Judge tosses 4-year-old fraud charges

Unacceptable delay' halts prosecution of city lawyer, Cornwall investment adviser accused of defrauding investors of $547,000; Crown to consider appeal

'Unacceptable delay' halts prosecution of city lawyer, Cornwall investment adviser accused of defrauding investors of $547,000; Crown to consider appeal


Judge tosses 4-year-old fraud charges

Jake Rupert

The Ottawa Citizen

Friday, July 23, 2004

Unacceptable delay' halts prosecution of city lawyer, Cornwall investment adviser accused of defrauding  investors of $547,000; Crown to consider appeal


A large-scale fraud case against an Ottawa family law lawyer and a Cornwall investment adviser was tossed out of court yesterday when a judge found the accuseds' rights to a trial within a reasonable amount of time had been breached.

After a stay of proceedings application was brought by the accuseds' lawyers, Ontario Superior Court Justice Tom Lally found that, under Canada's laws, he had no choice but to stop the prosecution of Leonard Levencrown, 55, and Marc Lefebvre, 41. The pair had been accused of defrauding investors of $547,000.

The judge found the 41/2-year wait was well outside the guidelines set down by the Supreme Court of Canada, and that the defendants suffered prejudice as a result.

The men, who were charged in connection with the collapse of a $3-million business venture, were to have their trial this October.

The main problem in the case, the judge found, was that for various institutional reasons, none of which were the fault of the accuseds or their lawyers, the preliminary hearing took 43 months to complete 50 days of evidence after initially being scheduled for two weeks. The judge said better estimates of the hearing's length, setting aside large blocks of court time instead of a day here and there, and a better plan of how to hear the evidence would have helped to shorten this period.

Making things worse, the judge said, preliminary hearings are held in Ontario Court, and in Eastern Ontario, that level of court is frequently overloaded, which results in long delays when cases run longer than planned.

Given this and the way the complicated preliminary hearing was managed by court officials, the judge said "it is no wonder the preliminary meandered along for three years and seven months.

"The management of this case was not matched with institutional resources so that the preliminary hearing could be completed within a reasonable time," the judge said.

The judge acknowledged the public's and alleged victims' interests in seeing a trial on the merits of the case against the accused but said the prejudice the men have suffered with the charges outstanding against them constituted a serious breach of their Charter of Rights, which guarantees those charged to be tried within a reasonable amount of time.

"Even without a Charter, (this) is an unacceptable delay to complete the first stage of criminal proceedings and would not be tolerated in any jurisdiction unless of course there was a serious illness of an accused or an essential Crown witness," he said.

After the ruling, Mr. Levencrown, who was one of Ottawa's leading family law lawyers before the charges were laid in April 2000, and Mr. Lefebvre declined to comment.

However, Mr. Levencrown's lawyer, Michael Edelson, said: "They are pleased that this ordeal is finally behind them.

"It's been a long time, and they now want to move on with their lives."

Assistant Crown attorney John McInnes said Judge Lally's ruling will be reviewed to see if an appeal will be launched.

The Crown has 30 days to do so.

At the heart of the allegations against Mr. Levencrown and Mr. Lefebvre, who was represented by Pat McCann, were two business ventures they had that were controlled by one parent company.

In the mid- to late-1990s, 33 people invested roughly $2.6 million with the men, who were planning to develop land in the U.S. Virgin Islands and open an upscale restaurant in Cornwall.

However, by 1999 both projects went bankrupt. Mr. Levencrown had invested $400,000 in the venture.

After bankruptcy proceedings produced little money, angry investors contacted police, and the men were charged with 34 counts of fraud and one count of theft.

The charges essentially related to $547,000 the men sunk into the doomed restaurant instead of investing it in the equally doomed Caribbean island project -- as the Crown alleged they were legally obligated to.

From the outset, the men maintained investing the money the way they did was legal.

They also insisted they didn't benefit financially in any way from the transfer of funds.

Indeed, if the stay application hadn't worked, they were going to trial to defend themselves against the six charges Ontario Court Justice Judy Beaman committed them to stand trial on.

After the preliminary hearing, Mr. Levencrown faced one count of theft and one count of fraud.

Mr. Lefebvre was charged with three counts of fraud and one count of theft in connection with the botched investment scheme.

In his ruling yesterday in an Ottawa courtroom, Judge Lally noted the evidence showed neither accused received any money from their actions, and actually lost out significantly thanks to the unfortunate transactions.

Also, Mr. Levencrown lost 40 per cent of his net worth when the projects failed, the judge noted.

"Although it is not necessary for a conviction to show the accused received any of the stolen money, where the evidence is clear neither accused received a penny ... I thought the situation was a bit unusual.

"Mr. McInnes states this type of factual situation happens quite often in commercial frauds. That may be, but it is not my experience."

What was in his experience, and in the law, the judge said, was measuring the prejudice the accused men experienced while having these "serious" criminal charges outstanding against them for so long.

The judge found the delays during the preliminary hearing cost Mr. Levencrown $25,000 extra in legal fees, and the charges and resulting media coverage exacerbated his bouts of depression to the point that he is now "significantly" medicated.

Furthermore, the judge said, Mr. Levencrown's law practice has suffered significantly.

The Law Society of Upper Canada refused to renew his certification as a family law specialist because of the outstanding charges against him, the judge added.

"Mr. Levencrown went from one of the best family court lawyers in Ottawa to a lawyer who was having cash flow problems, having to take marginal cases," the judge said.

"This matter has been a terrible burden on Mr. Levencrown physically and on his practice, and the longer it goes on, the worse it is."

Mr. Lefebvre went from being a very successful $330,000 per-year broker to selling office equipment after being stripped of his licence.

Also, he couldn't even get certified as a financial adviser because of the charges against him.

"Both accused have suffered actual prejudice, and I must take that into account when determining whether the delay in this case is reasonable," the judge said.

The judge said the guidelines for getting such cases to trial set down by the Supreme Court were set at roughly 18 to 24 months.

The judge also said there was nothing the Crown could have done or said to reasonably justify the 54 month gap that would have existed had the trial actually gone to court as scheduled in October of this year.

 The Ottawa Citizen 2004