwithstanding the inconsistency regarding who paid for the incorporation of 045, I found Mr. Mehta to be a credible witness, and I did not find him to be biased. He was forthright in his answers. I agree with Mr. Mehta’s assessment of the Quikcorp invoices. Even to the untrained eye, the Quikcorp invoice showing “World Corporation Inc.” appears to be a poor, and likely altered, copy of a copy of the “Rasik Mehta Lawyer” invoice. Mr. Mehta, personally, has nothing to gain from this litigation between the Laila Group and Katebian. It was clear that he regretted ever having encountered the Laila Group, and his work related to their business, which ultimately led him to surrender his licence to practise law. I accept his evidence that Katebian, as opposed to Alizadeh, retained him to incorporate 045. The records on file with the Ministry of Government and Consumer Services showed Katebian to be the incorporator.
[80] The evidentiary record supports the conclusion that Katebian was the incorporator of 045 and that he was a director of 045. The record does not support the conclusion that Katebian was a shareholder or had any equity in 045.
[81] Alizadeh testified that 045 did not have its own bank account, and, therefore, funds were transferred from CCCI, a Laila Group company, to 029, which did have a bank account, and whose director was Katebian. Alizadeh demonstrated that $298,907.70 flowed from CCCI to 029, and from 029 to Terry Wilson’s lawyer to fund the mortgage. Katebian did execute all of the necessary documentation relating to the mortgage. However, when the transaction closed, Anita Verma, the lawyer acting on the mortgage financing, reported to Alizadeh, and not to Katebian. Katebian was not copied on any of the correspondence among the parties to the purchase and financing.
[82] Katebian asserts that he funded the mortgage because he owns 029 and the monies were sourced from that company. The evidence does not support this conclusion. Katebian has not explained how he could have funded a $300,000 mortgage loan in 2014. At that time, the record shows that his businesses were losing money and his gross annual income, reported for tax purposes was $6,500 in 2013 and $18,750 in 2014.
[83] Katebian, in his evidence, including four separate affidavits, sworn between June 2018 and April 2019, and in his testimony at trial, made broad claims to be the legal and beneficial owner of 045, but could not explain how the mortgage was funded.
[84] On cross-examination on his affidavits prior to the trial, he claimed that the funds came from anonymous investors, who transferred the funds directly to the lawyers involved, bypassing any bank account. He deposed that the investors were expecting a return of 10 percent on this first mortgage, and when they did not get a return on their investment, he repaid the investors $330,000, being the principal investment plus $30,000 in interest. Katebian did not produce any documentation in support of this transaction with the supposed investors. When shown the cheque from CCCI for $298,000 deposited into the bank account for 029 for 045 to fund the mortgage, Katebian admitted that he had never seen the cheque, but still maintained that the funds from CCCI were in fact his funds. Again, he had no documentary evidence to support this claim.
[85] In his fifth affidavit in this matter, sworn in February 2020, Katebian advanced yet another narrative in support for his assertion that he financed the mortgage. This version conflicts with his earlier evidence. In this affidavit, he claims to have raised $450,000 from investors for a second mortgage on 65 Malmo (owned by 029), and then he lent the funds to the Laila Group, a portion of which they then repaid to him by way of a bank transfer to 029, and then, in turn, he lent the money to fund the Barrie Condo purchase. This evidence not only contradicts Katebian’s earlier evidence, but also is not supported by any loan or other documentation. When asked how the investors could have an interest in both the mortgage on 65 Malmo and on the Barrie Condo, Katebian explained: “legally it was under Malmo, but I told them really what I need it for.”
[86] I do not find any of the inconsistent explanations offered by Katebian regarding the funding of the mortgage to be credible. They are not supported by any documentation and have not been corroborated by any witness.
[87] Katebian asserted that he is the legal owner of 045 and the mortgage on the Barrie Condo, but he admitted that he took no step to renew the mortgage at the end of its one-year term. The mortgage remained in default for over seven years. Katebian also admitted that, contrary to the interests of any investor, he took no steps to enforce the mortgage notwithstanding that no interest had been paid on the mortgage.
[88] When the Barrie mortgage was postponed, for no consideration, Katebian signed the documentation as a director of 045. Agreeing to a postponement for no consideration would normally be inconsistent with an ownership interest.
[89] Despite the fact that 045 was incorporated in September 2014, Alizadeh testified that it was not until June 1, 2017 that she asked Mr. Madan to create the minute book for 045. The Minute Book showed “World Corporation Inc.” as the sole shareholder and World Corp. paid Mr. Madan for his work. At the same time, Katebian was removed as a director of 045.
[90] Mr. Madan could not recall if Katebian had played a part in incorporating 045 and he could not recall who asked him to incorporate it. He testified that he had done work for Missaghi for many years and that he did a lot of incorporations for Missaghi. He testified that the “WCI” shown on the invoice for services was the same “World Corp” as the one whose name he entered on the share certificates for 045 when Missaghi asked him to prepare a minute book for 045.
[91] He could not explain why two Quikcorp invoices would have been issued to two different entities for the incorporation of 045, though he testified that sometimes after he issued an invoice, the customer would ask him to change it to reflect the proper payor. This response does not explain why both invoices are stamped “Paid – 2014-09-23.”
[92] Mr. Madan testified that he had no concern creating the minute book for Missaghi when asked to do so in 2017, and that it was he who typed in the name “WCI” as the shareholder. He said that he knew that this was one of the companies that Missaghi and Alizadeh owned. He also testified that he backdated the documents because it was “normal” to backdate the documents to the date of incorporation.
[93] At the same time, a notice of change dated June 1, 2017 shows Laila Alizadeh as the director of 045. This change coincides with Katebian’s alleged extraction of $1 million from the residences that he was said to be holding on trust. Alizadeh and Troy Wilson testified that it was not surprising that the sole shareholder of 045, which they assert was World Corp., would remove Katebian as a director and appoint Alizadeh once the Laila Group no longer trusted Katebian.
[94] On February 21, 2019, Katebian, for the first time, produced a minute book for 045 showing him as the sole shareholder. There was no documentary evidence regarding who created this minute book or when. Katebian admitted that he had had no discussions with Mr. Madan in September 2014 regarding the creation of a minute book and he agreed that no share certificates were prepared in 2014. Katebian claimed that his minute book had been prepared by Rasik Mehta, who had been providing legal services to the Laila Group. Katebian produced no documentary evidence in support of this claim.
[95] None of the witnesses corroborated Katebian’s claim to be an owner of 045. On the evidentiary record, I find the owner of 045 is World Corp.
Katebian’s Credibility
[96] Despite Katebian’s assertion that he was the true owner of 029, 194, and 045, he could produce very few documents that one would expect an owner to have. For example, he produced few emails, third party communications, lawyers’ files, agreements, or accounting records. By contrast, the Laila Group produced entire lawyers’ files, agreements, email communications, transaction records, bank statements, original expense statements and original minute books.
[97] Katebian was asked to bring all original documents relating to the Corporations to the trial. At the trial, Katebian stated that he no longer had any original documents relating to the Corporations. At examinations for discovery, Alizadeh sought permission to image Katebian’s laptop, but he declined to grant it.
[98] I did not find Katebian to be a credible or truthful witness. His entrepreneurial history is far from stellar. In 2005, he pled guilty and was convicted of possessing counterfeit food products through his company Sigma. In this trial he downplayed his role in the fraud. He claimed to be a minority shareholder in Universal Foods Inc., which was also involved in the fraud. Universal Foods Inc. was then controlled by Missaghi Sr. However, in his sworn affidavits in this proceeding, Katebian described himself as having been a majority shareholder in Universal Foods Inc. Katebian denied having changed his name from Morteza Katebian to Ben Katebian following this criminal conviction, but when asked to produce any record of using the name “Ben” prior to his criminal conviction, he refused.
[99] Money Gate MIC, the private lending company co-founded by Katebian, failed to register with the Ontario Securities Commission (“OSC”). Notwithstanding that the audited financial statements for Money Gate showed losses year over year, Katebian’s evidence was that the financial statements did not reflect the true income of the business. He made this statement notwithstanding that the OSC, in its investigation of fraud at Money Gate MIC, found that Money Gate’s financial statements for the years ending 2015 and 2016 each showed net losses of over $100,000.
[100] Katebian’s income for 2013, 2014, 2015 and 2016, as reflected in his tax returns and the audited financial statements for Money Gate and Money Gate MIC, was $6,500 in 2013; $18,750 in 2014; $31,250 in 2015; and $26,224 in 2016. Notwithstanding both the financial statements and Katebian’s personal tax returns, at this trial, Katebian claimed to be earning $100,000 per year in those years, but testified that he was not declaring that income on his tax returns.
[101] On an improper mortgage application to Money Gate, by Katebian himself, he claimed to have an annual income of $300,000, and to have been employed at a company that he had shut down several years earlier in 2012. When questioned in this trial about that annual income, Katebian admitted that he did not earn that level of income, but that “everyone overstates income on mortgage applications because it is necessary for the computer to proceed.”
[102] On April 27, 2017, the OSC issued a cease trading order against Money Gate MIC. Katebian admitted that, following that order, he attempted to set up a new mortgage investment company. A receiver was appointed over Money Gate MIC in November 2018. On December 17, 2019, the OSC found that Katebian had committed securities violations, perpetrated a fraud on investors and authorized $1.5 million of non-arms’ length loans to each of himself and Payam. The OSC found that the fraud on the investors occurred when Katebian and Payam were experiencing significant financial pressure. As a result of the OSC findings, Katebian’s mortgage brokerage licence was revoked.
[103] Katebian refused 30 undertaking requests, which were relevant to these proceedings.
[104] It was not beyond Katebian to instruct others to create false documents to suit his purpose in this litigation.
Alizadeh’s Credibility
[105] I also did not find Alizadeh to be a credible witness. It was not beyond her to fabricate documents, or cause them to be fabricated, to suit her purposes in this litigation.
[106] When confronted with obvious inconsistencies in her evidence and that of disinterested third-party witnesses, Alizadeh refused to concede that her evidence was not accurate.
[107] Her own evidence included a number of internally inconsistent statements and was also inconsistent with other witnesses. Alizadeh testified that when her husband’s parents Missaghi Sr. and Mrs. Missaghi began to experience health issues, they transferred to her “all of the shares of all of their companies” around 2012. No explanation was given as to why she would become the beneficiary of these shares, notwithstanding that she had declared personal bankruptcy in 2009, or why she would receive the shares, as opposed to the children of Missaghi Sr. and Mrs. Missaghi, especially Missaghi, who appeared to be very involved in the business.
[108] Alizadeh’s evidence on the share transfer is inconsistent with Troy Wilson’s evidence that all of the Canadian commercial properties were owned by corporations that were subsidiaries of World Corp., which was owned by Mrs. Missaghi until she transferred ownership of those shares to Alizadeh. Erlick testified that Alizadeh became more involved in the Laila Group in 2011 and 2012, when Missaghi Sr. and Mrs. Missaghi were ready to transfer the business, owing to poor health, but the share transfer was still happening in 2013. His evidence was that Alizadeh would have acquired the shares of Metropolis Properties Inc. (“Metropolis”) in 2011/2012. Alizadeh’s evidence was that prior to receiving the shares, she had done some work relating to the Laila Group, such as errands and finding investors, but that she got much more involved in 2015, following the deaths of Missaghi Sr. and Mrs. Missaghi.
[109] Alizadeh’s evidence regarding the share ownership was far from clear. Though she claimed to have received all of the shares for all of the companies from her parents-in-law, later in her testimony, she stated that when shares were transferred to her husband Missaghi in 2011, he was out of his own bankruptcy which occurred in 2000. During her testimony, sometimes she would refer to when “we got the shares of the corporations” and what “we decided to do.”
[110] At one point in her testimony, she confirmed that she was the sole shareholder of Canada Investment Corporation (“CIC”), but later she stated that she was not sure whether CIC was owned by World Corp., and that she would need to check her records. Still later she testified that Missaghi Sr. owned CIC and, at the time of his death, he left the shares of CIC, through his will, to World Corp. She did not produce a copy of Missaghi Sr.’s will, or any documentation in support of the share transfers from Missaghi Sr. or Mrs. Missaghi to her.
[111] When asked in cross-examination who owned Metropolis, the corporation that owned 65 Malmo before it was transferred to 029 under power of sale proceedings, initially, Alizadeh testified that it was owned by Missaghi Sr. This testimony was inconsistent with her earlier testimony that Missaghi Sr. had only kept his shares of CIC. Later, she said she could not recall if Metropolis was part of the Laila Group. She also claimed that she could not remember a lawsuit in 2015 involving Metropolis in which she was named as a principal of Metropolis.
[112] Still later in her testimony, she testified that Missaghi Sr. transferred his shares in Metropolis Properties Inc. and CIC to her, but she could not remember when. At another point in her testimony, she conceded that Missaghi Sr. owned the shares of both Metropolis and CIC in 2013 when 029 was looking to purchase 65 Malmo from Metropolis.
[113] Alizadeh frequently testified that she was the sole shareholder of the whole of the Laila Group (Canada and the U.S.) that at one time had assets in excess of $50 million in the U.S. alone. She testified that she and the Laila Group had suffered losses in excess of $100 million in both the U.S. and Canada. Notwithstanding the significant alleged value of the Laila Group, I found that Alizadeh had a very loose grasp on what assets she and the Laila Group actually owned in Canada and the U.S. Alizadeh responded to most questions with respect to the U.S. holdings by explaining that she had delegated responsibility for these assets to Troy Wilson and she relied on him to manage those assets. She did not know whether there was a lawsuit in the U.S. with respect to one of her companies or whether an action was being brought to have a receiver appointed over the U.S. assets. She could not say whether Katebian was involved in ongoing lawsuits in the U.S. Alizadeh also claimed to know nothing about lawsuits involving her U.S. companies and identified Troy Wilson as the one who had authority to commence all appropriate lawsuits in the U.S. She refused to comment on the value of the litigation in which she and the Laila Group were involved, or the damages sought.
[114] Alizadeh described her role in the Laila Group as someone who brings people in to invest. She testified that it was her job to ensure that the investments were safe for the investors. When asked how many outside investors participate in Laila Group investments, Alizadeh could only say that she was not good with dates, numbers and names, that she tries her best, but does not have a great memory.
Disposition
[115] Despite the credibility issues relating to Katebian and Alizadeh, for the reasons given, on a balance of probabilities, I find that Katebian is the legal owner of 029, the shares of which he holds on a resulting trust for the beneficial owner World Corp. World Corp. is the owner of 194 and 045.
Costs
[116] I find that both parties, the plaintiff Katebian, and Alizadeh, representing the defendant Corporations, have not come to court with clean hands. Accordingly, I make no order as to costs.
Dietrich J.
Released: April 8, 2021