Litigation with the Atlantic Canada Opportunities Agency (ACOA)

• ACOA is a crown corporation and development agency, the largest single purveyor of federal funds to the Atlantic provinces for purposes of economic development.
• Its Business Development Program gives unsecured "repayable contributions" to business projects on favourable terms, including flexible payment and 0% interest.
• In its Statement of Claim and Reply to Demand for Particulars filed with the Nova Scotia Supreme Court, ACOA has accused the American investors of civil fraud and failure to make payment, among other claims, in yet no evidence exists to support these accusations. These unsubstantiated claims make the Americans appear like scoundrels to anyone who reads the law suit, immediately prejudicing them against the Americans. Attorneys are supposed to verify the facts supporting claims before they file them, but ACOA's law firm failed to do so.
• A report from an official, on-site audit performed by ACOA on September 15, 2000 is mysteriously missing from ACOA documents provided during discovery to date. This report would immediately prove the fraud claim to be unsubstantiated, as ACOA states that the Americans sold the business assets in June, 2000 in yet during the audit, the auditor inspected the property and verified the existence of the business' tangible assets 3 months after the alleged sale.
• ACOA claims that the American investors stopped paying them. In fact, ACOA stopped taking its automatic withdrawal from the corporate bank account of the business, where the Americans always kept sufficient funds to repay the contribution on a monthly basis.
• The American investors also made a substantial cash offer to ACOA to settle the matter in 2001, but ACOA demanded that the Americans reveal personal financial information and then refused to take the settlement.
• In 2005 and 2006, up to 4 1/2 years after it commenced the litigation, this arm of the Canadian federal government destroyed hundreds of pages of documents and photographs relevant to the Defendants' applications; these materials were potential evidence for the American investors' claims that ACOA misled them, treated them unequally as Americans, and negotiated in bad faith during 1997 and the first half of 1998. 
• The Nova Scotia rules of court require that the Plaintiff in a litigation supply a list of all its relevant documents within 60 days of the close of pleadings. ACOA filed its first list of documents nearly 6 years after the close of pleadings.
• ACOA won an Order from a Nova Scotia Supreme Court judge regarding disclosure of the names and addresses of the investors without providing any legal argument to justify its request, and the judge involved gave no written or verbal opinion on the issue--he merely gave the order with no justification.
• The Defendants have appealed that order to the Nova Scotia Court of Appeal since the order is wrong and unjustified on its face.
• Nevertheless, the Court of Appeal denied a stay application based on a fabricated accrual event never argued as such or raised as a fact in dispute by either side, that is, that an alleged event of accrual occurred in 1998.
• In June, 2008 the Defendants sought to have the claims dismissed because ACOA had failed to move the case forward over a period of 6 years. They also asked the Court to force ACOA to make full disclosure of all the documents in its posession since to that point ACOA had only divulged documents favourable to its case.
• The Supreme Court judge ruled against the Defendants on the dismissal application in large part because he said the Defendants did not prove that because of the delay caused by ACOA that any evidence or witnesses had disappeared making it impossible to have a fair trial.
• ACOA waited until after the June hearing and the November decision to admit that it had destroyed documents in 2005 and 2006.
• The Supreme Court judge gave an order at the June 5, 2008 hearing telling ACOA that it had to disclose everything about its relevant documents by July 31, 2008. The attorney for ACOA agreed to the order and the deadline in court chambers.
• The deadline passed an ACOA did not disclose any documents--in most civil law jurisdictions in the world, this would be considered contempt of the court. In yet, when the American investors formally informed the Court that ACOA had not met the deadline, the Court did nothing.
• Subsequently, when the Americans brought it to ACOA's attention that it had disobeyed a Court order, the attorney for ACOA denied that the order ever existed. He claimed that he and the judge had simply had a conversation in chambers, but no order had been made. He also wrote this in a letter to the judge.
• Next, in December, 2008, the judge, too, agreed with the ACOA attorney and said that he had never issued an order, and that he and the attorney were just having a conversation; at the same time, he issued the order favoring ACOA requesting that one of the Defendants reveal information about the other defendants--this order completely fails to follow the rules of court, but was given anyway.
• In February, 2009, the same judge in a letter to ACOA reversed himself and now says that he did give the order, that the order is still in effect, and that it must now be formalized in writing. Instead of following the usual procedure that would allow the Defendants who won the order to write it up, the judge asked the attorney for ACOA to write up an order to itself regarding evidence production.
• After protest by the Americans, the judge asked them too to submit a draft order, but as of March 26, 2009 has still never issued a written order requiring ACOA to produce documents.

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