In the words of the Court of Appeal at paragraph 34, “those funds should be the subject of a constructive trust in favour of DSLC Capital Corp. in order to prevent the unjust enrichment of Credifinance Securities Limited.” But, this is the end of the story. Let’s start at the beginning. DSLC Capital Corp. (DSLC) sought to invest in Credifinance Securities Limited (Credifinance) thinking that it was a member in good standing with the Investment Industry Regulatory Organization of Canada (IIROC). DSLC’s plan was to become a part owner of Credifinance so that DSLC could sell securities and other investments to its existing network of investors. Based on representations of the principal of Credifinance, DSLC loaned Credifinance $400,000 and, by share subscription agreement, proceeded to purchase a minority ownership interest in Credifinance.Read More
In 2008, lawyers reported that 10% of all claims involve fraud. Industry Canada suggests fraud is growing rapidly. In the US there are reports of internet fraud quadrupling to about 31,299 cases. In the context of estate litigation, fraud arises when someone exercises undue influence which amounts to coercion to procure a will, limitations periods and fraudulent concealment, improvident depletion of an estate to escape creditors or others, and defalcation by an executor or power of attorney in breach of his fiduciary duty. In civil litigation, fraud involves dishonest dealing resulting in damages to another party.