Executive Summary: Key Legal and Evidentiary Issues

• The defendant sought to vary a Mareva injunction to release funds for living expenses and exclude future income, but failed to meet the evidentiary threshold.

• The court found the defendant lacked full and frank disclosure, including incomplete information on financial assets and expenses.

• A request to recover the defendant’s passport was denied based on risk of flight and past international travel during the alleged fraud.

• The defendant’s motion to vary a Norwich order regarding a phone number was rejected due to insufficient evidence of non-use.

• The court emphasized the importance of compliance, transparency, and timeliness in applications to vary injunctive relief.

• The plaintiff’s fraud allegations involved over $5 million in public funds allegedly diverted by a former employee and co-defendants.

Background and alleged fraudulent scheme

The Regional Municipality of Peel brought an action alleging a $5 million fraud committed by Hamza Dualeh, a former employee, and 19 other co-defendants. Peel alleged that Dualeh redirected public funds earmarked for homelessness initiatives to personal associates and other individuals, resulting in substantial financial losses to the municipality. In response, Justice Conway issued a Mareva injunction on February 14, 2025, freezing the defendants’ assets and requiring Dualeh to surrender his passport. The court also issued a Norwich order compelling Freedom Mobile to provide subscriber records associated with phone numbers relevant to the investigation.

Procedural history and motion to vary injunction

Dualeh brought a motion to vary the Mareva and Norwich orders. He sought to exclude future income from the scope of the asset freeze, to release $1,893.50 monthly for living expenses, and to make a one-time withdrawal to cover outstanding personal debts. He also asked the court to remove the passport surrender condition and to exclude a phone number registered to his father from the Norwich order. Peel opposed the motion, citing Dualeh’s lack of full financial disclosure and non-compliance with procedural deadlines.

Assessment of living expenses and financial disclosure

The court applied the four-part test for releasing funds from a Mareva injunction, requiring the defendant to show no access to other assets, evidence of non-proprietary sources, exhaustion of those assets, and a balance of interests favouring relief. Justice Dietrich found that Dualeh had not met the threshold. He failed to provide complete and reliable information about his finances, including details on his rent, travel, and ability to access support from his family. Additionally, inconsistencies and omissions in his evidence—such as an undisclosed joint account and unexplained trips abroad—undermined his credibility.

Refusal to return passport

Dualeh also requested the return of his Canadian passport. The court considered his prior overseas travel to Somalia and Saudi Arabia during the period of the alleged fraud, along with inconsistent explanations for the trips. It was determined that the surrender requirement remained justified due to concerns over potential flight risk and the importance of maintaining his presence within the jurisdiction.

Norwich order remains in effect

The phone number ending in 1042, which Dualeh claimed belonged to his father, was also addressed. Peel submitted that the number was provided by Dualeh as his preferred contact upon termination and could be relevant to the fraud investigation. Since Dualeh did not deny regular use of the number and no evidence was provided from his father, the court upheld the Norwich order, but accepted a compromise: if Peel intends to rely on any records associated with that number, it must give 20 days’ notice, and both sides would work together to preserve privacy where necessary.

Conclusion and result

Justice Dietrich dismissed all aspects of Dualeh’s motion. The Mareva injunction and Norwich order remained in full force, with minor accommodations to address privacy concerns related to phone records. Costs submissions were invited if the parties could not agree. The decision underscores the court’s strict approach to asset-freezing orders in civil fraud cases, the evidentiary burden on defendants seeking relief, and the necessity of full disclosure and procedural compliance.