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Tag: ["🤵🏻", "🇨🇦", "💸", "🚫"]
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Date: 2024-05-12
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TimeStamp: 2024-05-12
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Link: https://torontolife.com/deep-dives/the-professor-the-caregiver-and-the-missing-30-million/
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Parent:: [[@News|News]]
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Read:: [[2024-05-28]]
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^button-Theprofessorthecaregiverandthemissing30millionNSave
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# The professor, the caregiver and the missing $30 million
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When William Waters was a newborn, his mother placed him in a basket and abandoned him on the front steps of an orphanage. It was 1932, the nadir of the Great Depression, and few families in Orangeville—then a rural town of 2,600—were in a position to adopt. So little Bill went home with the only woman who offered to take him: a 51-year-old seamstress named Edith Waters. Single and childless, she doted on her son and, as he grew older, encouraged his entrepreneurial spirit.
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As a boy, Waters worked three paper routes and built a chicken coop in his backyard. After high school, he ran a local taxi company and found entry-level work in the aerospace industry, earning enough to enrol at the University of Toronto. He then pursued a PhD in economics at the University of Chicago, where he dated a bright young English student named Phyllis Reimann. The couple were married in 1968 and settled in Toronto, where Waters’s alma mater offered him a teaching job.
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Waters was a popular professor—erudite and impish, with a rotating wardrobe of tweed jackets and a knack for making macroeconomics entertaining. In 1982, he became the first academic director of the executive MBA program at what is now the Rotman School of Management. He took an interest in his students’ lives, accompanying them to the pub after class and keeping in touch with alumni. Former pupils frequently asked him to invest in their start-ups. Most fizzled, but one business, an investment-management technology company called Financial Models, took off. Based on its success, Waters founded a firm called Portfolio Analytics, which provided stock and bond data to banks and portfolio managers. By the mid-2000s, both companies were sold, netting Waters, then in his 70s and retired, a windfall of roughly $50 million.
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***Related:** [A crooked cop, a dead man and an $800,000 estate fraud](https://torontolife.com/deep-dives/crooked-cop-dead-man-fraud-robert-konashewych/)*
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That much money would radically transform the average person’s life. Waters’s life mostly stayed the same. He and Phyllis, who never had children, stayed in their three-bedroom Tudor-style home near Yonge and Davisville. Waters attended the opera and dined at the members-only York Club, but he allowed himself few additional extravagances. He seemed more interested in giving his money away than in spending it. He donated upward of $10 million to U of T and millions more to a handful of hospitals around Toronto. He gifted a viola and bow worth $3.5 million to the TSO and helped finance the post-secondary education of several waiters who’d had the good fortune of serving him.
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There was one dark spot in Waters’s otherwise charmed life. In 1998, his wife fell down a flight of stairs. The accident left Phyllis bedridden, with chronic pain that robbed her of her mobility, her joy and her life as she knew it. She tried to ease the resulting depression with alcohol and prescription pills, which only made things worse. Before long, all traces of the old Phyllis—the cheery bookworm who loved going to the symphony and travelling the world—were gone. She became reclusive, eating, sleeping and watching TV alone in her bedroom.
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After Phyllis suffered a bad fall in 1998, she required constant care
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Waters was Phyllis’s power of attorney, which meant he managed her money and made decisions about her health. He never lost hope that Phyllis would return to her former self. He sent her to the Mayo Clinic, spent more than $30,000 on an experimental pain-alleviating device called the Calmare and flew medical specialists up from the States to examine her. Nothing helped. Phyllis continued to deteriorate, as did their marriage. Crippled by pain, she pushed Waters away, turning her head whenever he tried to kiss her goodnight.
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In the 2000s, Waters began hiring personal support workers to care for Phyllis. They didn’t typically last long. She was a difficult charge, often refusing to bathe or brush her teeth. But, in 2009, Waters found a caregiver named Gillian Henry who seemed like she might stick. When Henry started caring for Phyllis that May, the two of them established a breezy rapport, chatting about Henry’s kids—she had a 19-year-old son, Matthew, and a 13-year-old daughter, Noelle—and Phyllis’s favourite TV shows, *Grey’s Anatomy* and *Survivor*. Under Henry’s watch, Phyllis seemed more chipper, less paralyzed by her pain and its attendant malaise.
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As Phyllis improved, however, Waters’s body began to fail him. Throughout the late 2000s and 2010s, he fought (and beat) lymphoma, suffered a minor stroke and required dialysis to manage kidney failure. Preparing his last will and testament, he was characteristically philanthropic. Waters set aside a few bequests for friends, but he wanted to leave the bulk of his wealth to U of T, the TSO, and a dozen other cultural and charitable institutions. Over the course of seven pages, he painstakingly laid out how the money should be used: first, to care for Phyllis, then to establish endowment funds, finance educational programs and create scholarships for students in need.
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Waters died in July of 2021, at which point the trustees of his estate prepared to dispense the funds according to his wishes. But, when they opened his accounts, they discovered that his fortune had evaporated. As they pored over years of transfers and transactions, trying to figure out where the money had gone, they realized that all trails led to one person.
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Gillian Henry prays daily, wears a crucifix necklace, pays tithes to her evangelical church and carries a battered red Bible. Her faith stems from her childhood in Georgetown, Guyana, where she grew up attending Sunday services with her parents and six older siblings.
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When Henry was six years old, her mother moved to Canada, intending to plant roots so the rest of the family could join her. While they waited, the kids were left with their hard-drinking, mostly absent father. Unsupervised and unprotected, Henry and her sisters say they were repeatedly sexually abused by neighbours and relatives. Henry seemed ashamed about what happened to her as a girl, as if she thought the abuse were her fault. As she got older, she tried to forget, took refuge in her faith and focused on the positives in her life.
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In the 1980s, at age 14, Henry moved to Scarborough to join her mother, but life in Canada had its own challenges. She was one of the only Black kids at her high school. She struggled with reading and dropped out in Grade 11 but later earned her GED. Her mom was a personal support worker, and she decided to become one too, first working at a daycare and then at a nursing home before being referred to Waters.
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---
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##### When Waters hired Henry as his wife’s caregiver, she was 39 and struggling. As of her first shift, she had just $57 in her bank account
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When Henry was hired, she was 39 and struggling. She’d previously separated from Matthew’s father, and now she was in the middle of a protracted divorce from Noelle’s dad. She owned a house in suburban Whitby, but the property had three mortgages against it that exceeded its value. She’d borrowed money from her parents to keep up with interest payments, and now she owed them $114,000. As of her first shift, she had $57 in her bank account.
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Henry started as Phyllis’s nighttime aide, rounding out a staff that included a weekday PSW, a weekend caregiver and a private chef. Six nights a week, Henry would arrive around 6 p.m., bring dinner to Phyllis’s bedroom on the second floor, bathe her and then prep her for bed. Once Phyllis was asleep, Waters often invited Henry into the living room for a cup of tea. Then 77, he was physically frail but mentally sharp, and he told Henry stories from his younger years: growing up in Orangeville, studying in Chicago, working at U of T. Mostly, though, he asked Henry about her life.
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Waters quickly discovered the severity of Henry’s monetary troubles. Ever the altruist, he offered to help. During the first few weeks of Henry’s employment, her son wrecked her second-hand Honda Accord, so she borrowed her mom’s car to get to work. When Waters asked why she was driving a different vehicle, she told him about the accident. According to Henry, he transferred her more than $100,000 and told her to buy a Mercedes.
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Henry had never seen that kind of money. Her annual salary, paid by Waters, was $60,000. She assumed the transfer was a loan, but she never asked. Rather, she promptly purchased a new Mercedes SUV for over $80,000. She used another $14,000 to pay down some of her bills, and then, despite the tsunami of debt crashing up against her empty bank account, she spent $4,000 of the leftover funds at Peoples Jewellers in Oshawa. The splurge hardly mattered. A lot more cash was about to come her way.
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The volume of money currently flowing down through the generations—from those born before 1965 to those born after—is so vast that the phenomenon has its own nickname: the Great Wealth Transfer. In Canada, it’s estimated that the well-heeled Silent Generation and affluent baby boomers will leave $1 trillion to their Gen X and millennial heirs by 2026. Much of that capital will change hands smoothly: an elderly mother leaving her son her savings, a dying dad divvying up his assets equally among his children. But plenty of it will not.
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The Department of Justice estimates that one in 10 Canadians over the age of 65 are victims of crime every year, most often in the form of financial exploitation. Greedy kids pressure their senile parents for cash. Nefarious nephews write themselves into wills. Kimberly Whaley, the founding partner of Toronto-based estate litigation firm WEL Partners, says that when clients call her, they often think they have a unique story. “They say, ‘You’re not going to believe this. My aunt got married at the mall, and all of her assets got transferred to the UPS delivery person,’ ” she says. “I hear a variation of it every single solitary day.”
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Whaley’s colleague John Poyser has specialized in cases like these for more than 20 years. For perpetrators, he says, financial elder abuse is so appealing because it yields huge rewards with little risk. “If you try to rob a bank, there are guards and cameras. Police will show up instantly,” he says. “But, if you take advantage of your uncle, there are no guards, no cameras. No one’s going to come to try to stop it.” When fraudsters get found out, the courts sometimes order them to return the money, but criminal charges are rare. As Poyser puts it, “It’s the modern version of a heist.”
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Waters would have been the perfect mark. He had a fortune, no family to give it to and a soft spot for underdogs. Henry, meanwhile, was a single mother in desperate need of cash. The situation was ripe for abuse. But, the way Henry tells it, she—not Waters—was the one being exploited.
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Once Waters grasped the full scope of her fiscal woes, she says, he offered her enough money to consolidate her debts and make him the sole lender. That way, instead of having to send the bulk of her biweekly paycheques to three separate mortgage providers—two of them private lenders who charged astronomical interest—Henry could repay Waters at a more reasonable rate. On June 2, 2009, Waters transferred Henry $400,000, which she used to repay her parents and lighten some, but not all, of her other liabilities. Once again, she carved out enough cash to go on a shopping spree at a jewellery store, this time spending $11,000 in one go.
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Waters became a millionaire in his 70s and shared his wealth with several charities
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After that, according to Henry, everything changed. On a Saturday night within a week or two of that transfer, she showed up to work as usual. She put Phyllis to bed and then tiptoed to the adjoining bedroom, where she slept. She kept her door cracked open in case Phyllis needed anything overnight and placed a toolbox against it to prevent the Waterses’ cat, Frankie, from pawing it open. Then she changed into her pyjamas and crawled into bed.
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Before Henry fell asleep, she says, she heard footsteps ascending the stairs. According to Henry, the door creaked open, noisily dragging the toolbox across the wooden floor, and then Waters walked in, sat at her bedside and began rubbing her hands. When she asked what he was doing, he assured her everything would be fine. Then, she alleges, he pulled the duvet down and slid his hands under her pyjamas before taking one of her hands and placing it on his penis. Henry claims she told him to stop. Instead, she says, Waters told her that, if she resisted, he would take back the $400,000.
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From then on, she says, she understood that, once Phyllis had fallen asleep, Waters expected her to have sex with him. She dreaded it, but in her words, she “gave in,” responding to his transgressions the only way she knew how—by freezing up, shutting down, moving on. She felt like she had as a child, like the abuse was somehow her fault. She claims that Waters eventually apologized. Deprived of affection from Phyllis, he was lonely, and it had come out in a vile way. She says she forgave him because she had come to admire him—his generosity, curiosity and quick wit. He was a flawed but remarkable man. He had hurt her, yes, but he’d also helped her.
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And the help kept coming. In late June of 2009, Waters transferred Henry another $310,000 to pay down the remainder of her debts. Then, in July, he began quietly depositing lump sums into her bank account—$3,000 here, $6,000 there—each time telling her that he’d left her a little surprise. He gave her a Visa card linked to his account and, she claims, told her to buy red lingerie and a $53,000 diamond ring. According to Henry, Waters put the ring on her finger, popped a bottle of champagne and told her that, once Phyllis passed away, the two of them would get married.
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Whether or not Waters had assaulted Henry, what developed between them was an ongoing sexual relationship. Waters’s medical records show that he was prescribed Cialis around the time Henry was hired. A doctor’s note spoke of Waters’s new “gf,” saying, “He has one age 40, Nigerian—early days.” (Henry is Guyanese.) Waters occasionally took Henry to the opera, where, she says, he introduced her as his “special friend.” She also accompanied him to Ottawa in 2014, when he was awarded the Order of Canada in recognition of his philanthropy. The other guests assumed she was his caregiver.
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Not long after Waters supposedly asked Henry to be his future wife, he made plans to send his existing wife away. Given Phyllis’s improvements under Henry’s care, he wanted to wean her off alcohol and pills for good. He booked her a months-long stay at the Canyon, a luxury rehab centre in the arid mountains above Malibu with a swimming pool and a meditation dome. She arrived in late August of 2009.
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Around that time, says Henry, Waters began encouraging her to pursue ambitions beyond caring for private clients. Why not open her own nursing home? Henry demurred. If not a nursing home, Waters apparently pressed, then what did she want to do with her life? Henry told him she wanted to build a real estate portfolio—to purchase properties, renovate them, and rent them out or sell them. She’d never had the money to pursue such ventures. According to her, Waters offered to change that. He invited her to survey the market and bring him listings she liked.
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***Related:** [Meet the most charming fraudster in real estate](https://torontolife.com/deep-dives/the-most-charming-fraudster-ontario-gta-real-estate/)*
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That summer, Henry hired a realtor and started looking at houses near her own in Whitby. She selected a charming three-bedroom, three-bathroom detached in Oshawa that was listed for $259,900. She says she printed the MLS page and presented it to Waters and that he agreed it had potential. She placed an offer of $250,000, and the sellers accepted. Waters covered the cost as well as $75,000 worth of renovations.
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Henry’s Whitby home was saddled with three mortgages when she met Waters
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The process went so smoothly that, in November, they did it again. This time, Henry says, she showed Waters listings for both sides of an Oshawa semi-detached, and he provided the $345,000 purchase price. Then, in December, they added another property—a $300,000 corner lot in Whitby. Once again, Waters fronted the cash and Henry managed the day-to-day operations: hiring contractors, finding tenants and collecting thousands of dollars in rent, which she kept. If Waters had expectations about how to split the revenue, he never formalized them. On paper, the properties belonged to Henry.
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In January of 2010, staff at the Canyon decided Phyllis was ready to go home. According to her discharge report, she was not only sober but had been the “life of the party” at the facility. Back in Toronto, Waters was overjoyed with Phyllis’s remarkable recovery. She’d loved California, so he began searching for a property along the Golden Coast, eventually buying a $1.3-million retreat in Sea Ranch, California, in February of 2010. That month, when Phyllis’s daytime PSW left the Waterses’ employ, Henry became her full-time caregiver.
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Waters asked Lindsay Histrop, his long-time estate planner, to add Henry to his will as a way to reward her for her excellent service and commitment to Phyllis’s care. Histrop had never heard Henry’s name before, but the bequest didn’t surprise her. She knew that Phyllis’s well-being was Waters’s top priority and that he had struggled to find her a stable caregiver. It made sense that Waters would give Henry an incentive to stick around. To Histrop, this type of generosity was Waters’s MO. She wrote Henry into the will and gave it little more thought.
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After decades spent living paycheque to paycheque, Henry was suddenly a wealthy woman. On top of buying new properties, she improved her own, hiring contractors to renovate her kitchen and add a pool to her backyard. She bought a $50,000 Hummer for Matthew and a $40,000 showhorse for Noelle—the first of at least six steeds she would purchase with Waters’s cash.
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Like Waters, she also gave plenty of money to charity. She donated tens of thousands of dollars to her church and to SickKids. In 2010, she and Noelle flew to Guyana to refurbish an orphanage, donate to a convalescent home, fund a school meal program and hand out toys, stationery and other items to kids in Georgetown. In total, she donated about $1 million.
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In April of 2010, Waters helped Henry buy another house—not an investment property but a new home of her own. He had already agreed to pay $30,000 per year to send Noelle to Pickering College, a private school in Newmarket, so Henry, trying to spare her daughter the daily drive from Whitby, was looking for a family home nearby. She found a 4,000-square-foot brick house with a big tree in the backyard. Waters agreed to provide the $765,000 she needed to buy it on the condition that the proceeds from the property’s eventual sale would fund Noelle’s post-secondary education.
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According to Henry, Waters never liked her new house. If they were to live together as a married couple, he supposedly said, it should be in a bungalow, so there’d be no risk of him falling down the stairs. And so, in March of 2011, she bought a one-storey, five-bedroom mansion in a gated community next to the Magna Golf Club in Aurora for $2 million. Waters provided a $700,000 down payment and guaranteed a mortgage for the remaining $1.3 million—Henry told Waters she’d resell her other home to repay that mortgage, but she never did. She instead sunk another $2.5 million of Waters’s money into renovations on the new place: redoing the kitchen, adding a pool and a basketball court, installing a home theatre. Before long, the property was worth twice as much as Waters’s home in Toronto.
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Henry’s $2-million mansion in Aurora
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Because Waters’s money was spread among several different accounts—TFSAs, investments, savings, charitable funds and so on—and managed by a number of different advisers, no one initially knew just how much he was sending to Henry. But, when Waters started taking cash out of Phyllis’s account and borrowing against his home, an adviser at CIBC Wood Gundy reached out. Waters assured him that the money was for “investments” and that there was nothing to worry about. As more of Waters’s millions flowed to Henry, the adviser felt compelled to broach the topic more directly. He warned Waters that Henry might be taking advantage of him—that she might never pay him back. Waters thanked him for his concern and again assured him that everything was fine.
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Meanwhile, as Henry scouted, bought, renovated and leased out more properties, she spent less and less time caring for Phyllis—as little as one day a week at one point. Instead, Henry focused her efforts on finding a rural acreage where Noelle could board her horses. In late 2013, she settled on a $2.5-million 139-acre lot in Uxbridge. The property was run down, the barn was leaky and the horse stalls were broken. Henry planned to pour money into it, presumably hoping to turn it into a profitable ranch business: horse owners would pay to use the grounds, rent stalls and take lessons.
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Waters soon signed off on more than $5 million worth of renovations: more stalls, new riding arenas, a tuck shop in the garage. When the ranch opened, Henry named it King of Hearts Stable after one of Noelle’s horses. Noelle, who moved into one of two houses on the property in her early 20s, helped operate the business alongside seven other employees. By 2015, it was obvious that King of Hearts would never be the bustling equestrian business Henry had envisioned. They weren’t renting enough stalls or booking enough lessons to break even, never mind turning a profit. Soon, Waters was grumbling to friends about the money he was losing. When he mentioned it to a group of U of T alumni with whom he had regular dinners, they teased him: investing in a horse business, they said, was as good as digging a hole and shovelling money into it.
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The $2.5-million King of Hearts Stable, which Henry believed would turn a profit
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Waters also griped about King of Hearts to Histrop, his estate planner, so she asked him exactly how much money he had given to Henry. At that, she says, Waters looked out the window, paused and said Henry was “into him” for $5 million. Histrop suspected he was downplaying the amount. She made him promise he wouldn’t give away any more money. Beyond that, her hands were tied. Solicitor-client privilege prevented her from telling others about Waters’s financial affairs. She called the police anonymously, but they said that, if her client was of sound mind—and, by all accounts, Waters was—there was nothing they could do.
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Histrop lost sleep trying to figure out what to do next. Waters had no family looking out for him, so she felt she needed to take drastic measures, even if it meant breaching privilege. She consulted the Law Society of Ontario’s advisory services and emailed a number of Waters’s friends and professional advisers, sharing, in vague terms, her concerns. As the responses trickled in, she realized she wasn’t the only one who harboured concerns about Henry.
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Histrop—whom Waters had appointed as one of two trustees of his estate—contemplated an intervention, but it never materialized. Waters’s kidneys were failing. In between dialysis sessions, he was often fatigued and ill. At age 85, he needed surgery to clear obstructed arteries. He also suffered a collapsed lung and kept contracting what he called the 100-day cold. Eventually, he stopped shaving his face and combing his hair and lost so much weight that his clothes no longer fit. With all of Waters’s problems, it became impossible to pin him down to talk about his finances.
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In 2018, Waters’s doctor predicted he had six months to live and recommended that he and Phyllis, who was showing early signs of dementia, spend their final days in an assisted-living facility. Waters bought a spacious unit for the two of them in an Etobicoke retirement condominium called Hearthstone. Then, a few weeks before selling his house, he took out a $2.4-million mortgage on the property to make an “investment,” as he called it. Upon hearing this, Histrop confronted him again: What was going on? She urged him to get his money back from Henry. If Henry didn’t repay him, Histrop advised, Waters should take her to court. Waters refused and repeated his go-to lines, this time with uncharacteristic hostility: he knew what he was doing, they were investments, Henry would pay him back. Resigned, Histrop let it go.
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Henry continued caring for Phyllis when the couple moved to Hearthstone—at least until the pandemic hit in 2020. According to Histrop, she was caught using his fob to enter the building through the parking garage without signing in at the front desk, violating Hearthstone’s Covid policies. At that, Phyllis’s power of attorney—a doctor Waters had entrusted with her care when his own health worsened—fired Henry. Nonetheless, she and Waters spoke over the phone. On the evening of July 27, 2021, Waters, then 88, called Henry. It went to voicemail. “Hi, Gillian,” he said in a stilted message. “I hope you’re doing better, because you weren’t so good yesterday. Call me anytime. Thanks for now. Bye bye, sweetheart.” He died the next day.
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During his life, Waters joked that, though he’d made his millions in computers, he had no idea how to use one. He was a man of pen and paper. He took handwritten notes on virtually every conversation, phone call and investment. Waters printed, photocopied and faxed tens of thousands of documents over the years, often filing the originals onto shelves or into labelled folders. He didn’t own a cellphone or a laptop, so if he wanted to send an email, he either wrote down or dictated what he wanted to say to his secretary, who sent messages on his behalf.
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After Waters died, the second trustee of his estate, Agnes Kussinger, an analyst who’d worked for Waters since the 1970s, assumed the unenviable task of sorting through all the paperwork he’d left behind. When she visited Waters’s condo, she found notes everywhere. There were papers in piles on his desk, in stacks on the floor, in boxes in the closet. She wasn’t surprised—that was simply how Waters was. Back when he was alive, she’d asked him for details about the “investments” he’d made with Henry. He told her that Henry had all the documents about the money he’d given her. But, when Kussinger called Henry, she said no, all the paperwork was with Waters. At the time, the back-and-forth hadn’t worried Kussinger, but that was about to change.
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On one of his shelves, she found exactly what she was looking for: two folders labelled GH. Kussinger had put them there herself when she’d helped Waters move into the unit. She hoped the pages inside would solve the mystery—that they would meticulously detail how much money he had given Henry, how every dollar had been spent, how much she’d been expected to pay back. But the papers revealed nothing. There was no ledger, no list of properties bought and sold, just some handwritten notes with scattered mentions of transfers, property purchases and mortgages. It wasn’t clear whether Waters had intended for the transfers to be gifts, loans or investments. It wasn’t even clear how much money he’d given Henry.
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Kussinger kept digging. As one of the Waters estate’s trustees, she was responsible for settling his financial affairs and executing his will, which meant that she was permitted to access his financial accounts. As she sorted through reams of bank statements and Visa bills, she began to piece together the puzzle. The emerging picture was far worse than she could have imagined.
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##### Between 2009 and 2019, Waters transferred Henry roughly $30 million of his once considerable fortune. He died in debt
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Waters had transferred 98 per cent of his wealth to Henry, and she’d spent it all. She’d taken trips with her family to France, Italy and Disney World and accumulated $2.5 million in charges—including more than $100,000 worth of jewellery—on the Visa card that Waters paid. She’d bought herself another Mercedes, a Jaguar and a Bentley, plus luxury vehicles for her son, daughter and sister. Waters’s money had paid for Noelle to attend three different universities—Edinburgh, McMaster and Trent—and for Henry’s failed foray into growing medical marijuana.
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In 2011, she gifted one of her sisters half of an Oshawa semi she’d purchased, then she bought it back from her three years later. At one point, Henry spent more than $1.2 million on a new house for her parents and then bought the house they were moving out of for $800,000. Matthew was living rent-free in Henry’s original house—the one she told Waters she’d sell to pay down the $1.3-million mortgage on her house in Aurora. Waters was the one who ultimately paid off that mortgage. As soon as he did, Henry took out a $1.3-million home equity line of credit to give herself access to even more cash.
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Between 2009 and 2019, the bank records made clear, Waters had transferred Henry money on 391 separate occasions, totalling $30 million. There was barely half a million dollars left in his accounts. In fact, he died in debt. He had drained Phyllis’s accounts to give Henry another $5.5 million, and now the estate had to pay that money back.
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It didn’t make any sense to Histrop. As recently as 2018, she’d helped Waters update his will. All he’d left Henry were some shares in a start-up that eventually went bankrupt. He’d still earmarked the majority of his assets for endowments and scholarships. To Histrop and Kussinger, it seemed like Waters, who’d frequently described his transfers to Henry as “investments,” had expected to get his money back. Now, there wasn’t even enough money left to cover Phyllis’s ongoing care, which amounted to roughly $36,000 per month. To their minds, there was only one option. They had to take Henry to court.
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In November of 2023, *The Estate of William Robert Waters v. Henry et al.* began. Seven lawyers—three for Henry, four for the estate—filed into a University Avenue courtroom, dragging 20 bankers’ boxes of documents. Each side was prepared to convince Justice John Callaghan that their client was the rightful owner of Waters’s $30 million.
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Lorne Silver, lead counsel for the Waters estate, began his opening submissions with a bald assertion: “This is a case about financial elder abuse.” Henry and Waters, he argued, had agreed to enter a joint real estate investment business. Waters then transferred her investment money, expecting to yield a return. Henry instead spent nearly everything. Therefore, Silver contended, Henry held Waters’s money—and all it had bought—on resulting trust. In other words, she owed it all back to the estate.
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Arie Gaertner, Henry’s lead lawyer, urged Callaghan to consider important questions: Why would Waters, a renowned scholar and astute investor, have initiated a multimillion-dollar business partnership with Henry, a Grade 11 dropout? And if they were business partners, why weren’t there any agreements formalizing his supposed stake in Henry’s properties? Even when Waters’s advisers had pushed him to take legal action against Henry, he’d refused. Clearly, Gaertner argued, Waters had gifted the money to Henry and never expected to get it back. “The victim in this case,” he continued, “was Gillian Henry.”
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She attended every day of the trial—silent, stony and impeccably dressed in the public gallery. She took the stand midway through the 20-day proceedings. Under questioning from her lawyers, she was composed. But, under cross-examination, her demeanour shifted. She accused Histrop and Kussinger of setting her up, suggested that the estate’s lawyers had doctored Waters’s financial statements, and claimed, “There are so many people out to get me.”
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Henry also spoke at length about the alleged sexual assault—and launched a counterclaim against Waters’s estate for emotional damages resulting from it. There were inconsistencies in Henry’s recollection: the details of one of the incidents differed between tellings. And she disclosed another for the first time on the stand. Silver challenged these irregularities and questioned Henry’s reasons for not speaking up earlier. Was it because she didn’t want to speak poorly of Waters or because the assaults never happened?
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“This is why women don’t come forward,” Henry retorted. “Do you know how hard it is being Black coming forward and saying a wealthy man like Dr. Waters assaulted me?” She told Silver he’d never understand the pain she’d endured, and he shot back, “Did the flow of money ease the pain?” After days of questioning, Henry concluded, “If you don’t believe me, there’s nothing I can do.”
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The same could be said of the trial’s central question: Had Waters intended for Henry to keep the money? In court, Henry’s children and sisters—who were also named in the lawsuit—claimed, unconvincingly, that they had never discussed the story behind Henry’s newfound riches, even as she gave them houses, cars and piles of cash. Though several of Waters’s advisers told the court that he’d referred to his transfers to Henry as “investments,” there was no documentation to support that claim.
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Of all the paperwork produced at trial, only two single-sided pages seemed to directly address whether the transfers were gifts or loans. The first, a letter addressed “to whom it may concern,” written and notarized by Waters in June of 2014, explicitly stated, “In all, I and my corporation have provided—in addition to salaries and gifts of appreciation—$10,645,000 in loans in the expectation of \[Henry’s\] real estate and farm-based endeavours bearing fruit in due time.” But even this nominally case-cracking document proved puzzling, because two months later, Waters had notarized another letter stating that, in fact, only $1.4 million was loans, and the rest of the money represented “non-repayable imbursements.”
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On the stand, Henry explained the reason for Waters’s flip-flop. The first letter, she said, was created for inclusion in her divorce proceedings, so that her ex-husband wouldn’t be able to claim half of her new assets. Once the divorce was finalized, she continued, Waters once again popped a bottle of champagne, handed her a copy of the second note and told her that she’d only need to repay $1.4 million. At the very least, the timing of Henry’s divorce lines up, and she did pay $1.4 million back to Waters—using a slice of the other $28.6 million he’d given her.
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Henry claimed that Waters knew about—and approved of—every property she bought, every trip she took, every earring she purchased. He reviewed her Visa statements, signed off on renovation plans, and instructed his army of lawyers and accountants to stickhandle all of Henry’s real estate investments. “Dr. Waters never thought of any of these properties as his,” she testified. “I couldn’t spend a dime without Dr. Waters knowing what the money was for.”
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This past January, after hearing both parties’ closing submissions, Justice Callaghan indicated that he saw no clear winner. Rendering a verdict, he said, would be neither quick nor simple. He’d need to revisit thousands of pages of evidence, sift through case law and carefully consider a textbook’s worth of legal concepts, including resulting trust, undue influence, civil fraud, fiduciary duty and limitation periods.
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He will also need to decide whether to apply an arcane doctrine known as unconscionable procurement, which would make the transfers voidable if Callaghan concludes that Waters didn’t fully understand what he was doing and that Henry played an active role in obtaining a significant benefit for herself. There’s one hitch: unconscionable procurement has only been successfully applied in Ontario once in the past century, and no one’s quite sure whether it’s the law anymore. Though several recent cases—most of them Great Wealth Transfer disputes—have tried to resurrect this dormant doctrine, no judge has clarified whether lawyers can use it as a legal tool. Legal scholars will be watching to see whether *Waters v. Henry* is the case that tips the scales. As Callaghan put it before the trial concluded, “We’re in law school territory here.”
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Whenever it arrives, Callaghan’s verdict will provide a modicum of closure. It will lay out which parties are entitled to what money and who needs to pay millions of dollars in backlogged property taxes, mortgage payments and legal fees. He will likely reserve enough money to pay for Phyllis’s care for as long as she lives, but she’ll probably never see the $5.5 million her husband took from her accounts. To help her, the courts have already ordered the sale of Henry’s properties, save for her home and King of Hearts. Callaghan will decide whether she needs to put those on the market too.
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The decision will almost certainly leave many more questions unanswered. Why did Waters give Henry so much money? Was he simply smitten? Wracked by guilt about their affair (whether or not it was consensual) and scared that his secret would get out? We may never know. Waters can’t tell us, and Henry declined multiple interview requests for this story.
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Instead of certainty, we are left with grand stories told by skilled lawyers. From one point of view, Henry is the villain—a manipulative romance scammer who took advantage of a kind old man’s generosity and then smeared his legacy in a wicked attempt to keep his money. From another, Waters is the wrongdoer: a domineering monster who used his wealth to spoil his mistress and cover up his sexual crimes.
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In their own ways, however, both Waters and Henry were vulnerable. They were both victims and villains. Whatever happened between them, they were the architects of this current mess. Whether Waters wanted Henry to keep his money or give it back, all he needed to do was put it in writing, as he did with every other transaction, phone call and passing thought. By neglecting to do so, he triggered a protracted, acrimonious and costly trial. Ultimately, both he and Henry failed the one person they were supposed to care for, the person Waters claimed he loved most in the world: Phyllis.
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*This story originally appeared in the May 2024 issue of* Toronto Life *magazine. To subscribe* *for just $39.99 a year, **[click here.](https://secure.torontolife.com/W2NASHPT)** To purchase single issues, **[click here.](https://canadianmags.ca/collections/toronto-life-single-issues)***
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