Toronto’s Shai Gilgeous-Alexander, one of the NBA’s most promising young stars, is seeking to void the purchase of an Ontario mansion that was previously occupied by self-proclaimed ‘Crypto King’ Aiden Pleterski.
Gilgeous-Alexander purchased the $8.4 million lakefront home in Burlington, Ont., after Pleterski had previously leased it, reports CBC.
But shortly after moving in, a stranger showed up at the door, looking for Pleterski. Soon after, Gilgeous-Alexander learned of the previous occupant’s history and that the home had received several aggrieved visitors in the past, including at least one individual who had threatened to burn the property down.
Pleterski began making headlines in 2022 as a 24-year-old wunderkind who received more than $40 million from investors seeking big returns on the volatile crypto market. Investors later realized they’d been duped while Pleterski documented a jet-setting lifestyle on his Instagram account, including private jets and a collection of luxury vehicles.
Bankruptcy proceedings later revealed Pleterski had invested just a small fraction of the funds he had received and spent nearly half the $40 million on personal luxuries.
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Pleterski was later kidnapped, beaten and held for ransom over several days as some investors sought to recoup their losses. The incident led to charges against five men.
Gilgeous-Alexander has since filed a lawsuit to rescind the sale of the house, alleging that the sellers fraudulently failed to disclose the history of threats and visits by people searching for Pleterski. He maintains he wouldn’t have purchased the house if he’d known the full story, which only came to light after Gilgeous-Alexander’s girlfriend called the police to report the unwanted visitor.
The sellers, on the other hand, have denied misrepresentation, stating that four non-threatening visits occurred after Pleterski left. They argue that there was no duty to disclose those visits as they did not render the home unfit or dangerous.
Per CBC’s report, Pleterski had entered into a lease-to-own agreement for the property with a numbered company controlled by Ray Gupta and his son, Sandeep Gupta, who acted as Pleterski’s landlord while he lived in the home.
The case has put disclosures in real estate transactions in the spotlight, as well as highlighting the importance of thorough due diligence when purchasing properties. Gilgeous-Alexander reportedly moved out of the home just days after moving in.
Per the Real Estate Council of Ontario, the province’s regulatory body, brokers and salespersons are required to disclose material facts, including any information that might reasonably affect a person’s decision to buy or sell a property.
These disclosures include material latent defects, which are issues with the property that are not easily discoverable by a buyer, even with the assistance of a professional home inspection, and may render the home uninhabitable or dangerous.
These differ from patent defects, which are more likely to be easily observed or discovered through a home inspection.
Title issues, such as easements or liens that affect the property, legal issues, such as zoning violations, and financial issues, such as unpaid property taxes, are other elements that also need to be disclosed.
Sellers must also disclose the history of the property, including if it has been the site of crime, used for illegal activities or previously belonged to a “notorious individual.” There is no single definition of what a stigmatized property is across Canada, however, adding a subjective element to the disclosure.
Failure to disclose information that they are legally obligated to share can lead to lawsuits against realtors, and rescission of the purchase is a possible, though rare, outcome. In those cases, the buyer gets back their deposit and any other funds that may have been paid, while the seller regains full ownership and rights to the property as if the sale had not occurred.
Buyers are expected to to perform due diligence when purchasing a property but contingency clauses, breach of contract and misrepresentation or fraud can all lead to rescission.
While the Gupta’s maintain that the house isn’t dangerous, including noting that an individual inquiring about a former occupant is an entirely normal occurrence, the lawsuit alleges that the kidnapping of Pleterski underscores the seriousness of the case.
“The people who had been attending at the property were not making idle threats,” the lawsuit states.
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