Donald Trump Can Be Sued by Financially Ruined Investors of Toronto’s Trump Tower

Some investors who found themselves in financial ruin after buying units in Toronto's Trump Tower can sue the US Republican presidential candidate, an Ontario court ruled on Thursday, overturning a previous decision that he and two of his associates couldn't be held responsible.

Plaintiffs Sarbjit Singh and Se Na Lee, who each bought a hotel unit in the tower in the mid-2000s, expected to make money by allowing them to be rented out at luxury rates by the hotel's operator. Singh and Lee believed what they would make from renting out the units would not only cover expenses like property tax, mortgage, payments and housekeeping, but also earn them a healthy profit. But their plans didn't pan out. Singh lost over $248,000 and Lee lost more than $991,000 as a result of occupancy rates that were far lower than expected. Singh, one of 156 buyers who didn't end up closing on the purchase of his unit, and Lee argued argued that developer Talon International Investments had misled them by giving them inflated estimates of how much they could make by renting out their units—$550 per night for Singh's unit, and $600 per night for Lee's. The court ruled they should be released from their contract obligations, compensated for their losses, and that Lee's unit could be sold. In a decision by a lower court last year, Trump was absolved of any personal responsibility—the real estate mogul had never owned any part of the building or sold anything to the buyers. Trump did, however, license out his name for Talon to use and was highly visible in the marketing during construction. His company, Trump Toronto Hotel Management, takes care of the property's reservations, marketing, and housekeeping, and has been accused by Talon of subpar management. In May, Talon's lawyer told VICE News that a deal for the building's sale was in the works. But according to Thursday's ruling, the claimants can sue Trump, company chair Alex Schnaider, and former Talon president Val Levitan based on claims of oppression, collusion, and breach of fiduciary duties. Those claims have yet to be proven in court. "I'm delighted," Mitchell Wine, the lawyer representing the tenants suing Trump, told VICE News. "My clients were victims of a misrepresentation by the people promoting the Trump Tower and the court has vindicated them." Wine stresses, however, that the case isn't over yet. "The court did not hold Mr. Trump liable," Wine said. "All they said is he's still a defendant and could be held potentially liable in the future with respect to a bunch of the claims of my clients that haven't yet been considered by the court." He expects the ruling to apply to all 23 of his clients. But a lawyer representing Trump's company told Reuters there was "no factual or legal basis to hold [his client] liable. "My client did not enter into a contract with any of the buyers, did not sell anything to any of the buyers, and did not receive any money from any of the buyers," Alan Garten, a lawyer for the Trump Organization, told Reuters. Follow Tamara Khandaker on Twitter.