Enbridge v Marinaccio: 2012 ONCA: Fraud Breach of Trust Bribery

[1] Piro and Montaldi appeal the summary judgment granted to Enbridge.

[2] Piro was a labourer. Montaldi was an accountant. The primary defendant,

Marinaccio, was an operations supervisor for Enbridge. Enbridge, a regulated

utility, frequently had to repair property it had damaged during its regular

maintenance. In 2001, Marinaccio, Piro and Montaldi devised a scheme to do

this repair work.

[3] According to the appellants, the scheme was to operate as follows. Piro

alone would register business entities to do the work. Marinaccio’s involvement

would be concealed from his employer, Enbridge. However, Marinaccio would

hire contractors to do the work. Montaldi would prepare the invoices to be given

to Enbridge. Marinaccio would approve the invoices. Marinaccio, Piro and

Montaldi would share the

the payments from Enbridge in predetermined percentages.

[4] The appellants and Marinaccio carried out the venture for over six years.

Enbridge paid out over $6.5 million. Marinaccio has now admitted that the entire

scheme was a fraud. No work was ever done. All the invoices were phoney.

Marinaccio also claims that Piro and Montaldi were aware of the fraud. After the

lawsuit began, Marinaccio settled Enbridge’s claim against him for $1.9 million.

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[5] Enbridge then moved for summary judgment against Piro and Montaldi.

The motion judge, Newbould J., found that Marinaccio owed a fiduciary duty to

Enbridge and that he breached his fiduciary duty by secretly profiting at the

expense of his employer. The motion judge granted summary judgment against

Piro and Montaldi on three separate bases: knowing assistance to Marinaccio in

breaching his fiduciary duty; bribery; and unjust enrichment.

[6] On Enbridge’s main claim for knowing assistance, the motion judge found

Piro and Montaldi jointly and severally liable for $5,723,339.60, which was the

entire amount received from Enbridge less the net settlement amount paid by

Marinaccio (after deducting the costs ofcollection).