Monday, 31 August 2015

Punishing landlords for crimes they didn’t commit

Marlowe Van Dusen purchased a 12-residential building in Chatham, Ontario on March 10, 1995 for $308,000. There was no mortgage on the property. Its value was later increased to $400,000.           

On May 1, 2002, Marlowe transferred the property to his wife Patricia for $2 and “natural love and affection. It was later confirmed that this was done for estate planning and tax reasons. Both the Van Dusens confirmed that Marlowe continued to manage this property and that his wife, Patricia played no role in its management or maintenance and was unaware of any activities related to the building. Marlowe was for all intents and purposes the actual owner with all the responsibilities that come with its management.  

The apartments were predominantly low rent premises which were maintained exclusively by him. He attended at the building to collect the rent, attend to maintenance, assist tenants, and mow the lawn. He was on the premises multiple times each month and for this reason; he had a close attachment to this property.  

It is not unusual to end up renting apartments to some undesirable people in low rent apartment buildings and in this case, Marlow had undesirable tenants in his building.  

Between 1989 and March 10, 1995, before the purchase of the building by Marlowe, the police attended at the address on only two recorded occasions. Between March 10, 1995 and May 1, 2002, while Marlowe was the registered owner; there were 81 documented police occurrences.

Between May 1, 2002 when Marlowe transferred the property at 51 Taylor Avenue to Patricia and the year 2007, there had been 311 documented police occurrences. This is in contrast to the neighbouring properties at 49 and 55 Taylor Avenue, which had 12 and 5 police occurrences respectively during this period. All three low rent properties are similar as multi-unit residential buildings. The difference between the buildings is the quality of the tenants.

Between May 1, 2002 and August 13, 2007, as many as 21 search warrants under the Controlled Drugs and Substances Act (CDSA) were executed at 51 Taylor Avenue, and primarily at apartments 10, 11 and 12, resulting in 49 arrests with 119 charges being laid.

Most of the arrests were related to drug charges, however, there had also been numerous individuals charged with violating their bail conditions/probation, as well as criminal charges ranging from robbery and assault to possession of stolen goods. A number of people who had criminal records for breaking and entering were found in the building buying drugs and exchanging stolen good for drugs. In addition, those individuals who were found violating their bail conditions were primarily committing drug offences.

The unlawful activity at 51 Taylor permeated the entire building, inside and out. The principal tenants who resided at 51 Taylor and were primarily responsible for that unlawful activity; were those who resided in apartments 2, 10, 11, and 12. Apartment 9, which was vacant from time to time, as far back, as 2001, was also used as a location in which the criminals went into to consume illicit drugs.

 A tenant by the name of Marcus Hutchings lived in apartment 10 from at least 2001 until he was incarcerated for trafficking/possession of drugs in February 2007. Since May 1, 2002, there had been 20 police occurrences in respect of Hutchings’ apartment, including the execution of 14 search warrants and 36 arrests. He was known to the Police to be consistently involved in the trafficking of crack cocaine and marijuana, particularly from 51 Taylor. He has an extensive criminal record, which includes convictions for possession of controlled substances, possession of stolen property, break and enter, and assault. There is no evidence that Marlowe ever tried to evict him before a verbal notice in January, 2007 despite conversations between Marlowe and police about Hutchings as far back as 2002.

Richard Chandler resided at 51 Taylor, in apartment 12 until the preservation order. The police knew that he was working with Hutchings in trafficking in crack cocaine and marijuana from 51 Taylor and, before that, at other locations in the Chatham area. He has a lengthy criminal record, which includes convictions for possession of stolen property, possession of controlled substances and breach of undertaking. His former common law spouse, Michelle Perreault, who resided at 51 Taylor until June 2006 was also a drug user.

On July 25, 2007, the police confirmed that Scott Bechard was staying with Chandler in apartment 12. Bechard has a criminal record for assault, multiple thefts, fail to appear and obstruct peace officer and he told the police that he has had a cocaine dependency for the better part of a decade.

Serge Perreault resided in apartment 11 until the property was siezed. As the son of Michelle Perreault, he had lived with her and Chandler in apartment 12. Serge Perreault was known to work with both Marcus Hutchings and Richard Chandler trafficking drugs and has a criminal record for possession of drugs and failure to comply with recognizance.

There was also significant criminal activity related to the individuals residing in apartment 2. Police learned, in April 2007, that Johnathan Cumming was living there with Kent Butler. Butler, was known to police to be a crack cocaine, methamphetamine and prescription drug user and Cumming has a lengthy criminal record with numerous convictions for break and enter, theft, possession of property obtained by crime, possession of controlled substances, assault, fraud. This included 31 contacts with police between 2005 and 2007, including as late as July 25, 2007, when he was arrested for possession of a controlled substance.

In addition to the principal tenants involved in drug use and the drug trade named above, their customers and friends, although not tenants, regularly frequented the building. It is the evident that persons who were not tenants would come and go and share accommodation and while Marlowe might not have liked it, he felt that there was nothing he could do about it.

I don’t know if he refused to evict criminals in his building because he was afraid of them or alternatively he was indifferent to what they were doing in their apartments but he permitted those criminal tenants to remain in the building while committing their crimes. He admitted to having no real information as to who lived in the building at any given time. That was because he was focused on collecting his rent.

For years, the building had been a haven for criminals. These hoodlums should have been evicted in 2002 but instead, Marlow let them remain in their apartments where they continued to commit more crimes. That was a BIG mistake on the landlord’s part.  It would eventually cost him and his wife, big time.

There is a way in which the Provincial government can punish landlords who own property when they conduct or permit crimes to be committed in their homes or buildings. It is called the Civil Remedies Act, 2001

Section 3.1 of that Act states that in a proceeding commenced by the Attorney General, the Superior Court of Justice shall, subject to subsection (3) and except where it would clearly not be in the interests of justice, make an order forfeiting property that is in Ontario to the Crown (government of Ontario) if the court finds that the property is proceeds of unlawful activity. 

The fact that Marlowe and his wife were benefitting from the rent obtained from criminals who were committing crimes and earning money from those crimes was sufficient for the government to seize the property and sell it, with the money going to the government.

The reasonableness of the conduct of the breaching party is a crucial consideration when that party seeks relief from forfeiture in private law matters. In the context of a forfeiture application under section 3 of the CRA, it is the conduct of the party whose property is the target of the forfeiture application as it relates to the unlawful activity that is important.

That conduct is not limited to any involvement in the criminal activity on the owner’s part. It does however extend to any knowledge of the criminal activity, the failure to take reasonable steps to prevent the criminal activity, and any profit derived knowingly or unknowingly from the criminal activity, and any steps taken after the property owner became aware of the criminal activity. It is obvious that both Marlowe and his wife were aware of the crimes going in their building and had done nothing to stop it. As such, they were susceptible under the authority of the CRA to have their building taken from them. They were subsequently evicted as were the criminals in the building.

The question that must be answered is this. If only 4 out of 12 tenants are involved in criminal activity, does this justify the forfeiture of the building?

While the majority of the crime emanated from four apartments, the pervasiveness of the criminal activity cannot be ignored. It extended to the hallways, the common areas including the furnace and laundry rooms and to the exterior of the building including the parking lot. The sheer number of police attendances supports that conclusion. The size of the problem can also be gauged by the fallout experienced in the neighbourhood. This was the reasoning of the court also.

Further, the issue is not whether the building at large turned a profit from the criminal activity. The issue is whether the unlawful activity generated money.  It certainly generated money for the four tenants who were committing crimes. For example, the police seized $19,000 from Hutchings’ apartment which was ultimately forfeited.

Another question is, “Was Marlowe Dusen the responsible owner of the building?” 

To answer that question, it is important to start with the knowledge that at no time in the history of this building did Marlowe ever call the police for assistance when he really knew what was going on with respect to the criminal activity of those four tenants.

Marlowe told the court that many of the criminals attending those apartments weren’t his tenants. If he expected the court to accept that position, it was wishful thinking. He could have told the four tenants that their criminal friends could not enter the building. This he chose not to do.  He could also have evicted those four tenants. This he chose not to do. If he was afraid to do that, and I can understand his fear, he could have called the police (unknown to those tenants) and if they were arrested and held in detention, he could have then considered their apartments vacated and re-rented them to honest people. Simply put, Marlowe failed to evict the tenants committing criminal acts within the premises of 51 Taylor in a timely way. The evidence suggests he did not ever take steps in this regard under the Residential Tenancies Act and predecessor legislation. 

The Judge said, “The property, 51 Taylor Avenue, Chatham, Ontario, is an instrument of unlawful activity and will be forfeited to the Crown in right of Ontario pursuant to section 8(1) of the CRA.”

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