As noted, this determination applies from June 2019 at the earliest. It therefore applies to Cory's second investment (in March 2020) and to the investments of Guyot (in September 2019) and Ancona (in July 2020).
- It seems that it was possible to reach a result that would have required Debret to return even because of the conduct of negotiations in bad faith, which was reflected in the failure to disclose the required facts. There is no need to address this for the reason that the plaintiffs chose to focus their claims on the tort level, while basing them on the torts of fraud and negligent misrepresentation.
The lawsuit against Fine
- The nature of the presentation concerning Fine's expertise
- There is no dispute that it was Fine who interested the plaintiffs in the business venture relating to the projects promoted by the corporation owned by Debret, and it was he who presented it to them. The plaintiffs claimed that they were persuaded to invest in the venture by virtue of his captivating personality and his descriptions of the transaction as promising a high return at low risk. The structure of the transaction offered to the plaintiffs included providing them with a guaranteed return of more than 10% as a year or two had passed (the percentage of return changed according to the amount of the investment and the duration of the loan).
- There is also no dispute that Fine was not an employee of the corporation or of Debret, and did not hold any position in the Shop Corporation or any other corporation owned by Debret (as claimed by the plaintiffs themselves in the reply). Fine's testimony indicates that Debret offered him "investors/lenders for projects in the field of urban renewal in exchange for a commission ranging from 2% to 4%" (paragraph 4 of his affidavit). According to him, his role was limited to the fact that "I was a mediator. I was an advisor" (p. 37 of the minutes, line 1) "I am the broker and I bring the investors" (p. 40 of the minutes, line 9). This was also evident from the testimony of Kestenbaum, who testified that Fine himself brought him to invest in the company at an earlier stage. According to him, Fine was "bringing investors to Aryeh, for Aryeh to present everything" (p. 15 of the transcript, lines 11-13). Fine claimed that by virtue of his position, he interested the plaintiffs in investing in projects by way of a loan, while presenting them with the advantages of this investment channel, especially at a time when the return on money was very low in solid channels.
- The plaintiffs claim that Fine presented himself as having expertise in investing in real estate transactions in Israel. However, an examination of their testimonies shows that this representation is relevant, if at all, to Ancona's claim. The other plaintiffs were under a slightly different impression. Corey testified that Fine "was a good friend of the family and a personal friend of mine" and that she consulted with him because she saw him as a "real estate broker" who presented himself as well-versed in real estate transactions (paragraph 6 of the affidavit; In fact, Fine did not hold a real estate brokerage license on the relevant dates of the lawsuit, and issued a license only afterwards). Guyut made no reference to the expertise he attributed to Fine, and described conversations he had with Fine and Debrett on investment matters beginning in 2014 (paragraphs 9-12 of his affidavit).
The allegation of representations concerning Payne's expertise was, in fact, heard only from Ancona, who is the only one of the plaintiffs who had no previous friendship with Payne. Ancona contacted Fine via LinkedIn because the latter presented himself as a real estate dealer in Israel (paragraphs 7-8 of his affidavit; in the affidavit an attempt was made to create the impression that Fine had contacted Ancona, even though it was in fact Ancona who contacted Fine - p. 27 of the transcript, lines 24-25). He testified that Fine presented himself as an expert in executing purchase transactions in the Israeli market and even invited him to participate in a webinar he is holding on the subject of the purchase of real estate in Israel (paragraph 50 of Ancona's affidavit). Fine confirmed in his testimony that at that time he had a blog on real estate in Israel and that he had published updates on investments in Israel on the Internet (p. 41 of the transcript, lines 22-27). It seems that Ancona is the only one of the plaintiffs who has been exposed to the existence of these publications.
- It seems, therefore, that a distinction should be made between the representation of Corey and Guyot and that of Ancona:
Corey consulted with Fine on her own initiative because of their close friendship and knowing that he had knowledge of the field of investments. Guyut formed a friendship with Fine on a bicycle trip to Israel in 2014 (paragraph 4 of his affidavit), the two began to talk about the possibility of investing in real estate in Israel, and then Fine introduced him to Debrett. From then on, there were joint conversations between the three of them, and sometimes only of Guyot and Debrett, regarding various projects (paragraphs 4-12 of Guyot's affidavit). The relationship between Corey and Guyot is based on friendship and friendship and not by virtue of Fine's approach while presenting himself as an expert in real estate investments. The method of communication, which is not based on a representation of unique expertise and a sales campaign on behalf of Fine, has a certain weight in the discussion dealing with the issue of the scope of expectations and negligence in Fine's conduct regarding the provision of information.