Marlowe John Goring Found Liable for Art Consignment Fraud

Supported By:

Net Patrol International Inc.  Data Investigation and Forensic Services
Bankruptcy and Insolvency Trustees

Ordered to Pay $10,000 in Punitive Damages For $170,000 Fraud 

April 26, 2018 – At Canadian Fraud News, we report on decisions issued by Canadian Courts related to fraud, that are not reported in the main stream media, and that contain legal issues the Canadian public and fraud recovery experts should be aware of. The following is one such story.

On April 10, 2018, the Ontario Superior Court of Justice (Civil Division) released its decision in the fraud that Marlowe John Goring, an art distributor from British Columbia, perpetrated on artist James White of Caledon, Ontario.

The fraud involving Mr. Goring was not prosecuted through the criminal courts. Remarkably, for a fraud quantified at $170,000, the civil court only imposed a $10,000 punitive damages award. The facts, as set out by the Court, are as follows:

The Art Consignment Agreement

White Distribution Limited is an Ontario Corporation. It is owned and operated by James White of Caledon, Ontario. Mr. White carries on business as a wholesale art supplier. Marlowe John Goring is a business person residing in British Columbia.

On August 15, 2012, Mr. Goring attended the home of Mr. White and offered to sell paintings belonging to White on consignment. Mr. Goring and Mr. White agreed to the wholesale price of the paintings, and that while on consignment the paintings remained the property of Mr. White.

The incentive for Mr. Goring was that any amount that Goring obtained in excess of the wholesale price was Goring’s profit. At the time Mr. Goring was operating an art gallery in British Columbia. Mr. White transferred 35 paintings to Mr. Goring.

From 2012 to 2014, Mr. Goring did not report any sales to Mr. White. In February 2014, Mr. White inquired as to the status of his paintings. Mr. Goring advised Mr. White that he was still in possession of all of them. In July 2014 Mr. White learned that Mr. Goring’s art gallery was closing. Mr. White asked for his paintings back.

Mr. Goring returned 13 paintings. Mr. Goring failed to explain what happened to the other 22 paintings. The wholesale value of the missing paintings was quantified at $170,000. When Mr. Goring would not account for what happened to the missing paintings, Mr. White sued.

The civil trial for fraud proceeded uncontested. Mr. White testified. The Court found in Mr. White’s favour, and imposed a punitive damages award that is the focus of this article.

Findings of the Court

Mr. White alleged as aggravating factors to Mr. Goring’s fraud was that the two men were friends, and that he trusted Mr. Goring. Mr. White alleged that Mr. Goring took advantage of their friendship. Further, Mr. White incurred the expense of travelling to British Columbia three times to attempt to recover his paintings.

The Court held that Mr. Goring was in a position of trust to Mr. White despite there being no express contractual agreement creating a formal trust relationship. In a moment of contrition, Mr. Goring had written an email to Mr. White admitting he no longer had Mr. White’s art and that he owed him the value of the art.

Based on this admission, The Court found Mr. Goring personally liable for fraud and breach of trust, and issued an award of general damages to put Mr. White back in the position he would have been in but for the fraud – that is, the Court ordered Mr. Goring to pay Mr. White $170,000.

The Court went on to state that the conduct of Mr. Goring was a “marked departure from ordinary standards of decency, and that Mr. Goring’s conduct was malicious, oppressive and offended the Court’s sense of decency.

The Court held that punitive damages in civil actions straddles the concerns of civil law, which is compensation or recovery based, and criminal law, which focuses on punishment and rehabilitation. The Court noted that while criminal and regulatory law are recognized as the primary legal mechanisms for punishment, punitive damages also serve this legal goal.

Who is this Marlowe John Goring?

The Court did not explain it its reasons for judgment who Marlowe John Goring was. No other reported decisions on Mr. Goring were located. This may be the reason why the punitive damages order is remarkably low.

The Reported Decision

This Court’s decision on Mr. Goring is reported as White Distribution v. Goring, 2018 ONSC 2333. It is unknown if this decision is being appealed. The decision is publicly available on-line at:

https://www.canlii.org/en/on/onsc/doc/2018/2018onsc2333/2018onsc2333.html?searchUrlHash=AAAAAQAVIk1hcmxvd2UgSm9obiBHb3JpbmciAAAAAAE&resultIndex=1

Inquiries

At Canadian Fraud News Inc., we welcome information from the public on Mr. Marlowe John Goring who is the subject of this case.

For further information on this case, or any other fraud recovery inquiry, contact Canadian Fraud News Inc. at deborah@canadianfraudnews.com.