The Nova Scotia Court of Appeal says a couple did nothing wrong when they sold their home to a local charity for use as a lottery prize and then bought the home back from the winners at a considerable discount.
Kris and Jacques Martin filed an appeal last year after a Nova Scotia Supreme Court judge ruled in favour of ALPC Housing Solutions Inc., the company that managed the 2014 lottery for the Halifax Transition House Association.
Kris Martin was a director of ALPC, which in August 2013 suggested a home lottery to the association as a way to raise money to expand Bryony House, a Halifax shelter for abused women and their children.
The Martins sold their home at 205 Willowhill Ridge in Waverley to Bryony House for $1,075,000. After the prize was drawn for in November 2014, Kris Martin negotiated the repurchase of the house from the winners one week later for $621,500.
At trial, Justice Richard Coughlan found the Martins had breached their fiduciary duties to ALPC and ordered them to pay the company about $324,000 plus costs and interest.
But in a recent decision, the Appeal Court said the trial judge erred in finding the property was subject to a trust, in finding that Jacques Martin had fiduciary obligations to ALPC and in finding that the repurchase of the property was a corporate opportunity that belonged to the company.
“It is not surprising that a striking difference between the initial sale price and the price for the same property on its repurchase within a short timeframe would draw suspicion,” Justice Linda Lee Oland wrote for the three-judge appellate panel.
“Those few facts could blind an observer from taking into account other relevant facts and context. In this case, a full appreciation of the circumstances and the law shows there has been no wrong committed against ALPC.”
The Appeal Court allowed the appeal and awarded the Martins $66,000 in costs.
