Key Points

• Incident: In 2013, Liquid Capital was defrauded by WF Canada Ltd. (WF) through fictitious invoices supposedly approved by Enbridge Gas Distribution Inc. (Enbridge), resulting in a $757,525.50 advance.
• Perpetrators: WF's principals, Marc Daoust and Peter Cook, admitted their fraudulent conduct and were criminally convicted.
• Trial Findings: No evidence proved Frank Zito, Enbridge's collections manager, participated in the fraud. The trial judge dismissed the action and awarded costs against Liquid Capital.

Appeal Arguments and Court Rulings

1. Zito’s Liability:

   • Claim: Liquid Capital alleged Zito’s involvement based on his non-response to emails and payments from a third party, Racca.
   • Ruling: No sufficient evidence of Zito’s participation. Deleting emails believed to be spam did not prove his involvement.

2. Legal Test for Fraud:

   • Claim: Wrong legal test was applied.
   • Ruling: The correct legal standard was applied, finding no evidence of Zito’s knowing participation.

3. Insufficient Reasons:

   • Claim: Trial judge provided insufficient reasons.
   • Ruling: Reasons were adequate for meaningful appellate review.

4. Adverse Inference:

   • Claim: Adverse inference should have been drawn for missing documents.
   • Ruling: No error in the trial judge's discretion.

5. Recusal of Trial Judge:

   • Claim: Trial judge’s prior work for Enbridge required recusal.
   • Ruling: No merit to the claim.

Costs Appeal

• Claim: Costs awarded were excessive relative to damages claimed.
• Ruling: Upheld trial judge's discretion on costs, noting the original claim was over $1 million.

Disposition

• Appeal dismissed; costs of $27,500 each awarded to respondents Zito and Enbridge for the appeal. 
• Total Costs for Appeal: $55,000