Court File and Parties

COURT FILE NO.: CV-20-00643593-0A31 DATE: 20230705

ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN: DANIELE RAPONI Plaintiff

• and – OLYMPIA TRUST COMPANY Defendant
• and – ADI DEVELOPMENTS (LINK) INC. (f.k.a. ADI DEVELOPMENTS SUTTON INC.), ADI DEVELOPMENTS GROUP INC., and TARIQ ADI Third Parties

Proceeding under the Class Proceedings Act, 1992

Counsel: Ryan A. Morris and Daniel Szirmak for the Defendant Lisa Parliament and Jeremy Rankin for the Defendants ADI Developments (Link) Inc. and ADI Development Group Inc. Mary Paterson for FAAN Mortgage Administrators in its capacity as Trustee of Derek Sorrenti and Sorrenti Professional Law Corporation George Benchetrit, Court-Appointed Representative Counsel for Investors

HEARD: July 5, 2023

PERELL, J.

Reasons for Decision

[1] In this proceeding under the Class Proceedings Act, 1992, the Defendant Olympia Trust Company brings a consent or unopposed motion to have the third party proceedings of Adi Developments (Link) Inc., Adi Developments Group Inc. and Tariq Adi dismissed with prejudice and without costs.

[2] The background to this motion is as follows:

1. Olympia Trust Company is a non-deposit taking trust corporation formed under the Alberta Loan and Trust Corporations Act, with its head office located in Calgary, Alberta. It served as custodial trustee for investors’ registered plan investments in syndicated mortgage loans arranged by Fortress Real Developments Inc. and its affiliates.
2. The third parties, Adi Developments (Link) Inc. and Adi Development Group Inc. were borrowers in respect of Fortress syndicated mortgage loans entered into for the Sutton development project in Burlington, Ontario. The third party, Tariq Adi, was a director and officer of the Adi Companies.
3. The Adi Companies are defendants in other actions in the Ontario Superior Court of Justice pertaining to the Sutton syndicated mortgage loans, including a proposed class action bearing Court File No. CV-16-561293-00CP (the “Sutton Class Action”) and in an action commenced by FAAN Mortgage Administrators Inc. in its capacity as court-appointed trustee, bearing Court File Number CV-21-00672230-00CL.
4. In this proposed class action, the Plaintiff Daniele Raponi seeks to hold Olympia Trust responsible for losses sustained as a result of his and other proposed Class Members’ investments in the Fortress syndicated mortgage loans, including the Sutton syndicated mortgage loans.
5. In this proposed class action, Olympia Trust commenced a third party action on October 1, 2021. It seeks contribution and indemnity from the Adi Companies and Mr. Adi.
6. Mr. Raponi’s main action, however, was dismissed by order dated August 2, 2022, which order was upheld by the Court of Appeal for Ontario in a decision dated June 16, 2023.
7. On April 26, 2023, the Adi Companies, Olympia Trust, FAAN, counsel to the Sutton Class Action plaintiffs, and others entered into a Settlement and Mutual Release Agreement providing for the resolution and release of claims against the Adi Companies and certain related parties in connection with the Sutton syndicated mortgage loans.
8. The settlement agreement was approved by order of Justice McEwen dated June 1, 2023.
9. Section 11 of the Settlement Agreement requires Olympia Trust to seek an order dismissing this third party action against the ADI Defendants at the same time that counsel to the plaintiffs in the Sutton Class Action seek an order dismissing that action as against the Adi Companies.
10. The Settlement Agreement further provides that Olympia Trust shall withdraw its request for an Order dismissing this third party action if this Court declines to grant the Sutton Dismissal Order.
11. On July 5, 2023 in the Sutton Action, the Plaintiff Sandra Medland brought a motion for an Order approving the dismissal of her proposed class action as against the Adi Companies, which motion was granted. [3]

[3] Thus, Mr. Raponi’s main action against Olympia Trust has been dismissed obviating the basis for a third party claim by Olympia Trust against the ADI Defendants and Justice McEwen and I have approved settlement agreements providing for the resolution and release of claims against the ADI Defendants. And Olympia Trust’s motion to have the third party proceedings against Adi Developments (Link) Inc., Adi Developments Group Inc. and Tariq Adi dismissed with prejudice and without costs is on consent or unopposed.

[4] Accordingly, I grant Olympia Trust’s motion as requested.

Perell, J.

Released: July 5, 2023

Footnotes:

[1] S.O. 1992, c. 6. [2] R.S.A. 2000, c. L-20. [3] Medland v. Fortress Real Capital Inc., 2023 ONSC 3987.