Wednesday, 30 July 2014

Creep Extraordinaire                    

We all know the story of Cain and Abel and how Cain wanted what Abel had and the only way he could get it was to kill his brother which he did. Hence, the phrase, “the mark of Cain”.

Well, in this article, I am going to tell you about another brother who was just as evil. He didn’t kill his two brothers but he sure attempted to destroy them and in his attempt, he caused them real grief. The man I am writing about is Paul Politi, a name he chose as a replacement of his original name of Paul Sagman. This man is the kind of man that I refer to in the heading of this article as Creep Extraordinaire.                                            

This evil man’s two brothers are Uri and Doron Sagman and they can be called the overachievers of their family. Both became respected doctors and successful business people—one the founder of several bio-tech firms, the other a vice-president of a major pharmaceutical manufacturer.     

Politi was described by his own, dying father in a court document as the family’s “black sheep,” someone who committed “never-ending acts of betrayal.”

For years the two Toronto-based siblings fought bitterly with Politi over their father’s estate and the millions of dollars in Montreal real estate it contained. One of Politi’s brothers even used a hidden voice-recorder to collect evidence against him.

The two brothers had been the subject of libelous internet postings written by Politi and published in 2010. These defamatory publications appeared on websites owed by Politi`s various firms called, Tucows International Corp., Tucows Inc.,, Belleville Trust, 2183592 Ontario Inc. operating as Uxbridge Solar Farm which are ultimately owned and controlled by Politi.  (Politi and the Politi companies are hereinafter referred to collectively as the “Politi Defendants” of which they were all sued.) Of course, the man behind the defamation is of course Paul Politi.

After the two doctors obtained an injunction against their brother, Politi agreed to remove the internet postings. Politi filed for bankruptcy and was adjudged as being bankrupt on July 10, 2012.

The two doctors then sued their evil brother for libel in the Superior Court of Justice in Toronto.

Politi and his firms as defendants ceased participating in the action or communicating with the plaintiffs and their counsel. On June 25, 2013, the court struck out their Statement of Defence for failure to deliver an affidavit of documents and attend examinations for discovery (oral examination).
The Plaintiffs sought default judgment against the Politi and his firms and claim both compensatory and punitive damages. Although the websites had eventually been removed from the internet, the Plaintiffs submitted that the damage to their respective reputations that these websites were designed to cause had already been done.
The defamatory statements authored by Politi, and posted on the internet by the Politi Defendants, were closely linked to litigation commenced in 2008 in the Quebec Superior Court by Uri.

In that action, Uri sued Politi over his failure to complete a condominium purchase. That action was tried in Montreal before Justice Zerbisias, whose findings against Politi were damning, to say the least. Uri had sued his older brother, Politi  because of Politi`s cancellation of the contract of transfer which Uri originally transferred to Politi, for the sum of $1.00, a penthouse apartment, together with two parking spaces situated in the Sanctuaire Condominiums Complex in  Montreal.

URI claimed that the transfer of the apartment was null and void ab initio (from the beginning) because he was induced into executing (signing) the transfer document in error, for the sum of $1.00 by the fraudulent misrepresentations of Politi. In fact, Uri claims he had an agreement with Politi to sell the condominium to him for $1.2 million dollars.

Politi contested Uri's action on the grounds that there was never any agreement to pay $1.2 million dollars to Uri for the apartment. He claimed that Uri actually gave the apartment to him as an act of conscience by Uri, to compensate Politi because he allegedly did not receive his just share of the assets of their late father, Sadok Sagman, (their father) in the settlement of the latter's estate and of the financial issues between Politi and the rest of the family, due to mismanagement as alleged by Politi. He testified that the gift was to compensate him for alleged misdemeanors (forgery) committed by members of his family which divested Politi of his assets by the estate's Executors of a property eventually transferred to Politi.

Uri's action in Montreal accompanied by a seizure of the Sanctuaire Condo, was filed on May 21st 2008, and served on June 4th, 2008. On November 20th, 2009, Justice Yves Poirier. dismissed Politi's Motion to quash the seizure of the property. Thus the apartment remained under seizure.

During the trial held in Montreal, Justice (Judge) Zerbisias noted, at para 93 of her judgment, that Politi had threatened to “crush” Uri for failing to assist him in acquiring an interest in he property. Indeed, she found “proof of threats, by Politi against Uri and his family in the event Uri failed to cooperate.” Then, at para 114, Her Honour observed, in a moment of admirable understatement, that Politi has “an elastic notion of the truth.” She then went on to find that, in fact, Politi “lacks credibility, integrity, lies with impunity and without any conscience.” That certainly is a damming statement against Politi.
The issues before her Court therefore were:

1.       whether there was an agreement between Uri and Politi that Uri would transfer the Sanctuaire Condo to Politi in consideration of the payment by Politi to Uri of the sum of 1.2 million dollars;

2.         whether Uri was induced into error, by the fraudulent misrepresentations of Politi, to transfer the Sanctuaire Condo to him for the sum of $1.00 rather than for the agreed amount of $1.2 million dollars;

3.    whether Politi has committed abuse of process by contesting Uri's claim so as to render Politi liable for all Uri's extra-judicial fees and disbursements and charges, in addition to judicial costs on the action.

The brother’s father had become ill and after he was released from hospital, in March 2006, he discovered that Belleville Trust (one of his properties) documents had been altered by Politi contrary to his father’s instructions. It had been changed by Politi for his and his children's sole benefit. His father demanded that Politi have the trust modified to comply with his original estate plan and instructions.

When Politi, who was a trustee of Belleville Trust, failed to comply, his father arranged that all of the assets of Belleville Trust be transferred to a new trust which he created called Tours Belleville Trust. (Tours) In April 2006, on Politi’s father’s instructions, Belleville Trust transferred all of its assets to Tours Belleville Trust. The trustees of the new trust, Tours, were his father, Araujo and others. Politi was not named as a trustee of the new trust. This obviously angered him but had to be obvious to him that his father no longer trusted him.

On September 21st, 2006, the brother’s father executed a new will, which he confirmed on December 15th, 2006, wherein he declared his son Politi “unworthy of being his heir”, and specifically divested him of any right to inherit any portion of his estate. Later the father died  on January 6th, 2007.

Following his father’s death, Politi continued his action against the Estate and his brothers. The bitterness of the dispute pitted the family against Politi and at the same time, jeopardized their financial affairs. In October 2007, notwithstanding the ongoing hostile relationship between the parties, logic prevailed. At that point, Place l'Acadie, an important asset of the estate, was cash deficient and needed extensive repairs. It had lost many tenants; was in default under municipal by-laws; was in arrears in its taxes to the municipality as well as to the first mortgage creditor. Both the city and mortgage creditor had instituted proceedings in execution of their claims or security against the property. A hearing on the mortgage foreclosure proceedings was fixed for November 26th, 2007. The sale for municipal taxes was scheduled for November 5th, 2007. The property was encumbered by Politi's prior registration and could not be refinanced to the family.

On October 28th, 2007, the parties entered into a ‘Standstill Agreement’ whereby they suspended all legal proceedings between them for six months in order that they could proceed to the refinancing of Place l'Acadie on the basis of a new loan commitment for 8 million dollars obtained from a lending institution. The proceeds of the loan were to be used to pay the outstanding indebtedness of the building, some of the debts of the property and of their father’s s Estate, and to effect repairs on the property.

During the six months stand still period, the parties undertook in good faith to resolve their differences and proceedings. Politi undertook to radiate his advance registrations against the properties since the loan commitment was conditional upon removal of all encumbrances registered against Place l'Acadie. An independent property manager was to manage the day-to-day operations of Place l'Acadie, the Sanctuaire Condo and Greenshields. The object of the agreement was to salvage Place l'Acadie and to allow its refinancing. The Standstill Agreement confirmed that ownership of the Sanctuaire Condo vested in Uri.

The Standstill Agreement was immediately followed by a ‘Final Settlement Agreement’ executed between the parties on October 31st, 2007. The Final Settlement Agreement provided for the settlement and discontinuance of all the proceedings between the parties, as well as the radiation and discharge of the advance rights registered by Politi. It obliged the parties to cooperate with regard to the new loan commitment to refinance Place l'Acadie, and set out the terms of disbursement of the loan proceeds. Essentially the new mortgage loan would be used to pay for the charges and costs of the loan; discharge existing mortgages; pay outstanding liabilities; discharge outstanding income taxes due by Uri and Doron in association with their deceased father's properties; and, to discharge the loan registered on the Sanctuaire Condo, which condo remained in Uri's name.

As part of the settlement, and on Politi's initiation, the parties agreed that Place l'Acadie was to be transferred to Politi's Trust, Belleville Trust, by their father's company, 6656. Notwithstanding that the property remained in the name of 6656, Belleville Trust accepted the said property as it was, without claims or warranty of any kind, and immediately assumed sole management and all responsibility for the property pursuant to a "Management Agreement" signed that same day, October 31st, 2007

Since Politi was spending his time in Montreal managing Place l'Acadie for his own account, he requested during sometime in January 2008, that Uri permit him to reside in the Sanctuaire Condo when he was in Montreal. Uri agreed in good faith and in the continuing spirit of reconciliation with his brother. The parties then executed a month-to-month lease for the premises dated January 31st, 2008. This lease was actually required in order that Politi could gain physical access to the apartment.

The lease of January 31st, 2008 was subsequently replaced by another lease whereby Uri leased the apartment to Politi for one year starting January 5th, 2008 for an annual rental of $ 25 200. This latter lease granted Politi an option to cancel it upon one month's notice as well as a “first right of refusal to match any offers to purchase received from potential buyers of the Sanctuaire Condo.

In February 2008, Uri received an offer from and was negotiating to sell the apartment for 1.1 million dollars to V and G. Uri's version is that, when he disclosed the offer of 1.1 million dollars received for the Sanctuaire Condo to Politi, that Politi then indicated his desire and intention to purchase the condo for 1.2 million dollars i.e. $100,000 above the price offered by V and G. Thus, on or about February 22nd, 2008.  Uri suspended his negotiations to sell the apartment to the V and G.

Uri and Politi then agreed that Politi would pay the purchase price for the Sanctuaire Condo to Uri as soon as possible out of the expected proceeds to be derived by Politi from the pending sale of Place l'Acadie for the sum of 14.8 million dollars, out of which Politi or Belleville Trust expected to earn approximately 6.8 Million dollars net.

Politi denied that there was ever any discussion, at any time, of the purchase price of 1.2 million dollars. It was then that Uri realized that he had been tricked by Politi and as a result, lost the opportunity to sell the property to V and G. He should have put that agreement with Politi in writing especially when he already knew that his brother was not a man who could be trusted.

Nevertheless, a transfer of the apartment was to be scheduled almost simultaneously with the sale of Place l'Acadie so that Politi could receive the proceeds of that sale and apply them immediately to payment of the purchase price of 1.2 million dollars for the apartment to Uri. The parties continued to cooperate in order to give effect to their respective undertakings and to complete the transfer of the Sanctuaire Condo as well as the transfer and sale of Place l'Acadie.

On April 16th, 2008, the Sanctuaire Condo transfer was registered. Belleville Trust received the net proceeds of the sale in excess of 6.85 million dollars from the sale of Place l'Acadie. However,  no payment was made to Uri. Politi originally postponed payment to Uri claiming that he had encountered banking complications, and had to wait for the clearing from the bank before he could pay the funds to Uri.

Uri learned from his attorney Mr. Kovnats in Toronto that Politi was selling the condo.  Mr. Kovnats had received a telephone call from a René Gauthier in Montreal to verify the signatures on the powers of attorney authorizing the spousal consent declaration on the transfer of the apartment. Gauthier disclosed that he acted on behalf of buyers who were negotiating to buy the condominium from Politi. They were the same purchasers with whom Uri had dealt with—V and G.

Upon being informed by attorney Kovnats of the proposed sale, on May 9th, 2008, Uri called Politi who denied that he was selling the apartment. Politi also informed Uri that all banking formalities relating to the Place l'Acadie sale had been completed. Politi would now pay Uri on the morning of May 12th, 2008 and the parties agreed to meet for breakfast on May 10th, 2008.
That same day, May 9th, 2008, unknown to Uri, Politi discussed the proposed sale of the condominium with Me Gauthier, attorney for his proposed buyers V and G. Politi insisted that unless they proceeded directly and immediately to the sale, bypassing other offers, and the money was disbursed to him immediately, Politi would not sell the property. Upon Gauthier's refusal to proceed in that fashion, Politi withdrew from the negotiations.

On May 10th, 2008, Uri and Politi met for breakfast to settle the details of payment. They agreed to meet at Politi's bank in Toronto at 11:00 am on May 12th, 2008 where Politi would pay Uri. On May 12th, 2008, Politi called Uri to delay the meeting to 2:00 pm, then again to 4:00 pm, and then to the next day. That same evening, Politi, Uri and Doron dined together at Grano restaurant in Toronto.

On May 12th, 2008 at their dinner at Grano, the three brothers discussed, as they had previously in March or April 2008, when they dined at the Host restaurant, Politi's outstanding payment of 1.2 million dollars to Uri for his acquisition of the Sanctuaire Condo, as well as an offer by Politi to help his brothers, Uri and Doron, by giving them gifts of $700,000.00 and $500,000.00 respectively, to free them from their mortgages on their residences.  In the presence of both of his brothers, Politi undertook to pay Uri the next day.

On the following day, May 13th, 2008, Politi postponed his meeting with Uri to May 14th, 2008.  By coincidence on that very day, May 13th, 2008, Uri received confirmation that on April 18th, 2008, four days after Uri's transfer of the apartment, Politi had signed a listing agreement, with the same real estate agent with whom Uri had dealt, to sell it for the sum of 1.25 million dollars.

On May 14th, 2008, Uri went to meet Politi at the latter’s bank in Toronto for their scheduled meeting to receive payment. Politi failed to appear. Subsequently, Uri sought out Politi at his café where Politi suddenly, for the first time, expressed his anger and the injustice which he claimed was caused to him because he had not received a share in the Du Fort property. He demanded that Uri help him acquire that interest from their stepmother, Araujo, failing which he would not pay him the 1.2 million dollars. This was a completely new demand by Politi. Uri rightfully refused to cooperate since that didn’t constitute his original agreement with Politi.

The parties met again one last time, on June 3rd, 2008 to discuss the transfer and payment and other issues. Uri recorded the discussions between himself and Politi at that last meeting. Nothing was resolved. No payment was made so Politi was served with Uri’s claim the following day, on June 4th, 2008.

As far as Justice hearing the case was concerned, a resolution of this issue relied principally on issues of credibility and on the inferences that could be drawn from the actions and documents filed in court which supported the version of one or other of the parties rather than on the analysis and interpretation of those documents which are clear and unequivocal.

The justice ruled that the version advanced by Uri was clear and consistent. His testimony before the Court was direct, detailed and without hesitation.
The version advanced by Politi was inconsistent, illogical and unworthy of being believed. His testimony was evasive, hesitant, contradictory, argumentative, and he gave long diatribes which were not answers to the questions asked of him. He contradicted himself on several occasions, as well as contradicting his own evidence, or, being contradicted by it, i.e. his examination on his affidavit on July 11th, 2008; his evidence on the Motion to Quash on September 2nd, 2009; and his own defence in the present matter.

The Justice also ruled that Politi's version is not accepted as trustworthy by him for the following reasons;  it was inconsistent with the documentary evidence filed and from which the Court could draw inferences that there was an agreement to sell the property for the sum of 1.2 million dollars.

The Justice also said that Politi was inconsistent with the delay agreed upon for the execution of the transfer and its scheduling on the day before the Place l'Acadie sale, and which is supported by the agreement to suspend registration of the transfer till after that sale.

Further, he ruled that Politi's original explanation for the gift by Uri was that Uri felt guilty and wished to compensate Politi for the mismanagement of Place l'Acadie by the Estate following their father's death up to the date of the settlement. This explanation is contradicted by Politi's failure to assert such a claim until he was sued by Uri; Politi's acknowledgement that it was the Estate and not Uri personally who was responsible for managing that property; Politi's execution of a full and final release on October 31st, 2007 in favour of the Estate and in favour of Uri for all claims, actions, and demands of whatever nature he may have had against the Estate and Uri relating to the past operation and management of all the properties at issue including Place l'Acadie; Politi's knowledge and acceptance of the estimated value of Place l'Acadie, at the time of the settlement, at approximately 9 million dollars, which was subsequently sold in April 2008 by Belleville Trust, with Uri's assistance for 14.8 million dollars yielding the sum of approximately 6.8 million net to Belleville Trust;

Further, after Politi's original justification of Uri's gift was set aside by the trial judge on the Motion to Quash, and soundly contradicted by the documentary evidence, Politi changed his explanation to justify the gift, or, transfer for $1.00, as Uri's compensation to Politi for having participated in an alleged forgery, while their father was alive, which divested Belleville Trust of all its assets by transferring them to Tours.

There were more reasons why the Justice ruled against Politi but it must be obvious to my readers by now that Politi was a dishonest man who wanted to wreak revenge on his brother Uri by cheating him from what he owed him.

The Justice declared that the seizure of the property by Uri before judgment was good, valid and binding. She further dismissed Politi’s defence and ordered Politi to pay Uri his extrajudicial costs and disbursements, (including the cost of expert reports) totalling $282,882.23 as of September 20th, 2011 along with judicial court costs on the present action to Uri plus pre-judgment interest and the applicable tax.

With respect to Uri’s and his other brother’s claim for defamation of character which they filed in the Superior Court in Toronto against Politi, it didn’t go well for this dishonest man.

Justice Morgan said in art in his ruling the following;

“Politi has never apologized for the creation and publishing of the defamatory websites. The sites were live for approximately three months, during which time the media was advised about their existence. Their only discernable purpose was to harm the Plaintiffs and to make good on the threats to which Justice Zerbisias alluded in the Quebec judgment. The Plaintiffs therefore deserve to be awarded general damages in an amount that is substantial enough to reflect the serious damage done to them.” unquote

The justice also said;

“The defamatory statements in the instant case were published in a medium notorious for its ability to spread falsehoods far and wide. Scholars and courts alike have noted that not only are web postings “communicated through a medium more pervasive than print, and for this reason they have tremendous power to harm reputation but the extraordinary capacity of the Internet to replicate almost endlessly any defamatory message lends credence to the notion that ‘the truth rarely catches up with a lie.” unquote

It is important to note that not only economic loss, but personal feelings of injury and public embarrassment are to be taken into account when awarding damages.

The justice then said;

“Considering the ubiquitous medium used by Politi to defame his two brothers, I would award $150,000 in general damages in respect of each the Plaintiffs.  The Plaintiffs together shall therefore have an award of $300,000.”

Plaintiffs’ counsel submitted that this case was also an appropriate one for punitive damages. These kinds of damages are awarded when the conduct of the defendant is so egregious, it is deserving of punishment. Such damages are calculated so that they act as a deterrent to the defendant and to others from acting in an egregious manner.

The Justice said with respect to punitive damages;

“Having lost the law suit in Quebec over the condominium purchase, Politi went out of his way to fulfill his threat to “crush” the Plaintiffs. It is incumbent on a court to express its disapproval of this type of conduct in a most strenuous way.” unquote

The Justice awarded $50,000 in punitive damages against Politi. This means that each of the two brothers were awarded $200,000.  It also means that Politi had to pay (aside from court costs and lawyer’s fees)  $400,000 for defaming his two brothers. That is a high price for trying to wreak revenge on his brothers.

The brothers don’t expect to get much or any of that money since Politi is more or less broke. Had this horrible man been honest and treated people fairly, he would have received benefits from his father’s estate and from the sale of the properties.  Of course, his credit is so far down the toilet, even the plumber won’t be able to retrieve it.

This man reminds me of Aesop’s dog that was on a bridge over a pond. It had a bone in his mouth and when it leaned over the edge of the bridge, it saw its reflection. But the dog thought it was another dog with a bone in its mouth so it opened its mouth to grab the other dog’s bone and lost the one it previously had in its mouth. Politi saw a source of income beyond his own and tried to grab it and lost his own money in the process. It looks damn good on him.

I hope his brothers are not in a forgiving mood. They should treat Politi like one treats fleas. Once you remove them, don’t go back to the source of the fleas again. 

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