It was sold as a low-risk, low-stress, self-financing real-estate investment, and involved 14 non-descript condos on a Vernon street more associated with crime than as a place to invest money.
But in the 11 years since a variety of investors bought the rental units, eight of those years have been tied up in bitter litigation fueled by antagonism and deeply entrenched positions.
Following an 18-day trial at the Vernon courthouse, Justice Elaine Adair said that fortunately, the one area of consensus between all the parties involved was that they wanted the units sold.
“Sale of the units would at least bring an end to the prolonged fighting over matters relating to the Strata Corporation and its governance, and reduce the scope of the war to one over money and the division of profits,” Justice Adair said.
Details of the case are laid out in a 101-page, 36,000-word B.C. Supreme Court decision.
According to the decision, the case dates back to 2008 when Rene Gauthier, Odin Zavier, and Thane Lanz formed SWS Marketing to start a business in real estate investment.
Zavier had purchased a marketing licence, which allowed him to take on clients and advise them on marketing plans. Lanz took one of Zavier’s classes and they became friends.
They met Gauthier and the three decided to go into real estate investment. They launched SWS Marketing and although the three were supposed to own the company equally, Gauthier held more than 50 per cent of the shares and controlled the firm.
SWS Marketing got involved in three residential real estate development projects in the Lower Mainland before finding the 14 units in Vernon in 2010.
The following year Zavier bought the 14 units, spread over two buildings for $1.6 million. It worked out at $116,000 per unit, which they thought was a good deal as the units had been appraised at $145,000 each.
The transaction was structured so that, before completion, the company entered into separate contracts of purchase and sale for the individual units with investors.
Zavier, Lanz, and Gauthier were all involved in approaching potential buyers for the units. The investors were spread across the country and they sold it as a “hands-off” deal.
“The Vernon Project was presented as one having positive cash flow, and not requiring much cash up front,” the decision reads.
Investors needed to provide $2,500 and obtain a mortgage. SWS Marketing would manage the rental building and provide the remaining roughly $30,000 for the down payment.
As part of the transaction, each of the new owners also had to sign a Joint Venture Agreement.
These agreements laid out the profit share of 50 per cent between an owner and SWS Marketing.
It’s these Joint Venture Agreements that became to focus of much of the litigation.
The agreements appeared to have gone smoothly until 2013 when things broke down.
A dispute between Gauthier and Zavier “boiled over” and Lanz sided with Zavier.
“The Fall of 2013 also marked the beginning of the duelling strata councils,” the decision reads. “The ‘Gauthier Council,’ and the ‘Zavier Council.’
Due to their dispute, both Gauthier and Zavier created their own strata councils. Condo owners then chose sides and paid their strata fees to the strata council they preferred. The opposition strata council then sent demand letters asking for payment.
Justice Adair said this created “more confusion.”
Around this time the litigation started.
SWS Marketing, which is controlled by Gauthier, sued Zavier and Lanz, along with eight other owners, the strata council, and nine John and Jane Does.
Gauthier argued that Zavier and Lanz along with the other owners had breached the Joint Venture Agreement on how the profits were divided.
The parties were regularly in and out of court.
“By 2017, some of the defendant-owners had had enough and wanted out of their investments,” the decision says.
Zavier then steered the owners towards a company owned by his wife called the Home Buying Centre.
The company promised to help people who have properties that are difficult to manage.
SWS Marketing then accused Zavier and Lanz of intentionally creating the “chaos” so the owners would give up their units to Zavier’s wife’s company.
Zavier denied that.
The lengthy court documents go through the long history of disagreements between the parties as they argue about what certain contracts meant.
Both parties accuse the other of being “evasive, obstructive and dishonest” throughout the trial.
There are accusations of forged signatures and very different accounts of who paid for what.
Justice Adair agreed that Zavier and Lanz were both “argumentative and evasive” and she also felt there were concerns about the credibility and reliability of some of Gauthier’s evidence.
“Through their answers, both Mr. Zavier and Mr. Lanz demonstrated considerable antagonism toward Mr. Gauthier,” the Justice said.
The Justice said Lanz was “openly sarcastic and derisive.
“My strong impression was that Mr. Lanz has held a long-standing grudge against Mr. Gauthier, and saw the trial as an opportunity to settle scores,” the Justice said.
Ultimately, following a lengthy analysis of multiple claims and counterclaims, the Justice dismissed the action against Lanz but ruled that Zavier, along with each of the condo owners had breached the Joint Venture Agreement.
However, the court proceedings are not yet over.
The Justice ruled that neither side had put forward an argument about how the court should go about assessing the damages.
“In those circumstances, I have concluded that I cannot make a final order, and it would not be just to make such an order, without receiving further submissions,” Justice Adair said.
The Justice then ordered both sides to come back to court with submissions about how to move forward with damages.
To contact a reporter for this story, email Ben Bulmer or call (250) 309-5230 or email the editor. You can also submit photos, videos or news tips to the newsroom and be entered to win a monthly prize draw.
We welcome your comments and opinions on our stories but play nice. We won’t censor or delete comments unless they contain off-topic statements or links, unnecessary vulgarity, false facts, spam or obviously fake profiles. If you have any concerns about what you see in comments, email the editor in the link above.
Island's largest investment in affordable housing taking shape in Saanich | BC Gov News – BC Gov News
Ahmed Hussen, federal Minister of Housing and Diversity and Inclusion –
“Everyone deserves a safe place to call home. Our government remains committed to working with our partners to ensure our seniors have access to housing that meets their needs. Today’s announcement is another important step in the right direction and will go a long way to support families in Saanich. This is the National Housing Strategy at work.”
Parm Bains, Member of Parliament for Steveston–Richmond East –
“This investment from the National Housing Co-investment Fund is improving the economic and social well-being of the individuals, seniors and families who will soon call Nigel House their home and will make Saanich a better place to live. When people have a secure and stable home, they gain the confidence they need to succeed and fulfill their potential.”
Fred Haynes, mayor, District of Saanich –
“It’s amazing what can happen when multiple stakeholders, including our local community associations, take a collaborative and proactive approach to challenges like housing. This project caters to a wide range of housing needs in Saanich and I look forward to seeing how it will enhance our community over the years to come.”
Derrick Bernardo, president and CEO, Broadmead Care –
“Broadmead Care has had a dream for years to build a new Nigel House. We are excited to see housing, health and social services coming together to make this dream a reality and more. The new Nigel House will be part of a beautiful community campus of care with a focus on aging in place, research and innovation.”
Geoffrey Ewert, CEO, Garth Homer Society –
“The Nigel Valley Project is a remarkable collaborative effort with the goal of meeting the needs of our diverse community. What we are creating is more than just housing – we are creating an inclusive community where people from all walks of life feel a true sense of belonging and have a place that feels like home.”
Bruce Homer, board chair, Garth Homer Foundation –
“The Nigel Valley project amplifies what can be achieved when stakeholders collaborate for the good of the community as a whole. Garth Homer is proud to be a part of this transformative initiative.”
Virginia Holden, executive director, Greater Victoria Housing Society –
“Greater Victoria Housing Society is really thrilled that we can increase the amount of affordable rental homes available in Saanich. We are very grateful to be a part of this strong partnership with the Province and other community non-profit organizations that will result in a transformation of this neighbourhood, and create a community where everyone feels at home.”
Chris Forester, executive director, Island Community Mental Health (ICMH) –
“Providing housing and recovery-oriented supports to people living with mental health challenges is at the heart of our work. ICMH is proud to partner in bringing 800 homes and the creation of an inclusive community to the Nigel Valley to serve so many of those in need.”
Indigenous-led Winnipeg organizations' $620M investment plan proposes new hospital, housing – CBC.ca
A hospital for Indigenous people and hundreds of new housing units are among the spending priorities laid out in an investment plan released Wednesday by a coalition of Indigenous-led organizations in Winnipeg.
The Winnipeg Indigenous Executive Circle — a coalition of 32 member organizations that work to support Winnipeg’s Indigenous population — is proposing a 10-year, $620-million spending plan, which it believes will make Winnipeg a better, healthier place for its communities.
“It’s essentially just laying out … in dollar terms, where we need help and where we see funding gaps that we need to actually hit these objectives,” co-chair Kendall Joiner said at at the Neeginan Centre on Higgins Avenue, where the plan was unveiled on Wednesday.
Spending proposals are broken down into four priority areas: health and well-being, housing and homelessness prevention, supports for families, and employment and education.
One of the big-ticket items in the plan is a hospital specifically serving Indigenous people, estimated to cost $65 million.
The plan also calls for a commitment to build hundreds of new housing units, including supportive housing and units with rent geared to income, expected to cost at least $347 million.
Other priorities include $1 million for cultural programming through the Winnipeg Indigenous Friendship Centre and $1.2 million for the creation of Indigenous research institutes.
Leaders of the Winnipeg Indigenous Executive Circle — whose membership includes organizations like Ma Mawi Wi Chi Itata Centre, End Homelessness Winnipeg and the Eagle Urban Transition Centre — say the goals in the plan would promote and elevate the work Indigenous-led groups are already doing.
“We’re a community that’s always been told, ‘this is what you need to do to move forward,'” said Crystal Laborero, chief executive officer of the coalition group.
“I think we’re in a day and a time that we are now realizing that … we have a lot of leaders in the community that are looking to make change for the urban Indigenous community and we have the solutions. We’re the experts in our field, so we feel that we can do this.”
The coalition says the plan shows governments and donors exactly what it would take to make Winnipeg a more welcoming and safer place for people who are First Nations, Métis and Inuit.
Success will be measured not by dollar value, but by how willing governments are to come to the table as equals, and how willing they are to understand that the Indigenous-led groups that make up the coalition know exactly what their communities need, the Winnipeg Indigenous Executive Circle said.
Credit Suisse Nabs Truist's Wolfgram for Tech Investment Banking – BNN
(Bloomberg) — Credit Suisse Group AG hired Rick Wolfgram as a managing director within its technology investment-banking group.
Wolfgram, who’s based in San Francisco, will report to Brian Gudofsky, the Swiss lender’s global head of technology investment banking, according to a memo to staff seen by Bloomberg News. A spokesman confirmed the memo’s contents, declining to comment further.
Wolfgram was most recently a managing director at Truist Financial Corp., where he led internet and digital media investment banking. He’s worked on transactions including initial public offerings for Coursera Inc., DoubleVerify Holdings Inc., NerdWallet Inc., Udemy Inc. and Snap Inc., as well as a high-yield offering for Cars.com Inc., Gudofsky said in his memo. Wolfgram joined Truist in 2012 after working at ThinkEquity.
Earlier this month, David Miller, Credit Suisse’s global head of investment banking and capital markets, said the Zurich-based firm plans to hire roughly 40 managing directors as part of its broader effort to rebuild.
©2022 Bloomberg L.P.
Xiaomi shares Xiaomi 12S series camera samples with Xiaomi 12S Ultra to feature new flagship Sony IMX989 sensor – Notebookcheck.net
Regina George's "Mean Girls" Mansion Listed for Sale in Toronto for $27M – Storeys
Politics Briefing: Atlantic premiers make the case for more health care funding from Ottawa – The Globe and Mail
Silver investment demand jumped 12% in 2019
Europe kicks off vaccination programs | All media content | DW | 27.12.2020 – Deutsche Welle
Global Media Markets, 2015-2020, 2020-2025F, 2030F – TV and Radio Broadcasting, Film and Music, Information Services, Web Content, Search Portals And Social Media, Print Media, & Cable – GlobeNewswire
Economy9 hours ago
Trump's Billionaire Neighbor Warns US Economy Is In An “Omnibubble” – Forbes
Economy10 hours ago
Canada's economy grew in April, but May contraction expected – CBC News
Politics2 hours ago
The Bullhorn Politics of Roe v. Wade – The Wall Street Journal
Sports2 hours ago
Sports events to bet on this summer
Health9 hours ago
Heart Attack Drug Proves Effective at Treating Stroke – Technology Networks
Tech24 hours ago
Quebec-area game devs are worrying about impact of new language laws – Game Developer
Media10 hours ago
Media companies expand health coverage after the Supreme Court abortion ruling. – The New York Times
Science6 hours ago
James Webb Space Telescope's powers will be revealed in just weeks and scientists can't wait – Space.com