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ARTICLE · 11 JANUARY 2019

Fraud And Knowing Assistance—Between The Innocents

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Fraud continues to plague businesses and individuals in Canada and abroad, increasing at an alarming rate. Those involved in asset recovery frequently turn to the equitable doctrine

CanadaCriminal Law
Munaf Mohamed
Munaf Mohamed
Michael Mysak
Michael Mysak
Aoife McManus
Aoife McManus
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Introduction

Fraud continues to plague businesses and individuals in Canada and abroad, increasing at an alarming rate. Those involved in asset recovery frequently turn to the equitable doctrine of knowing assistance to catch "strangers" to the fraud but with actual knowledge of it. Many times assets are held by these strangers and are the main means of recovery. But what happens when two sets of victims are pitted against each other suggesting one set of victims are liable for knowing assistance?

The Supreme Court of Canada (SCC) is set to determine this issue in a case from Ontario.

The SCC recently granted leave to appeal from the Ontario Court of Appeal's decision in DBDC Spadina Ltd v Walton, 2018 ONCA 60, a case involving a complex multiparty multi-mil lion dollar real estate fraud1. The Ontario Court of Appeal extended the doctrines of knowing assistance and corporate identification effectively to prioritize one set of innocent fraud victims over another.

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