Her Majesty the Queen - v. -, 2014 SKPC 7

IN THE PROVINCIAL COURT OF SASKATCHEWAN Citation: 2014 SKPC 007 Date: January 16, 2014 Information: 44663319 Location: Saskatoon _____________________________________________________________________________ Between: Her Majesty the Queen - and - Peter Turanich Appearing: Darren Howarth For the Crown Jack Hillson For the Accused JUDGMENT METIVIER , J INTRODUCTION [ 1 ] Peter Turanich is charged that:

a) On or about July 10, 2012, he defrauded Olena Gaivoronska of $8,000.00 contrary to section 380(1) (

a) of the Criminal Code .

b) Between August 15 and 26, 2012, he defrauded Olena Gaivoronska of $8,000.00 contrary to section 380(1) (

a) of the Criminal Code . BACKGROUND FACTS [ 2 ] Mr. Turanich’s real estate license was taken away approximately three years ago after working as a realtor for twenty-four years. [ 3 ] The complainant was born in the Ukraine where she was trained to be a hairstylist. She moved to Canada six years ago, finding employment as a hairstylist in a number of salons. In 2012, she decided to purchase a hair salon and start her own business. [ 4 ] The complainant initially intended to purchase an existing salon.

For that purpose, she contacted Trevor Jones, a realtor whose services she previously used to purchase her condominium. Since Mr. Jones did not work in commercial real estate, he referred her to Peter Turanich. Mr. Jones told the complainant that Mr. Turanich worked privately. [ 5 ] In early July 2012, Mr. Turanich showed the complainant a few salons for sale. Because the complainant was not enthused by what she saw, she turned her mind to the possibility of building a new salon. She thought that the University would be an ideal location for the salon and asked Mr.

Turanich to look into this possibility. [ 6 ] Mr. Turanich contacted Freda Salikin, the Business & Facilities Manager for the University of Saskatchewan Students Union (“USSU”). Ms. Salikin advised Mr. Turanich that the USSU was accepting business plans and lease offers for 3000 square feet of non- food retail space in the Place Riel Student’s Centre. [ 7 ] Over the next couple of months, Mr. Turanich assisted the complainant in putting the deal together. Mr.

Turanich’s services included: arranging for the complainant to look at the lease space; handling communications with the USSU facilities department; approving the floor plan on the complainant’s behalf; and providing advice to the complainant on the lease proposal and other matters. [ 8 ] On August 15, 2012, the complainant wrote a cheque payable to Peter Turanich in the sum of $5,000.00. On or about August 26, 2012, the complainant wrote a cheque payable to Peter Turanich in the sum of $3,000.00.

The parties dispute the purpose of these cheques and the discussions surrounding these cheques, specifically whether the cheques were provided as payment for Mr. Turanich’s services or as a deposit to the USSU under the lease agreement. [ 9 ] Mr. Turanich deposited the two cheques, totaling $8,000.00, into his personal account as payment for his services. ISSUES [ 10 ] Both counts arise from the complainant’s payment of $8,000.00 to Mr. Turanich in August 2012. It is alleged by the Crown in count one that Mr.

Turanich obtained the $8,000.00 by falsely representing himself as a real estate agent to the complainant. [ 11 ] The Crown alleges in count two that the $8,000.00 was obtained by Mr. Turanich on the basis of a false representation made to the complainant, namely that the money was required by the USSU as a deposit on the lease. [ 12 ] Mr. Turanich denies committing both alleged acts of fraud. He says that he advised the complainant at the outset that he was no

longer a realtor, but worked as a “consultant”. He maintains that the $8,000.00 was legitimately charged as a fee for his consultingservices and paid by the complainant on that basis. THE LAW [13]

Section 380 of the Criminal Code provides: 380.

(1) Every one who, by deceit, falsehood or other fraudulent means, whether or not it is a false pretence within the meaning of thisAct, defrauds the public or any person, whether ascertained or not, of any property, money or valuable security or any service, (

a) is guilty of an indictable offence and liable to a term of imprisonment not exceeding fourteen years, where the subject-matter of theoffence is a testamentary instrument or the value of the subject-matter of the offence exceeds five thousand dollars; or (

b) is guilty (

i) of an indictable offence and is liable to imprisonment not exceeding two years, or (ii) of an offence punishable on

summary conviction, where the value of the subject-matter of the offence does not exceed five thousand dollars. [14] In R. v. Theroux, (SCC), [1993] 2 S.C.R. 5, the Supreme Court of Canada considered the elements that theCrown must prove beyond a reasonable doubt to establish the offence of fraud. The actus reus of the offence of fraud will be establishedby proof of: 1. The prohibited act, be it

an act of deceit, a falsehood or some other fraudulent means; and 2. Deprivation caused by the prohibited act, which may consist in actual loss or the placing of the victim’s pecuniaryinterests at risk. [15] The mens rea of fraud is established by proof of: 1. Subjective knowledge of the prohibited act; and 2. Subjective knowledge that the prohibited act could have as a consequence the deprivation of another (which deprivation mayconsist in knowledge that the victim’s pecuniary interests are put at risk). [16] This case also raises issues of credibility on key issues.

In assessing credibility, I am obliged to follow the framework set outin R. v. W. (D.), (SCC), [1991] 1 S.C.R. 742 and R. v. McKenzie (1996), (SK CA), 106 C.C.C. (3d) 1(Sask. C.A.). ANALYSIS Count #1 [17] The first count alleges that Mr. Turanich committed the act of fraud by accepting $8,000.00 as payment for his services, afterfalsely representing himself as a real estate agent. The actus reus of the offence of fraud first requires proof of the prohibited act - be itan act of deceit, a falsehood or some other fraudulent means.

[ 18 ] The complainant testified that she understood Mr. Turanich to be a licensed realtor. Although she is not sure if Mr. Turanich told her that directly, she arrived at that conclusion based on circumstances which included the following: • She was referred to Mr. Turanich through a realtor; • Mr. Turanich told her at the outset that she did not have to worry about paying for his services, since the seller is responsible for paying the realtor. [1] • Mr. Turanich accompanied the complainant to a meeting with Women Entrepreneurs of Saskatchewan where he produced a business card, marked as Exhibit P-3 at trial.

This business card includes a logo for Repco Realty Saskatoon, and the words “REALTOR – Commercial & Residential” appear under Mr. Turanich’s name; • When Mr. Turanich requested the cheques for a deposit on the lease, he said that the money would go through his real estate company, and then be transferred to the USSU; and • In October 2012, three handwritten receipts, marked as Exhibit P-7 at trial, were left for the complainant at the front desk of her work for payment of the $8,000.00 in August 2012. The first receipt is dated September 9, 2012, in the amount of $1,500.00 for the “Real Estate Association”.

The second receipt is dated September 9, 2012, in the amount of $3,500.00 for the “Real Estate Commission”. The third and final receipt is dated September 14, 2012, in the amount of $3,000.00 for “Real Estate Fees”. [ 19 ] The complainant testified that she provided the $8,000.00 to Mr. Turanich as a deposit on the lease with USSU. She testified that she asked Mr. Turanich on numerous occasions to provide written receipts for the money she paid as a deposit on the lease.

When she finally received the receipts in October 2012, the receipts did not appear professional nor did they contain any reference to the $8,000.00 deposit. When she questioned Mr. Turanich about these receipts, he said that his wife had prepared the receipts. Furthermore, he told her that the money was not paid as a deposit but that the money was paid for his services. Shortly thereafter, the complainant fired Mr. Turanich and proceeded to finalize the lease agreement with the USSU without Mr. Turanich’s assistance. [ 20 ] The Crown presented evidence at trial that Mr.

Turanich also held himself out as a real estate agent to others. On July 25, 2012, Mr. Turanich sent an email to Ms. Salikin at the USSU, marked as Exhibit D-1 at trial, asking if the USSU paid a fee as “he was a realtor”. Ms. Cholowski, a business advisor with Women Entrepreneurs of Saskatchewan, testified and stated that Mr. Turanich told her he was a “realtor”. [ 21 ] Mr. Turanich denies that he held himself out as a real estate agent. Mr. Turanich testified that he told the complainant from the outset that he was not a realtor.

He testified that he explained to the complainant that he worked as a “consultant” and, as such, he could not be involved with the lease. Mr. Turanich admits that he gave the complainant a business card from his former position with the real estate company, with a line drawn through the office fax number and box office address, so that she would have his contact information; however, Mr. Turanich testified that he informed the complainant that he was not with the real estate company anymore. Mr.

Turanich firmly denies that the receipts marked as Exhibit P-7 were prepared by him or by his wife at his instruction, and denies that he delivered the receipts to the complainant. [ 22 ] Although Mr. Turanich testified that he told the complainant he could not be involved with the lease, Mr. Turanich showed the complainant the lease premises, handled communications with the lessor, provided the complainant with advice about the rental rate, and approved the floor plan on her behalf. It is my view that by involving himself in the negotiation of the lease, Mr.

Turanich was performing the services of a realtor. [ 23 ] I do not believe Mr. Turanich’s testimony that he advised the complainant that he was not a realtor, nor am I left with a reasonable doubt by it. The evidence as a whole satisfies me beyond a reasonable doubt that Mr. Turanich falsely held himself out as a realtor. [ 24 ] The second part of the actus reus requires proof that deprivation was caused by the dishonest act. The Crown has not established that there was a deprivation suffered by the complainant as a result of Mr. Turanich’s deceit or falsehood, namely Mr.

Turanich’s representation that he was a realtor at all material times. The complainant testified that she wrote the cheques to Mr. Turanich because he told her that the USSU required the money as a deposit, not because he was a realtor or in payment of his services as a realtor. Therefore, any deprivation could not be attributed to Mr. Turanich’s dishonest act of holding himself out as a realtor. [ 25 ] I find Mr. Turanich not guilty of count #1.

Count #2 [ 26 ] The second count alleges that Mr. Turanich obtained $8,000.00 from the complainant by falsely advising that the money was required as a deposit for the USSU lease. [ 27 ] The complainant testified that she provided the cheque dated August 15, 2012, to Mr. Turanich during a meeting at the Mendel Art Gallery. Mr. Turanich told the complainant that the USSU required a $5,000.00 deposit on the lease, and he assured her that this was a typical requirement. He requested that the cheque be made out to him, on the understanding that the money would be transferred to the USSU.

The complainant was concerned that paying the deposit would leave her short on the down payment that she needed to obtain a business loan from the bank; however, Mr. Turanich convinced her that the lease would not happen without the deposit, in which case a business loan would be of no use to her. [ 28 ] The complainant testified that the second cheque, dated August 26, 2012, was written on a Monday afternoon in the parking lot of the Galaxy Theatres. The complainant was going to a movie with her daughter and a friend when she received a telephone call from Mr. Turanich advising her that there was an emergency.

Mr. Turanich told her that the USSU required another $3,000.00 deposit to secure the lease. The complainant was very upset as payment of the further deposit would come from the money she saved as the down payment on her business loan. Mr. Turanich assured her that all she needed to do was write the cheque and she would have the space. He instructed her to backdate the cheque to Friday to increase her credibility with the USSU in terms of getting the money to them as soon as possible. [ 29 ] On the other hand, Mr.

Turanich testified that once his work was done and the lease was secured, he asked the complainant to pay him for his services and that she happily complied in the form of these two cheques dated August 15 th and August 26 th , 2012, totaling $8,000.00. Mr. Turanich testified that the complainant asked for her money back sometime later but he refused as he felt that he had done a good job for her. [ 30 ] Mr.

Turanich also testified that he paid his son $2,000.00 out of the money he received from the complainant for time that his son spent reviewing the complainant’s business plan and suggesting changes. [ 31 ] There were numerous internal inconsistencies in Mr. Turanich’s evidence. For example, Mr. Turanich testified that he was an “extremely competent realtor” and an “extremely competent consultant”, yet he did not prepare a written fee agreement, invoice, or a receipt. Mr.

Turanich testified that he told the complainant at the outset that his services would cost approximately 5% to 7% of the lease value; however, he charged her $8,000.00, which he says was calculated on the basis of the time spent putting the deal together, the amount of the lease and the square footage. Mr. Turanich was unable to provide the court with a breakdown of the fee when asked to do so in cross-examination, and gave conflicting testimony as to whether the fee included GST. Furthermore, Mr. Turanich testified that he requested payment for his services after his work was done and the lease was finalized.

However, the cheques were written in August 2012, and emails marked as Exhibit D-1 at trial show that communications with the USSU regarding square footage and floor plans continued until the end of September and the lease was not signed until October 19, 2012. Finally, in my view, Mr. Turanich’s denial of any knowledge or involvement in the making or delivery of the receipts marked as Exhibit P-7 makes no sense. [ 32 ] I conclude that Mr. Turanich is not a credible witness. I do not believe Mr.

Turanich’s evidence, nor am I left with a reasonable doubt by it. [ 33 ] Based on the complainant’s evidence, which I accept, I find that Mr. Turanich told her that the USSU required the $8,000.00 as a deposit on the lease and that she provided the money to Mr. Turanich on that basis.

In my view, the complainant’s evidence that the money was provided as a lease deposit is consistent with the context of the evidence as a whole, including the hastily arranged meeting at the Galaxy Theatres and the absence of any documents supporting the payment of a fee. [ 34 ] There was, in fact, a deposit requested by the USSU for the lease. I note that in the letter marked as Exhibit P-2 at trial, Ms. Salikin states that the USSU requested a deposit on the space in the amount of $3,000.00, and then reduced the amount to $1,000.00 at Mr. Turanich’s suggestion.

However, the sum of $8,000.00 was never discussed and, in any event, no deposit was ever received by the USSU. It may be that these events were precipitated by a request for deposit from the USSU; nonetheless, the information provided by Mr. Turanich to the complainant was false, both as to the amount of money requested and its purpose. [ 35 ] In committing the offence of fraud on the complainant, Mr. Turanich took advantage of the position of trust that he had

developed with the complainant and profited from it. With respect to the second branch of the actus reus , the complainant suffered from a deprivation of actual loss in the sum of $8,000.00 as a result of Mr. Turanich’s misrepresentations. [ 36 ] The mens rea of a fraud is established by proof of an accused’s subjective knowledge of the prohibited act, and subjective knowledge that the prohibited act could have as a consequence the deprivation of another. Mr. Turanich misrepresented the amount sought from the USSU as a deposit and failed to advance any funds to the USSU. I find that Mr.

Turanich misled the complainant by indicating the need to provide payment in the sum of $8,000.00 and by failing to forward the funds to the USSU. He also had subjective knowledge that these acts would deprive the complainant of $8,000.00. [ 37 ] Mr. Turanich may have thought himself entitled to the money for the services he had provided to the complainant, but that does not constitute a defence to the charge of fraud ( Theroux , at para. 32 ). [ 38 ] I find Mr. Turanich guilty of count #2. CONCLUSION [ 39 ] I find Mr. Turanich not guilty of count #1 and guilty of count #2. _________________________ S.

Metivier, J.