More legal troubles for used car business and associated dealer

Lower Sackville used car salesman headed to trial on fraud charge

A used car dealership in Lower Sackville, N.S., and its salesman are facing more legal troubles after a bank and finance company launched civil actions against them and another used car dealer in the area.

Great Buys salesman Darren Blumenthal is facing civil action by RBC. Alan Jewell and Justin Cormier, who work for Carsville, are also named as defendants in the case, first reported by AllNovaScotia.com.

In court documents, RBC says it approved a dealer agreement with Carsville to finance the sale of its vehicles. It says Great Buys was turned down for a similar agreement "in part on the basis of its poor business reputation and in particular the poor business reputation of its principal Blumenthal."

Allegations not proven in court

It's alleged Carsville breached its contract with RBC by arranging loans for vehicles that were owned by Great Buys, and that Blumenthal, Jewell and Cormier conspired to fraudulently misrepresent the situation.

Court documents also allege that Carsville had submitted an incorrect vehicle identification number (VIN) for one of the vehicles financed by RBC.

As well, the court documents allege the defendants misrepresented two other car loans. In total, RBC says it's lost more than $100,000.

None of the allegations has been proven in court. 

Carsville owner responds

Jewell, who owns Carsville, told CBC News he's been in business 17 years and doesn't feel he's done anything wrong.

When contacted by CBC, Blumenthal said he was meeting with his lawyer and was unable to talk.

RBC spokesperson Trish Vardy told CBC the documents relate to a civil proceeding and they have not filed a report with police.

More court action

Blumenthal and his wife, Rebecca, are also facing action from Nextgear Capital Corp., which says the couple defaulted on $600,000 in credit.

The court documents say when the Blumenthals were notified action was going to be taken against them, they "absconded with a number of motor vehicles" in which Nextgear Capital had an interest.

Nextgear sought and was granted an emergency order requiring the Blumenthals to disclose the location of the vehicles and not sell, destroy or damage them.

A hearing on the matter will be held in Nova Scotia Supreme Court next week.

In the court documents, Nextgear listed 45 high-end vehicles, including BMWs, Mercedes-Benz and Audis that it is seeking to recover.

Repo company moves in

On April 19, a repossession company removed at least 19 vehicles from the Great Buys lot on Sackville Drive, leaving it virtually empty.

At the time, the owner of the repossession company said it was trying to locate at least another 30 vehicles that "have gone missing in the past 72 hours."

Darren Blumenthal is also facing a charge of fraud over $5,000 in connection with one of the cases in the RBC civil suit.

A judge will issue her decision on whether the charge should proceed to trial on May 12.