REGINA — Saskatchewan mega farmer Darrel Monette says he will appeal a recent British Columbia court decision that awarded an advisor $12 million for helping him buy a company with 16 ranches.
In a press release posted to social media March 31, the owner of Monette Farms disputed the B.C. Supreme Court judge’s findings, including that he planned to finance the acquisition through a side deal to sell substantial ownership of his company.
“Our ownership has not changed and I remain the sole owner,” he said in the release.
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“Our independence allows us to maintain our unique identity and operate in a way that aligns with our values and vision.”
Monette, a farm operator with an estimated 350,000 acres in Saskatchewan, British Columbia, Manitoba, Montana and Arizona, said his company is “committed to transparency, integrity and fairness in all our dealings, including the B.C. ranch transaction in question.”
The case involved the sale of shares of Blue Goose Cattle Co., which included about 45,000 acres in 21 locations of the B.C. interior.
According to court documents, Blue Goose sold its shares to Monette Farms, Darrel Monette and a numbered company in 2021 for $63 million.
Vancouver Island businessman and former Saskatchewan farmer and landowner David Dutcyvich said he had introduced the parties and provided advisory services. He testified Monette knew the fee was $12 million but that Monette later reneged on paying him.
The complex case began when another company, LBJ Capital Inc. wanted to purchase BGCattle and asked Dutcyvich to help with the sale. At the time the sale price was $100 million and the parties agreed Dutcyvich would be entitled to half the money saved if he could get a better deal.
Dutcyvich and his company 3L Developments spent a couple of years researching the holdings and trying to verify the actual number of cattle. He eventually recommended the buyer pay no more than $76 million.
“On July 22, 2020 LBJ sent an unsigned solicitor’s irrevocable direction to pay $12 million to 3L Developments as part of the transaction process,” the court documents said.
But by fall of that year LBJ couldn’t raise the money to complete the sale and Blue Goose wanted nothing more to do with the company, describing LBJ as “dodgy.”
In the meantime, and unbeknownst to Dutcyvich, Monette was arranging “to have some measure of involvement with LBJ,” according to the documents.
“Mr. Monette disputes this. However I find that the evidence supports this involvement and I therefore conclude that it did occur and was underway at this pertinent time,” justice Emily Burke wrote.
A realtor had told Monette that LBJ was interested in buying Monette Farms and Monette had been on several conference calls with all the parties.
After the LBJ deal to buy BGCattle fell through, Monette made his offer in March 2021.
Burke accepted testimony that Monette asked Dutcyvich for help when he decided to purchase the ranches and a processing plant in North Vancouver and that LBJ had offered to buy 75 percent of Monette Farms for $630 million.
Dutcyvich testified that Monette twice agreed to pay the $12-million fee, although Monette later said that wasn’t true.
The plaintiffs said Monette expected the fee would be paid by LBJ when it purchased Monette Farms so he didn’t care about the amount.
“I accept the truth of this proposition,” Burke wrote.
She said Dutcyvich was a more credible witness and that oral contracts are enforceable if they are clear.
“In view of this tangled history it is disingenuous of Mr. Monette to indicate this deal was his initiative and a deal of Monette Farms alone,” Burke wrote in her ruling.
Contact karen.briere@producer.com
