C ourt FileNo .

ONTARIO SUPERIOR COURT OF JUSTICE B E T WE E N : HARRY BIEBERSTEIN

Q g- J t -Q 9 t

P laintiff ,

THE CORPORATION OF THE CITY OF BRANTFORD Defendant.

S TATEM ENT OF CLAI M TO THE DEFENDANT: A LEGAL PROCEEDING HAS BEEN COMM ENCED AGA INST YOU by the plaintiff . The claim made against you is set out in the following pages.

IF YOU WISH TO DEFEND THIS PROCEEDING, you or an Ontario lawyer acting for you must prepare a statement of defence in Form 18A prescribed by the Rules of Civil Procedure, serve it on the plaintiff s lawyer or, where the plaintiff does not have a lawyer, serve it on the plaintiff, and file it, with proof of service, in this court office, WITHIN TWENTY DAYS after this statement of claim is served on you, if you are served in Ontario.

If you are served in another province or territory of Canada or in the United States of America, the period for serving and filing your statement of defence is forty days. If you are served outside Canada and the United States of America, the period is sixty days.

Instead of serving and filing a statement of defence, you may serve and file a notice of intent to defend in Form 18B prescribed by the Rules of Civil Procedure. This will entitle you to ten more days within which to serve and file your statement of defence.

IF YOU FAIL TO DEFEND THIS PROCEEDING, JUDGMENT MAY BE GIVEN A GA INST YOU IN YOUR ABSENCE AND WITHOUT FURTHER NOTICE TO YOU. IF YOU WISH TO DEFEND THIS PROCEEDING BUT ARE UNABLE TO PAY LEGAL FEES, LEGAL AID MAY BE AVAILABLE TO YOU BY CONTACTING A LOCAL LEGAL AID OFFICE. DATE: October 19, 2011 Issued by:

Local Registrar Address of Court Office: Brantford Courthouse 70 Wellington St. Brantford ON N3T 2L9 TO : TH E CORPORATION OF THE CITY OF BRANTFORD 100 Wellington Square, P.O. Box 818, Brantford, Ontario, Canada N3T 5R7 C LA I M 1) The Plaintiff HARRY BIEBERSTEIN, seeks against THE CORPORATION OF THE CITY OF BRANTFORD (hereinafter called the CITY OF BRANTFORD): a) A Declaration that the Plaintiff is the beneficial and legal owner of any right, title or interest in Market Square, Brantford, Ontario or in any other real or personal property or interest that the CITY OF BRANTFORD has acquired or will hereafter acquire from GABRIEL KIRCHBERGER, SUSANNE VIKTORIA SCHM IDT, NOMEN FITNESS INC., 487223 ONTARIO LIM ITED and 1171852 ONTARIO LIM ITED carrying on business as G.K. YORK M ANAGEMENT SERVICE; b) A Declaration that the entering into ventures which conferred benefits and assets on the CITY OF BRANTFORD on one hand and on GABRIEL KIRCHBERGER, SUSANNE VIKTORIA SCHMIDT, NOMEN FITNESS INC., 487223 ONTARIO LIM ITED and/or Page 2

1171852 ONTARIO LIM ITED carrying on business as G.K. YORK M A NAGEMEN T SERVICE on the other hand amount to the persons carrying on a business in common with a view to profit and constitute a partnership at law; c) A Declaration that the entering into ventures which conferred benefits and assets on the CITY OF BRANTFORD on one hand and on GABRIEL KIRCHBERGER, SUSANNE VIKTORIA SCHMIDT, NOMEN FITNESS INC., 487223 ONTARIO LIM ITED and/or 1171852 ONTARIO LIM ITED carrying on business as G.K. YORK M A NAGEMEN T SERVICE, on the other hand, in the ownership, leasing and business operations of Market Square, Brantford, Ontario with a view to profit constitute a partnership at law; d) A Declaration that the CITY OF BRANTFORD has actual notice of the interest of the Plaintiff in all of the real and personal property of GABRIEL KIRCHBERGER, SUSANNE VIKTORIA SCHMIDT, NOMEN FITNESS INC., 487223 ONTARIO LIM ITED and 1171852 ONTARIO LIM ITED carrying on business as G.K. YORK MA NAGEMENT SERVICE; e) A n Order for an accounting and/or tracing of funds and/or property received by from, transferred to, or exchanged with any of GABRIEL KIRCHBERGER, SUSANN E VIKTORIA SCHMIDT, NOMEN FITNESS INC., 487223 ONTARIO LIM ITED and 1171852 ONTARIO LIM ITED carrying on business as G.K. YORK M A NAGEMEN T SERVICE; Pre-judgment interest in accordance with the Courts of Justice Act; g) h) i) 2) Post-judgment interest in accordance with the Courts of Justice Act; Costs of this action; Such further and other relief as to this Honourable Court may seem just.

The Plaintiff Harry Bieberstein resides in the City of Toronto, in the Province of Ontario. Page 3

3)

The Plaintiff Harry Bieberstein is a business person carrying on business in Canada, Germany and elsewhere.

4)

The Plaintiff Harry Bieberstein is the beneficial owner of all the real and personal property of GABRIEL KIRCHBERGER, SUSANNE VIKTORIA SCHMIDT, NOMEN FITNESS INC., 487223 ONTARIO LIM ITED and 1171852 ONTARIO LIM ITED carrying on business as G.K. YORK MANAGEM ENT SERVICE.

5) 6)

The Defendant the CITY OF BRANTFORD is a Municipal corporation. The defendant the CITY OF BRANTFORD is involved in public private partnerships with GABRIEL KIRCHBERGER, SUSANNE VIKTORIA SCHMIDT, NOMEN FITNESS INC., 487223 ONTARIO LIM ITED and 1171852 ONTARIO LIM ITED carrying on business as G.K. YORK M ANAGEMENT SERVICE and is, at law, in partnership as they are carrying on business in common with a view to profit, and the partnership includes the ownership and/or operation of Market Square, Brantford, Ontario.

7)

The Plaintiff Harry Bieberstein relies on the facts detailed in his Statement of Claim in Court file CV-10-8534-00CL a copy of which is attached as Schedule "A" and his Statement of Claim i n Court file CV-10-8535-00CL a copy of which is attached as Schedule "B" .

8)

The Plaintiff Harry Bieberstein pleads and relies on the Partnership Act R.S.O. 1990, as amended.

DATED: Wednesday, October 19, 2011

MORRIS MANNING, Q.C.

PROFESSIONAL CORPORATION 605-65 Queen Street West P.O. Box 79 Toronto ON MSH 2M 5 Morris Manning, Q.C.

(LSUC10863R)
Page 4

Telephone: 416-304-0841
Facsimile: 416-929-8411 Lawyer for the plaintiff.

Page 5

Schedule "A" Statement of Claim in Court file CV-10-8534-00CL

Page 6

Court File No. 4~ ONTARIO SUPERIOR COURT OF JUSTICE B E T WE E N :

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~~ P t l - GO CL

HARRY BIEBERSTEIN

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P laintiff ,

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and-

GA BRIEL K IR CHBERGER, SUSA NNE V IK T ORIA SCH M I DT, N OM EN FIT NESS INC., 487223

ONTARIO LIMITED and 1171852 ONTARIO LIMITED carrying on business as G.K. YORK MANAGEMENT SERVICE
Defendants.

STATEMENT OF CLAI M

TO THE DEFENDANT: A LEGAL PROCEEDING HAS BEEN COMMENCED AGAINST YOU by the plaintiff. The claim made against you is set out in the following pages.
IF YOU WISH TO DEFEND THIS PROCEED IN G, you or an Ontario lawyer acting for you must prepare a statement of defence in Form 18A prescribed by the Rules of Civil Procedure, serve it on the plaintiff's lawyer or, where the plaintiff does not have a lawyer, serve it on the plaintiff, and file it, with

proof of service, in this court office, WITHIN TWENTY DAYS after this statement of claim is served on you, if you are served in Ontario.
If you are served in another province or territory of Canada or in the United States of America, the

period for serving and filing your statement of defence is forty days. If you are served outside Canada
and the United States of America, the period is sixty days. Instead of serving and filing a statement of defence, you may serve and file a notice of intent to defend in Form 18B prescribed by the Rules of Civil Procedure. T his will entitle you to ten more days within which to serve and file your statement of defence.

IF YOU FAIL TO DEFEND THIS PROCEEDING, JUDGMENT MAY BE GIVEN AGAINST YOU
IN Y OUR ABSENCE A ND W IT H OUT FURTHER N OTICE TO Y OU . IF YOU WISH TO DEFEND THIS PROCEED ING BUT ARE UN A B L E TO PAY LE GA L FEES, LEGA L A I D M AY BE

AVAILABLE TO YOU BY CONTACTING A LOCAL LEGAL AID OFFICE.

DATE:

January 12, Z010

Issued by:

L al Registrar

Joanne Nlcoara

330 University Avenue 7th Floor Toronto, ON, M 5G 1R 7

TO:

GA BRIEL K IRCHB ERGER 1 19 McGill Road, R R 1 M ount Pleasant, ON NOE 1K O

AND TO:

SUSANNE VIKTORIA SCHMIDT

Nomen Fitness Inc. 164 Colborne Street West B rantford Ontario N3T 3K 5

AND TO:

N OMEN FITNESS INC.,

164 Colborne Street West B rantford Ontario N3T 3K 5

AND TO :

487Z23 ONTARIO LIMITED 3Z5 West St. Suite A100

Brantford, Ontario N3R 3 V6

AND TO:

1171852 ONTARIO LIMITED carrying on business as G.K. YORK MANAGEMENT SERVICE

325 West St. Suite A 100 B rantford, Ontario N3R 3V 6

C LA I M T HE CLAI M 1) The plaintiff HARRY BIEBERSTEIN, the assignee of an indebtedness owed by the defendant GABRIEL KIRCHBERGER to the BERLIN-HANNOVERSCHE HYPOTHEKENBANK ,
herein called the BERLIN HY PO B A N K , and the assignee of all actionable wrongs committed by the defendants GA BRIEL K IR CHBERGER, SU SA NN E VI K T O RIA SCHMI DT, NO ME N

Page 2

FITNESS INC., 487223 ONTARIO LIMITED and 1171852 ONTARIO LIM ITED carrying on business as G.K. YORK MANAGEMENT SERVICE against the BERLIN HYPO BANK , seeks: a) as against the defendant GABRIEL KIRCHBERGER: i) A n Order realizing the collateral security given by the defendants to the BERLIN H YPO BANK ;
ii ) A n Order recognizing and enforcing a foreign j udgment issued in Germany in a civil and commercial matter; iii ) A n Order requiring the payment of an amount in Canadian currency suff icient to purchase the amount of the obligation in the foreign currency at a bank in Ontario listed in Schedule 1 to the Bank Act (Canada) at the close of business on the first day on which the bank quotes a Canadian dollar rate for purchase of the

foreign currency before the day payment of the obligation is received by the creditor (Section 121(1) Courts of Justice Act). The foreign obligation as of
December 31, 2009 is 7,314,892.25 EUROS plus interest after. that date at the rate

of 14% per annum being a per diem interest cost of 2,805.71 EUROS;
b) as against all of the defendants, including the defendant GA BRIEL K IR CH BERGER:

i)
ii )

D amages in the sum of $10,000,000.00 for conversion and fraud;

A n Order that the defendants have been unjustly enriched at the expense of the

BERLIN HYPO BANK in the amount of $10,000,000.00; iii ) iv )

v)

An Order for an accounting of funds; An Order for the tracing of funds;

A n Order appointing a receiver manager of all the real and personal property of the defendants;

Page 3

vi )

A Declaration that there exists in favour of the plaintiff a constructive trust and that the defendants hold as trustees for the benefit of the plaintiff all their real

and personal property; vii ) viii ) A ggravated damages in the amount of $1,000,000.00; Punitive damages in the amount of $1,000,000.00;

ix) Pre-judgment interest in accordance with the Courts of Justice Act;

x)
xi ) xii )

Post-judgment interest in accordance with the Courts of Justice Act;

Costs of this action; Such further and other relief as to this Honourable Court may seem just.

THE PARTIES AND OVERVIEW 2) The BERLIN HYPO BANK is a Banking Corporation that specializes in loans for the
acquisition and improvement of real property in Germany and elsewhere. 3) T he plaintiff Harry Bieberstein:

a)
b) 4)

Re sides in the City of Toronto, in the Province of Ontario;

I s a business person carrying on business in Canada, Germany and elsewhere.

T he plaintiff Harry Bieberstein is the assignee of: a) the civil and commercial debt owed by the defendants to the BERL IN H Y PO BA N K ;

b)

a l l chose in action with respect to the actionable wrongs committed by the defendants
a gainst the BERLIN HY PO BA N K .

5)

T he plaintiff Harry Bieberstein claims on the "Notarized Debt A cknowledgment" of the

defendant GABRIEL KIRCHBERGER, which according to German Law:

a) constitutes a continuing collateral security on all of the debtor's real and personal property which is on demand enforceable under the same rules as a judgment by a

Page 4

German Court; and b) is of the same legal effect as a Judgment of a Court and can be executed without further

legal requirements. 6) The amount owing by the defendant GABRIEL KIRCHBERGER on account of the funds borrowed from the BERLIN HYPO BANK as of December 31, 2009 is 7,314,892.25 EUROS
plus interest after that date at the rate of 14% per annum being a per diem interest cost of 2,805.71 EUROS. 7) T he defendant GA BRIEL K IRCH BERGER:

a)

a t the time of his dealings with the BERLIN HYPO BANK pretended to be a German
citizen born June 14, 1949, and bearing German passport bearing identification number

2399506150D 4906144<0709093 <8 who was living in Germany and carrying

on the business of real estate development in Germany and as such he persuaded the

BERLIN HYPO BANK to lend the equivalent of many millions of dollars to a real estate development company IMKA IMMOBILIEN BESIT-U. VERW. GES. MBH.
h erein called IM K A ; b) is a Canadian citizen who resides in the City of M ount Pleasant, in the Province of Ontario;

c)

was at all material times the principal shareholder and directing mind of:
i) the defendant 1171852 ONTA RIO L I M ITED carrying on business as G.K .

YORK MANAGEMENT SERVICE; ii ) iii )

d)

the defendant NOMEN FITNESS INC.; and the defendant 487223 ONTARIO LIMITED;

used his co-defendants to hold and conceal his assets so as to frustrate the Bank's ability to collect on the debt.

Page 5

8)

The defendant SUSANNE VIKTORIA SCHMIDT was born in Germany and now resides in the Province of Ontario where she manages the business of NOMEN FITNESS INC.

9)

The defendant NOMEN FITNESS INC.:

a) b) c) i s a corporation incorporated pursuant to the laws of the Province of Ontario; c a rries on business in the Province of Ontario; and h as its principal off ice in the City of Brantford, in the Province of Ontario,

10 )

The defendant 487223 ONTARIO LIMITED:

a) b) c) i s a corporation incorporated pursuant to the laws of the Province of Ontario; c a rries on business in the Province of Ontario; and h as its principal office in the City of Brantford, in the Province of Ontario.

11 )

The defendant 1171852 ONTARIO LIMITED carries on business as G.K. YORK MANAGEMENT SERVICE and:
a) i s a corporation incorporated pursuant to the laws of the Province of Ontario;

b)
c) 12)

ca rries on business in the Province of Ontario; and

h as its principal office in the City of Brantford, in the Province of Ontario.

T he BERLIN H YPO BA N K , as pleaded herein, lent various corporate entities related to the

defendant GABRIEL KIRCHBERGER large sums of money. 13 ) The defendant GABRIEL KIRCHBERGER:
a) a t the time of his borrow ing from the BERLI N HY PO BA N K pretended to be a German citizen living in Germany and carrying on the business of real estate development in

Germany and as such he persuaded the BERLIN HYPO BANK to lend the equivalent of
many millions of dollars to various corporate entities related to the defendant GA BRIEL

KIRCHBERGER including a real estate development company IMKA IMMOBILIEN

B ESIT-U. VERW. GES. M BH. herein called IM K A ;

Page 6

b)

w as one of the principals of the various corporate entities to which the BERLIN HYPO BANK lent money; and

c)

a t the time of entering into the loan agreements the defendant GA BR IEL KIRCHBERGER concealed from the BERL IN H Y PO BA N K the fact that he had

immigrated to Canada in 1986. 14 ) The BERLIN HYPO BANK entered into seven loan transactions for which the defendant GABRIEL KIRCHBERGER is liable and:
a) as of December 31, 2009 the outstanding indebtedness is 7,314,89Z.25 EUROS and exists as a valid and enforceable debt in Germany; b) c) 15) a f ter December 31, 2009 interest is owing at the rate of 14% per annum; and a fter December 31, 2009 the per diem interest cost is 2,805.71 EUROS.

T he defendant GA BRIEL K IR CHBERGER in consideration of the loans being made to

companies in which he was the principal shareholder: a) signed the loans as principal debtor; and

b)

g a ve as collateral security a "Notarized Debt Acknowledgm ent" pledging all of his real
and personal property as collateral security for the repayment of the loan.

16)

G e rman law permits the BERLIN H Y PO BA N K and its assignee the plaintiff H ARRY BIEBERSTEIN, as holder of the "Notarized Debt Acknowledgment" of GA B RIEL KI RCHBERGER, to seize all of GA BRIEL K IRCHBERGER's real and personal property on demand without further legal process.

17 )

The defendant GABRIEL KIRCHBERGER by virtue of the default of his personal corporations GbR Gabriel Kirchberger und Martin Kirchberger, GbR Gabriel Kirchberger und Jurgen
Gerasch and IM K A GmbH, is indebted to the plaintiff on account of seven loan transactions which as of October 31, Z009 total 7,251,977.46 Euros and have a per diem rate of interest of

Page 7

1,031.39 Euros.
18) T he indebtedness arises as a result of the following loan transactions: The First Loan a) T he defendant GA BRIEL K IR CHBERGER guaranteed a loan from the BERLIN HY PO BA N K to IM K A GmbH on December 29, 1992, which guarantee was collaterally secured by a "Notarized Debt Acknowledgement" of the defendant GA B RIEL

KIRCHBERGER;
i) ii ) T he loan was in the principal sum of 2,450,000 Duetchesmarks; A s of October 31, 2009 the defendants are indebted to the plaintiff in the sum of

1,920,804.38 Euros; iii ) By correspondence dated January 6, 2010 the BERLIN HYPO BANK demanded
payment under the guarantee; The Second Loan b) T he defendant GA BRIEL K IRCHBERGER guaranteed a loan from the BERLIN HY PO BA N K to IM K A GmbH on December 29, 1992, which guarantee was collaterally secured by a "Notarized Debt Acknowledgement" of the defendant GA B RIEL KIR CH BERGER ;

i) ii ) iii )

The loan was in the principal sum of 2,700,000.00 Deutschemarks; As of October 31, 2009 the loan balance was 1,626,028,98 Euros; and By correspondence dated January 6, 2010 the BERLIN HYPO BANK demanded payment under the guarantee;

The Third Loan

c) T he defendant GA BRIEL K IR CH BERGER guaranteed a loan from the BERLIN HY PO BA N K to 1M KA GmbH on October 5, 1995, which guarantee was collaterally secured

Page 8

by a "Notarized Debt A cknowledgement" of the defendant GA BR IEL

KIRCHBERGER; i) ii ) iii ) The loan was in the principal sum of 350,000.00 Deutschemarks; As of October 31, 2009 the loan balance was 194,614.91 Euros; and B y correspondence dated January 6, 201Q the BERLIN HYPO BANK demanded payment under the guarantee;
The Fourth Loan

d)

The defendant GABRIEL KIRCHBERGER on December 12, 1996 guaranteed a loan from the BERLIN HYPO BANK to his personal corporation GbR Gabriel Kirchberger
und M artin K irchberger, which guarantee was collaterally secured by a "Notarized Debt Acknowledgement" of the defendant GA BRIEL K IRCHB ERGER;

i)
ii )

The loan was in the principal sum of 1,3Q0,000.00 Deutschemarks;

A s of October 31, 2009 the defendants are indebted to the plaintiff in the sum of

569,933.13 Euros; and iii ) B y correspondence dated January 6, Z010 the BERLIN HYPO BANK demanded payment under the guarantee;
The Fifth Loan

e)

The defendant GABRIEL KIRCHBERGER on August 18, 1997 guaranteed a loan from the BERLIN HYPO BANK to his personal corporation GbR Gabriel Kirchberger und
Martin K irchberger, which guarantee was collaterally secured by a "Notarized Debt

Acknowledgement" of the defendant GABRIEL KIRCHBERGER; i)

ii )

The loan was in the principal sum of Z3,854,854,00 Deutschemarks;

A s of October 31, 2009 the defendants are indebted to the plaintiff in the sum of 2,322,898.17 Euros; and

Page 9

iii )

B y correspondence dated January 6, 2010 the BERLIN HYPO BANK demanded

payment under the guarantee;

The Sixth Loan

f) T he defendant GA BRIEL K IR CHBERGER on M arch 19, 1998 guaranteed a loan from the BERLIN HY PO BA N K to his personal corporation GbR Gabriel K irchberger und Martin K irchberger, which guarantee was collaterally secured by a "N otarized Debt Acknowledgement" of the defendant GA BRIEL K IR CH B ERGER ;

i)
ii )

The loan was in the principal sum of 1,Z50,000.00 Deutschemarks;

A s of October 31, Z009 the defendants are indebted to the plaintiff in the sum of 294,511.84 Euros; and

iii )

B y correspondence dated January 6, 2010 the BERLIN HYPO BANK demanded

payment under the guarantee; and

The Seventh Loan

g)

The defendant GABRIEL KIRCHBERGER on July 14, 1998 guaranteed a loan from the BERLIN HYPO BANK to his personal corporation GbR Gabriel Kirchberger und
Martin K irchberger, which guarantee was collaterally secured by a "Notarized Debt Acknowledgment" of the defendant GA BR IEL K IRCHBERGER ;

i)
ii )

The loan was in the principal sum of 565,500 Deutschemarks;

A s of October 31, 2009 the defendants are indebted to the plaintiff in the sum of

269,195.05 Euros; and iii ) By correspondence dated January 6, 2010 the BERLIN HYPO BANK demanded payment under the guarantee.
19) On M arch 4, 2003 the defendant GA B RIEL K IR CHB ERGER was subjected to examination
under oath pursuant to Germ an insol v ency l aw s . I n those proceedings, the defendant

Page 10

GABRIEL KIRCHBERGER:
a) a d mitted ownership of 90% of the defendant G.K. Y ORK M A N A GEM EN T SERV ICE;

b) c) d)
e)

a d mitted ownership of 90% of the defendant 1171852 ONTARIO LIMITED; f alsely asserted that those entities had no equity or value; f alsely asserted that he had no other assets; and
w i l f ully concealed and fraudulently concealed his true financial standing by asserting that he had no assets and that those companies had no equity or value.

20 )

The defendant GABRIEL KIRCHBERGER: a) D e frauded the BERLIN HYPO BANK by:
consenting to judgment in Germany by signing the "Notarized Debt Acknowledgement" and thereafter removing his assets from Germany, including funds borrowed from the BERLIN H Y PO B A N K and using those funds to acquire assets in Canada in the names of his co-defendants and others not c urrently known to the plaintiff ;

ii )

l ying on his German insolvency proceedings by falsely denying that he had

assets in Canada;

iii )

creating a dual identity for himself under the name Gabriel K irchberger with the i ntention of defeating the claims of the BERLIN H Y PO BA N K ;

iv )

w i l f ully and fraudulently concealing his true financial standing by hiding his

assets by: (1 ) pretending to be insolvent in Germany while acquiring assets in Canada; and
(2) b) m o ving his assets beyond the jurisdiction of the German Courts;

concealed his fraud by unlawfully obtaining Canadian citizenship by lying and stating

Page 11

that he resided in Canada when in fact he was living in Germany and perpetrating his f raud on the BERLIN H YPO BA N K ; c) creating his dual identity by lying on his Canadian citizenship application by falsely asserting that he was in Canada for a three year period when in fact he was not in Canada for a suff icient length of time because of the time he spent in residence in

Germany; and d) us ed his illegally obtained Canadian citizenship to defeat the BERLIN HYPO BANK by
moving his assets including funds borrowed from the BERL IN HY PO BA N K to Canada and by investing those funds in the names of his co-defendants.

21 )

In the spring of 2009 the BERLIN HYPO BANK discovered that:

a) t he defendant GA BR IEL K IR CHBERGER had lied in the Germany insolvency proceedings and that he in fact had hidden assets in Canada; under his Canadian persona

b)

the defendants GABRIEL KIRCHBERGER, SUSANNE VIKTORIA SCHMIDT, 1171852 ONTARIO LIMITED carrying on business as G.K. YORK MANAGEMENT SERVICE and 487223 ONTARIO LIMITED had used funds misappropriated from the
BERLIN H Y PO BA N K to acquire real and personal property in the Province of Ontario;

c)

The defendant GABRIEL KIRCHBERGER perpetrated his fraud by creating a dual

identity for himself; both of those identities being under the name Gabriel K irchberger, one in Canada and the other in Germany; and

d)

The defendant GABRIEL KIRCHBERGER by deceit pretended that the Canadian

"Gabriel K irchberger" operating in Brantford, Ontario was unrelated to the German "Gabriel K irchberger" operating in Berlin, Germany.

22)

T he defendant GA B RIEL K IR CHBERGER in an effort to conceal that he was the same Gabriel

Page 12

Kirchberger pretended to be a wealthy business person who owned 11,000 rental units in

Germany. 23 ) In so doing, the defendant GABRIEL KIRCHBERGER: a) b) D efaulted on his agreement with the BERLIN HYPO BANK ; Wrongfully hid his assets from the BERLIN HYPO BANK by;
i) Pr etending to be insolvent in Germany while acquiring assets in Canada; and

ii ) 24 )

M o ving his assets beyond the jurisdiction of the German Courts.

The defendants GABRIEL KIRCHBERGER, 117185Z ONTARIO LIMITED carrying on business as G.K. YORK MANAGEMENT SERVICE and 487223 ONTARIO LIMITED have been unjustly enriched in the sum of $10,000,000.00 by using funds belonging to the BERLIN HYPO BANK to acquire real and personal property in the Province of Ontario.

25)

T he plaintiff is the beneficial owner of all real and personal property owned by the defendants.

Z6 )

By correspondence dated January 6, 2010 the BERLIN HYPO BANK called the collateral
security by serving notice on the defendant GA B RIEL K IR CH BERGER.

27)

T he conduct of the defendants is suff iciently reprehensible to merit an award of exemplary

damages in the sum of $1,000,000.00 and punitive damages in the sum of $1,000,000.00.
28) T he plaintiff requires that to the extent permissible the issues of fact are to be tried and the

damages assessed by a jury.

DATED: Monday, January , Z010 i 'h Pcs)

MORRIS MANNING, Q.C.

PROFESSIONAL CORPORATION

605-65 Queen Street West

P.O. Box 79 T oronto ON M 5H ZM 5 Morris M anning, Q.C.

(LSUC410863R) Page 13

Frederick J. Shuh (LSUC 16148H) Telephone: 416-304-0841 Facsimile: 416-929-8411 Lawyers for the plaintiff.

Page 14

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Schedule "B" Statement of Claim in Court file CV-10-8535-00CL

Page 7

Court File No. C 9- IC' ONTARIO SUPERIOR COURT OF JUSTICE B ETWEEN :

cOURp Q

HARRY BIEBERSTEIN

P laintiff ,
" r ~c

and-

re/e,RKO% GA BRIEL K IRCHBERGER, SU SA NNE V I K T ORIA SCH M I DT, N OM EN FIT NESS INC., 487ZZ3

ONTARIO LIMITED and 1171852 ONTARIO LIMITED carrying on business as GK. YORK MA NAGEMENT SERVICE
Defendants.

S TATEMENT OF CLAI M TO THE DEFENDANTS:

A LEGAL PROCEEDING HAS BEEN COMMENCED AGAINST YOU by the plaintiff. The claim
made against you is set out in the follow ing pages. IF YOU WISH TO DEFEND TH IS PROCEED ING, you or an Ontario lawyer acting for you must prepare a statement of defence in Form 18A prescribed by the Rules of Civil Procedure, serve it on the plaintiff's lawyer or, where the plaintiff does not have a lawyer, serve it on the plaintiff , and file it, with proof of service, in this court off ice, W ITHIN TW EN TY D AY S after this statement of claim is served on you, if you are served in Ontario. If you are served in another province or territory of Canada or in the United States of America, the period for serving and filing your statement of defence is forty days. I f you are served outside Canada and the United States of America, the period is sixty days.

Instead of serving and filing a statement of defence, you may serve and file a notice of intent to defend in Form 18B prescribed by the Rules of Civil Procedure. This will entitle you to ten more days within
which to serve and file your statement of defence.

IF YOU FA IL TO DEFEND TH IS PROCEED ING, JUD GM ENT M AY BE GIV EN A GA IN ST Y OU

IN YOUR ABSENCE AND WITHOUT FURTHER NOTICE TO YOU. IF YOU WISH TO DEFEND THIS PROCEEDING BUT ARE UNABLE TO PAY LEGAL FEES, LEGAL AID MAY BE AVAILABLE TO YOU BY CONTACTING A LOCAL LEGAL AID OFFICE. DATE: Tuesday, January 12, 2010 Issued by:

oc a

gi stra r

J oanne Nicoara RoQ lstrar Supenor Court ut Justu:6

Address of Court Office: 330 University Avenue

7th Floor

Toronto, ON, M5G 1R7

TO:

GABRIEL KIRCHBERGER 119 McGill Road, R R 41

Mount Pleasant, Ontario NOE 1K O

AND TO:

SUSANNE VIKTORIA SCHMIDT

Nomen Fitness Inc. 164 Colborne Street West B rantford, Ontario N3T 3K 5

AND TO:

N OMEN FITNESS INC.,

164 Colborne Street West B rantford, Ontario N3T 3K 5

AND TO :

487223 ONTARIO LIMITED

325 West St. Suite A 100 B rantford, Ontario N3R 3V 6

AND TO:

1171852 ONTARIO LIMITED carrying on business as G.K. YORK MANAGEMENT SERVICE

325 West St. Suite A 100 B rantford, Ontario N3R 3V 6

C LA I M THE CLAIM
1) T he plaintiff H A RRY B IEBERSTEIN, the assignee of an indebtedness owed by the defendant GA BRIEL K IRCH BERGER to the HYPO REA L ESTATE BA N K A G, herein called the HY PO

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BA N K , and the assignee of all actionable wrongs committed by the defendants GABRIEL KIRCHBERGER, SUSA NNE V I K T ORIA SCH M I DT, N OM EN FITNESS INC., 487223

ONTARIO LIMITED and 1171852 ONTARIO LIMITED carrying on business as G.K. YORK MANAGEMENT SERVICE, against the HYPO BANK seeks:
a) A s against the defendant GA B RIEL K IRCHB ERGER :

i)

A n Order realizing the collateral security given by the defendants to the HYPO B ANK ;

ii )

A n Order recognizing and enforcing a foreign judgment issued in Germany in a civil and commercial matter; and

iii )

A n Order requiring the payment of an amount in Canadian currency suff icient to

purchase the amount of the obligation in the foreign currency at a bank in

Ontario listed in Schedule 1 to the Bank Act (Canada) at the close of business on the first day on which the bank quotes a Canadian dollar rate for purchase of the foreign currency before the day payment of the obligation is received by the

creditor (Section 121(1) Courts of Justice Act). The foreign obligation as of

December 31, 2009 is 3,134,066.54 EUROS plus interest after that date at the

rate of 14% per annum being a per diem interest cost of 1,202.10 EUROS; b) As against all of the defendants, including the defendant GABRIEL KIRCHBERGER: i)
ii )

D amages in the sum of $10,000,000.00 for conversion and fraud;

A n Order that the defendants have been unjustly enriched at the expense of the

HYPO BANK in the amount of $10,000,000.00; iii )

iv ) v)

An Order for an accounting of funds;

A n Order for the tracing of funds; A n Order appointing a receiver manager of the real and personal property of the

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defendants; vi ) A Declaration that there exists in favour of the plaintiff a constructive trust and

that the defendants hold as trustees for the benefit of the plaintiff all their real and personal property; vii ) viii )
ix ) x)

A ggravated damages in the amount of $1,000,000.00; Punitive damages in the amount of $1,000,000.00;
Pre-j udgment interest in accordance with the Courts of Justice Act; Po st-judgment interest in accordance with the Courts of Justice Act;

xi ) xii )

Costs of this action; and Such further and other relief as to this Honourable Court may seem just.

THE PARTIES AND OVERVIEW

2) T he HYPO B AN K is a Banking Corporation that specializes in loans for the acquisition and

improvement of real property in Germany and elsewhere. 3) The plaintiff Harry Bieberstein:
a) Resides in the City of Toronto, in the Province of Ontario;

b) 4)

Is a business person carrying on business in Canada, Germany and elsewhere.

The plaintiff Harry Bieberstein is the assignee of:

a) b) t he civil and commercial debt owed by the defendants to the HYPO BA N K ; and a l l chosei n action wi th respect to the actionable wrongs committed by the defendants a gainst the HYPO BA N K ,

5)

T he plaintiff Harry Bieberstein claims on the "Notarized Debt A cknowledgment" of the

defendant GABRIEL KIRCHBERGER, which according to German Law:

a) constitutes a continuing collateral security on all of the debtor's real and personal property which is on demand enforceable under the same rules as a judgment by a

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German Court; and b) i s of the same legal effect as a judgment of a Court and can be executed without further

legal requirements. 6) The amount owing by the defendant GABRIEL KIRCHBERGER on account of the funds borrowed from the HYPO BANK as of December 31, 2009 is 3,134,066.54 EUROS plus
interest after that date at the rate of 14% per annum being a per diem interest cost of 1,202.10

EUROS. 7) The defendant GABRIEL KIRCHBERGER:

a) a t the time of his dealings with the HYPO BA N K pretended to be a German citizen born

June 14, 1949, and bearing German passport bearing identification number
2399506150D 4906144<070909 3 < 8 who was living in Germany and carrying on the business of real estate development in Germany and as such he persuaded the HY PO B A N K to lend the equivalent of many mill ions of dollars to himself and to corporations in which he had substantial interests; b) i s a Canadian citizen who resides in the City of M ount Pleasant, in the Province of Ontario; c) w as at all material times the principal shareholder and directing mind of:

i)

the defendant 1171852 ONTARIO LIMITED carrying on business as GK. YORK MANAGEMENT SERVICE;

ii ) iii )
d)

the defendant NOMEN FITNESS INC.; and the defendant 487223 ONTARIO LIMITED;

used his co-defendants to hold and conceal his assets so as to frustrate the Bank's ability to collect on the debt.

8)

T he defendant SU SA NN E V I K T ORIA SCHM ID T was born in Germany and now resides in the

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Province of Ontario where she manages the business of N OM EN FI TNESS IN C.

9)

The defendant NOMEN FITNESS INC.:

a) i s a corporation incorporated pursuant to the laws of the Province of Ontario;

b) c) 10 )

c a rries on business in the Province of Ontario; and has its principal office in the City of Brantford, in the Province of Ontario.

The defendant 487223 ONTARIO LIMITED:

a) b) c) i s a corporation incorporated pursuant to the laws of the Province of Ontario; ca rries on business in the Province of Ontario; and h as its principal off ice in the City of Brantford, in the Province of Ontario.

11 )

The defendant 1171852 ONTARIO LIMITED carries on business as GK. YORK MANAGEMENT SERVICE and:
a) b) c) i s a corporation incorporated pursuant to the laws of the Province of Ontario; c a rries on business in the Province of Ontario; and h as its principal office in the City of Brantford, in the Province of Ontario.

1Z )

The defendant Gabriel Kirchberger:

a) a t the time of his borrowing from the HYPO B A N K pretended to be a German citizen li ving in Germany and carrying on the business of real estate development in Germany

and as such he persuaded the HYPO BANK to lend the equivalent of many millions of dollars to a real estate development company IMKA IMMOBILIEN BESIT-U. VERW. G ES. MBH. herein called IMKA ; b)
c)

w as one of the principals of IMKA; and

a t the time of entering into the loan agreement the defendant GA BRIE L KIR CH BERGER concealed from the HYPO B A N K the fact that he had immigrated to Canada in 1986.

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13 )

The HYPO BANK lent IMKA the principal sum of 3,221,138.85 EUROS on January 25, 2000

a)

as of December 31, 2009 the outstanding indebtedness is 3,134,066.54 EUROS and

exists as a valid and enforceable debt in Germany;

b) c)
1 4)

a fter December 31, 2009 interest is owing at the rate of 14% per annum; and a fter December 31, 2009 the per diem interest cost is 1,202.10 EVROS.

T he defendant GA BRIEL K IRCHBERGER in consideration of the loan being made to IM K A :

a) b)

signed the loan as principal debtor; and g a ve as collateral security a "Notarized Debt Acknowledgment" pledging all of his real
and personal property as collateral security for the repayment of the loan.

1 5)

G e rman law permits the HYPO B A N K and its assignee the plaintiff H A RRY BIEBERSTEI N , as holder of the "Notarized Debt Acknowledgment" of GA BR IEL K IR CH BERGER, to seize all

of GABRIEL KIRCHBERGER's real and personal property on demand without further legal process.
16) T he defendant GA BRIEL K IR CHBERGER by virtue of his default and the default of the borrowing corporations is indebted to the plaintif f on account of the loan transactions which indebtedness as of December 31, 2009 totals 3,134,066.54 Euros and has a per diem rate of interest of 1,202.10 Euros. 17) O n M arch 4, 2003 the defendant GA B RIEL K IRCHBERGER was subjected to examination

under oath pursuant to German insolvency laws. In those proceedings the defendant GABRIEL KIRCHBERGER:
a) b) c) a dmitted ownership of 90% of the defendant G K . Y ORK M A N A G EM EN T SERV ICE ; a dmitted ownership of 90% of the defendant 1171852 ONTA RIO L IM IT ED ; f alsely asserted that those entities had no equity or value; P ag e 7 o f 10

d) e)

f alsely asserted that he had no other assets; and w i lf ully concealed and fraudulently concealed his true financial standing by asserting that he had no assets and that those companies had no equity or value.

18 )

The defendant GABRIEL KIRCHBERGER: a) D e frauded the HYPO BANK by: i) consenting to judgment in Germany by signing the "Notarized Debt Acknowledgement" and thereafter removing his assets from Germany, including
funds borrowed from the HYPO B A N K and using those funds to acquire assets in Canada in the names of his co-defendants and others not currently known to t he plaintiff ;

ii )

l ying on his German insolvency proceedings by falsely denying that he had

assets in Canada;

iii )

creating a dual identity for himself under the name Gabriel K irchberger with the

intention of defeating the claims of HYPO BANK ; iv ) w i lfully and fraudulently concealing his true financial standing by hiding his
assets by: (1) pretending to be insolvent in Germany while acquiring assets in Canada;

and
(2) b) m o ving his assets beyond the jurisdiction of the German Courts;

concealed his fraud by unlawfully obtaining Canadian citizenship by lying and stating that he resided in Canada when in fact he was living in Germany and perpetrating his f raud on the HYPO BA N K ;

c)

creating his dual identity by lying on his Canadian citizenship application by falsely
asserting that he was in Canada for a three year period when in fact he was not in

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Canada for a sufficient length of time because of the time he spent in residence in Germany; and
d) used his illegally obtained Canadian citizenship to defeat the HYPO B A N K by moving his assets including funds borrowed from the HYPO BA N K to Canada and by investing those funds in the names of his co-defendants.

19 )

In the spring of 2009 the HYPO BANK discovered that: a) the defendant GABRIEL KIRCHBERGER had lied in the Germany insolvency
proceedings and that he in fact had assets in Canada;

b)

the defendants GABRIEL KIRCHBERGER, SUSANNE VIKTORIA SCHMIDT, 1171852 ONTARIO LIM ITED carrying on business as GK. YORK MANAGEMENT SERVICE and 487223 ONTARIO LIMITED had used funds misappropriated from the HYPO BANK to acquire real and personal property in the Province of Ontario;

c)

The defendant GABRIEL KIRCHBERGER perpetrated his fraud by creating a dual

identity for himself; both of those identities being under the name Gabriel K irchberger, one in Canada and the other in Germany;

d)

T he defendant GA B RIEL K IR CHBERGER by deceit pretended that the Canadian "Gabriel K irchberger" operating in Brantford, Ontario was unrelated to the German "Gabriel K irchberger" operating in Berlin, Germany.

20 )

T he defendant GA B RIEL K IRCHBERGER in an eff ort to conceal that he was the same Gabriel Kirchberger pretended to be a wealthy business person who owned 11,000 rental units in

Germany. 21 ) In so doing, the defendant GABRIEL KIRCHBERGER:

a) b) D ef aulted on his agreement with the HYPO B A N K ; W r ongfully hid his assets from the HYPO BA N K by : P ag e 9 o f 10

i)
ii )

Pr etending to be insolvent in Germany while acquiring assets in Canada; and

M o v ing his assets beyond the jurisdiction of the German Courts.

22 )

The defendants GABRIEL KIRCHBERGER, 1171852 ONTARIO LIM ITED carrying on business as GK. YORK MANAGEMENT SERVICE and 487223 ONTARIO LIMITED have
been unjustly enriched in the sum of $10,000,000.00 by using funds belonging to the HYPO BA N K to acquire real and personal property in the Province of Ontario.

23 ) 24)

T he plaintiff is the beneficial owner of all real and personal property owned by the defendants. B y correspondence dated January 6, 2010 the HYPO B A N K called the collateral security by

serving notice on the defendant GABRIEL KIRCHBERGER.

25) T he conduct of the defendants is sufficiently reprehensible to merit an award of exemplary damages in the sum of $1,000,000.00 and punitive damages in the sum of $1,000,000.00. 26) T he plaintiff requires that to the extent permissible the issues of fact are to be tried and the

damages assessed by a jury. DATED: Monday, January N, 2010

It.g~& ) MORRIS MANNING, Q.C.

PROFESSIONAL CORPORATION 605-65 Queen Street West
P.O. Box 79 T oronto ON M 5H 2M 5

Morris Manning, Q.C. (LSUC410863R) Frederick J. Shuh (LSUC416148H) Telephone: 416-304-0841 Facsimile: 416-929-8411
L awyers for the plaintiff .

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