Canadian court rules Trump can face claims in Toronto tower case

October 13, 2016 4:03 PM EDT

Republican U.S. presidential nominee Donald Trump speaks to the audience at a campaign rally in West Palm Beach, Florida, U.S., October 13, 2016. REUTERS/Mike Segar


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By Alastair Sharp

TORONTO (Reuters) - U.S. Republican presidential candidate Donald Trump can be pursued for some claims made by investors in a hybrid hotel-condo tower in Toronto bearing his name, according to a Canadian court ruling released on Thursday.

An Ontario appeals court reversed an earlier decision to throw out a case brought against Trump and associates by the investors, who said they were misled into investing in the development in Toronto's financial district.

The investors bought units in the tower that were then placed into a pool of rooms to be rented out at luxury rates by the hotel's operator.

"There would be no factual or legal basis to hold my client liable, principally because my client did not enter into a contract with any of the buyers, did not sell anything to any of the buyers, and did not receive any money from any of the buyers," said Alan Garten, general counsel for the Trump Organization.

A lawyer representing all the defendants, Symon Zucker, said he was still reviewing the judgment to determine the merits of an appeal, but said he was pleased it contained no adverse findings against either Trump or his associate.

"As to the balance of the claim, should it be pursued, we believe that it has no chance of being successful," he said.

The 65-story property is managed by the Trump Organization.

Lawyers for Trump and two others had argued that no misrepresentations had been made or that in any event they should not attract personal liability.

Trump won a victory last year when a lower court absolved the real estate businessman of any personal responsibility, as his company had only licensed the Trump name to Talon International Development Inc, which owns the property.

In the Court of Appeal for Ontario ruling published on Thursday, Justice Paul Rouleau dismissed claims against Trump and two associates for misrepresentation and breach of a ruling by a securities regulator.

However, the judge said it was unfair for the original ruling to dismiss claims "based on oppression, collusion, or breach of fiduciary duties," and said these can still be heard in court.

Trump "is still a defendant in this action...and he can still be held liable to these people for damages," said Mitchell Wine, a lawyer for the plaintiffs.

"This court said you're still very much part of this thing, and you still have to answer to all of these allegations other than the two that the court considered in this decision."

The ruling also said Talon must pay damages to one buyer for "negligent misrepresentation" and another sale must be rescinded.

The case is: Singh v. Trump, 2016 ONCA 747, docket number: C60787

(Reporting by Alastair Sharp; Additional reporting by Emily Flitter; Editing by Leslie Adler)



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