Executive Summary: Key Legal and Evidentiary Issues

• Dispute centers on whether funds from a polyurethane business partnership were improperly used to acquire property in Iran.

• Plaintiffs allege the defendant Niaz Sabaghchian holds the Salar Property in trust for them.

• The court rejected the defendant’s attempt to summarily dismiss the unjust enrichment claim due to incomplete disclosure.

• Defendants provided inconsistent and misleading evidence about legal title to the Salar Property.

• Plaintiffs were awarded special costs due to the defendant’s obstructive litigation conduct.

• Final determination on ownership and benefit from the property was deferred to a full trial due to complexity and unresolved factual disputes.

Facts and outcome of the case

The case involves a complex business and family dispute between Abbas Beigi and International Design Group Limited (IDG) on one side, and Aliakbar Sabaghchian, members of his family, and a related corporate entity on the other. The plaintiffs alleged they had entered into two business partnerships with Aliakbar Sabaghchian: one to invest in real estate in British Columbia and another to operate a polyurethane supply business for shoe manufacturing in Iran. They claimed Aliakbar misappropriated funds from both ventures and breached fiduciary duties.

One central issue concerned a property in Iran known as the Salar Property. The plaintiffs alleged that Aliakbar had caused the Salar Property to be registered in his daughter Niaz Sabaghchian’s name using partnership funds, and sought a declaration that she held it in trust for IDG and the partnership. Initially, the plaintiffs also alleged Niaz had knowingly received partnership funds improperly through a realtor's commission refund in British Columbia (referred to as the Queen’s Refund), but that claim was later withdrawn.

Niaz Sabaghchian applied to have the claims against her dismissed via summary trial, arguing that the allegations were unfounded, that she was not enriched, and that documents presented by the plaintiffs were forgeries. However, the court found that Niaz and Aliakbar initially denied her legal ownership of the Salar Property, only to later admit it in response to expert evidence submitted by the plaintiffs. The judge concluded that the defendants' document disclosure remained incomplete and noted that resolving the unjust enrichment claim in isolation would lead to an unfair and piecemeal approach to a broader and complex financial dispute.

The court refused to grant summary judgment in favor of either party. Niaz’s application to dismiss the unjust enrichment claim was denied, and the court also rejected her request for special costs concerning the previously withdrawn Queen’s Refund claim. Instead, the court ordered Niaz to pay special costs to the plaintiffs due to her obstructive and misleading conduct in the proceedings, particularly in concealing her legal title to the Salar Property and shifting litigation positions.

Although this ruling did not resolve the entire case, it established that the unjust enrichment and trust claims against Niaz should proceed to full trial along with the other remaining claims and counterclaims between the parties. The court emphasized the importance of full document disclosure and cross-examination to fairly determine the complex financial dealings at issue.