Mississauga, Ontario-based Attar Metals Inc. reportedly has filed a lawsuit against a property development company that acquired a former General Motors (GM) plant and that contracted with Attar Metals to share scrap metal and other revenue earned on the property.
An online news article by an Ontario-based publisher says Attar Metals has filed suit against the Ontario-based Bayshore Groups “seeking $15 million for breach of contract, breach of fiduciary duty and conversion in the statement of claim,” according to the St. Catharines Standard report.
Attar Metals had entered into a revenue-sharing deal with Bayshore, but the scrap company now alleges that Bayshore “secretly mortgaged the property, sold assets behind its back and is using corporate accounts for unrelated projects like the incorporation of a boxing club and equestrian center,” the Standard article states.
The suit, as quoted by the Standard, indicates Attar Metals entered the contract under the premise that activities at the property would include demolishing structures, generating scrap metal and environmentally remediating and rehabilitating the property.
Instead, the lawsuit contends, Bayshore has “used the property for its personal benefit.” Since entering the agreement in 2014, Bayshore Group also has taken out two mortgages on the property, the suit alleges. As well, according to the suit and the Standard report, Bayshore has established its headquarters in one of the former GM buildings that otherwise could have been demolished and sold for scrap revenue.
A counterclaim filed by Bayshore contends Attar Metals was supposed to pay an equal share of operational expenses at the site and has not done so. That circumstance, according to the developer, means the prior revenue sharing letter of understanding is now void.