Based on some recent news stories published by major Toronto media outlets, certain property developers and real estate lawyers are not to be trusted. It’s somewhat common sense to recommend to potential homebuyers that they should proceed with caution and do their research before making a major home purchase, but in most cases, it’s impossible to anticipate or predict when one is being scammed. But the good news is, as the examples below will demonstrate, tenants and victims are fighting back, seeking accountability and restitution from the developers and real estate professionals who failed to live up to their promises at the point of sale.
The most publicized incident to make headlines as of late involves Real estate lawyer Meerai Cho, who is currently under investigation by Toronto police for defrauding condo buyers, charged with 75 counts of fraud over $5,000, possession of property obtained by fraud, and breach of trust. According to Vidya Kauri of CP24.com, Cho completed purchase-and-sale agreements in 2012 for pre-construction condominium units in a building planned on a vacant lot at 5220 Yonge St. (Yonge Street and Finch Avenue), taking deposits from the buyers to be held in trust until construction by the Centrust Development Group was to be completed. But once the condo project was cancelled back in January of this year, buyers began to step forward arguing that their deposits had never been returned. Initial police investigation revealed that the trust the monies were held in had been emptied by 2012. A total of 25 complainants have come forward thus far, claiming to have lost more than $2-million collectively, but police, in uncovering bankruptcy statements filed by Cho, estimate that approximately 141 complainants may have lost roughly $12.4-million in expected losses. Cho is currently in police custody, and awaiting trial to be held on October 2.
Susan Pigg of the Toronto Star, disclosed details recently of a lawsuit that was filed by Etienne de Muelenaere, a 26 year old resident of a 44-storey Charles St. highrise. The suit alleges that Great Gulf, developer of the highrise project, acted both negligently and in breach of contract in the installation of faulty water valves during the building’s construction four years ago. As a result, tenants are experiencing dramatic fluctuations in water temperature, which is not only annoying, but potentially dangerous. Being in construction himself, Muelenaere suspecting that non pressure-balanced valves were used instead of pressure-balanced valves, spending $4,000 to have the faulty valves (and cracked bathroom tiles needed to reach the valves) replaced. He argues the lawsuit is not about the money, but admits he was slightly angered when Great Gulf refused to compensate him for the repairs. The $29-million class-action suit is being filed on behalf of all tenants, many of which have complained have been scalded.
And then there’s the story of Wendy Ji, who also filed a class-action lawsuit seeking restitution from property developer Elad Canada Inc. for promises they made regarding her two-bedroom unit at the Emerald City Condominiums at Don Mills Rd. and Sheppard Ave. E., back when she purchased the unit in 2010. Ji argues that herself, along with all the tenants in her complex, were lead to believe the 36-storey tower would have “easy underground access” to the Sheppard subway line and Fairview Mall, which ultimately never came into fruition. The lawsuit, citing misrepresentation and breach of contract, involves owners of 60 condos in the 464-unit Emerald City Phase I, seeking a total of $30-million.