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have triggered concerns at Blaneys, he said: "It should have big time. . . . They should have known that sort of information isn't easy to come by. In the old days we used to buy all sorts of information but those days are long gone." Two days before Blaneys hit Cunningham with the motion, Edney wrote to Montgomery about a wire transfer document the investigators had furnished, saying "the source of the evidence is unknown" and mentioned there was a chance the courts would sanction her for "having obtained this evidence." The day before the November hearing where the contempt motion was introduced, Ian Epstein, a Blaneys partner and member of the firm's executive committee, left a voicemail on Edney's phone saying after conferring with another senior partner, they approved of proceeding with the contempt motion on the grounds that they trusted Johnson's background as a cop. "But you know I think you were quite right not to have asked where [Johnson] got the information but you've got it and you know at the end of the day I think . . . they're just going to be put on the defensive," he added. What lengths should the law firm have gone to to verify the White and Johnson report before they used it? In 2005, Ontario Superior Court Justice P.H. Howden wrote in Stone v. Stone "the court acknowledges that the standard of proof in contempt cases is proof beyond a reasonable doubt. The ordinary civil standard does not apply." This point was reiterated in 2007 by Pattillo in dismissing the contempt motion brought by Cunningham's wife, writing "contempt is a very serious matter. The onus is on the person alleging it. . . ." and the standard was "proof beyond a reasonable doubt." "You always have an obligation for due diligence," observes Phillip Epstein, "and you have a professional obligation not to bring motions that are frivolous and unfounded and particularly with a motion for contempt, you have a duty to the court as well as to your client to make sure there is a basis for the application." He also said the disclaimer on White and Johnson's report should have been heeded. "It's like an accountant saying I can't verify the numbers on a financial statement. That sort of financial statement is useless." Only after the contempt motion was served did Blaneys try to verify White and Johnson's findings, according to documents filed with the court. And it didn't take them long to discover they couldn't. In fact, two days after the hearing, Blaneys' Andrew Heal received information from the HSBC and CIBC banks saying they could not verify the purported Cunningham accounts. Meanwhile, Cunningham immediately went to the various banks and had them issue letters saying no such accounts existed. By early December 2006, three days before they were supposed to return to court to argue the motion, Heal said to Edney in an e-mail that "until there is clear information corroborating the origins and authenticity of the documents in question, I am unable, and in my view we are unable, to argue the continuing motion. . . ." A day later, Heal and Edney told Montgomery none of the banks could confirm any accounts or money existed. Meanwhile, Cunningham complained to the Law Society of Upper Canada about the Blaneys lawyers' actions. In a Sept. 24, 2009 letter, the LSUC refused to commence proceedings against Edney, concluding as Edney was advancing his client's interests — without any knowledge that the underlying report was either fraudulent or based on inaccurate or forged documents — he had acted reasonably and was justified in his methods. In the end, Blaneys hired another corporate investigation firm, which could not verify the White and Johnson information either. By January 2007, the lawyers were telling Montgomery they couldn't proceed using the information (she remained unconvinced). By then White and Johnson were refusing to answer Blaneys' questions about the material. All told, by October 2007 Montgomery spent $250,000 on White and Johnson and their spurious information and $600,000 in combined legal and investigation fees. Cunningham says he's shelled out $650,000 in unnecessary costs fending off the allegations. During the winter of 2007, Montgomery dropped Blaneys and hired new lawyers. Edney and Blaneys refuse to comment on the whole affair, citing the pend- ing lawsuit. Yet Sherman, Cunningham's divorce lawyer, is ticked off that Blaneys never acknowledged it used fabricated information. "I have never received anything from opposing counsel saying 'OK, OK, we agree that there is no evidence to support any of this and we're withdrawing the allegation,'" he says. DESPITE EVIDENCE, PI LICENCE RENEWED F or Cunningham, the nightmare was only beginning. He was forced to complain three times to the PSISB about White and Johnson before the regulatory agency finally acted. And even after the OPP officer assigned to the case concluded in the summer of 2007 "the bank accounts did not exist and the wire transfers did not take place" Johnson's licence was renewed twice more by PSISB. White and Johnson were finally charged by the OPP in the summer of 2009 before fleeing Canada the following year, setting up shop in a condo they owned in the Bahamas. There they created a web site to mock their victims and make more unsubstantiated claims about corruption among prominent Canadians. They were finally run down after they accused Julian Fantino, a former Toronto police chief and a cabinet minister in the federal government, of corruption by hiding millions of dollars in offshore accounts. He was not amused and ordered the RCMP to find White and Johnson. In August last year, they were arrested in Turks and Caicos. They were then charged by the U.S. Internal Revenue Service for money laundering and fraud and deported to the U.S. this past spring. Nevertheless, none of the lawyers who hired White and Johnson ever reported their actions to the PSISB; one complained to the OPP. The whole ordeal, however, has taken a financial and physical toll on Cunningham. "You start to talk about the damages that I've experienced, and the loss of time for your business, and all the rest of the costs that go with it, it's horrific," he says. "Absolutely horrific . . . I'm certainly going to be in the Freedom 75 program, as opposed to maybe Freedom 60. I have no prospect of retiring whatsoever." www.CANADIAN L a w ye r m a g . c o m October 2013 31

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