15°c Clear
25°c Variable cloudiness
Winnipeg Free Press - PRINT EDITION
Shamray sues former attorneys
Michael Shamray
MICHAEL Shamray's name is back on the court docket, but this time he is a plaintiff and the defendants are his former lawyers.
Shamray is suing the Winnipeg law firm Aikins MacAulay & Thorvaldson and several of its current and former lawyers and partners for about $1.3 million. He is claiming the firm was "in breach of their continuing fiduciary duties" surrounding a conflict of interest that lead to Aikins' lawyers being disqualified from representing Shamray in the middle of his defence of his multimillion-dollar fraud case in 2004.
Shamray was convicted of four counts of fraud arising from the October 1998 bankruptcy of The Shamray Group (TSG) of companies in which about $50 million went missing and has never been publicly accounted for.
Shamray's suit alleges Aikins had already racked up fees of $1.45 million defending the former Manitoba business star before a Manitoba court disqualified Aikins from the case in January 2005 because of a conflict of interest.
Shamray eventually pleaded guilty to the fraud charges and was sentenced to two years in prison in April 2006.
This statement of claim says Shamray retained Aikins in October 1998, and was represented primarily by Bruce Taylor and Raymond Flett in respect to allegations at the time and "potential civil claims and criminal charges arising from those allegations."
The claim alleges Aikins was in a conflict of interest right from the start because of its association with Vision Capital Fund Limited Partnership.
Vision Capital was one of the victims of the Shamray fraud and was the party that filed the original complaint with the RCMP that eventually led to the charges against Shamray.
The conflict of interest arose from the fact that Duncan Jessiman acted as Vision's lawyer in its business dealings with Shamray before and after he joined Aikins as a partner in April 1998.
In the statement of claim against Aikins and 12 of its current and former lawyers, it acknowledges that when the conflict of interest came up, Shamray and TSG "agreed to assist the law firm (Aikins) in opposing the disqualification motions."
After the court disqualified Aikins from the case in January 2005, Aikins' managing partner, Ed Warkentin, told the Free Press "that both parties were fully aware of the relationship throughout and to our knowledge agreed to our continuing involvement."
The statement of claim says Shamray incurred $159,212.74 in legal fees regarding the disqualification proceedings, a loss of $1 million in the value of services Aikins had already rendered in his criminal defence, another $150,000 in legal services he had to duplicate in matters unrelated to the criminal action, and another $25,000 in time and expense in finding other lawyers.
Winnipeg lawyer Robert Tapper represents Aikins.
"I fully expect to receive instructions to vigorously defend Aikins," Tapper said.
"I know the transaction which is at issue and Aikins' position that it holds very strongly is that it has no responsibilty to... Michael Shamray arising out of any legal services to this gentleman or to his company which, as you know, has had its share of difficulties with the law."
It took more than three years for the RCMP to lay fraud charges against the former rising star of the Manitoba business scene and then another four years-plus before Shamray pleaded guilty and was sentenced.
martin.cash@freepress.mb.ca
Republished from the Winnipeg Free Press print edition June 22, 2010 B3
More Business
- Back to Top
- Return to Business
More Business
(1 of 50 articles for this week)
G-8 summit leaders to focus on deterring worker kidnappings in Africa, closing tax loopholes
1:42 AM 0ENNISKILLEN, Northern Ireland - Leaders of the G-8 wealthy nations are spending the final day of their summit focused on ...
Poll
Most Popular Business
- St. Vital Centre's energy savings help managers snag BOMA awards
- Manitoba Movers
- NY, Va. 7-Eleven stores raided as US accuses owners and managers of exploiting immigrants
- N.D. oil spurs $4.1-B outlay for railroad
- Is legal pot ready for a "Starbucks" brand? Activists say no, but a businessman tries his luck
- MTS, Rogers extend LTE deal
- Netflix to run 300 hours of original TV series from DreamWorks Animation in multi-year deal
- New owner for lumber stores
- Hong Kong flight with passenger who claimed everybody poisoned lands in US; police greet plane
- Warren Buffett -- Winnipeg-style
- Sobeys expanding reach in Western Canada with Safeway acquisition
- Former Winnipeg financier linked to offshore companies
- Aircraft maintenance engineer taking off
- Two CBC reporters freed after being detained in Turkey
- Toronto condo market poses economic risk to Canada
- St. Vital Centre's energy savings help managers snag BOMA awards
- New owner for lumber stores
- Fund helps entrepreneurs fly
- Canadian credit unions an eye-opener
- Tours to see Arctic icons up as overall tourism trade rebounds
- New owner for lumber stores
- Earls Pembina says goodbye after 18 years
- Sobeys expanding reach in Western Canada with Safeway acquisition
- Grove Pub to take over former home of Papa George's
- New rules let customers cancel phone contracts without penalty after two years
- MTS to sell Allstream to Egyptian investment group, focus on Manitoba market
- Where is easy street? Survey of city's richest routes may surprise
- Custom-made suits no longer just for the ultra-wealthy
- Eateries brace for Blue blitz
- Chocolate price-fixing charges
- St. Vital Centre's energy savings help managers snag BOMA awards
- Manitoba Movers
- N.D. oil spurs $4.1-B outlay for railroad
- NY, Va. 7-Eleven stores raided as US accuses owners and managers of exploiting immigrants
- Oil more lucrative than mining
- Warren Buffett -- Winnipeg-style
- Historic Masonic Temple sold to consultancy firm for $12.5 million
- Sobeys expanding reach in Western Canada with Safeway acquisition
- Manitoba Movers
- Toronto condo market poses economic risk to Canada
- Cutting edge, made-in-Manitoba tech finds buyer -- in Manitoba
- Richardson to spend $40M to boost ag operations
- Tours to see Arctic icons up as overall tourism trade rebounds
- Google unveils Internet beaming balloons launched into stratosphere
- Fund helps entrepreneurs fly
- St. Vital Centre's energy savings help managers snag BOMA awards
- New owner for lumber stores
- New owner for lumber stores
- Snowbirds: It's that time of year again
- Sobeys expanding reach in Western Canada with Safeway acquisition
- Custom-made suits no longer just for the ultra-wealthy
- New rules let customers cancel phone contracts without penalty after two years
- Where is easy street? Survey of city's richest routes may surprise
- Value Partners cracks $1-B mark in assets
- MTS to sell Allstream to Egyptian investment group, focus on Manitoba market
- Manitoba Movers
- Grove Pub to take over former home of Papa George's
Ads by Google
You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.
You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.
Have Your Say
New to commenting? Check out our Frequently Asked Questions.
Have Your Say
Comments are open to Winnipeg Free Press print or e-edition subscribers only. why?
Login SubscribeHave Your Say
Comments are open to Winnipeg Free Press Subscribers only. why?
SubscribeThe Winnipeg Free Press does not necessarily endorse any of the views posted. By submitting your comment, you agree to our Terms and Conditions. These terms were revised effective April 16, 2010.