The Royal Canadian Legion in North Burnaby is suing its ex-lawyer after a developer tore down the war veterans’ social hall and broke a promise to build a new one.
In a May 15-filed B.C. Supreme Court action, Royal Canadian Legion #148, aka North Burnaby (B.C. No. 148), claimed lawyer Anthony H.S. Knight and his firm, McMillan LLP, caused the Legion loss, damage and expense when the plan to replace the 1955-built Legion Hall fell through.
The Legion retained Knight to advise on the sale of 4354-4357 Hastings Street to Epta Properties (Hastings 3) Development Ltd.
Beginning in November 2012, the court filing said, the Legion instructed Knight to review the exchange agreement, conduct due diligence on Epta and provide advice about the property, including a second mortgage in favour of the Legion.
The Legion claimed Knight agreed to “exercise the skill and diligence of a reasonably competent solicitor in carrying out the instructions of the plaintiff.” It alleged that Knight acted contrary to the Legion’s instructions and established legal practice by failing to address and advise on the sufficiency of security for the transaction.
None of the allegations has been tested in court. When contacted by theBreaker, Knight declined comment. He said that no statement of defence has been filed.
Since 2011, according to his bio on the McMillan law firm website, Knight has bought and sold 76 commercial properties for clients, totalling $922 million. His bio also says he has acted as borrower’s counsel for 85 loan transactions worth almost $2.75 billion. Knight was called to the British Columbia bar in 1977.
After the exchange agreement and transfer of the property to Epta, the Legion claimed Epta encumbered the property with a mortgage and “borrowed amounts that imperilled and/or violated the plaintiff’s security in the property, as represented by the second mortgage, including an aggregate amount exceeding the value of the property. Epta Hastings later failed to satisfy its payment obligations under the Epta mortgage leading to significant losses to the plaintiff.”
Epta vowed in 2013 to build a new Legion canteen by 2015 within the mixed-use, 26-condo development, called Centro. Epta paid the Legion’s $145,000 tax bill for 2014. It took out a $3.1 million loan, but claimed $2.82 million in costs, including a $700,000 “development management fee.”
Epta has been a party in more than 40 court actions in British Columbia. Instead of suing Epta or giving it more time to begin construction, members of the cash-strapped Legion voted to sell the property to Beedie Development Corp., even if that jeopardized the resurrection of the Legion canteen. Beedie’s proposal includes a 50-seat liquor primary establishment, a fraction of the previous 425-seat licence for the canteen.
The site remains vacant, but a Beedie-branded banner was recently erected around the site. The banner also contains the Royal Canadian Legion’s B.C. command logo.
Epta put an end to a North Burnaby institution. In April, it put an end to four West Broadway small businesses, including Kitsilano institutions Benny’s Bagels and Moderne Burger, to make way for its 22-condo Monument project.
Epta’s related company, Apollo, started as a wine importer and became a major cranberry grower for giant Ocean Spray. Court filings show that, over a seven-year period, Apollo advanced $5.9 million from its cranberry farming cashflow to related parties, “with the majority of the advances made to Epta Properties Ltd.”
Apollo was in default to Farm Credit Canada in January 2015 when it owed $23.626 million to secured creditors, primarily Farm Credit ($17.3 million) and First West ($4 million). In July 2015, Apollo reached a deal to sell the land, buildings, equipment, permits and contracts to D.R. Barnston Holdings Ltd. for $24.875 million, with a Feb. 11, 2016 closing date.
Despite the North Burnaby Legion fiasco, Alex B. Tsakumis, vice-president of Epta, played a key role in a US$75 million deal for 618 acres of vacant land near Palm Springs. EC Rancho Mirage Holdings GP Corp. bought the land, also known as Section 38, near the Sunnylands estate in Rancho Mirage.
Tsakumis registered EC Rancho Mirage Holdings GP Corp. in May 2017 in Delaware and his name and West Vancouver residential address are on the company’s November 2017 registration in California. Clarity Real Estate announced the acquisition in late March and its vice-president, Russell Holmes, wouldn’t say how much, if any, equity that Epta had in the deal.
Tsakumis’s cousin is ex-media commentator Alex G. Tsakumis, of Trigate Properties, who denies any overlapping interests or directors with Epta. “We have never had anything to do with Epta Properties, and we will never have anything to do with Epta Properties — ever, period,” Alex G. Tsakumis said in a statement to theBreaker last November.
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