'Wild West': Controversy dogs Nova Scotia's marine brokerage industry
Unregulated marine brokers involved in deals worth tens of millions of dollars in Nova Scotia annually
A fisherman from Shelburne County says he will fight a lawsuit from a marine broker seeking a $38,000 commission on the sale of a boat and lobster licence.
Donnie Roy, a lobster fisherman who lives near Lockeport, N.S., paid a commission to brokers in the sale of his lobster licence and vessel, Justified Expense.
Now another marine brokerage, Novi Marine Brokers of Yarmouth, is suing Roy, demanding $38,000 in commissions because Roy had also signed a listing agreement with the company.
"It's not fair. One commission should be enough," Roy said.
The dispute raises questions about the unregulated marine brokerage industry in this province, which is involved in the sale of fishing boats and licences in the tens of millions of dollars every year in Nova Scotia.
Lobster licences alone can start at $400,000 in southwestern Nova Scotia, while those in the Bay of Fundy can go for well over $1 million.
Unlike real estate brokers, marine brokers who handle these sales are not regulated.
The "automatic renewal" clause in Roy's agreement with Novi Marine Brokers, for instance, would not be permitted in a real estate transaction.
The registrar of the Nova Scotia Real Estate Commission said the ban on a "perpetual" listing and other constraints are designed to protect consumers.
"We want consumers to make informed decisions," Brad Chisholm said in a written response to CBC News.
In Roy's case, the listing agreement was for a minimum 12-month term and automatically renewed unless either party gave written notice.
"You sign a contract but you don't get a copy of it. They say it's in the mail, so after a few weeks go by you forget about it and carry on," said Roy.
"I thought it was for six months. I never got a copy of the contract."
Roy also said the Novi broker he was dealing with, Dane Devine, assured him he would waive the commission because the company did arrange his purchase of a new boat after he sold the Justified Expense.
"He told me that right after I sold it. He said just forget about it [the commission]. We won't worry about that, we'll work off this one," Roy said.
Unfortunately, that deal did not work out. That vessel, called Shirley and Bryan, had engine troubles which Roy said he could not afford to repair.
Those financial pressures forced him to sell his lobster licence, he said. Today, the ship is high and dry and sitting nose-down in a Shelburne shipyard.
'He had a binding agreement'
For its part, Novi Marine Brokers said it is merely attempting to "enforce our rights" to collect commissions to which it is entitled. The commissions apply to sales within the initial one-year term, it said.
Devine said the company did make efforts to sell Donnie Roy's boat, but he did a side deal with another broker.
"He sold it out from under us while he had a binding agreement," Devine said.
He also denied ever offering to waive the commission.
Roy said he erased Devine's phone message in which the offer was made.
Devine is a familiar figure in Nova Scotia's marine brokerage business.
He has operated a number of companies, including Devine Brokers & Appraisals Ltd., Novi Marine Brokers Ltd. and Novi Boat Brokers.
The lawsuit against Roy was filed by a related company, 3263626 Nova Scotia Limited, of which Tammy Ward is listed as president, secretary, agent and director.
Devine and related companies have been involved in numerous legal disputes as a defendant or plaintiff.
He declared personal bankruptcy in 2016 with liabilities of $330,000 and assets of $297,000.
Domain name controversy
Devine has also been caught twice registering domain names similar to those of competitors.
The first was in 2006 and the second was in 2016.
In the most recent example, Devine registered troysmarinebrokers.com with the web domain register GoDaddy.
That was almost identical to the website operated by a competitor and former business partner Troy Doucette. Doucette's website is troysmarinebroker.com.
Doucette complained to GoDaddy's arbitratrator, claiming the addition of an "s" at the end of the domain name was a deliberate attempt to "take away business by a direct competitor" and redirect web traffic to Devine's business website of noviboatbrokers.com.
In October 2016, Devine consented to relinquish the domain name troysmarinebrokers.com on the condition that Doucette give up all claims against him.
Troy Doucette declined to be interviewed, as did officials with another marine brokerage TriNav, which obtained a $40,000 judgment against Devine and related companies in 2010 in connection with a similar domain name dispute.
Novi Marine Brokers did not respond to followup questions about the web domain dispute, civil actions or Roy's claim he was never given a copy of the listing agreement.
'The wild west'
Longtime fisheries lawyer Clifford Hood of Yarmouth likens the unregulated marine brokerage industry to the "the wild west."
He said marine brokers should be regulated, given the high stakes involved in the transactions and the frequency of problems he sees.
"It is very commonplace. Too commonplace, when you consider the nature of the business, the size of the business relationships people are entering into and the potential harms," Hood said.
"I don't want to tar all marine brokers with the same brush," he said as a caveat.
He warns fishermen may be entering contractual arrangements that are beyond the ability of the marine broker, or enter into a situation where their deposit money disappears, the deal doesn't get closed or, like Donnie Roy, where multiple commissions could be paid on the same sale.
Hood said fishermen are not the only ones affected.
"I know of at least two lawyers representing clients in this area that had to stand up for their clients and the bar society behind them, to address significant… — tens of thousands of dollars in damage claims — because of a broker defaulting or otherwise not complying with their legal and or ethical obligations.
"I've seen many other agreements where there are two brokers involved and there is a fight going on."
Conflict over $6,000 deposit
Shelburne County fisherman Jamie Bower said last summer he had problems with a local marine broker, Willie Sears, who passed away last summer.
Bower had to hire a lawyer to get a $6,000 deposit back after he discovered upon final inspection that a boat he was looking to buy had a hole in the hull that had been patched.
"I was told I would get my money back, but when the time come, I couldn't get my money back. Willie disappeared," Bower said.
Novi Marine was the broker in the sale of a boat he did buy.
Bower said Novi wanted him to use its lawyer, which he refused.