City to charge contractors involved in new Calgary mom's 'nightmare' experience

The City of Calgary has laid charges against one man who ran a general contracting business that clients called "horrible" and "a nightmare," and plan to serve his partner in short order.

The two men, Damir Hrustanbegovic and Sean Hlushak, ran a company called Fresh Contracting and Construction. Four of their clients told CBC News that the company lied about progress, didn't complete work and neglected to pay subcontractors. 

They even put lives at risk by leaving a propane tank in a pile of tools in an attached garage, according to one family.

Kent Pallister, the city's chief licence inspector, said investigators began to look into the matter after reading the CBC News story.

• Calgary cafe owner faces bankruptcy, shop closure after $100K contractor nightmare

"It looks like we had a similar investigation already going with [a different victim], a residential consumer that had hired a business in Calgary and didn't get any work done, or very little," said Pallister. "Now, they can't get ahold of the business."

Pallister said the city had evidence that the two men had operated their business while unlicensed and had failed to maintain standards in their operations. They charged Hlushak on Friday, and plan to serve Hrustanbegovic shortly.

As we peel back the onion here, we're finding more and more victims.- Kent Pallister, chief licence inspector for the City of Calgary

"Our licence inspector investigating is trying to seek out any more victims, because it looks like this is growing as we speak," he said. "As we peel back the onion here, we're finding more and more victims."

Pallister said contractors must meet certain qualifications to obtain a City of Calgary business licence.

"Once you've met all those qualifications and standards, you have to maintain them," he said.

The city said as Hrustanbegovic and Hlushak were found to have been operating their business while unlicensed and were not meeting bylaw standards, they were subject to charges.

None of the allegations as of yet have been proven in court.

"Our bylaw has specified penalties of $1,000. However, in cases like this, if there's a victimization and if it's a large dollar amount or there's a large number of people that have been affected, we usually will make it a mandatory court appearance," Pallister said. "We'll have all of our evidence through the prosecution set out in court, and fines on a bylaw per charge can be up to $10,000."

CBC News reached out to Hlushak and Hrustanbegovic before the initial story was published and reached out again on Friday by phone and email but has yet to receive a response.

Emails sent to addresses registered to the business bounce back, and the company's Facebook page, website and Hlushak's LinkedIn page were deleted after CBC News first reached out.

'It feels really good'

Sarah Byers, who hired the two men to complete $100,000 of work at her new cafe, said hearing news of the charges made her feel like the justice system was working.

"It's feels really good to see that maybe this article helps someone wake up and be like, 'Holy crap, the things we heard are true and we should investigate this,'" she said. "I don't know how far it will go … but I'm assuming it's going to mean that they can't do this business anymore and hurt more people across the city."

Byers's shop, Dilish Bites 'N Brews, opened just eight weeks ago. But she said financial strains placed on the business as a result of the saga led to the shop closing on Wednesday.

Those burdens won't go away as a result of these charges, she said.

"It won't give us closure, no. They owe us a lot of money. I don't know if we're ever going to see a dollar from them," Byers said. "[But] in terms of a positive outlook for us … the community is just so supportive, like friends and family and people I don't know from across the country have reached out to me. It's just really great. It's great."

Community members have started an online fundraiser with the aim of helping Byers reopen her business.

Other clients of the company said they also felt relieved to hear about the potential charges.

"Two words: I'm ecstatic," said Elizaveta Smirnova, who with her mother hired Fresh Contracting in August 2018, paying more than $30,000 for work that was not completed.

"I'm not getting any money back. I'm not getting my time back. I'm not getting anything like that back.… I'm happy that potentially no one else will be affected like all of us were. But it's bittersweet."

Ongoing investigation

Pallister said the city was still combing through leads that have come through to the city as a result of the initial story, and encouraged any others who had dealt with the company to come forward.

"We're not done with it. But if we can get the word out to anybody that has been victimized by this business or any other business, please use the resources of the City of Calgary because we want to do our part," he said.

Information on Fresh Contracting or any other company carrying out similar practices can be reported to 311.