Court File and Parties
COURT FILE NO.: FS-22-28258 DATE: 2024-11-29 SUPERIOR COURT OF JUSTICE – ONTARIO
RE: Ekaterina Cherkassova, Applicant AND: Sergey Cherkassov, Respondent AND: Spetsavtomatika KZ, Respondent AND: Gennady Cherkassov, Respondent AND: R & S Supreme Mobile Wash Inc., Respondent AND: Supreme Capital Group Inc., Respondent AND: Rustam Ilakhunov, Respondent
BEFORE: Justice Kraft
COUNSEL: Gida Deti, Counsel for the Applicant Tilda Roll, Counsel for the Respondent, Sergey Cherkassov Arkadi Bouchelev, Counsel for the Respondents, Spetsavtomatika KZ and Gennady Cherkassov Eka Maysyuk, Counsel for the Respondents, R&S Supreme Mobile Wash Inc., Supreme Capital Group Inc. and Rustam Ilakhunov
HEARD: November 28, 2024
ENDORSEMENT
Nature of the Motion
1The applicant, Ekatarina Cherkassova (“wife”), seeks financial disclosure from the respondents, Rustam Ilakhunov (“Rustam”), R&S Supreme Mobile Wash Inc. (“R&S”) and Supreme Capital Group Inc. (“Supreme”), together referred to as the “Corporate Respondents”. The wife submits that the respondent, Sergey Cherkassov (“husband”) was an owner and active participant in these businesses during the marriage and it was only after separation that he announced he has no ownership in these corporations. Further, the wife argues that the corporate documentation appears to have been amended after the parties’ separation to match the husband’s narrative. For these reasons, the wife maintains the disclosure she seeks from Rustam, R&S and Supreme is necessary and relevant, not only to prove the extent of the husband’s net family property but, also, to determine his true income for support purposes.
2Rustam asks that the wife’s motion be dismissed. He submits that the husband is neither an owner of R&S nor Supreme which is reflected in the corporate records and that only he and the husband’s father, Gennady Cherkassov (“Gennady”) are shareholders. Gennady owns Spetsavtomatika KZ (“SKZ”), a foreign company. Rustam maintains that before both companies were incorporated, he ran the business, the seed capital for which was provided by Gennady and SKZ. In exchange for investing $280,000 USD in Rustam’s company, Gennady requested that his son be given a job by Rustam for the company which is why the husband was employed by the companies.
3According to the wife, Faieta, J. made an order on May 16, 2022, requiring the Corporate Respondents to provide financial disclosure to her. She submits that the Corporate Respondents are in breach of this order and asks this court to compel them to produce this disclosure, failing which, she asks for fines to be imposed effective immediately for the items of disclosure already ordered to be produced by Faieta, J., starting December 1, 2024, and for all other items, with fines accumulating monthly until the disclosure is provided. Alternatively, if the Corporate Respondents fail to comply with the disclosure order, the wife asks for leave to bring a contempt motion against them.
4The Corporate Respondents maintain that there is no court order requiring them to produce any disclosure. At the time Faieta, J. made the disclosure order on May 16, 2022, neither Rustam, R&S nor Supreme were parties to this proceeding, nor were they given notice of a motion for third party disclosure. Accordingly, they submit they are not in breach of any court orders. Instead, they argue that the disclosure order of Faieta, J. was only for the husband to produce disclosure.
Issues to be Decided on this Motion
5The issues for me to determine on this motion are:
a. Whether the Corporate Respondents are in breach of a disclosure order made by Faieta, J. on May 16, 2022?
i. If the answer to a. is yes, whether the Court should impose fines on the Corporate Respondents for their failure to comply with the previous disclosure order?
b. Whether the Corporate Respondents should be ordered to produce the disclosure set out in Schedule “A” to the wife’s Notice of Motion, dated July 22, 2024?
6I have ordered the disclosure sought by the wife from the Corporate Respondents, only once a Non-Disclosure Agreement is prepared by the Corporate Respondents for execution by the wife. The reasons for my decision are set out below.
Brief Background
7The wife and husband were married for 11 years. They have two children.
8The issues outstanding in the litigation are the division of net family property, which includes a determination of whether the husband has an ownership interest in R&S and Supreme, and support, which includes a determination of the husband’s true income for support purposes.
9During the marriage, the wife did not work outside of the home. It is agreed that the husband’s source of income came from R&S.
10R&S is a company based in Mississauga, Ontario and provides mobile truck washing services in the GTA. It began operations in 2007.
11According to the husband and Rustam, the only shareholders of R&S are Gennady and Rustam.
12Supreme Capital is a real estate holding company, the primary assets of which are a 100% interest in two residential condominium rental units located at 88 Scott Street, Suites 4907 (purchased in September 2018) and 101 Charles Street West, Suite 1806 (purchased in March 2015). Again, according to the husband and Rustam, the shareholders of Supreme Capital are Gennady and Rustam.
13It was only after the wife received the husband’s Answer and Financial statement on April 19, 2022 that she discovered he claims to hold 49% of his interest in both R&S and Supreme in trust for his father’s company, SKZ and the remaining 1% for Rustam. This came as a complete surprise to her as she always understood the husband was a 50% owner of R&S and Supreme. The wife understood that the husband managed both investment condominiums on his own and that he owned them outright.
14According to the wife, the parties lived a luxurious lifestyle, which included vacations to places such as Europe, Bahamas, and the Maldives, flying business class, driving luxury vehicles such as Mercedes, and purchasing expensive clothing and jewellery. The wife submits that substantial amounts from the corporate accounts were deposited by the husband into the parties’ joint account and he used corporate credit cards to support their lavish lifestyle and family expenses.
15On August 13, 2021, less than 2 weeks after the parties’ separated, the husband transferred title to the Charles Street and Scott Street condominiums from his sole name to Supreme and claims to hold title to these properties in trust for Rustam and SKZ. The mortgage application which the wife attached as an Exhibit to her affidavit, sworn on July 22, 2024, lists the husband as an owner of R&S and having an annual income of $370,000. This contradicts the husband’s sworn financial statement sworn in this proceeding.
16Despite the husband’s transfer of the two investment properties to Supreme, the mortgages registered on title to both investment properties remain in the husband’s name.
17The motion before me is to address disclosure the wife seeks from Rustam, R&S and Supreme.
Issue One: Whether the Corporate Respondents are in breach of a prior disclosure order of Faieta, J., dated May 16, 2022?
18At a case conference on May 16, 2022, Faieta, J. ordered the husband to produce the financial disclosure listed in paragraph 17 of the wife’s case conference brief.
19I have reviewed paragraph 17 of the wife’s case conference brief, which contains a list of 29 items for the husband to produce, a list of 3 items for Gennady to produce; a list of 9 items for R&S to produce; and a list of 9 items for Supreme to produce.
20Paragraph 2 of Faieta, J.’s Endorsement states,
“The Respondent shall provide the disclosure requested at paragraph 17 of the Applicant’s Case Conference Brief dated May 5, 2022 within 30 days.”
[Emphasis added]
21The Endorsement does not require Gennady, Rustam R&S or Supreme to produce any disclosure. At the time the case conference was held on May 5, 2022, neither Gennady, Rustam, R&S nor Supreme were made parties to this family law proceeding. Further, since there was no motion before the court, these third parties were not served with motion materials seeking disclosure from them.
22Accordingly, I do not find based on the record before me that Gennady, Rustam, R&S nor Supreme were subject to a prior order for disclosure. Although paragraph 17 of the wife’s case conference contains lists of financial disclosure she wanted produced by Gennady, R&S and Supreme, Faieta, J.’s order only references the husband as being required to provide her with disclosure and that can only have meant the list of items she sought from him.
23On this basis, I do not find that Rustam, Gennady, R&S or Supreme are in breach of an existing court order requiring financial disclosure. As a result, the relief sought by the wife for the imposition of fines as a result of breach by Rustam, R&S and Supreme of an existing disclosure order need not be considered by me, since there is no triggering event.
24Therefore, the real issue for me to decide on this motion is whether Rustam, R&S and Supreme should be ordered to produce the financial disclosure requested by the wife in her Notice of Motion
Issue Two: Should Rustam, R&S or Supreme be ordered to produce the financial disclosure sought by the wife in Schedule “A” to her Notice of Motion
25Despite the position taken by Rustam and the husband in this proceeding, the wife believes the husband has an ownership interest in R&S and Supreme and that Rustam and Gennady have altered the corporate documentation after the separation to make it seem like the husband has always been holding his father’s shares in both companies in trust for him.
26According to the husband, he met Rustam in 2000 and Rustam was looking for a partner to continue his business operations at R&S, which was initially a partnership. The husband advises as follows:
a. In 2007, Rustam wanted to expand R&S and needed to buy equipment. The husband introduced Rustam to his father, Gennady, who resided and worked in Kazakhstan at that time. Gennady owns SKZ, a foreign company.
b. Gennady and SKZ decided to advance funds to Rustam to grow R&S. Since Gennady was in Kazakhstan, he and his wife, Nina, appointed the husband as their Power of Attorney on January 8, 2009.
c. On February 24, 2010, R&S was incorporated. The husband holds 49% of the shares in R&S in trust for SKZ. Because SKZ was a foreign company it could not hold 50% of the shares, so Rustam also held 1% of the shares in R&S in trust for SKZ. The other 50% owner of R&S is Rustam.
d. He was employed by R&S but Rustam was the decision maker for the company, and his father was the financier.
e. Rustam and Gennady decided to invest R&S profits into real estate properties and as a result, two condominiums were purchased by R&S - the Charles Street property in 2015 and the Scott property in 2018.
f. On November 15, 2018, Supreme was incorporated as a holding company. Supreme has the same share structure as R&S. Supreme was incorporated to ensure that both investment properties were handled through Supreme. The husband claims he signed trust agreements between himself and Supreme.
g. During the marriage, his sole income came from R&S. The deposits to the parties’ joint bank account he claims do not reflect his true income, because the rental income from the two properties was deposited into the parties’ joint accounts as a flow through.
27The wife brought a motion to register a certificate of pending litigation on both the Charles Street and the Scott Street condominiums which was heard on November 5, 2024. The determination of that motion is outstanding.
28The determination of the husband’s ownership in R&S and Supreme is an issue that will be determined at trial. However, I find that the determination of the husband’s ownership interest in these corporations, if any, requires disclosure of corporate documentation from both R&S and Supreme. Further, to determine the husband’s income for support purposes, disclosure from R&S and Supreme are necessary, since the parties have directly opposed narratives as to how they met their expenses during the marriage, but they do agree that the husband derived his income from R&S. This is particularly the case, since the husband and Rustam have admitted on their respective questioning, that the husband has control over the corporate bank accounts and regularly transferred corporate funds into his personal bank accounts and vice versa.
29The wife points to the following documentation to support her position that the husband has an ownership interest in the two corporations from which she seeks disclosure:
a. The R&S corporate profile, which was first registered as partnership, lists the original two partners in the business as the husband and Rustam. The husband is listed as a partner and not as someone holding shares in trust for Rustam. This is contrary to Rustam’s affidavit in which he deposes that he was the sole founder of R&S and Sergey was brought in later.
b. The Corporate Registry for R&S lists the husband as the secretary for the company, even though the husband and Rustam claim the husband is a bare trustee, holding Rustam’s shares in trust for him.
c. The husband was an active participant with R&S, including opening corporate bank accounts and investing funds in the business. This is evidenced by the fact that TD sent a letter to Supreme, dated March 15, 2019, regarding its investment account by sending it to the husband’s attention and addressing the letter to the matrimonial home address.
For this reason, I find that disclosure of the corporate bank accounts and credit card statements for both R&S and Supreme are necessary and relevant.
d. A copy of the 2019 corporate financial statement for R&S was signed by the husband, demonstrating that the husband had authority to sign corporate financial statements. This is contrary to the husband’s claim that he was an employee of R&S.
e. The wife points to a wire transfer dated January 20, 2021 showing funds wired from Supreme to the husband which she submits was used to fund the parties’ trip to the Maldives in Jan/Feb of 2021. This is disputed by the husband.
f. Immediately after separation, the husband for the first time claimed that he was not the owner of either R&S or Supreme. To prove this, the husband produced copies of Trust Declarations to the wife. The Trust Declarations list the husband as a “bare trustee” but do not provide details about the nature of the timing of the transfers, the duties in which the husband will engage, and/or any consideration between the husband and the beneficiary. The Trust Declaration were signed years apart.
For this reason, the wife seeks the file from the corporate lawyer who prepared these Trust Declarations to verify the validity of the documents produced by the husband to date. I find that this documentation is relevant and necessary to determine the ownership of R&S and Supreme.
g. Despite Rustam’s claim that the husband’s father provided the seed capital for R&S, no evidence has been produced to demonstrate that his father provided consideration for his 49% of the shares.
h. The corporations in question have been in existence for 10 years. Changes to the corporate structure only began after the parties’ separated.
i. Prior to the parties’ separation, the husband issued shares to the wife in R&S and the wife obtained a copy of the Minute Book from the accountant, Milman & Company at that time. After the separation, the husband provided a copy of the Minute Book for R&S with the shareholder ledger where the words “in trust” were added after the husband’s shares were listed. The wife deposes that the words “in trust” do not appear on her copy of the Minute Book. This discrepancy has not been explained to her.
ii. The R&S corporate records show that Articles of Amendment were filed on August 6, 2021, four days after separation, and the husband went from being listed as the President of the company to the General Manager.
iii. Another change was made on July 24, 2023, when for the first time the husband’s father is listed as a General Manager.
iv. Again, this is contrary to Rustam testifying during his Questioning that no changes were made to the corporate records for R&S after the separation.
For all of the above reasons, the wife seeks disclosure from the corporate accountants for R&S and Supreme and the original corporate Minute Books for each company. I agree this disclosure is both relevant and necessary.
i. The 2019 corporate financial statement for Supreme shows the husband’s signature which was included in the husband’s certificate of disclosure. In another copy of the corporate financial statement it shows Rustam’s signature and not the husband’s signature. The wife claims that similar amendments were made to the income tax return for Supreme.
j. The husband had produced two corporate income tax returns for R&S and Supreme. These returns include a note stating, “retain on file, do not submit to CRA” and appear to have been amended after the parties’ separation. Specifically, the wife alleges that the R&S 2020 tax return was amended to add SKZ as the beneficial owner at the husband’s direction. A letter from the accountant, dated March 7, 2022, instructed the husband to file a T1134 form separately with CRA to report foreign affiliates, and the amendments to the tax return are shown in an Exhibit to the wife’s affidavit. The wife believes that the husband made these changes after separation to support his narrative that he has no ownership interest in these companies.
Due to the inconsistencies in the corporate financial statements and corporate income tax returns, the wife seeks disclosure of the corporations’ prior accountant’s file and the current accountant’s files. I believe these files are necessary and relevant.
Husband’s Valuation Report
30In response to an order from Diamond, J., the husband retained a CBV to obtain a valuation of the fair market value of R&S, Supreme, Supreme Water Delivery Inc. and 12065916 Canada Inc. as at the parties’ date of separation, August 2, 2021.
31The Report was completed by Steven Rayson and is dated October 28, 2024. It states that other than 12065916 Canada Inc. (in which the husband advises he has a 50% interest), the husband told the valuator that he is not a shareholder in the other three corporations. The report clearly states “However, as at the date of this Report, we have not been able to confirm this.” The wife’s position is that there is an overwhelming lack of disclosure given to the husband’s own expert and because of this, the valuation Report provided by Mr. Rayson is disputed by her.
32The Report acknowledges its limitations in the scope of review. It specifically states that,
In preparing our Report, we requested certain documents with which we were not provided. These documents are listed in Appendix A. In the event that some or all of these documents are provided to us after the date of this Report, our Valuation conclusions may change.
In addition, we requested, but were not provided with, a letter of representation signed by Mr. Cherkassov to confirm that he did not have any information or knowledge of any facts not disclosed in this Report with respect to our Valuation of the Companies that would affect the conclusions arrived at herein.
33Schedule “A” to the Valuation Report has an extensive list of disclosure Mr. Rayson did not receive to prepare his report. This is highly relevant to this motion since it is evident that the husband did not disclose highly relevant documents to his own expert. Schedule “A” identifies the documents Mr. Rayson requested from the husband but which he did not receive, as follows:
Limitations on scope of review
In preparing our Report, we requested but were not provided with the following:
Details of any significant events occurring between the valuation date of August 2, 2021 and the current date. This may include, but not limited to, the incorporation and/or start-up of any new businesses, or closure of existing businesses, etc.
The Articles of Incorporation and shareholders’ registers for each Company, with details of the type and characteristics of the issued and outstanding shares.
Copies of any shareholders’ agreements.
Copies of the minutes for all Companies for fiscal years 2019 to the current date.
Details of any business valuations or offers to purchase a Company or Companies from 2019 to the current date.
Details of major capital commitments/expenditures anticipated in the near term (type of expenditure, amounts involved), as well as an indication of the ongoing levels of capital expenditures required to sustain the operations of the Companies.
Corporate documents for R&S Supreme Mobile Wash Inc.:
Corporate financial statements for the fiscal year ended December 31, 2021.
Detailed general ledgers, trial balances, adjusting journal entries, corporate tax returns and notices of assessment for the fiscal years ended December 31, 2017 to 2021 (the “period under review”).
Details of the management salaries and/or dividends paid by the Company, including any such remuneration paid to Mr. Cherkassov and/or to any other parties or persons related to him during the period under review.
A copy of the Company’s vehicle insurance policy or policies, including details of the vehicles covered under the policy or policies during the period under review.
Details of any unreported sales, barter transactions or other types of revenue earned by the Company but not included in the books and records during the period under review.
A list of discretionary/personal expenses paid for by R&S.
Details of contingent liabilities, contractual obligations or litigation, if any.
Corporate documents for Supreme Capital Group Inc.:
Corporate financial statements for the fiscal year ended December 31, 2021.
Detailed general ledgers, trial balances and adjusting journal entries for the fiscal years ended December 31, 2017 to 2021 (the “period under review”).
The corporate tax returns for the fiscal years ended December 31, 2017 to 2019 and 2021.
The corporate tax return notices of assessment for the fiscal years ended December 31, 2017 to 2021.
A list of discretionary/personal expenses paid for by Supreme Capital.
Details of contingent liabilities, contractual obligations or litigation, if any.
Details of any investments or marketable securities held by the Company as at August 2, 2021, and their market values as at that date.
Corporate documents for Supreme Water Delivery Inc.:
Detailed general ledgers, trial balances, adjusting journal entries, corporate tax returns and notices of assessment for the fiscal years ended December 31, 2019 to 2021 (the “period under review”).
A copy of Supreme Water’s vehicle insurance policy or policies, including details of the vehicles covered under the policy or policies during the period under review.
Details of any unreported sales, barter transactions or other types of revenue earned by Supreme Water but not included in the books and records during the period under review.
A list of discretionary/personal expenses paid for by Supreme Water.
Details of contingent liabilities, contractual obligations or litigation, if any.
34Given that the general ledgers for R&S and Supreme were not disclosed to the Valuator, nor details of the remuneration paid to the husband, I find that the disclosure sought by the wife with respect to R&S’s and Supreme’s general ledgers, bank statements, credit card statements, loan agreements with third-party lenders, including loan applications, and net worth statements, along with credit facilities, balance sheets and expense reports are all highly relevant and necessary disclosure that ought to be produced.
35Since the husband transferred funds from the corporation to pay personal expenses, all of the corporate bank account statements are necessary and relevant to determine the husband’s true income for support purposes.
36The Authorizations and Directions the wife seeks are for all banking financial institutions, including banks and credit unions to authorize the release of information and documentation. Rustam, R&S and Supreme, argues that Authorizations to all such institutions is overreaching and not proportional. The wife argues that she cannot know whether R&S, Supreme or Rustam have accounts at other banks, given the lack of disclosure to date. She further argues that there is no prejudice to the corporations if the Authorizations and Directions are signed since if there are no bank accounts at an institution, the institution will simply state that.
37Counsel for Rustam, R&S and Supreme argued there would be hardship to the corporations and it would be detrimental to the corporations if these Authorizations and the disclosure requested is permitted. When asked by the Court to describe the potential hardship, there was a concern raised that the wife would report Rustam, R&S and/or Supreme to CRA. As a result, counsel for the Corporate Respondents asked that no further disclosure be produced until it is determined that the husband has an ownership interest in R&S and/or Supreme.
38This is not a practical solution. As stated above, the determination of the husband’s ownership, if any, in R&S and Supreme is a triable issue. If the trial judge determines the husband has an ownership interest in R&S and Supreme, then a new trial would need to be convened once the corporate disclosure is provided. The issues are not bifurcated nor did any of the Corporate Respondents seek such relief.
39Counsel for the husband acknowledges that since the husband’s ownership in the Corporate Respondents is a triable issue, it is not practical for the disclosure to come at a later time. However, she asks that the wife and her counsel not receive any of the corporate disclosure directly and that, instead, disclosure, if ordered, be delivered directly to the wife’s Valuator who will be critiquing the Rayson Report. The concern raised is that if the wife is in receipt of the corporate documentation and disclosure she seeks she will take steps to somehow damage or ruin the active operation of the businesses.
40When asked by the Court if the wife was asked to sign a Non-Disclosure Agreement (“NDA”) by the Corporate Respondents, the answer was no.
41Counsel for Rustam, R&S and Supreme submitted that if any disclosure is ordered, the wife be required to sign an NDA.
42I agree that prior to any disclosure being ordered, the wife be required to sign an NDA. I so order.
43The directions to the corporate lawyers who drafted the transfer of the corporations is necessary along with the documents for the lawyer who prepared the trust documentation. The husband gave an undertaking to get his corporate lawyer’s file and later claimed that the other parties would not consent to him providing this disclosure. I order the Corporate Respondents to produce the files from the corporate lawyers who prepared these documents.
44In family law, there is a fundamental obligation for parties to provide full and frank financial disclosure. This duty extends to all relevant financial information, including any interest in corporate entities. Failure to disclose such information impedes the court's ability to ensure a fair resolution of financial disputes; Roberts v. Roberts, 2015 ONCA 450, at para. 11.
45In Hohl v Hohl, 2021 ONSC 2182, the court emphasized the necessity of full and frank disclosure in family law, particularly when corporate entities are involved. The court highlighted that when a party has control over or involvement with corporations, those entities hold crucial financial information that is directly relevant to support and the equalization of net family property. The court adopted a liberal approach to ordering disclosure, especially in cases where there is a complex corporate structure that might be used to conceal income or assets. The court ordered extensive disclosure from corporations controlled by the respondent’s family, recognizing the importance of these records in accurately determining the respondent’s financial position: at paras. 20-24, 25-26, and 27-35.
46In Filoso-Baglione v Lawson, 2024 ONSC 3900, the court addressed the issue of third-party disclosure, specifically focusing on financial documents held by the applicant’s father, who was not a party to the litigation. The court ordered the production of certain bank statements from the father’s corporation, noting that these documents were relevant to the issues in the case, particularly concerning the applicant's financial situation and the nature of the financial support provided by her father. Despite the father not being a party to the litigation, the court found that the bank statements were necessary for determining the applicant's true income and financial means. The information was directly relevant to the respondent’s defense, particularly regarding the claims of financial abuse and the applicant’s entitlement to spousal support. The court held that without these documents, it would be unfair to require the respondent to proceed to trial, as the information was necessary to properly assess the applicant’s financial circumstances; at paras. 44-52.
47As the Supreme Court suggested in Leskun v. Leskun, 2006 SCC 25, [2006] 1 S.C.R. 920 (S.C.C.), at para. 34, nondisclosure is the cancer of family law. This is an apt metaphor. Nondisclosure metastasizes and impacts all participants in the family law process. Lawyers for recipients cannot adequately advise their clients, while lawyers for payors become unwitting participants in a fraud on the court. Judges cannot correctly guide the parties to a fair resolution at family law conferences and cannot make a proper decision at trial. Payees are forced to accept an arbitrary amount of support unilaterally determined by the payor. Children must make do with less. All this to avoid legal obligations, which have been calculated to be a fair quantification of the payor's required financial contribution. In sum, nondisclosure is antithetical to the policy animating the family law regime and to the processes that have been carefully designed to achieve those policy goals.
48In the case at bar, although the Corporate Respondents are not family members to the husband, Gennady, his father, is an apparent partner of the Corporate Respondents and no doubt has influence over them. The family law legislation and the Family Law Rules are clear. The disclosure being sought by the wife is relevant and necessary not only to determine the husband’s ownership in R&S and Supreme, if any, but also to the very relevant issue of his income for support purposes.
ORDER
49This court makes the following order:
a. The R&S Supreme Mobile Wash Inc., Supreme Capital Group Inc. and Rustam Ilakhunov, the Corporate Respondents shall deliver a Non-Disclosure Agreement to the Applicant within 7 days of the Release of this Endorsement for her execution. If there are any issues with the terms of the NDA, the parties shall arrange a check-in conference before me at 9:00 a.m. on an agreeable weekday.
b. Within 45 days of the release of this Endorsement, the Corporate Respondents shall produce the following disclosure to the Applicant:
i. Access to the original corporate Minute Book;
ii. Authorization and Direction allowing R&S's former accountant, Yasha Bushuev, to provide to the Applicant's counsel all files which Mr. Bushuev retained in his possession including correspondences, notes, drafts etc. relating to the corporation's finances and income tax filings;
iii. Authorization and Direction allowing R&S current accountant, Milman & Company, to provide to the Applicant's counsel all files including correspondences, notes, drafts etc. relating to the corporation's finances and income tax filings;
iv. Directions and Authorizations addressed to all banking/financial institutions, including banks and credit unions, in the name of R&S Supreme Mobile Wash Inc., authorizing the release of information and documentation to the Applicant’s counsel, including but not limited to bank and credit information;
v. Copies of R&S's general ledger from its inception to date;
vi. Copies of all R&S’s bank statements from inception to date;
vii. Copies of all credit card statements from January 2018 to date;
viii. Copies of all loan agreements between R&S and third-party lenders together with loan applications and net worth statements from inception to date;
ix. Copies of all other credit facilities from January 2018 to date;
x. If R&S applied for the government CEBA loan, a copy of that application;
xi. Copies of all lease agreements from inception to date;
xii. Copies of all balance sheets from inception to date;
xiii. Copies of all expense reports from January 2018 to date, with supporting documents.
c. With 45 days of the release of this Endorsement, the Corporate Respondents shall deliver the following items of disclosure to the Applicant:
i. Access to the original corporate Minute Book;
ii. Authorization and Direction allowing its former accountant, Yasha Bushuev, to provide to the Applicant's counsel all files which Mr. Bushuev retained in his possession including correspondences, notes, drafts etc. relating to the corporation's finances and income tax filings;
iii. Authorization and Direction allowing its current accountant, Milman & Company, to provide to the Applicant's counsel all files including correspondences, notes, drafts etc. relating to the corporation's finances and income tax filings;
iv. Directions and Authorizations addressed to all banking/financial institutions, including banks and credit unions, in the name of Supreme Capital Group Inc., authorizing the release of information and documentation to the Applicant’s counsel, including but not limited to bank and credit information;
v. Copies of its general ledger from its inception to date;
vi. Copies of all its bank statements from inception to date;
vii. Copies of all credit card statements from inception to date;
viii. Copies of all loan agreements between it and third-party lenders together with loan applications and net worth statements from inception to date;
ix. Copies of all other credit facilities from January 2018 to date;
x. If it applied for the government CEBA loan, a copy of that application;
xi. Copies of all lease agreements from inception to date;
xii. Copies of all balance sheets from inception to date;
xiii. Copies of all expense reports from January 2018 to date, with supporting documents.
d. The parties shall try and settle the issue of costs of this motion. If they are unable to do so, the Applicant shall serve and file costs submissions in writing of no more than 3 pages, not including a Bill of Costs of Offers to Settle within 10 days of the release of this Endorsement. Within 7 days of being served with the Applicant’s Bill of Costs, the Corporate Respondents, shall serve and file responding costs submissions in writing of no more than 3 pages, not including a Bill of Costs or Offers to Settlement. Within 5 days of being served with the responding costs submissions, the Applicant shall serve and file reply costs submissions, if any, of no more than 1 page.
Justice Kraft
Date: November 29, 2024