An Ontario court rejected an appeal from an offshore trust that holds funds allegedly funnelled from Bridging Finance Inc. (BFI), which sought to challenge the venue for a pair of legal actions — one brought by the firm’s court-appointed receiver, and one from BlackRock — seeking to recover funds from the trust.
In March 2025, the Ontario Superior Court of Justice heard two nearly-identical motions brought by a trust set up in Lichtenstein by Bridging co-founders David and Natasha Sharpe, The Salus Rete Trust, which was seeking to stay legal actions that sought to recover assets from it.
“It is alleged that the Sharpes falsely represented BFI to be a legitimate investment and loan company, while they funnelled BFI’s funds to a trust held offshore in Liechtenstein, of which the Sharpes and their minor son were beneficiaries,” the court noted. The trust was originally set up with the Sharpes and their son as beneficiaries, but the son is now the sole beneficiary.
“These allegations spawned a number of actions against the Sharpes and other defendants, including First Trust Management AG in its capacity as trustee of The Salus Rete Trust,” it said.
In one action, Bridging’s receiver, PricewaterhouseCoopers LLC, alleged that the trust received money from the Sharpes ($5.9 million and US$265,002) that, it says, they received as kickbacks, in breach of their fiduciary duties to Bridging — and that those assets are being hidden in the trust.
The second action, brought by BlackRock, seeks damages on behalf of its funds, which it alleged, resulted from misconduct at Bridging — and that some of that money can be traced to the trust.
Those allegations have not been proven.
In its role as trustee for the family trust, First Trust Management AG, sought to stay or dismiss both actions against it, arguing, among other things, that the plaintiffs’ pleadings were inadequate, and that Ontario isn’t the proper jurisdiction for the actions.
The motion judge rejected those arguments, ruling that the pleadings were sufficient at this stage, and that there were various factors linking the cases to Ontario, making it the most appropriate and convenient jurisdiction.
Now, the Court of Appeal for Ontario has also rejected an appeal of those rulings.
On the issue of whether the pleadings were adequate, the appeal court sided with the motion judge, which found that the actions were relatively straightforward.
“At their core, the claims are readily understood,” the motion judge said. “Monies beneficially belonging to the Bridging funds, their unitholders or BlackRock were inappropriately taken by the Sharpes and used to settle the trust. The trustee knew or ought to have known the source of those funds, but accepted them anyway. The plaintiffs want those monies back.”
On that issue, the appeal court said that the “motion judge made no error.”
As for the jurisdiction issue, the court also found “no error” in the lower court’s rulings. Among other things, it found that certain contracts related to the dispute were made in Ontario, the trust’s beneficiaries were all residents of Ontario, the funds used to settle the trust originated in Canada, and the alleged misconduct took place in Ontario.
“[A]lthough funds were received in Liechtenstein, the site of the wrongdoing was Ontario,” the appeal court noted.
Those factors “not only establish the nexus between the dispute and Ontario, they also inform the reasonable expectations of the trustee,” the court said. “The trustee could not reasonably expect that Liechtenstein would be the proper forum for litigation of disputes arising out the settlement of the trust.”
Ultimately, the court dismissed the appeal, ruling that the lower court made no error, and the trust failed to make its case for overturning those decisions.