# Bavelis v. Doukas (In re Bavelis)

> United States Bankruptcy Court, S.D. Ohio · March 28, 2013 · 490 B.R. 258

URL: https://www.frixlaw.com/law-library/cases/8495784

## Case

- **Full name:** In re George A. BAVELIS, Debtor. George A. Bavelis v. Ted Doukas
- **Court:** United States Bankruptcy Court, S.D. Ohio
- **Decided:** March 28, 2013
- **Citations:** 490 B.R. 258; 2013 Bankr. LEXIS 1198; 2013 WL 1275334
- **Precedential status:** Published
- **Opinion:** Opinion of the court by Hoffman
- **Judges:** Hoffman
- **Cited by:** 10 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/8495784

## How later opinions describe it (automated extraction)

- finding that Mr. Doukas “intended to take advantage of Mr. Bavelis and deprive him of his assets”

## Opinion text

MEMORANDUM OPINION ON DEBTOR’S OBJECTION TO PROOFS OF CLAIM OF QUICK CAPITAL OF L.I. CORP.
JOHN E. HOFFMAN JR., Bankruptcy Judge.
I. Introduction
The issue before the Court is whether Quick Capital of L.I. Corp. (“Quick Capital”) or any entity affiliated with it holds a claim against the Chapter 11 bankruptcy estate of George A. Bavelis (“Mr. Bavelis” or “Debtor”). Ted Doukas, a/k/a Leftheris Doukas (“Mr. Doukas”), the president and sole shareholder of Quick Capital, asserts that Quick Capital has a secured claim against Mr. Bavelis based on a promissory note (“QC Note”), a loan agreement (“QC Loan Agreement”) and a security agreement (“QC Security Agreement” and, together with the QC Note and the QC Loan Agreement, “QC Loan Documents”) that Mr. Bavelis signed in June 2009. Quick Capital filed an original proof of claim for a lesser amount (“Original Proof of Claim”), but then filed an amended proof of claim, Claim No. 49-2 (“Amended Proof of Claim” and, together with the Original Proof of Claim, “Proofs of Claim”), in the amount of $14 million plus interest.
Although claims based on promissory notes and loan agreements are relatively commonplace in bankruptcy, there is nothing ordinary about the facts that gave rise to Quick Capital’s purported claim. Mr. Doukas himself concedes that Quick Capital lent Mr. Bavelis no funds. Rather, he contends that the consideration provided for the QC Loan Documents was fourfold: (1) a $200,000 loan provided by means of a check that one of Mr. Doukas’s other companies, Nemesis of L.I. Corp. (“Nemesis”), issued to Mr. Bavelis; (2) approximately $1.4 million of funds that Mr. Doukas transferred from certain bank accounts to purchase stock in Sterling BancGroup Inc. *265 (“Sterling Holding”), allegedly on behalf of Mr. Bavelis; (3) Mr. Doukas’s promise to pledge his assets to help resolve Mr. Ba-velis’s financial problems and to purchase nonperforming loans of Sterling Holding’s banking subsidiary, Sterling Bank of Palm Beach County, Florida (“Sterling Bank”); and (4) Mr. Doukas’s promise to provide consulting and management services to Mr. Bavelis, including attempting to resolve disputes with one of Mr. Bavelis’s business partners, Mahammad A. Qureshi (“Mr. Qureshi”), in a manner that would be in the best interests of Mr. Bavelis. In the alternative, Quick Capital argues that, if Mr. Doukas in fact purchased the shares of stock in Sterling Holding on his own behalf and not on behalf of Mr. Bavelis, then Mr. Doukas personally has a claim against Mr. Bavelis under Florida state law regulating the sale of securities.
Mr. Bavelis takes the position that he owes nothing to Mr. Doukas or his companies. According to Mr. Bavelis, Mr. Dou-kas took advantage of, among other things, their shared Greek heritage; the close friendship that quickly developed between Mr. Doukas and Mr. Bavelis and his wife, Georgia Gia Bavelis (“Mrs. Bavelis”), after they first met Mr. Doukas in early 2009; Mr. Bavelis’s need to complete his estate planning; and the desire on Mr. Bavelis’s part to save the failing Sterling Bank and to extricate himself from the strained business relationship with Mr. Qureshi.
Based on the documentary evidence and the testimony of multiple witnesses, the Court concludes that the Proofs of Claim must be disallowed and that neither Mr. Doukas nor any of his companies has a claim against Mr. Bavelis or his bankruptcy estate. First, Mr. Bavelis repaid the funds that Nemesis advanced to him. Second, neither Mr. Doukas nor any of his companies provided the other consideration allegedly supporting the QC Loan Documents. In this regard, the Court finds that Mr. Doukas purchased shares in Sterling Holding on his own behalf, not on behalf of Mr. Bavelis; that the assets that Mr. Doukas purportedly made available to restructure Mr. Bavelis’s financial situation and/or to purchase nonperforming loans of Sterling Bank were never effectively used for that purpose; and that neither Mr. Doukas nor his companies ever provided consulting, management or estate planning services of any value, but instead perpetrated a scheme designed to deprive Mr. Bavelis of substantially all of his assets. In fact, Mr. Doukas made several representations that fraudulently induced Mr. Bavelis to sign the QC Loan Documents. Finally, the argument that Mr. Doukas personally has a claim against Mr. Bavelis based on Mr. Doukas’s purchase of stock in Sterling Holding is without merit.
This opinion constitutes the Court’s findings of fact and conclusions of law pursuant to Federal Rule of Bankruptcy Procedure 7052. To the extent any of the Court’s findings of fact are determined to be conclusions of law, they are adopted as such; likewise, to the extent any of the Court’s conclusions of law are determined to be findings of fact, they are adopted as such.
II. Jurisdiction
The Court has jurisdiction to hear and determine this matter pursuant to 28 U.S.C. §§ 157 and 1334 and the general order of reference entered in this district. This is a core proceeding. See 28 U.S.C. § 157 (b)(2)(B).
III. Findings of Fact
Based on the evidence adduced at trial, 1 including the documentary evidence and *266 the testimony presented, and having considered the demeanor and credibility of the witnesses, the Court makes the findings of fact set forth below.
A. Events Occurring Before the Execution of the QC Loan Documents
1. Mr. Bavelis’s Real Estate and Banking Businesses
This is the story of how Mr. Bavelis came to trust Mr. Doukas enough to issue one of his companies a multimillion dollar promissory note and how Mr. Doukas later took advantage of that trust. It is difficult to understand why Mr. Bavelis allowed himself to become so closely involved with Mr. Doukas without knowing something of Mr. Bavelis’s .background before the two men met. Mr. Bavelis was born in Greece in 1937 and emigrated to the United States in 1958. Tr. at 451-52. After obtaining a scholarship and earning a degree from the University of Arkansas in mechanical engineering, he began working as an engineer in Arkansas. Tr. at 452-53. He and Mrs. Bavelis (who also was born in Greece) married in 1964 and moved in 1969 to Columbus, Ohio, where Mr. Bavelis continued his work as an engineer. Tr. at 380; 453. In 1971, he began subleasing rental properties and thereafter purchased apartment buildings to lease. Tr. at 453-54; 493. In 1973, he became a real estate broker. Tr. at 454.
By sometime in 1975, Mr. Bavelis no longer worked as an engineer, but instead was engaged full time in the real estate business. Tr. at 454. He organized Pella Company, a Columbus real estate investment and management company, Debtor’s Ex. 118 at 6, and over the years formed more than 30 real estate investment partnerships operating in Columbus (“Ohio Partnerships”). Tr. at 454-55. Mr. Ba-velis personally guaranteed the mortgage debt incurred by the Ohio Partnerships. Tr. at 465-66.
In 1996, Mr. Bavelis and other investors acquired Sterling Bank. Tr. at 226-27; 456; Debtor’s Ex. 118, Confidential Memorandum Summary at 1. A federally-chartered savings bank, Sterling Bank converted into a commercial bank chartered by the State of Florida in 2004. Debtor’s Ex. 118 at 1. Mr. Bavelis was a director of Sterling Bank and also was the chairman of the board, chief executive officer and president of its parent, Sterling Holding. Debtor’s Ex. 118 at 6. At one point, Mr. Bavelis and members of the Bavelis family, directly and through trusts, owned somewhere between 52-55% of Sterling Holding. Tr. at 177; 458.
2. The Debtor’s Relationship with Mr. Qureshi
In the early 2000s, a Sterling Bank lending officer suggested that Mr. Bavelis meet Mr. Qureshi, a customer of Sterling Bank, because Mr. Bavelis owned interests in six or seven gas stations, and Mr. Qure-shi held interests in over 100 gas stations. Tr. at 458-59. The meeting went well, and the two men decided to go into business together. Tr. at 459. As Mr. Bavelis put it, “[Mr. Qureshi] came to my office and we met and we talked about what he was doing and what I was doing in the gas stations.” Tr. at 459:11-13. “And we hit it [off] pretty well there, I thought he was a very nice guy and we kept talking and at some point we said, ‘Why don’t we just buy some gas stations together, invest some money together.’ And we decided to get into the partnerships.” Tr. at 459:13-18. From 2004 to 2007, Mr. Bavelis and Mr. Qureshi worked together to form limited *267 liability companies for the purpose of investing in not only gas stations, but also office buildings and mixed-use real estate developments.
The result was an alphabet soup of companies. First, there was FLOMAQ, LLC (“FLOMAQ”), which was owned 50% by FLOHIO, LLC (“FLOHIO”), an Ohio limited liability company in which Mr. Bavelis had an indirect interest, and 50% by MAQ Management, Inc. (“MAQ Management”), named with the initials of its president, Mr. Qureshi. Tr. at 459-60. The successor in interest to FLOMAQ was FLOVEST, LLC (“FLOVEST”), formed in 2004 by equal members MAQ Management and FLOHIO. Tr. 461; Debtor’s Ex. 14. The members of FLOHIO were Bavelis Family, LLC (“Bavelis Family”), Yessios Limited Partnership and Vakaleris Family Limited Partnership, with each owning one-third of FLOHIO. The Bavelises’ three daughters each owned 30% of Bavelis Family, with Mr. Bavelis and Mrs. Bavelis each owning 5%. Mr. Bavelis was the manager of FLOHIO. Tr. at 460.
After FLOVEST came BMAQ, LLC (“BMAQ”), formed in 2005 by equal members Bavelis Family and Qureshi Family, LLC (“Qureshi Family”), of which Mr. Qureshi was a manager. Debtor’s Ex. 15; Tr. at 461. Next there was GMAQ, LLC (“GMAQ”), formed in 2006 by equal members Mr. Bavelis and Mr. Qureshi. Debt- or’s Ex. 16; Tr. at 461. Finally, George Real Estate Holdings, LLC (“George Real Estate”) was formed. Tr. at 461-62. The original members of George Real Estate were Mr. Bavelis and an individual affiliated with Mr. Qureshi. However, an unsigned, amended and restated operating agreement submitted by the parties suggests that GMAQ later became the sole member of George Real Estate. Debtor’s Ex. 17. The limited liability companies formed by Mr. Bavelis and Mr. Qureshi will be collectively referred to as the “Ba-velis-Qureshi LLCs.”
FLOVEST eventually became the owner of several properties, including a gas station in Indiana, a truck stop in Ohio and an office building and several parcels of land in Florida. It also began developing a shopping center in Lake Mary, Florida that the parties referred to as the “Lake Mary Project.” Tr. at 463. BMAQ acquired four gas stations as well as land in Florida and Georgia. Tr. at 462-63. In order to finance these projects, Mr. Bavel-is and Mr. Qureshi caused FLOVEST and BMAQ to obtain loans from various lenders, Tr. at 463-64, including Fifth Third Bank (“Fifth Third”), First Southern Bank (“First Southern”), Colonial Bank, N.A. (“Colonial Bank”) and Heartland Bank. The aggregate principal amount of the debt owed by FLOVEST and BMAQ to those banks was approximately $21 million. Of this amount, the vast majority (more than $18 million) was the debt of FLO-VEST.
Mr. Bavelis personally guaranteed (or otherwise had personal liability on) all of this debt, Debtor’s Exs. 19-26, 2 Tr. at 464-65, and Mr. Qureshi personally guaranteed at least some of it. Debtor’s Exs. 23, 26. GMAQ had no bank debt, so Mr. Bavelis had no guarantee obligations with respect to that company. Tr. at 462. Likewise, there is no evidence that Mr. Bavelis guaranteed any debt of George Real Estate or that it had any debt.
The relationship between Mr. Bavelis and Mr. Qureshi was good for several years, but it began to deteriorate after Mr. Bavelis came to believe that Mr. Qureshi and MAQ Management were not providing *268 a sufficient share of the funds to service the debt of BMAQ and FLOVEST. Tr. at 467-68. 3 In order to service that debt, Mr. Bavelis borrowed money from FLOHIO and Pella Company. Tr. at 467-68; 472.
3. The Debtor’s Relationship with Mr. Doukas
Mr. Bavelis was about to meet a different sort of businessman in Mr. Doukas. According to a biography he provided to Mr. Bavelis, Mr. Doukas was born in Greece and was educated in medicine at the University of Pisa in Italy and in business at the New York Institute of Technology. He began, the bio stated, his “investment career” in Long Island, New York, leading to a self-proclaimed “very successful career as a financier and real estate developer.” Debtor’s Ex. 46 at GB 000790. Mr. Doukas’s business, by his own account, was “creatfing] a leverage that you can negotiate so it will make money-” Tr. at 843:22-23. “I buy things ... that are dead.... ” Tr. at 843:23-24. “[T]hese days they call me undertaker because I buy things that are finished, they don’t have any life and I’m trying to bring life out of it.” Tr. at 843:24-25-844:1-2. Consistent with that approach, in October 2008, a company that Mr. Doukas owned — Blair International, Inc., a Nevada corporation (“Blair”) — took quitclaim deeds to over 50 parcels of real property located in Fort Lauderdale, Florida. The grantor was a company (“Glenn Wright Co.”) operated by Glenn Wright (“Mr. Wright”), a Fort Lauderdale home builder. Debtor’s Ex. 46 at GB 000791; Tr. at 841; 912. Sterling Bank held mortgages on seven of the parcels securing loans it had made to Glenn Wright Co. for the construction of single-family homes. Tr. at 913. At the time Glenn Wright Co. delivered the deeds to Blair, the loans from Sterling Bank were in default, Tr. at 643-44; 842, and Mr. Doukas was aware that the properties were subject to Sterling Bank’s liens. Tr. at 297. In addition, the homes on the lots were uncompleted, with buyers ready, willing and able to purchase at least some of the homes upon completion. Tr. at 231-32; 247-48.
Mr. Wright informed Sterling Bank of the transfers to Mr. Doukas, who was then contacted by representatives of the bank. Tr. at 644-45. It would soon become apparent to those representatives that Mr. Doukas’s goal was to receive payment in exchange for deeds in lieu of foreclosure. Tr. at 843. Mr. Doukas’s description of the negotiations with those representatives — including David Albright (“Mr. Al-bright”), the president and chief executive officer of Sterling Bank — is revealing with respect to Mr. Doukas’s thought process at the time:
[T]hey were trying to negotiate with me. So at that point they had, the bank had two loans that they had to close by December 31 st, the same year, 2008. And what happened, these loans were very substantial, there was about 1.5 million dollars every loan, about that number. And what will happen is the bank will have a big problem because if they were not closing these loans was the end of the fourth quarter and then they will have to put the capital into the, into the bank because for reserves, because that loan was in default. So there were two buyers previously and this was a very unique thing, that had already signed a contract with a higher price. Now if they would lose these two buy *269 ers, the new buyer would never even touch these two houses, they will be empty forever. And that was the big thing that was going down with the bank, they were trying to negotiate with me.
So they came to the office and I told them, listen, I will work with you but, you know, I have to get paid and I have, you know, what is for me because I didn’t do this for nothing, so what is for me, what am I going to get? So we argue and we’re going back and forth and we didn’t have very good, a very good meeting. As a matter of fact I told them I would not make any deal. I’m done.
So they were very desperate and then they called me again and I hung up on them. I said, “Listen, I’m not going to do any deal with you guys if you’re not reasonable and what you’re going to give me as a bank and to go and sign the deeds back to you, whatever, cooperate with you so you don’t lose the two buyers.
Tr. at 842:12-843:19.
Mr. Bavelis was not involved in the negotiations on behalf of Sterling Bank at that point. Because the negotiations were not going well, and because Mr. Bavelis was, like Mr. Doukas, of Greek descent, Mr. Albright contacted Mr. Bavelis in November 2008 to inquire if he knew Mr. Doukas. Tr. at 642. Mr. Bavelis did not know him, Tr. at 473, and was reluctant to become involved due to other pressing matters, including the terminal illness of his brother. Tr. at 474. Mr. Albright persisted, Tr. at 645, and Mr. Bavelis ultimately agreed to help. As Mr. Bavelis describes it:
And in fact [Mr. Albright] told me that he and ... another employee ... apparently went to his office and then he, Ted Doukas was very belligerent with them. He, I guess he cussed them out and all this kind of things. And I said, “David, please I have so many other things” and that was a time when my brother was very sick and unfortunately passed away the 23 of December of 2008. And I just said, “Please, work things out. I just don’t have the time.” But then he proceeded to call me again and I said, “Okay, I’ll call him.” So I called Ted Doukas on the phone and I talked to him and I told him that “I understand there were some problems here, what, what can we do to resolve, Ted?” And he said, “Are you a Greek?” I said, “Yes, I’m a Greek.” “I’m a Greek, too.” I said, “Well, great.” So we spoke for a while and we hit it [off] very well. I was really very happy that we got somebody to finally communicate and hopefully the bank resolve some problems.
Tr. at 474:9-475:2.
Thomas A. Vogel (“Mr. Vogel”), a director of Sterling Bank and Sterling Holding, Tr. at 230, held a dim view of Mr. Doukas’s involvement with the properties. According to Mr. Vogel, Mr. Doukas made the process more difficult for Sterling Bank:
[W]e didn’t have control, Glenn Wright Construction is out of town, Glenn Wright takes off and we’re dealing with Mr. Doukas. So we struggled our way, the plans all of a sudden [were] missing, permits we couldn’t find. We brought in a contractor as the bank to try and just finish them up. We started dealing with the owners or the prospective owners of the homes to get them enough done to where we could get them closed. And it was a very difficult process.
*270 We had to discount the prices. And we got out of them but it was a loss.
Tr. at 233:9-234:2.
Mr. Bavelis testified that he was advised at some point that “because of the delays while [Mr. Doukas] was the owner of Blair International^] the bank had to concede to the buyers.” Tr. at 650:22-24. “And instead of the buyer having to do certain improvements, the bank accepted the responsibility to do it and pay for it so that they can close the loans before the end of the year.” Tr. at 650:25-651:3. At the time, however, Mr. Bavelis did not share Mr. Vogel’s views of Mr. Doukas’s involvement. “It was very important for the bank to close the two loans,” Mr. Bavelis testified. “[I]t was the 30th or 31st of December and [Mr. Doukas] was available on the phone. I think he was in Naples at the time to assist the bank in signing whatever paperwork was necessary to close those two loans.” Tr. at 649:25-650:4. From Mr. Bavelis’s perspective, Mr. Doukas, “[o]nce he found out that I was a Greek and we talked a little bit about background then he was cooperative with David Albright to close the loan.” Tr. at 650:8-11. As distasteful as Mr. Dou-kas’s involvement was to Mr. Albright and Mr. Vogel, Mr. Doukas’s decision to cooperate after Mr. Bavelis became involved was a springboard for a relationship of trust and confidence that developed between Mr. Bavelis and Mr. Doukas.
A close relationship rapidly formed between Mr. Bavelis and Mr. Doukas. After speaking on the telephone just the month before, they met in person for the first time in early January 2009 during a dinner at which they “talked about [their] heritage, about [their] life in Greece and so on....” Tr. at 478:15-17. By February 2009, Mr. Bavelis considered Mr. Doukas to be a very good friend. Tr. at 478-80. And Mr. Doukas began referring to Mr. Bavelis — whose own brother had died in December 2008 — as his “brother.” Tr. at 391-92; 492-93. As Mr. Bavelis testified, “I just lost my brother and I find another brother.” Tr. at 492:25-26. In the supposed fraternity that formed between the two men, Mr. Bavelis would have been the elder of the two. Mr. Doukas’s bio stated that he had restructured companies “throughout the past 25 years,” Debtor’s Ex. 46 at GB 000791, a time line that likely would place him in his mid-50s, and he appears to be a decade or two younger than Mr. Bavelis, who is in his mid-70s.
Mr. Bavelis had known Mr. Vogel long before he knew Mr. Doukas. In fact, Mr. Vogel had known Mr. Bavelis since the mid-1990s, considered him a friend, Tr. at 227, 230, had “never seen George ever do anything inappropriate,” Tr. at 230:5-6, and believed him to be “extremely truthful.” Tr. at 230:19. When Mr. Vogel raised his concerns about Mr. Doukas, stating to the effect that Mr. Doukas was “going to be a problem,” Tr. at 239:2-3, “Mr. Bavelis was very much kind of adamant that he was, he used the word brother and a friend [with respect to Mr. Dou-kas] and it was that he was going to help us and it was going to be good.” Tr. at 239:14-17. . Mr. Bavelis’s views in this regard were confirmed by Richard Moyle Fritz, Jr., the chief financial officer of Sterling Bank and Sterling Holding, Tr. at 143, who testified that Mr. Bavelis placed “great value [on Mr. Doukas’s] being Greek and, you know, he was very trusting.” Tr. at 171:21-22. “He said trust him like a brother. And put great value and emphasis on the fact of they both being [of] Greek ... heritage.” Tr. at 171:22-25.
Whether or not Mr. Doukas initially shared Mr. Bavelis’s feelings, he acted as though he did and even referenced their friendship when writing to Mr. Bavelis in *271 business-related emails. For example, when corresponding with Mr. Bavelis about five other lots that Glenn Wright Co. had quitclaimed to Blair and on which Sterling Bank held mortgages securing notes that were in default, Tr. at 477; 651-52, Mr. Doukas sent Mr. Bavelis an email on February 12, 2009 stating as follows: “i didn’t forgot about the houses that we have to finish. I have already 3 or 4 bids and we will take the best one that we can save you money, i want you to minimize your loses and i am doing this became we are friends for life.” Debtor’s Ex. 44 at GB 000834 (emphasis added). 4
An apparent friendship also developed between Mr. Doukas and Mrs. Bavelis. The first time she met Mr. Doukas was sometime in late February or early March 2009, when the Bavelises had dinner with Mr. Doukas at the Greek Islands restaurant in Fort Lauderdale, Florida. Tr. at 384-88; 482. As Mrs. Bavelis testified, Mr. Doukas divulged personal information about his ex-wife and children during the dinner conversation:
[W]e connected very, very fast because [Mr. Doukas] just told us everything about himself and about his family, about his divorce.
He told me how horrible his wife was. How horrible his daughters were. They took everything from him. He told me the whole night he was going on and on about his personal life, about his home, about his — how he lived with his wife all these years and how bad she was. And his daughters were calling him names and I thought ... how can a child do this to the father. And I, I just felt terrible for him.
Tr. at 385:6-27. The Bavelises, who maintained homes in Columbus, Ohio and Boca Raton, Florida, would see Mr. Doukas frequently during their time in Florida, with Mr. Doukas often coming to their home for dinner. Tr. at 388. During the summer of 2009, Mr. Doukas, who had a residence on the Gulf Coast of Florida, Tr. at 848-49, would sometimes stay in another condominium the Bavelises owned in the same building in which they lived in Boca Raton (which is on Florida’s Atlantic coast), so that Mr. Doukas would not have to travel so frequently back and forth between the east and west coasts of Florida. Tr. at 410; 848^9.
During these visits, in addition to sharing intimate details about his ex-wife and children, Mr. Doukas endeared himself to the Bavelises in other ways. He told them that he had helped his family in Greece financially, as Mr. Bavelis had helped his family. Tr. at 389. He led them to believe that he shared the Bavelises’ religious beliefs, that he was a member of a Greek Orthodox church and participated regularly in its services. Tr. at 389-90. 5 He presented them with a religious icon that he said was from Greece. Tr. at 390. Mr. Doukas told Mrs. Bavelis that the purpose of this icon was to “protect your house and to bless you.” Tr. at 390:1-2. “And that made me feel even more comfortable about him,” Mrs. Bavelis said. Tr. at 390:2-3. “I kept telling George, *272 look at this man, I mean he is such a good man, how can he, how can his wife and his family do all of these things to him.” Tr. at 390:4-6.
By the spring of 2009, Mr. Bavelis was “working around the clock,” Tr. at 479:16-17, and was taking prescription medication to alleviate anxiety. Tr. at 383. Mr. Ba-velis and Mr. Doukas would discuss the causes of Mr. Bavelis’s stress, including, among other things, the “problems with Qureshi.” Tr. at 388:13-14. Mr. Doukas promised Mr. Bavelis that he would negotiate with Mr. Qureshi in an attempt to resolve those problems in a manner favorable to Mr. Bavelis. Tr. at 393, 482-83. Mr. Doukas also made similar representations to Mrs. Bavelis. In so doing, Mr. Doukas referenced the fraternity he purportedly felt with Mr. Bavelis when he told Mrs. Bavelis that “the only reason he’s doing this [is] to help George ... because he’s his brother.... ” Tr. at 396:7-8. Mr. Doukas also advised Mrs. Bavelis that he was not seeking remuneration in exchange for his services. “He told me a couple of times, ‘Did I ever ask for anything? Did I ever ask for money? I don’t want anything. I just want to help George because I cannot see him stressing so much. He’s going to get sick.’ ” Tr. at 396:16-20. “[H]e told me that he was retired and the only reason he’s doing this to help George is because he’s his brother and he wants to help him to take care of Qureshi’s business,” Tr. at 396:6-9, and that Mr. Doukas “doesn’t have to work, he doesn’t need the money. He has money, he doesn’t have to work.” Tr. at 396:9-11. These conversations typically would occur while Mr. Ba-velis was working at his computer, with Mrs. Bavelis and Mr. Doukas sitting nearby. Tr. at 393.
The conversations would sometimes take on a more ominous tone. Mr. Doukas even advised Mrs. Bavelis “at one point that [Mr. Qureshi is] around bad people and he can have someone kill George.” Tr. at 397:5-6. Of course, she “was really shaken by that.” Tr. at 397:6. “But then he just calm me down somehow.” Tr. at 397:6-7. “He told us that he [Mr. Doukas] was working with the FBI.... ” Tr. at 397:10-11. “And he told us, you know, all these things. ‘I’m going to get Qureshi, he cannot get away. He’s doing all these bad things and he’s trying to ruin you. And I’m going to take care of all these problems.’ ” Tr. at 397:16-20. Not only did Mr. Doukas make these statements, Mrs. Ba-velis believed them. Tr. at 397-98. There is no evidence, however, that any of the things Mr. Doukas told the Bavelises about Mr. Qureshi were even remotely true.
At that point, the friendship between Mr. Bavelis and Mr. Doukas was based on several factors, including their common Greek heritage; their mutual entrustment of details about their personal lives and businesses; values they ostensibly held in common; and Mr. Bavelis’s belief that Mr. Doukas had only his best interests at heart. In March 2009, Mr. Doukas informed Mr. Bavelis that, in order to advance those interests, he would need a 10% stake in GMAQ so as to be in a better position to negotiate with Mr. Qureshi. Tr. at 487. Mr. Bavelis, who by then had introduced Mr. Doukas to Mr. Qureshi, Debtor’s Ex. 173 at 5:23, agreed. On March 27, 2009, Mr. Bavelis (as a member of GMAQ), Mr. Doukas (on behalf of Blair) and Mr. Qureshi (as a member of GMAQ) signed an agreement entitled “GMAQ, LLC, Members, Transferor’s and Transferee’s Consent and Approval of Transfer of Ownership” (“March Agreement”). Debtor’s Ex. 130. By that agreement, Mr. Bavelis transferred to Blair 10% of his membership interest in GMAQ, with Mr. Qureshi consenting to the transfer. Mr. Doukas promised Mr. Bavelis that, as soon *273 as a resolution was reached with Mr. Qure-shi, he would return the March Agreement and reconvey the 10% interest back to Mr. Bavelis. Tr. at 490. Mrs. Bavelis confirmed that Mr. Doukas so advised her husband. Tr. at 430:11-27 (“We didn’t question Ted, we trusted Ted Doukas. He told us, he told George he was going to bring the 10% back.... It was given to him so he can negotiate with Qureshi and as soon as he did that he would give this 10% back. I didn’t think anything of it.”).
In addition to talking about the problems with the Bavelis-Qureshi LLCs, Mr. Bavelis and Mr. Doukas discussed the banking business. Mr. Bavelis asked Mr. Doukas if he would be interested in purchasing shares in Sterling Holding, and Mr. Doukas said that he would purchase shares. Tr. at 485. Consistent with that representation, in March 2009, Mr. Doukas paid over $200,000 to purchase 1,200 shares of stock in Sterling Holding. Tr. at 204; 485; 603-04; 848. This appeared to have further deepened Mr. Bavelis’s trust in Mr. Doukas. On March 27, 2009, Mr. Bavelis sent a letter to Mr. Doukas enclosing a stock certifícate for those shares. Debtor’s Ex. 119 at BAV 00256.
The two men also discussed the idea of Mr. Doukas depositing funds in Sterling Bank. After Mr. Doukas advised Mr. Ba-velis “that he had a lot of money in New York[,]” Tr. at 492:5, Mr. Bavelis suggested that Mr. Doukas begin depositing money in Sterling Bank. And I said, “Ted, why don’t you move it? You move down here to Florida, why don’t you move your money here?” He said, “Yeah, George, I will do that.” Tr. at 492:6-8. On April 24, 2009, Mr. Doukas sent Mr. Bavelis an email attaching a letter from New York Commercial Bank (“NYCB”) stating that Mr. Doukas had been banking with NYCB since February 15, 2000, identifying four accounts that Mr. Doukas maintained at NYCB and stating that he “maintains the highest level of trust with New York Commercial Bank.” Debtor’s Ex. 45 at GB 000817. That same day, Mr. Bavelis forwarded the NYCB letter to Regina Water-house, the chief retail banking officer of Sterling Bank, asking her to “help in opening the [accounts] that Ted needs so that he can transfer his money into Sterling Bank[,]” and to “keep in mind that Ted is a very close friend of mine and a substantial shareholder.” Debtor’s Ex. 45 at GB 000814. Ms. Waterhouse began working to help Mr. Doukas open the accounts. Debtor’s Ex. 50 at GB 000709.
On April 24, 2009, Mr. Doukas emailed Mr. Bavelis a biography and a list of selected accomplishments. That biography painted a picture consistent with the independently wealthy individual Mr. Doukas previously had portrayed to the Bavelises. Among other things, the list of selected accomplishments stated that Mr. Doukas was the “[o]wner of approximately $30,000,000 of private stock....” Debtor’s Ex. 46 at GB 000791.
Meanwhile, with respect to the Bavelis-Qureshi LLCs, FLOVEST was the most pressing problem. Among the properties it owned, only two of them — the office building and the gas station — were producing income, meaning that it was becoming increasingly difficult for FLOVEST to make its mortgage payments. With an outstanding balance in excess of $10 million, the loan for the Lake Mary Project matured, and in May 2009 Colonial Bank notified FLOVEST that it would not renew the loan. Tr. at 468-71. Colonial Bank eventually initiated foreclosure proceedings and sought the appointment of a receiver for FLOVEST. Tr. at 472. Sometime in the second quarter of 2009, before the execution of the QC Note, conversations occurred in which Mr. Doukas promised Mr. Bavelis that he would ac *274 quire certain debt that Mr. Bavelis had guaranteed — including the $3.7 million debt held by First Southern and the more than $10 million debt held by Colonial Bank with respect to the Lake Mary Project. Mr. Doukas advised Mr. Bavelis that this would help alleviate Mr. Bavelis’s stress arising from his dealings with the banks. Tr. at 500-02.
At that time, Sterling Bank and Sterling Holding, like Mr. Bavelis, were having financial difficulty. Tr. at 143^49; 174-75. At least part of Sterling Bank’s problems stemmed from nonperforming loans resulting from the distressed economy and depressed real estate values in Florida. Tr. at 144-45; 187. Sometime before October 2008, state and federal regulators had recommended that Sterling Bank improve the quality of its assets. Tr. at 172-75. In June 2009, Sterling Holding would be required by the regulators to raise additional capital, Tr. at 145-46, and by August 2009 the board of directors of Sterling Holding would approve a plan to raise $12.6 million of capital. Tr. at 149-50. Aware of Sterling Bank’s financial problems, in May 2009, Mr. Doukas promised Mr. Bavelis that he would assist Sterling Bank by purchasing certain of its nonperforming loans. Tr. at 504-05; 510; 890-92. In the biography he had presented Mr. Bavelis, Mr. Doukas had noted his “ability to negotiate and restructure large debts.” Debtor’s Ex. 46 at GB 000790.
At least as early as May 2009, Mr. Ba-velis and Mr. Doukas had conversations in which they broached the idea of Mr. Dou-kas becoming a substantial investor in Sterling Holding. Tr. at 507. As Mr. Bavelis put it: “[Mr. Doukas] got very interested in the banking business and ... at some point we talked about the two of us owning the majority of the bank. And he was willing to invest a lot of money in the bank. He said he had a lot of money and he was willing to invest it.” Tr. at 507:21-26. Mr. Bavelis cautioned Mr. Doukas in this regard:
I talked to him all along where we stood with the bank and that we had to raise capital and we had to raise 12 million dollars in capital by June 2010. And we talked about this very specifically and I said, “We either invest the 12 million dollars or we don’t invest any money at all because we’re going to lose it.” And he said, “George, don’t worry about it. I have enough money of my own and I have enough friends and I have enough contacts, don’t worry about it. I’ll take care of that, I’ll find the money.
Tr. at 508:18-509:1. Mrs. Bavelis also expressed concern about Mr. Doukas purchasing the stock, telling him that she did not “want anything to happen to [his] money.” Tr. at 408:3. In response, Mr. Dou-kas told her that he was going to purchase more stock on his own behalf and allayed her concerns by saying: “Don’t worry, don’t worry, everything is okay. I take my chances and I always win.” Tr. at 408:4-5. Sometime in May 2009, Mr. Dou-kas advised Mr. Bavelis that he might make additional stock purchases in Sterling Holding of $3 million. Tr. at 680-81.
In a move that enhanced Mr. Bavelis’s trust and confidence in his friend, Mr. Doukas caused $2 million to be deposited into accounts maintained at Sterling Bank. Tr. at 131; 676; 944; 951-55. In particular, on May 22, 2009, Nemesis deposited two cheeks — one in the amount of $270,000 and another in the amount of $1,730,000, for a total amount of $2 million — into accounts maintained at Sterling Bank. Debt- or’s Ex. 98 at IB/DOU 00072; IB/DOU 00074. Those amounts came from Mr. Doukas’s divorce proceeding. Tr. at 944. With those amounts already deposited, Mr. Doukas promised Mr. Bavelis that he would deposit an additional $80,000 to *275 $120,000 every month in Sterling Bank from income that he or his companies received. Tr. at 1058-59. Based on these representations regarding the purchase of stock and the deposits in Sterling Bank, on May 23, 2009, Mr. Bavelis sent Mr. Al-bright an email in which he stated:
I have Ted’s tax returns in the # 1 fire proof drawer
When you talk to Ted please talk to him as a Mend of the bank, a very good Mend of mine and a prospective investor in the bank of three million dollars. Without Ted’s investment it will be very difficult for us to raise the required capital. As you are well aware he has deposited in the bank about two million dollars and he will be depositing his receivable rent checks of 80-120 thousand dollars a month in our bank.
Debtor’s Ex. 56 at GB 000656. As this email shows, Mr. Bavelis had obtained Mr. Doukas’s tax returns for Mr. Albright to review. Before leaving them in the drawer for Mr. Albright, Mr. Bavelis did not review the tax returns. Tr. at 679-80.
In May 2009, Sterling Bank was still attempting to sell five of the lots that Glenn Wright Co. had quitclaimed to Blair in October 2008. At the time Blair received the quitclaim deeds, Mr. Doukas knew the five lots were subject to Sterling Bank’s liens. Tr. at 297. Mr. Doukas ultimately placed deeds to the five lots in escrow while Sterling Bank worked to finish the homes by using another contractor. Tr. at 251-52. According to Mr. Vogel, “the homes took twice as long as it would have taken ... if [they were not] quit claimed out.” Tr. 252:24-25. 6 Mr. Doukas’s approach to the deal, though, did not harm the relationship between Mr. Bavelis and Mr. Doukas, who previously had told Mr. Bavelis that he was handling the transaction in the manner he was “because we are friends for life.” Debtor’s Ex. 44 at GB 000834.
Mr. Bavelis not only thought of Mr. Doukas as a close friend and brother, he also considered him a trusted business ad-visor. With respect to one real estate project in Florida, in May 2009, Mr. Bavel-is sent an email to another man stating that Mr. Doukas was his “special friend and partner” and requested that the man speak to Mr. Doukas to hear Mr. Doukas’s “strategy he plans for us to succeed.” Debtor’s Ex. 51 at GB 000707. Also in May 2009, Mr. Bavelis advised Mr. Al-bright that “the time has come that you need to utilize Ted’s help to try to clear up as [many] of these [nonperforming] loans ASAP.” Debtor’s Ex. 52 at GB 000704. With respect to other transactions, Mr. Doukas was advising Mr. Bavelis that “I know I can handle it this is my cup of tea” and “these are the kind of deals I work all day.” Debtor’s Ex. 55 at GB 000675. An email that Mr. Bavelis sent to an attorney involved with Sterling Bank litigation in early July 2009 is indicative of how Mr. Bavelis viewed Mr. Doukas’s role in June 2009. In that email, Mr. Bavelis referred to Mr. Doukas as “a friend and advisor of mine” and requested that the attorney speak to Mr. Doukas so that “he can understand the case.” Debtor’s Ex. 58 at GB 000039.
Mr. Doukas had led Mr. Bavelis to believe that he was negotiating with Mr. Qureshi to resolve the disputes over the Bavelis-Qureshi LLCs in a manner favorable to Mr. Bavelis, but that his negotiations had failed to reach such a resolution because Mr. Qureshi “was not taking [Mr. Doukas] seriously,” Tr. at 707:6-7, and that he therefore needed more authority to negotiate with Mr. Qureshi. Tr. at 568; *276 706-07. On or about June 21, 2009, Mr. Doukas presented Mr. Bavelis with an agreement (“R.P.M. Agreement”) by which Mr. Bavelis would, in return for $50,000, transfer his “50% interest in GMAQ” to R.P.M. Recoveries, Inc. (“R.P.M.”), a New York corporation of which Mr. Doukas was president. Debtor’s Ex. 131. 7 When he signed the R.P.M. Agreement, Mr. Bavelis believed that he was giving “him a larger percentage so that [Mr. Doukas] can be able to be more effective.” Tr. at 707:7-9. Mr. Bavelis’s understanding when he signed the R.P.M. Agreement was that the agreement was temporary and would be “coming right back to me.... ” Tr. at 717:13. By signing such an agreement with the understanding that it would be returned to him, Mr. Bavelis demonstrated a high level of confidence in Mr. Doukas. According to Mr. Bavelis, at that time “I had already established a trust in Ted Doukas that we became very good friends and I would listen to him because he offered so many things that he was going to do for me.” Tr. at 667:4-8. “He’s going to help me in many respects. And I had no doubts about it at that time.” Tr. at 667:8-9. “[H]e was my brother at the time. We had such a close relationship that I trusted Ted for anything he told me.” Tr. at 685:23-686:1. As Mrs. Bavel-is put it, “George and I had come to a point where anything he said we trusted him.” Tr. at 391:20-21. Although Mr. Bavelis knew that Mr. Doukas — at least from the perspective of Mr. Albright and Mr. Vogel — had the potential to be a difficult person with whom to transact business, Mr. Doukas had not given Mr. Bavel-is any reason not to trust him. In fact, by June 2009, Mr. Doukas had done two things he had told Mr. Bavelis that he would do — purchase approximately $200,000 of stock in Sterling Holding and deposit $2 million in Sterling Bank.
B. The QC Loan Documents
1. Representations Prior to Their Execution
In June 2009, Mr. Bavelis firmly believed that Mr. Doukas was on his side and considered him a friend and brother in whom he could place the utmost confidence and trust. In fact, Mr. Bavelis trusted Mr. Doukas enough to sign and deliver a multimillion dollar promissory note — the QC Note — and the QC Loan Agreement and QC Security Agreement even though Quick Capital was lending Mr. Bavelis no funds.
Before Mr. Bavelis signed and delivered the QC Loan Documents, Mr. Doukas had promised that he would deposit $80,000 to $120,000 a month in Sterling Bank (in addition to the $2 million that he had deposited from his divorce). As Mr. Bavelis testified, this promise induced him to sign the QC Loan Documents. Tr. at 1059-60. Mr. Doukas’s other promises — that he would work on Mr. Bavelis’s behalf to resolve the issues with Mr. Qureshi and that he would purchase nonperforming Sterling Bank loans as well as the Colonial Bank and First Southern loans guaranteed by Mr. Bavelis — factored into the inducement as well. Tr. at 736.
Mr. Doukas also promised Mr. Bavelis that he would help finalize Mr. Bavelis’s estate planning. As Mr. Bavelis testified:
[Mr. Doukas] was going to plan my estate.... [H]e needed about three to four months to try to help me to plan my estate. I had told him before ... *277 that I have a trust but I have not funded it with any money. And he said, “George, I have done this before and I can help you with this thing.” I said, “Yes, fine, Ted. I will need some help because I did my trust about six, seven years ago and I don’t have, I mean I have not done the second or third part because there were two more parts to do that.” ... And then he said, “I can help you with this, I have done it.” Not as a lawyer but as an individual to tell me what to do and how to put assets into this company, into this trust.
Tr. at 582:26-583:13. See also Tr. at 698:2-4 (“[H]e said he had a lot of experience about that and he’s going to help me to plan my estate and finish up what needed to be done.”). Because Mr. Doukas was not an estate planning attorney or other estate planning professional, the clear implication was that, at a minimum, Mr. Doukas had planned his own estate in the manner he was suggesting for Mr. Bavelis.
In addition to discussing estate planning generally, Mr. Doukas was specific, telling Mr. Bavelis that “it was going to be for the future, for my grandkids and my great-grandkids, I would form this perpetuity, perpetual something, I can keep my assets and not have to be planned from thereon. It was going to be done once and forever and he was going to help me do all those things.” Tr. at 785:9-15. As Mr. Bavelis testified, the George A. Bavelis Trust (“Trust”) was not funded “with any money,” Tr. at 583:3, only with shares of stock of Sterling Holding. Tr. at 698-99.
Given Mr. Bavelis’s awareness that Mr. Doukas was not an estate planning attorney or other estate planning professional, the idea that Mr. Bavelis would turn to Mr. Doukas for assistance in completing his estate plan might seem implausible. But it is not improbable that Mr. Bavelis, whose brother had died just six months before, would be thinking about estate planning in June 2009. And there is considerable evidence (in addition to Mr. Ba-velis’s testimony) that Mr. Doukas did promise to help finalize Mr. Bavelis’s estate plan. Mrs. Bavelis confirmed her husband’s testimony that Mr. Doukas promised to assist Mr. Bavelis in this manner. Tr. at 394:3-8 (“[T]hey were talking one day and because they always talk about different things and George told him that he was planning his estate and he didn’t have everything done. And Doukas volunteer that, ‘Oh, I’ve done this before. I can, I can take care of that.’ ”). Mrs. Bavelis was specific that the offer was made “around June[,]” Tr. at 394:19, and that it occurred in connection with the QC Note. Tr. at 403:13-17 (“Yes, the note he was, George told him something about our estate that he had not finished and he said, ‘Oh, don’t worry, I’ve done that before, I can finish it up for you and you don’t have to do anything, I’ll take care of it.’ ”); 428:24-26 (“And then he also told him to sign a promissory note for his estate planning”). Mr. Bavelis gave Mr. Doukas a copy of The George A. Bavelis Revocable Trust Agreement dated October 18, 2004 (“Trust Agreement”), Quick Capital Ex. XX; Tr. at 583-85, and the Trust became a party to the QC Loan Documents, facts that are consistent with the notion that the QC Loan Documents related to estate planning.
Mr. Doukas advised Mr. Bavelis that, as part of the estate planning, he was “going to form a Nevada corporation because there were some advantages that Nevada corporations have[,]” Tr. at 584:16-17, including that “somehow people can’t go and find out who the shareholders are or something like that.” Tr. at 585:17-19. A few weeks after the execution of the QC Loan Documents, one of Mr. Doukas’s attorneys *278 sent Mr. Bavelis an agreement that, if Mr. Bavelis had signed it, would have transferred certain of his interests in the Ohio Partnerships to the Nevada corporation that Mr. Doukas was proposing to form. It was not until after he signed the QC Loan Documents, however, that Mr. Bavel-is received the proposed agreement transferring assets to the Nevada corporation and thus became uncomfortable with the concept of the particular Nevada corporation Mr. Doukas was suggesting.
In the summer of 2009, Mr. Bavelis believed that he did not have the ability to service any more debt. Tr. at 602. Consistent with that belief, before he signed the QC Loan Documents, Mr. Bavelis obtained a promise from Mr. Doukas that he would not be required to make payments on the QC Note. As Mr. Bavelis testified: “[W]hen I gave him this note for $14,000,000 I said, “Ted, you don’t expect me to make payments for this thing?” He said, “No, no, no, you don’t need to make payments.” Tr. at 598:22-25.
Before Mr. Bavelis signed the documents, Mr. Doukas also represented to Mr. Bavelis that the QC Loan Documents would be returned when the estate planning was finalized. “He told me it would take three to four months when I signed this note, it would take me three to four months and then I give those papers back to you, George.” Tr. at 584:9-12. Like the other representations Mr. Doukas had made to Mr. Bavelis up to that point, Mr. Doukas’s statements that he would not seek payment and would return the QC Loan Documents after Mr. Bavelis’s estate planning was completed were intended to induce Mr. Bavelis to sign the QC Loan Documents.
Mr. Doukas persuaded Mr. Bavelis not to consult his own attorney before signing the QC Loan Documents, which had been prepared by Mr. Doukas’s Florida attorney and reviewed by another of Mr. Dou-kas’s attorneys, John Stravato. Tr. at 274-75. Mr. Stravato and Mr. Doukas sent Mr. Bavelis a copy of the QC Loan Documents for his signature via email:
I remember receiving an email from John Stravato and another email from Doukas while I was in Columbus, Ohio. And they wanted to have this in a hurry. And I believe I signed them and I notarized them on Monday and overnighted] them directly to him on that day and he received them the next day.
Tr. at 718:7-13.
Mr. Bavelis did not consult his own longtime attorney, Michael Schaeffer, before he signed the QC Loan Documents, because Mr. Doukas advised him that he did not need to do so:
I had so much trust and faith in what Ted was telling me and I just felt he had done it so many times. In fact he told me he had an in-house lawyer in New York for about 10 years and he has learned a lot of those things. “George, I can help you with those things.” Those are small little things I can take care of. You don’t need to talk to your lawyer.” And [I] took it for granted that he really was trying to help me and I was his brother, he would not do any harm to his brother.
Tr. at 590:14-23.
Mrs. Bavelis confirmed that her husband would not have sought his own attorney’s advice under these circumstances. “At one point I remember George wasn’t sure about something, I can’t recall exactly what it was, and Ted said, ‘Oh, don’t worry, you don’t need an attorney. I’ve done this before, I can, I can take care of it.’ ” Tr. at 400:25-27. “And I told George, I said, ‘Well, if he’s done all this he can do that also, you don’t have to ask anybody.’ I trusted the man.” Tr. at 400:23-401:2.
*279 2. The Contents of the QC Loan Documents
a. The QC Note
Mr. Bavelis signed the QC Note in Columbus on June 22, 2009. Debtor’s Ex. 73. He signed it twice, the first time in his individual capacity, the second as the trustee of the Trust. At the top, under the word “Note,” appears the following text:
$14,000,000.00 June 21, 2009 Franklin County, Ohio.
The QC Note identifies the consideration as “FOR VALUE RECEIVED.” It inconsistently states that the interest rate is “fourteen (5%) per annum” and then provides that the amount of interest is $58,333.33 per month, which equates to 5% per annum. The principal balance of $14 million was to be due on June 21, 2014. The QC Note states that it “may not be changed or terminated orally” and also contains the following text, which falls short of being a sentence: “IT IS EXPRESSLY AGREED, that the said principal sum secured by this Note shall become due at the option of the holder hereof on the happening of any default or event by which, under the terms of the Security Agreement securing this Note.” Debtors’s Ex. 73 at GB 003826.
As already discussed, the evidence presented at trial established that Mr. Doukas had represented to Mr. Bavelis that he would not be required to make the monthly interest payments or the $14 million principal payment due under the QC Note,
b. The QC Loan Agreement
Mr. Doukas signed the QC Loan Agreement, Debtor’s Ex. 76, as the president of Quick Capital. Mr. Bavelis signed it both in his individual capacity and as the trustee of the Trust, and it defines Mr. Bavelis in this dual role collectively as “GAB.” After naming the parties, the QC Loan Agreement sets forth two recitals:
Whereas Quick has provided and will continue to provide consulting and management services in an effort to restructure various liabilities and troubled assets owned directly or indirectly by GAB; and
Whereas GAB as security for the payment of these services rendered and to be rendered agrees to provide a security interest for Quick in various securities in the amount of Fourteen Million ($14,-000,000) Dollars[.]
Debtor’s Ex. 76 at GB 004059. The QC Loan Agreement does not refer to the QC Note. The only reference in the QC Loan Agreement itself to any payment by GAB is the phrase “the payment of these services rendered and to be rendered,” which appears in the second recital set forth above.
Following the recitals, Quick Capital “represents that it will make available to GAB the following corporations which can be used to collateralize loans during the restructuring and refinancing process: 4 Louden Ave Corp., Raelaur LLC, 2 Lisa Court Corp. and Aries Capital of L.I. Corp.” Debtor’s Ex. 76 ¶ 1.
In addition, the QC Loan Agreement states that Quick Capital “shall tender the sum of Two hundred Thousand ($200,000) Dollars to George A. Bavelis which he will accept on behalf of himself and as trustee of George A. Bavelis Trust No. 1, dated October 18, 2004.” Debtor’s Ex. 76 ¶ 2. There was no evidence presented during the trial establishing that the $200,000 sum would not actually be advanced or that Mr. Bavelis would not be required to repay any amount he actually borrowed.
The QC Loan Agreement provides that the parties would enter into the QC Security Agreement. It also states that “[i]t is acknowledged by the parties that all fees have been earned on a flat rate basis, the *280 sufficiency of the consideration by all parties is hereby acknowledged.” Debtor’s Ex. 76 ¶ B. It contains a few boilerplate provisions, Debtor’s Ex. 76 ¶ 4, 5, 8, a confidentiality clause, Debtor’s Ex. 76 ¶ 6, and a provision making New York law the governing law, Debtor’s Ex. 76 ¶ 7, followed by the signatures and notary blocks. That is all that is contained within the four corners of the QC Loan Agreement. Mr. Doukas, though, contends that the QC Loan Agreement also includes the following Schedule A:
Schedule A
Disbursements
Upon execution of Agreement — $200,000 downpayment
By December 31, 2009 — not less than 10% of note (not including downpayment) must be advanced as cash.
Debtor’s Ex. 76 at GB 004061; Tr. at 279.
Mr. Doukas’s testimony regarding the existence of a Schedule A to the QC Loan Agreement lacks credibility for several reasons. First, the drafter of the QC Loan Documents clearly knew how to reference attached schedules. In fact, the QC Security Agreement — -a separate document presented to Mr. Bavelis for signature at the same time he signed the QC Loan Agreement — included a reference to a different Schedule A than the one Mr. Doukas alleges was attached to the QC Loan Agreement. In this regard, the QC Security Agreement provided that Mr. Ba-velis individually and as trustee of the Trust was granting to Quick Capital a security interest in 80,000 shares in Sterling Holding and 30 securities “annexed in schedule A’.” QC Security Agreement ¶ 4. Despite the fact that the drafter of the QC Loan Documents knew how to refer to attached schedules in the text of agreements, the QC Loan Agreement does not reference Schedule A.
Second, the text of the QC Loan Agreement provides that Quick Capital shall tender $200,000, but says nothing about at least 10% of $14 million ($1.4 million) being advanced as cash. It is unlikely that parties would reference a $200,000 payment in the text of a loan agreement but leave a $1.4 million payment to a schedule that is not even referenced in the agreement.
Third, the two unsigned copies of the QC Loan Agreement that Mr. Stravato and Mr. Doukas sent to Mr. Bavelis the day before Mr. Bavelis signed it do not include a Schedule A. Debtor’s Ex. 74-A; 74-B; Tr. at 277-279; 580-81. When confronted with this fact during the trial, Mr. Doukas suggested that he sent the QC Loan Documents to Mr. Bavelis for signature via Federal Express or some other overnight service, but he provided no evidence that he had done so. Tr. at 279-82. Fourth, the “not less that 10%” of the QC Note (i.e., not less than $1.4 million) all too conveniently approximates the $1,464,725 of funds that Mr. Doukas transferred from certain bank accounts maintained at Sterling Bank for the purchase of additional stock in Sterling Holding in September 2009 (of which more below) — transfers that Mr. Doukas now says were on behalf of Mr. Bavelis even though all the evidence is to the contrary. Mr. Bavelis characterized the contention that Schedule A was part of the QC Loan Agreement as “the big lie of the century.” Tr. at 579. While the Court need not go that far, it finds that Mr. Doukas’s testimony that the QC Loan Agreement included Schedule A was false.
In an attempt to call Mr. Bavelis’s credibility into question, Mr. Doukas also made a false statement regarding Schedule A in his proposed findings of fact and conclusions of law (“Doukas Findings & Conclusions”) (Doc. 245). He alleged that the purported existence of Schedule A shows that Mr. Bavelis filed a misleading declara *281 tion in connection with a state court lawsuit that Quick Capital commenced in 2010 against Mr. Bavelis in the Supreme Court of New York, County of Nassau (“New York State Court”) for amounts allegedly due under the QC Note (“Quick Capital Lawsuit”). Mr. Bavelis filed a notice of removal of the Quick Capital Lawsuit to the United States District Court for the Eastern District of New York (“New York Federal Court”). On June 23, 2010, Mr. Bavelis signed a declaration (“Bavelis Declaration”) in which he stated, among other things, that he had “reviewed the Note and Security Agreement that are attached as Exhibit 1 to [his] Notice of Removal filed in this action.” Quick Capital Ex. GG ¶ 2. Exhibit 1 to that notice of removal was the notice of motion for summary judgment in lieu of complaint that Quick Capital had filed in the New York State Court; attached to that notice of motion for summary judgment in lieu of complaint was an affidavit by Mr. Doukas in which he referenced the QC Note and the QC Security Agreement (which were attached as exhibits to the affidavit), but did not reference or attach as an exhibit the QC Loan Agreement. See docket of New York Federal Court, Case No. 10-2759 (Doc. 1 at 10-22). 8 Mr. Bavelis did not state in the Bavelis Declaration that he had reviewed the QC Loan Agreement. That makes sense, because the QC Loan Agreement was not attached to Quick Capital’s notice of motion for summary judgment in lieu of complaint and therefore was not attached as Exhibit 1 to Mr. Bavelis’s notice of removal. Despite this, in his proposed findings, Mr. Doukas makes much of that fact that “[t]he June 23, 2010 Affidavit [that is, the Bavelis Declaration] did not contain any mention of the defense raised in this Court that the Loan Agreement ... did not contain Schedule A.” Doukas Findings & Conclusions ¶ 16.
Mr. Doukas then stated in his proposed findings that “the Loan Agreement that was filed as an Exhibit to the Complaint did, in fact, contain Schedule A, as an exhibit to the Loan Agreement.” Doukas Findings & Conclusions ¶ 17. This statement is not true. As noted above, the document Mr. Doukas filed in the New York State Court was a motion for summary judgment in lieu of a complaint, not a complaint. Much more importantly, that motion did not include the QC Loan Agreement as an exhibit. A motion that Mr. Doukas later filed (on July 6, 2010) in the Quick Capital Lawsuit did include an affidavit that in turn included a copy of the QC Loan Agreement with a Schedule A attached. See docket of New York Federal Court, Case No. 10-2759 (Doc. 5, Attachment 2, Ex. E). The Bavelis Declaration, however, was dated June 23, 2010 and therefore clearly was in response to the notice of motion for summary judgment in lieu of a complaint, which did not include the QC Loan Agreement. 9
*282 Mr. Doukas also attempted to paint the Bavelis Declaration as misleading because in it Mr. Bavelis stated that Mr. Doukas “represented to me that my assets would be protected if I executed the Security Agreement and the Note,” Quick Capital Ex. GG ¶ 11, while saying nothing about estate planning. However, although the Bavelis Declaration did not mention estate planning, the Bavelis Declaration is not inconsistent with Mr. Bavelis’s testimony during the trial that the QC Loan Documents related to the planning of his estate. Tr. at 784-85. In short, Mr. Bavelis did not file a false declaration in the Quick Capital Lawsuit, and Mr. Doukas’s suggestion otherwise is itself misleading,
c. The QC Security Agreement
Mr. Bavelis signed the QC Security Agreement on his own behalf and on behalf of the Trust on June 22, 2009. Debt- or’s Ex. 77. The QC Security Agreement states that “[f]or value received” Mr. Ba-velis individually and as trustee of the Trust grants to Quick Capital a security interest in certain shares in Sterling Holding and securities referenced in a schedule that is referred to as Schedule A. QC Security Agreement ¶¶ 2, 4. The QC Security Agreement states that it “secures the payment and performance of: (a) all obligations pursuant to [the QC Loan Agreement and the QC Note].” QC Security Agreement ¶ 3. Defaults would include, among other things, “another secured party or judgment creditor exercising], or attempting] to exercise or giving] notice of its intention to exercise its rights against the Collateral.” Id. ¶ 9 . It was not inconceivable that such a default might occur given that the assets subject to the QC Security Agreement had previously been pledged to other entities. Tr. at 585. In particular, the securities identified on the Schedule A to the QC Security Agreement were pledged as collateral for the various credit facilities extended by Fifth Third, Tr. at 586, and the shares in Sterling Holding had been pledged to another lender. Tr. at 586.
3. The Consideration for the QC Loan Documents
Mr. Doukas contends that, in addition to the $200,000 and “not less than” $14 million of cash, the consideration for the QC Note included other promises, some of which are mentioned in the QC Loan Agreement and some of which are not. First, there was the promise to make assets available to secure loans to effectuate a restructuring of Mr. Bavelis’s liabilities and the troubled assets owned by Mr. Bavelis and the Trust. Mr. Bavelis believed that he did not have the ability to service any more debt, Tr. at 602, so the parties’ understanding was that Mr. Dou-kas himself would use the assets to obtain loans in his own name in order to purchase the Colonial Bank and First Southern loans, as well as the Sterling Bank nonperforming loans. Tr. at 109:24-25 (Mr. Dou-kas characterizing the QC Loan Agreement as imposing “my obligations on the note to pledge as many assets as I can”). As explained in the next section, no such benefit materialized.
Mr. Doukas was, he testified, personally obligated to make all of his assets — not just those that were the subject of the QC Loan Agreement — available to Mr. Bavel-is:
Q. Mr. Doukas, were assets made available to Mr. Bavelis that ... were *283 not included in this QC Loan Agreement of June 21st, '09?
A. Yes.
Q. And tell us what any of those assets were?
A. Anything I have on the financial statements, anything that I own because I own all these companies 100%.
Q. And did you tell that to Mr. Doukas, excuse me, Mr. Bavelis?
A. Yes, he knew about that.
Tr. at 889:1-13. See also Tr. at 109:24-25 (Mr. Doukas characterizing the QC Loan Agreement as imposing “my obligations on the note to pledge as many assets as I can”). Mr. Doukas also testified that he was prohibited by his agreement with Mr. Bavelis from pledging his assets for any purpose other than assisting Mr. Bavelis. However, as Mr. Doukas himself conceded, Tr. at 269-72, the QC Loan Agreement did not impose that restriction.
Mr. Doukas himself had no binding obligation to make assets available under the QC Loan Agreement. The only entity affiliated with Mr. Doukas that was a party to the agreement — Quick Capital — owned none of the assets that were to be made available to Mr. Bavelis. Tr. at 44. Those assets — the corporations 4 Louden Ave. Corp. (“Louden”), Raelaur LLC (“Rael-aur”), 2 Lisa Court Corp. (“Lisa Court”) and Aries Capital of L.I. Corp. (“Aries Capital”) — were solely owned by Mr. Dou-kas, Debtor’s Ex. 241; Tr. 39-44; 50-51, but Mr. Doukas personally was not a party to the QC Loan Agreement. That also was the case with the R.P.M. Agreement, under which the assets of MD Stat LLC and Leftheris Properties Corp. were pledged. Debtor’s Ex. 131. Mr. Doukas owned R.P.M. (the only Doukas party to the R.P.M. Agreement), Debtor’s Ex. 241, but R.P.M. did not own MD Stat LLC or Leftheris Properties Corp. Those corporations were solely owned by Mr. Doukas, Debtor’s Ex. 241; Tr. 39-44; 50-51, who was not a party to the R.P.M. Agreement. In other words, under the QC Loan Agreement, as well as the R.P.M. Agreement, Mr. Bavelis purportedly had the right to use assets based on an agreement with an entity that did not own the assets, while the owner of the assets — Mr. Doukas— personally had no contractual obligation to make them available. 10
In addition to providing funds and making assets available, his obligations under the QC Loan Agreement, Mr. Doukas testified, included purchasing nonperforming loans held by Sterling Bank:
[I]t was the agreement that we had, you know, how to raise money for the, you know, for the bank. But to get the nonperforming loans that was even more important because the banks if you take the nonperforming loans out then you’re increasing the capital and then you don’t have a lot of problems. That was a big issue. And what we were doing we were pledging this, these assets that were taking nonperforming loans and now we have the bank to, direction to go up.
Q. And was that the overall intent of all these agreements in June of '09?
A. Yes.
Tr. at 891:21-892:9.
Furthermore, Mr. Doukas testified that the consideration under the QC Loan Agreement included his promise to provide *284 consulting and management services, which he valued at approximately $500,000, even though the QC Loan Agreement does not specify the value. Tr. at 327-28. Mr. Doukas also testified that the consulting services were for three items: (1) to restructure the loans with Colonial Bank and First Southern, Tr. at 285; (2) to acquire nonperforming loans from Sterling Bank; and (3) to buy out Mr. Qureshi and indemnify Mr. Bavelis. Tr. at 290.
C. Events Occurring After the Execution of the QC Loan Documents
Events occurring (or failing to occur) during the seven months after the QC Loan Documents were signed make it clear that Mr. Bavelis repaid the funds that Nemesis advanced to him; that neither Mr. Doukas nor any of his companies provided the other consideration allegedly supporting the QC Loan Documents; that Mr. Doukas made several representations that fraudulently induced Mr. Bavelis to sign the QC Loan Documents; and that Mr. Doukas personally has no claim against Mr. Bavelis based on Mr. Doukas’s purchase of stock in Sterling Holding.
1. The Repayment of All Amounts Actually Advanced
After a dinner at the Bavelises’ Florida home that took place in early July 2009, Mr. Doukas gave Mr. Bavelis a $250,000 check dated June 21, 2009. Debtor’s Ex. 102; Tr. at 720. Mr. Doukas testified that the amount of the check included the $200,000 that was to be advanced under the QC Loan Agreement, Tr. at 49:19-22, as well as $50,000 under the R.P.M. Agreement. Tr. at 861. In the Bavelis Findings & Conclusions, Mr. Bavelis states that “the circumstances under, and purposes for which, Ted Doukas elected to deliver a check in the amount of $250,000, from Nemesis, to Mr. Bavelis are peculiar to stay the least,” Bavelis Findings & Conclusions ¶ 169, presumably in part because “[t]he check itself was dated June 21, but the record is undisputed that it was not delivered during that time frame.” Id. There was nothing peculiar about the timing. The R.P.M. Agreement and the QC Loan Agreement were dated June 21, 2009. It appears that Mr. Doukas, rather than mailing the check to Mr. Bavelis (who was in Ohio when he signed the R.P.M. Agreement and the QC Loan Documents), simply waited to deliver the check in person.
The check was drawn on an account maintained not by Quick Capital or R.P.M., but instead on an account maintained by Nemesis. Mr. Bavelis apparently was surprised when Mr. Doukas gave him the $250,000 check, because Mr. Dou-kas had represented that no payments would be due under the QC Note and had promised that the QC Loan Documents and the R.P.M. Agreement would be returned. Mr. Bavelis’s surprise was not entirely warranted. After all, there was no evidence of an agreement that the $50,000 payment under the R.P.M. Agreement would not be made. Likewise, although Mr. Doukas had promised Mr. Ba-velis that he would not be required to make the monthly interest payments or the principal payment due under the QC Note, there was no testimony establishing that $200,000 would not be borrowed under the QC Loan Agreement or that Mr. Bavelis would not be required to repay any amount actually advanced.
Consistent with an understanding that $200,000 would be advanced under the QC Loan Agreement, on the memo line of the check Mr. Doukas wrote words that, although difficult to read, appear to be “Consideration on the Note.” Mr. Bavelis attempted to refuse the check, but Mr. Doukas insisted he take it. Mr. Bavelis *285 accepted the $250,000 check and deposited it into one of his accounts. Tr. at 594. He then promptly repaid it:
Later on within a month or so, I went back and wrote two checks, again we had dinner at my house, I told him, “Ted, here is the money that you loaned me.” He said, “George, don’t worry about it, don’t worry about it.” I said, “Ted” in fact I said, [in Greek] ... the good transactions make the good Mends. And I told him that in Greek. And I said, “Please take the money.” He said, “No, George, don’t worry about it, don’t worry about it.” So I was bothered by that statement, don’t worry about it, don’t worry about it. So I went to the bank and I gave the checks to the bank and I said, “Please deposit into his account.” And I wrote on the checks, “Loan return.” I return the loan.
Tr. at 720:18-721:8. To be more precise, Mr. Bavelis issued Mr. Doukas a check drawn on the account of Pella Financial Services in the amount of $100,000; the check was dated July 14, 2009 and posted on July 27, 2009. The memo line indeed states “Return Loan.” See Debtor’s Ex. 96, IB/DOU 0004; Debtor’s Ex. 107. Mr. Ba-velis also issued Mr. Doukas a check drawn on the account of Pella Financial Services in the amount of $150,000; that check was dated July 27, 2009 and posted on August 17, 2009. The memo line on that check also states “Return Loan.” Debtor’s Ex. 96, IB/DOU 0006; Debtor’s Ex. 103 at GB 003837; Debtor’s Ex. 108; Tr. at 595-98. Mr. Doukas refused to accept the checks personally, but Mr. Ba-velis caused them to be posted to an account Mr. Doukas maintained at Sterling Bank. Tr. at 594-98; Debtor’s Ex. 102. To be clear, even though Mr. Bavelis was the party to the QC Loan Agreement, he repaid the loan using funds borrowed from Pella Financial Services, the issuer of the checks, Tr. at 774-76, just as Mr. Doukas had made the loan through an entity (Nemesis) that was not a party to the QC Loan Agreement.
Mr. Doukas asserts that the $250,000 payment Mr. Bavelis made to him by means of the two checks had nothing to do with the QC Note, that instead the payment fulfilled an oral side deal under which Mr. Bavelis agreed to pay Blair $50,000 per deed for the five Glenn Wright Co. lots that had not yet been sold. Tr. at 76-77; 296-300; 899-901. In support of this assertion, Mr. Doukas testified that, because Glenn Wright Co.’s loan with Sterling Bank was nonperforming, on March 30, 2009, Blair became the obligor on a $3,567,000 promissory note (representing the amount owed by Glenn Wright Co.) and that Mr. Doukas guaranteed Blair’s obligations under the note. Tr. at 895:7-900:14; 931:6-12; 933. Quick Capital offered Exhibits BBBBB and FFFFF in support of Mr. Doukas’s testimony. According to Mr. Doukas, Exhibit BBBBB, in the words of his counsel, “purports to be an amended and restated promissory note dated March 30, 2009 in the amount of $3,567,000[,]” Tr. at 895:7-13, a note that included a signature by Mr. Doukas on behalf of Blair and a guarantee by Mr. Doukas. Tr. at 896:15-897:6. Exhibit FFFFF, Mr. Doukas contends, is, again in the words of his counsel, “an escrow agreement purportedly between Blair International as borrower, mortgagor, Sterling bank and a law firm in Ft. Lauderdale, Florida.” Tr. at 897:10-14. The escrow agreement purportedly was signed by Mr. Doukas and Mr. Albright, Tr. at 897:18; 898:2-6, and allegedly provided for the quitclaim deeds to the five Glenn Wright Co. lots to be placed into escrow. Tr. at 898:15-18. By an agreed order entered after the trial (Doc. 201) (“Agreed Order”), the parties agreed that the Court would reserve ruling on the admissibility of Ex *286 hibits BBBBB and FFFFF to allow Quick Capital an opportunity to obtain certified copies of the exhibits; the certified copies were intended to establish that the Blair note and escrow agreement were served on Mr. Doukas in connection with litigation pending in a Florida state court, that such service was made only shortly before the trial on the Proofs of Claim had commenced, and that the exhibits therefore should be admitted into evidence despite not being produced to Mr. Bavelis prior to trial. Quick Capital did not file certified copies of the documents, leaving Mr. Dou-kas’s testimony as the only evidence of the note issued by Blair and the guarantee provided by Mr. Doukas.
Quick Capital contends that “[t]he only rational reason Doukas/Blair would be willing to undertake liability on a $3,567,000 construction loan” while “relinquish[ing] all control of construction and profit at sale” and “simultaneously deeding] the five homes to a bank representative at closing would be that Doukas/Blair had an agreement to be paid for these transactions.” Doukas Findings & Conclusions ¶ 146. If so, that is not how Mr. Doukas represented the transaction to Mr. Bavelis. In February 2009, Mr. Doukas had sent Mr. Ba-velis an email regarding the five Glenn Wright Co. lots, stating that Mr. Doukas’s actions with respect to the matter were motivated by the fact that “we are friends for life.” Debtor’s Ex. 44. Mr. Bavelis testified, and the Court finds, that Mr. Bavelis was unaware of the purported note and guarantee until Mr. Doukas stated during the trial that Blair had issued the note and that Mr. Doukas had guaranteed it. Tr. at 660:9-24. Thus, there would have been no reason for Mr. Bavelis to believe that Mr. Doukas expected to be compensated for his involvement in the Glenn Wright Co. matter, and certainly no reason for Mr. Bavelis to believe that Mr. Doukas expected any such compensation to come from Mr. Bavelis.
Quick Capital further argues that Mr. Bavelis’s “testimony requires the Court to conclude that Doukas/Blair actions were virtually philanthropic in nature — done for no consideration, provided no ‘upside’ profit potential, and incurring only ‘downside liability’ on the loan.” Id. ¶ 147 . But any such “downside liability” was perhaps less so if Mr. Doukas never intended that he or Blair would satisfy the liability. In this regard, it bears noting that a deficiency judgment in excess of $3 million based on the liability under the note eventually was entered against Blair. Tr. at 902:16-20. In the end, even if Mr. Doukas’s testimony regarding Blair’s liability on the note and the subsequent deficiency judgment is accurate, that testimony is not in Quick Capital’s favor, but instead provides another example of a situation in which Mr. Dou-kas and one of his companies failed to perform.
There simply is no evidence supporting Mr. Doukas’s assertion that Mr. Bavelis paid $250,000 in order to satisfy an oral side agreement between Mr. Doukas and Mr. Bavelis with respect to the five Glenn Wright Co. lots. Indeed, all the evidence is to the contrary. The memo lines on both of Mr. Bavelis’s checks state “Return Loan.” Mr. Bavelis adamantly denied that the checks were in payment for the Glenn Wright Co. deeds, Tr. at 476^481, testifying that there were no discussions along those lines and that he would never make such payments. Tr. at 481:9-13 (“Absolutely not. The first time I saw something like $50,000 for a house was back in 2010. I never heard of anything like that. A director in my position to bribe someone, that’s unheard that, that’s absurd.”). See also Tr. at 512. Mr. Doukas testified that receiving $250,000 from Mr. Bavelis in exchange for the fives deeds “was a business *287 transaction,” Tr. at 901:17, even though in February 2009 he had sent Mr. Bavelis an email stating “i want you to minimize your loses and i am doing this because we are friends for life.” Debtor’s Ex. 44 at GB 000834. In fact, an email Mr. Doukas had sent on June 2, 2009 advising Mr. Bavelis that “all the liens were settled with the five houses,” Debtor’s Ex. 57 at GB 000501, was forwarded by Mr. Bavelis to another person, and in the forwarding email Mr. Bavelis referred to Mr. Doukas as his “Mend” three times. Debtor’s Ex. 57 at GB 000501; Tr. at 571. It seems improbable that the close relationship between Mr. Bavelis and Mr. Doukas would have continued if Mr. Doukas had requested $250,000 from Mr. Bavelis personally in exchange for deeds on properties securing defaulted loans held by Sterling Bank.
Moreover, the notion that the $250,000 was income to Blair is inconsistent with the evidence produced at trial with respect to the non-filing of income tax returns. Mr. Doukas never produced any evidence that he, Blair or any of his other companies reported $250,000 of income on any income tax returns on account of a transaction with Mr. Bavelis. Tr. at 76-77. Nor is there any evidence that Mr. Doukas or any of his companies reported on any tax returns the interest income he testified he received from Mr. Bavelis when, at Mr. Doukas’s request, Mr. Bavelis issued Quick Capital two checks drawn on the account of Bavelis Financial Services, one dated July 28, 2009, the other dated August 28, 2009, each in the amount of $58,300. See Debtor’s Ex. 104.
Mr. Bavelis described the $58,300 checks as follows:
[A]fter Mr. Doukas apparently received his monthly statement he saw that I did deposit the money in there. He came to my house, we had dinner. And before he left, again we got up for him to leave, he said, “By the way, George, give me a couple of checks.” I said, “How much?” He said “$58,300 each.” So I gave him two checks, [$]58,-300. And I didn’t think, I thought it was just planning of my estate. That’s what I considered it to be. I didn’t ask any questions.
Tr. at 598:7-16. Mr. Doukas advised Mr. Bavelis that he would return the checks, Tr. at 598-99, but there is no evidence that he ever did.
Mr. Doukas characterized the two $58,300 payments as interest payments under the QC Note. But while conceding that Quick Capital should have reported this purported interest income on its tax return for 2009, Tr. at 75-76, Mr. Doukas provided no evidence that it had been so reported. He did not produce a tax return for Quick Capital for 2009, instead stating only that he would have produced it if it had been prepared and suggesting that he still (in 2012) had an extension for the filing of Quick Capital’s 2009 tax return. Although Mr. Doukas represented to the Bavelises that he was working directly with the FBI and, as explained below, the Federal Deposit Insurance Corporation (“FDIC”), he apparently left any contacts with the IRS to his accountant. He testified that he needed to ask his accountant to confirm that Quick Capital still had an extension in 2012 to file its 2009 tax return, but Mr. Doukas never provided such confirmation on the record. Tr. at 75-76.
In sum, the Court concludes that, whether it was $200,000 or $250,000, the entire amount that Nemesis lent to Mr. Bavelis was repaid and that any payment that Nemesis made on behalf of R.P.M. under the R.P.M. Agreement also was repaid.
2. The Nevada Corporation
As already discussed, Mr. Doukas first mentioned the formation of a Nevada cor *288 poration to Mr. Bavelis in connection with estate planning and the execution of the QC Loan Documents. Tr. at 584-85. The name of the corporation was TNS Holding Corp. (“TNS”). Tr. at 309. During the trial, Mr. Doukas disclaimed knowledge of TNS. Tr. at 309-12. There is abundant evidence, however, that Mr. Doukas was intimately aware of and interested in TNS. A few weeks after the QC Loan Documents were signed, one of Mr. Doukas’s attorneys, Mr. Stravato, sent an email to Mr. Doukas and Mr. Bavelis attaching an agreement entitled Assignment of Interests in Partnerships. Had he signed that agreement (“TNS Agreement”), Mr. Ba-velis would have assigned his interests in 22 of the Ohio Partnerships to TNS. Debt- or’s Ex. 87; Tr. at 587. Mr. Doukas also forwarded the same email to Mr. Bavelis. Debtor’s Ex. 87; Tr. at 309-311. Mrs. Bavelis confirmed that it was not her husband, but instead was Mr. Doukas, who wanted Mr. Bavelis to form TNS and transfer assets to it. Tr. at 409. On the draft of the articles of incorporation for TNS, the Florida address for Mr. Doukas appeared in the box for the incorporator even though the incorporator was identified as Mrs. Bavelis. Debtor’s Ex. 83 at GB000042; Tr. at 313:4-9; 314:1-15; 586. Mr. Bavelis did not know the persons identified as the directors of TNS. Tr. at 588-89.
On November 21, 2009, Mr. Doukas forwarded to Mr. Bavelis an email that had been sent to Mr. Doukas on July 6, 2009 regarding the incorporation of TNS. Debt- or’s Ex. 92 at GB 001264. With respect to that email, Mr. Doukas testified as follows:
Q. Look at Exhibit 92 please and ... there’s two emails, the one at the bottom appears to be an email from Fran Autumn to among others Ted Doukas, right?
A. Yes.
Q. Dated July 6, 2009, correct?
A. Yes.
Q. And the subject of that email is TNS Holding Corporation, correct?
A. Yes.
Q. It says, “Ted, still waiting for the signed page to be sent back to me for filings.” Do you see that?
A. Yes.
Q. So Fran Autumn has a company that allows you to establish corporations?
A. Yes and I gave the name to anybody when they open a corporation. I said she’s very good. She’s doing the job very well. So, yes, I know Fran.
Q. And then the email that is dated July 6, 2009 you had reforwarded to Mr. Bavelis on November 21, 2009 at 10:16 a.m., do you see that?
A. What is that, what exhibit?
Q. At the top of the page.
A. I forwarded to Mr. Bavelis, yes.
Q. Okay, so you apparently gave the name to — of this lady to Mr. Bavelis plus you sent reminder notices to Mr. Bavelis about the formation of TNS Holding Corporation, the company you said you knew nothing about?
A. He wanted to, he wanted to have a corporation, so I gave the name to order a corporation and that lady sent me a copy. It was not my corporation, it was his corporation, so I don’t know anything about TNS Holding, what’s it doing or anything, it was his business.
Q. So it wasn’t important for you that it was getting filed?
A. For me it was he sent an email and I sent it back to say look at what she send me here. She wanted to sign some papers but it was not my business, it was not my corporation.
*289 Q. Okay, not your business, not your corporation. Did you care one way or the other whether Mr. Bavelis actually signed that document then, apparently not, right?
A. He ordered a corporation so it was, they sent me a copy of that email and I forwarded it to him, there’s nothing wrong with that.
Q. Okay. My question is did it matter to you one way or the other whether or not Mr. Bavelis proceeded forward in completing the incorporation of the Nevada corporation?
A. It was his business. It was his decision, it was not mine.
Q. Did it make any difference to you?
A. No difference.
Tr. at 314:17-317:9. See also Debtor’s Ex. 92. Mr. Doukas provided no explanation for why it occurred to him on November 21, 2009 to forward an email that he had received more than four months earlier regarding a subject that purportedly meant nothing to him. On December 8, 2009, Mr. Doukas sent another text message to Mr. Bavelis forwarding an email he received that same day regarding the filing of TNS in Nevada, stating “George follow up with this to be file.” Debtor’s Ex. 93 at GB 001262. See also Tr. at 317-18. Mrs. Bavelis recalled that Mr. Doukas pushed the formation of TNS and reminded her husband to take the steps necessary to form the company. Tr. at 409-10.
Mr. Bavelis was uncomfortable with the idea of signing the TNS Agreement because he did not recognize the names of the proposed directors and because Mr. Doukas’s home address was used for the address of the incorporator. Tr. at 588-89. For the first time, he decided not to do something suggested by Mr. Doukas. He did not, however, advise Mr. Doukas of this decision, but instead “was postponing as much as I could.” Tr. at 589:4-5. Over the course of the next several months, Mr. Bavelis would have other reasons to be uncomfortable with Mr. Doukas.
3. The Promised Deposits
The parties did not testify that monthly deposits of $80,000 to $120,000 formed part of the consideration for the QC Loan Documents, but those promised deposits were part of the inducement that persuaded Mr. Bavelis to sign the documents. Tr. at 1059-60. Mr. Doukas, however, never deposited $80,000 to $120,000 a month into accounts maintained at Sterling Bank. He conceded that he failed to do so, Tr. at 951, and the evidence shows that any deposits he made of income from his companies were relatively small. Tr. at 960-62. In an effort to make it appear that he deposited substantial income from his companies into Sterling Bank, Mr. Doukas testified that Nemesis deposited $270,000 of rent checks into accounts maintained at Sterling Bank on May 22, 2009. Having previously testified that this amount was entirely from his divorce, Tr. at 944, he revised his testimony to state that this amount was from income received by one of his companies, Efastos Corp. He did not, however, produce a federal income tax return substantiating such income. Tr. at 951-55. Faced with these discrepancies, Mr. Dou-kas testified that he in fact was depositing funds into accounts maintained at banks other than Sterling Bank. Tr. at 962-67.
The evidence also demonstrates that neither Mr. Doukas nor his companies had the ability to make deposits at the promised level. A deposit of $80,000 per month for the six remaining months of 2009 after the QC Loan Documents were executed would have equated to a deposit of $480,000 in 2009. The tax returns that Mr. Doukas and his companies produced, however, demonstrate that the net income (after cash expenses) for Mr. Doukas and *290 his companies was approximately $176,630 for the entire year of 2009. Debtor’s Exs. 186, 188, 192, 195, 198, 209, 218 & 218. In other words, at the time Mr. Doukas promised to cause deposits of $80,000-$120,000 a month to be made into Sterling Bank, he knew that he had no ability to fulfill the promise. Like Mr. Doukas’s tax returns for 2009, tax returns for 2008 would have revealed an inability to make the promised deposits. Debtor’s Ex. 187, 191,197, 206, 212, 217; Tr. at 679-80. But Mr. Bavelis did not know in June 2009 that Mr. Doukas lacked the ability to make the promised deposits, because Mr. Bavelis did not review the tax returns that Mr. Dou-kas had delivered to him to give to Mr. Albright.
4. The Purchase of Additional Shares in Sterling Holding
Mr. Doukas contends that he performed under the QC Loan Agreement by purchasing more than $1.4 million of stock in Sterling Holding on Mr. Bavelis’s behalf. The evidence shows, however, that Mr. Doukas purchased the stock on his own behalf. As already discussed, Mr. Doukas had purchased more than $200,000 of shares in Sterling Holding in March 2009, and in May of that year advised Mr. Bavel-is that he might invest as much as an additional $3 million, resulting in warnings from both of the Bavelises and a statement by Mr. Doukas to Mrs. Bavelis that “I take my chances and I always win.” Tr. at 408:5.
The efforts to increase the capital of Sterling Bank were continuing in July 2009. On July 29, 2009, Mr. Albright sent an email to Mr. Bavelis and the other directors of Sterling Bank regarding a potential investment of capital by two people who were not shareholders at that time. In that email, Mr. Albright stated that he felt “strongly that having them part of the Sterling Bank family would be very positive for all of us[,]” while recognizing “that dilution is not good for any of us.” Debt- or’s Ex. 59 at GB 001447-48. The next day, Mr. Bavelis forwarded the email to Mr. Doukas and made the following plea:
Please take a look at what David is trying to do; he is trying to take our bank and give it to his friend. Leftheri, you have helped me a lot so far and I will never forget it. I NEED YOUR HELP TO STOP HIM SHORT of his selfish action. I have no use for his 25 million to make this a great bank and get back to where we were before this financial downturn. I would need your help to raise at least 10 million this year but not less than 5 million in August and middle of September. If we can raise the total amount of 10 million before the end of September it will help a lot. Then we can take our time and raise 2-3 million before June of next year. I sincerely believe that [with] that much capital the bank will be on its way back to where I am used to operating my banking business. Please let me know if I need to meet with you and or any one else any where in the world to stop David short from bringing his friend in and taking over the bank that I worked so hard to create. I can assure you the potential is great with this bank and there is a lot of money to be made here on it if I get the capital that I need.
Debtor’s Ex. 59 at GB 001447.
That same day, Mr. Doukas responded to Mr. Bavelis regarding Mr. Albright: “george my brother we will not let anybody take our bank, i knew he was not a good person and he wanted to take you out. i will not let him me and you we have to get him out. i will call you tomorrow, i went to greece for ten days.... ” Debtor’s Ex. 59 at GB 001447. Mr. Bavelis ex *291 plained Mr. Doukas’s reference to “our bank” as follows:
[W]e had long conversations and long discussions with him that we were going to take the majority of this bank, probably 80 or 90% between the two of us. Because we were going to put a lot of money when the bank needed the money, approximately, I’m saying here 10,-000,000 but we’re talking about 12,000,-000, what the regulators told us to do. In fact we talked about him becoming as much shareholder as I am.
Tr. at 574:21-575:8.
On August 7, 2009, Mr. Bavelis, as chairman of the board of Sterling Holding, sent a letter to its shareholders (including Mr. Doukas), stating in part as follows:
Sterling Bank, like a high majority of the banks in Florida, has been coping with the troubled loans so far and a written agreement has been reached between the Bank, the Federal Reserve and the State of Florida that we must reserve additional funds for reserves and further increase our capital ratios even though we have always been in the “well capitalized” category. In an effort to comply with the regulators requests and increase our regulatory ratios to the unprecedented higher ratios, the Board of Directors unanimously approved raising $12,600,000 new capital, primarily from the existing shareholder[s] through the end of the month, on a prorata basis at $100 per share for Class A and $80 per share of Class B and any shareholder may purchase any additional Common Shares of Class A or Class B for the same pro rata after August 31, 2009. Class A Shares are voting and Class B Shares are non-voting but the shareholder distributions of both classes of shares will be the same as soon as our bank begins distributing money again with the permission of our regulators which we hope to be sometime in a year or two.
Debtor’s Ex. 116. Along with the letter Mr. Bavelis sent a subscription agreement (Debtor’s Ex. 117), a confidential private placement memorandum (Debtor’s Ex. 118) and an annual report (Debtor’s Ex. 120). Tr. at 149-151. Like the other shareholders of Sterling Holding, Mr. Dou-kas was sent a copy of these materials, including the private placement memorandum. Tr. at 150-51; 745:14-25. Mr. Ba-velis also gave Mr. Doukas a copy of the private placement memorandum, Tr. at 745:14-25, and Mr. Bavelis discussed the private placement memorandum with Mr. Doukas. Tr. at 746:3-14. The private placement memorandum provided a “Notice to Florida Residents” stating that the securities had not been registered and that all persons purchasing the securities in Florida had a three-day right of rescission under Fla. Stat. Ann. § 517.061 (ll)(a)(5). Debtor’s Ex. 118 at iv.
Although Mr. Doukas did not sign a subscription agreement, during a telephone call on the morning of September 23, 2009, he informed Mr. Fritz that he wished to purchase stock in Sterling Holding, referencing the price for the Class B shares. Tr. at 149-56; 199-201. He did not state that he was purchasing the stock on behalf of Mr. Bavelis or anyone else, Tr. at 154:12-16, or that he was making a loan to Mr. Bavelis. Tr. at 154:17-19. Around noon that same day, Mr. Fritz sent Mr. Doukas an email confirming the substance of this conversation. Tr. at 154-58. The email stated as follows:
Mr. Doukas:
Please confirm the following based on our phone conversation this morning.
I am transferring monies from the following accounts into Sterling BancGroup, Inc. in order to buy company stock on your behalf.
*292 $45,600 from ... Leftheris Properties Corp.
$199,275 from ... Leftheris Ted Doukas
$919,095 from ... Nemesis of L.I. Corp.
$500,030 from [a certificate of deposit issued to] ... WKYA Holdings Corp
(This CD is currently pledged for a line of credit that will now be closed based on using the funds from this CD for purchasing company stock)
The total amount being transferred into Sterling BancGroup, Inc. to' purchase stock is: $1,664,000.00
Please confirm that you agree and approve all of the above transactions.
Thank you
Moyle Fritz
Debtor’s Ex. 121 at GB004014. See also Tr. at 57-60.
In his email, Mr. Fritz twice stated that Mr. Doukas’s funds were being transferred into a Sterling Holding account; Mr. Fritz in no way indicated that the funds were being transferred on Mr. Ba-velis’s behalf. Mr. Fritz also twice stated that the funds were being transferred for the purpose of purchasing stock in Sterling Holding; in one of those instances Mr. Fritz made clear that the purpose was to “to buy company stock on your behalf.” Mr. Fritz made no reference to a stock purchase on behalf of Mr. Bavelis. In response, Mr. Doukas sent the following email:
Hi moyle I authorize you to transferred the all the monies today except on my personal account you hold it for- now so transferred everything else except the personal and next week I will wire more money try to sent me the wire instructions too thanks confirm you received that email thanks Ted
Debtor’s Ex. 121 at GB 004014. Mr. Dou-kas was instructing Mr. Fritz not to transfer $199,275 from his personal account, so that the amount of funds being transferred would be $1,464,725. Mr. Doukas raised no issue with the statements in Mr. Fritz’s email to the effect that the funds were being transferred to Sterling Holding for the purpose of purchasing stock on behalf of Mr. Doukas. Tr. at 157:15-158:5. The $1,464,725 of funds were transferred to an account named “Sterling BancGroup, Inc.” Debtor’s Ex. 121 at GB 004015-GB 004021; Tr. at 159-61. This amount closely approximates the “not less that 10%” of the alleged Schedule A to the QC Loan Agreement. Although Mr. Doukas purchased the shares in September 2009, he requested that the issuance of stock certificates be deferred until after he formed a trust similar to Mr. Bavelis’s, at which time the certificates would be placed in the name of Mr. Doukas’s trust. Tr. at 608. This request no doubt would have taken Mr. Ba-velis by surprise in light of Mr. Doukas’s representation of his extensive estate-planning experience — presumably gained from planning his own estate-prior to the execution of the QC Loan Agreements.
In order to explain the inconsistency between the foregoing and his argument that the funds were being provided for Mr. Bavelis’s benefit, Mr. Doukas alleged the existence of a confidential agreement with Mr. Bavelis under which the transfer of the funds was to purchase stock on behalf of Mr. Bavelis. Tr. 60:24-61:19. Mr. Dou-kas did not produce the agreement before trial. During trial, he stated to Mr. Bavel-is’s attorney that “[y]ou can read the agreement. You will see it there. Confidentiality.” Tr. at 61:16-17. The alleged agreement, however, was never produced. Other than Mr. Doukas’s self-serving testimony, there is no evidence that such an agreement ever existed.
By contrast, Mr. Bavelis testified that there was no such agreement, Tr. at 604, and his testimony was supported by ac *293 tions taken by himself and his family. Mr. Bavelis stated that if he or members of his family were going to purchase additional shares in Sterling Holding he would place the stock certificates in the name of the person who provided the funds for the purchase. Tr. at 605. And that is precisely what he and members of his family did. In September 2009, Mrs. Bavelis purchased shares in Sterling Holding on behalf of a trust, and one of the Bavelises’ daughters purchased shares on her own behalf. Later that same year, in December, Mr. Bavelis purchased additional shares in Sterling Holding on behalf of the Trust. Tr. at 605-06; Debtor’s Ex. 122.
Mr. Doukas himself purchased additional stock in Sterling Holding near the end of September 30, 2009. He signed a letter stating that the proceeds of a $500,000 loan from Sterling Bank (secured by an asset owned by Leftheris Properties Corp., Tr. at 862-63) should be transferred into “my Leftheris Properties Corp. account” and $7,000 from “my Leftheris Ted Dou-kas account ... to my Leftheris Properties Corp. account” and that “$500,000 of funds in my Leftheris Properties Corp. account [should be used] to purchase Sterling BancGroup stock.” Debtor’s Ex. 121 at GB 004033; Tr. at 105-08. The account statement that Sterling Bank sent Mr. Doukas for the period ending September 30, 2009 referenced the $500,000 amount and stated that it was to “PURCHASE 6250 SHARES SBG STK.” Debtor’s Ex. 121 at GB 004034; Tr. at 109; 202-03; 206; 862-63. In other words, Mr. Doukas obtained a loan from Sterling Bank for the purpose of purchasing stock in Sterling Holding. In November 2009, representatives of Sterling Bank came to believe that it was impermissible for the bank to make a loan for the purpose of purchasing stock in Sterling Holding and therefore rescinded the transaction, resulting in a repayment of the loan and reimbursement of interest and closing costs paid by Mr. Dou-kas. Tr. at 162-66; 210-13; 927-29; Debtor’s Ex. 121 at GB 004003; GB 004035-36; Debtor’s Ex. 124 at TD 000109.
On October 20, 2009 (before the September 30 stock purchase was rescinded), Mr. Doukas himself provided information to Mr. Bavelis that was to be included in a personal financial statement for Mr. Doukas. Tr. at 871. The second page of that financial statement stated that Mr. Doukas was the 100% owner of 25,759 Class A and B Sterling Holding shares. Debtor’s Ex. 48 at GB 003913. That number of shares is equivalent to the sum of the shares Mr. Doukas purchased in March 2009 (1,200), on September 23, 2009 (18,309) and on September 30, 2009 (6,250). 11
*294 For the foregoing reasons, the Court finds that the stock Mr. Doukas purchased in Sterling Holding in September 2009 was purchased on his own behalf, not on behalf of Mr. Bavelis.
5. The Colonial Bank and First Southern Loans Guaranteed by Mr. Bavelis
Mr. Doukas also testified that the consideration provided for the QC Note included the restructuring of the Colonial Bank and First Southern loans that Mr. Bavelis had guaranteed. Tr. at 285. No such restructuring ever occurred, and the responsibility for the failure lies with Mr. Doukas. On September 24, 2009, Mr. Doukas sent Mr. Bavelis a text message regarding Colonial Bank and the Lake Mary Project. Debtor’s Ex. 67 at GB 004052. Mr. Bavelis explained the text as follows:
[H]e was going to buy the bank notes so I would not have to have this pressure on me to make the payments. And that’s what he was referring to, the Colonial Bank was taking over by BB & T and at that time I think it was in transition between BB & T and FDIC. We’re not quite sure as to who the owner of the note is going to be. And in fact he told me he had a friend at FDIC and he was going to work with FDIC and this note from Colonial Bank will not go into BB & T. His friend will help him to keep it so he can buy it.
Tr. at 576:27-577:10. As Mr. Bavelis testified, this “[njever happened.” Tr. at 577:12. 12
Mrs. Bavelis confirmed that Mr. Doukas said he was working with someone at the FDIC to purchase the notes. Tr. at 405. In fact, Mr. Doukas staged a scene to make it appear that he was working on acquiring the notes. As Mrs. Bavelis testified:
In my kitchen ... Ted Doukas he dialed a number and he had this guy on a speaker phone and he asked him, “What’s happening with the notes?” And this guy, whoever the guy was said, “Oh, don’t worry, by Thursday I’ll have the notes.” And that was going on for many, many months. But that night this man whoever the man was told Ted Doukas that the notes would be finalized by Thursday.
Tr. at 406:4-12.
They never were. Nor was a deal reached with First Southern. As Mr. Ba-velis testified, the lack of success was a result of Mr. Doukas’s failure to do what would have been required. Tr. at 627:15-24 (“[Mr. Doukas], apparently he was telling me that he was talking to the banks to buy the notes. And at some point I remember talking to Chuck whom I knew, he was executive vice president of First Southern Bank. And I asked him, ‘Chuck, why does it take you so long for you to get this note sold to Ted Doukas?’ He said, ‘George, I asked him to send me financials *295 and other papers and he never did do anything, I didn’t get anything, so I’m not working on it.’ ”). Mr. Doukas failed to provide financial statements and other documents because he had never had any prepared. Tr. at 68-69. Mr. Bavelis never received anything in writing showing that Mr. Doukas had reached an agreement with these lenders. Tr. at 627-28. In fact, Mr. Doukas conceded that no restructuring was ever accomplished and that a term sheet was never even signed. Tr. at 286-89.
6. The Request to Return the QC Loan Documents
Before Mr. Bavelis signed the QC Loan Documents in June 2009, Mr. Doukas told him that he would return the documents within three to four months. Tr. at 584:9-12. In late October 2009, after Mr. Dou-kas failed to return the QC Loan Documents in that time frame, Mr. Bavelis suggested that the poor relationship Mr. Doukas had with his daughters counseled in favor of returning them:
I think it was close to the end of October when I specifically asked him, I said, in fact my wife was there at the time and I said, “Ted, you know, you’re flying back and forth to New York and you’re flying a lot all over the place, and God forbid if something happens to you what is going to happen to this note, this $14,000,000 note. I feel very uncomfortable because if your daughters get a hold of this note where would I be with the $14,000,000 note.” He said, “Don’t worry about it. I’ll give it back to you. I’ll give it back to you.” That was his answer. And in fact the rest of the papers, every time I ask for, “I will give them back to you. I will give them back to you.”
Tr. at 591:10-28. Mrs. Bavelis remembered the conversation the same way:
[T]hey were in the living room talking and George told Ted, he said, “You know, Ted, I feel a little uneasy because you travel so much and you have this $14,000,000 note and you’re telling me, you know, your children, your daughters are, you don’t have relationship. If something happens to you how am I going to deal with the girls?” And he said, “Oh, okay, I’ll just give it to you. Don’t worry, I’ll give it to you.”
Tr. at 403:27-404:8. In other words, Mr. Bavelis realized that it would not be apparent to the beneficiaries of Mr. Doukas’s estate that no payments were to be made under the QC Note. His request to return the QC Note — as well as Mr. Doukas’s statement that he would do so — is consistent with Mr. Bavelis’s testimony that no payments were expected under the QC Note and that the QC Loan Documents would be returned.
7. The Bavelis-Qureshi LLCs
At some point, Mr. Bavelis and Mr. Dou-kas discussed the possibility of Mr. Bavelis causing an assignment to be made of the 50% interests in the Bavelis-Qureshi LLCs (held by him, Bavelis Family and FLOHIO) to Mr. Doukas or one of his companies. Quick Capital Ex. T. Mr. Dou-kas testified that he made Mr. Bavelis aware of his desire to purchase those interests on his own behalf prior to the execution of the QC Loan Documents in June 2009, Tr. at 852, and that the agreement was that as part of the deal he or one of his companies would agree to provide Mr. Bavelis indemnification on account of Mr. Bavelis’s guarantees of the bank debt of the Bavelis-Qureshi LLCs. Tr. at 290. To the contrary, the evidence suggests that the discussions, if any, that Mr. Bavel-is and Mr. Doukas had regarding Mr. Dou-kas or one of his companies obtaining interests in the Bavelis-Qureshi LLCs on a permanent basis occurred in the fall of *296 2009. Quick Capital Ex. T. In fact, before Mr. Bavelis assigned 10% of his interest in GMAQ to Blair and his entire interest in GMAQ to R.P.M., Mr. Doukas promised Mr. Bavelis that the assignments would be returned once the negotiations with Mr. Qureshi were finalized, which apparently would have resulted in neither Mr. Doukas nor any entity affiliated with him permanently retaining any interest in the Bavel-is-Qureshi LLCs.
The Court, however, need not decide whose recollection of the timing is accurate. Before the execution of the QC Loan Documents, Mr. Doukas promised that he would negotiate with Mr. Qureshi in such a manner that any resolution of the disputes with respect to the Bavelis-Qure-shi LLCs would be in the best interests of Mr. Bavelis. As explained below, Mr. Doukas contends that Nemesis now owns the 50% interest in the Bavelis-Qureshi LLCs once owned by Mr. Bavelis, Bavelis Family and FLOHIO, without any indemnification being provided to Mr. Bavelis — a result that clearly is not in the best interests of Mr. Bavelis. In other words, whether the specific promise made by Mr. Doukas prior to the execution of the QC Loan Documents was the one described by Mr. Bavelis or the one set forth by Mr. Doukas, Mr. Doukas kept neither. In fact, Mr. Bavelis never received indemnification or anything else in exchange for the transfer of interests in the Bavelis-Qureshi LLCs (other than the $50,000 under the R.P.M. Agreement, which Mr. Bavelis repaid).
In addition to the false promises that Mr. Doukas made before the execution of the QC Loan Documents, a series of events that occurred in the fall and winter of 2009 led to this outcome. By the fall of 2009, Mr. Bavelis’s FLOVEST problems included personal guarantee obligations in excess of $13.7 million ($3.7 million held by First Southern and approximately $10 million held by Colonial Bank), as well as a state court action by Colonial Bank seeking foreclosure and the appointment of a receiver with respect to the Lake Mary Project. Before the execution of the QC Loan Documents, Mr. Doukas had promised Mr. Bavelis that he would acquire this debt as well as work to resolve the issues with Mr. Qureshi in a manner consistent with the best interests of Mr. Bavelis. Even if Mr. Bavelis had desired to rely solely on Mr. Doukas to resolve those issues, Mr. Bavelis was not in a position to rely solely on Mr. Doukas when it came to FLOVEST. The equal members of FLO-VEST were MAQ Management and FLO-HIO. Thus, Mr. Bavelis’s interest in FLOVEST was indirect — a 50% interest was held by FLOHIO, and a one-third membership interest in FLOHIO was held by Bavelis Family, in which Mr. Bavelis held an interest. The principals of the other members of FLOHIO were, of course, interested in resolving the FLO-VEST issues, including the Colonial Bank foreclosure action.
In the summer and fall of 2009, Mr. Bavelis and Mr. Qureshi had a number of meetings to discuss FLOVEST and to address the possibility of one of them buying the other’s interests in the Bavelis-Qure-shi LLCs. Debtor’s Ex. 173 at 123-25; Quick Capital Exs. M; T. The last of those meetings occurred sometime in the fall of 2009. Debtor’s Ex. 173 at 123:3-9. On October 21, 2009, Mr. Bavelis sent a letter on behalf of FLOHIO to MAQ Management and Mr. Qureshi, Quick Capital Ex. M; Tr. at 609-10, offering to sell FLO-HIO’s 50% interest in FLOVEST to MAQ Management in exchange for $100,000 and a release of FLOHIO’s and Mr. Bavelis’s liabilities on the bank debt. Alternatively, FLOHIO would purchase MAQ Management’s 50% interest in FLOVEST for $100,000. Mr. Bavelis was at that point *297 dissatisfied with Mr. Doukas’s lack of success in reaching a deal with Mr. Qureshi. He explained the purpose of the letter as follows:
[BJecause of not being able to accomplish what Ted Doukas was promising me he would accomplish, my partners and I were getting so uneasy about it and we decided one way to split this partnership, this LLC, is to go ahead and make [Mr. Qureshi] an offer, either we buy him out or he buys us out. And this is what this is in reference to. My other two partners, The Vakaleris Family LLC and the Yessios Family LLC agreed for us to write this letter.
Tr. at 610:7-16. In response, on October 29, 2009, Mr. Qureshi (on behalf of MAQ Management) sent a letter to Mr. Bavelis purporting to accept FLOHIO’s offer to sell its membership interest to MAQ Management for $100,000, provided that Mr. Bavelis’s guarantees would remain in place. Quick Capital Ex. N; Tr. 610-11. That letter was followed by one from Mr. Bavelis to Mr. Qureshi on November 4, 2009 stating that the release of Mr. Bavel-is’s guarantee obligations was an “integral part of the offer,” characterizing Mr. Qure-shi’s letter as a counteroffer and rejecting that counteroffer on behalf of FLOHIO. Quick Capital Ex. O. On November 12, 2009, Mr. Qureshi sent Mr. Bavelis a letter reiterating MAQ Management’s position that it had properly accepted FLOHIO’s original offer. Quick Capital Ex. P. Those letters did not result in a resolution, and the problems with FLOVEST continued. 13
In November 2009, Mr. Bavelis’s attorney, Mr. Schaeffer, sent a letter to Mr. Bavelis and certain principals of the other members of FLOHIO (i.e., Yessios Limited Partnership and Vakaleris Family Limited Partnership). Debtor’s Ex. 127. In response to the letter from Mr. Schaeffer, one of those principals stated in an email: “I vote to proceed with the ... dissolution [of FLOVEST], even though I have a strong suspicion that [Mr. Qureshi] will find a way to maneuver around this as well. I see this as a last resort and if it does not work the consequences should be obvious.” Debtor’s Ex. 127 at TD 000119. In response, Mr. Bavelis stated that he “would prefer to see what the possibility is of working out with the plaintiffs lawyer and possibly the judge before we jump into dissolution. I believe Mahammad is getting desperate more and more every day. I hope to hear something this coming week regarding the Notes.” Debtor’s Ex. 127 at TD 000118. In an email he sent to Mr. Bavelis and others with an interest in FLOHIO on November 30, 2009, Mr. Schaeffer recommended the filing of a dissolution complaint. Debtor’s Ex. 127 at TD 000117. That same day, Mr. Bavelis forwarded Mr. Schaeffer’s email to Mr. Doukas. Debtor’s Ex. 127 at TD 000117.
Mr. Bavelis did not inform Mr. Schaef-fer of what happened next until after the fact. The confidence Mr. Bavelis previously had in Mr. Doukas apparently was momentarily restored when, in December 2009, Mr. Doukas advised Mr. Bavelis that a deal had been struck with Mr. Qureshi. Mr. Doukas told Mr. Bavelis that, in order to finalize the deal, Mr. Doukas would need an assignment to be made to Nemes *298 is of the 50% interests that Mr. Bavelis, Bavelis Family and FLOHIO owned in the Bavelis-Qureshi LLCs, but that the assignments would be returned after Mr. Doukas had acquired the 50% interest held by Mr. Qureshi. That is, as he had with the QC Loan Documents, Mr. Doukas told Mr. Bavelis that he would return the assignments after the deal with Mr. Qureshi was finalized. 14 Mrs. Bavelis confirmed that Mr. Doukas made such a representation to her husband:
Q. Did you hear any discussions between your husband and Mr. Doukas about your husband assigning any interest in any of the Florida operating companies and I define those as BMAQ, GMAQ, Flovest or George Real Estate?
A. Yes, I did.
Q. And please explain to the Court—
A. Yes.
Q. — what you recall hearing in that regard.
A. I did hear them discussing that and I heard Doukas telling George, “You know, you give me, you sign these documents I will negotiate with Mahammad and after everything is done I’ll just give you back the papers. It’s a matter of dealing with this man and after I do that I’ll just return the papers back.” As a matter of fact he used a term, a Greek term ... which means it’s just between us, I’ll just give it back to you.
Q. And when you say he indicated he would return the paper, return the paper when?
A. After he had finished dealing with Mahammad Qureshi.
Tr. at 401:21 — 402:22. See also Tr. at 412; 428-32. Unbeknownst to Mr. Bavelis, however, in December 2009 Mr. Doukas was attempting to purchase on his own behalf the 50% interest in the Bavelis-Qureshi LLCs owned by Mr. Qureshi or his affiliated entities. Debtor’s Ex. 173 at 18:21; 19:16. 15
On the afternoon of December 16, 2009, Mr. Bavelis and Mr. Doukas met at a shopping center in Boca Raton. Mr. Ba-velis describes the meeting as follows:
So in fact we met around 5:30 I remember at Starbucks Café. And he said, “Once we sign this I’m going to straight to [Mr. Qureshi’s] house and it’s done. It’s a done deal, George.” He took this paper from the back of his pocket along with some other pieces of paper and I was so relieved, finally we got it, a resolution here.
Tr. at 569:21-27. See also Tr. at 615-17. And so, on December 16, 2009, Mr. Doukas handed Mr. Bavelis — and Mr. Bavelis signed — four agreements purporting to transfer membership interests in the Ba-velis-Qureshi LLCs to Nemesis. In particular, Mr. Bavelis (on his own behalf and as a member of GMAQ) and Mr. Doukas (on behalf of Nemesis) signed an agreement entitled “GMAQ, LLC, Members, Transferor’s and Transferee’s Consent and *299 Approval of Transfer of Ownership” (“December GMAQ Agreement”). Debtor’s Ex. 139. By the December GMAQ Agreement, Mr. Bavelis transferred to Nemesis all of his membership interest in GMAQ, even though he had already transferred 10% of that interest to Blair in March and 50% of that interest to R.P.M. in June 2009. Mr. Qureshi was named as a party on the first page of the December GMAQ Agreement, but he did not sign it — only Mr. Bavelis and Mr. Doukas signed. In light of the fact that GMAQ had no bank debt and owned approximately several million dollars in assets, Tr. at 767, 1004-06, Mr. Bavelis arguably had once again signed an agreement purporting to transfer his interest in the most valuable of the Bavelis-Qureshi LLCs.
At that same meeting, Mr. Bavelis (as the manager of Bavelis Family) and Mr. Doukas (on behalf of Nemesis) signed 'an agreement entitled “BMAQ, LLC, Members, Transferor’s and Transferee’s Consent and Approval of Transfer of Ownership” (“December BMAQ Agreement”). Debtor’s Ex. 140. By the December BMAQ Agreement, Mr. Bavelis purported to transfer to Nemesis all of Bavelis Family’s right, title and interest in 100% of its membership interest in BMAQ. Qureshi Family was named as a party on the first page of the December BMAQ Agreement, but neither Mr. Qureshi nor anyone else signed the December BMAQ Agreement on behalf of Qureshi Family.
In addition, Mr. Bavelis and Mr. Doukas signed an agreement entitled “George Real Estate Holdings, LLC Members, Transferor’s and Transferee’s Consent and Approval of Transfer of Ownership” (“December George Real Estate Agreement”) Debtor’s Ex. 141. Under the December George Real Estate Agreement, Mr. Ba-velis purported to transfer a membership interest in George Real Estate to Nemesis. Mr. Qureshi was named as a party on the first page of the December George Real Estate Agreement, but he did not sign the agreement.
Finally, Mr. Bavelis (as the manager of FLOHIO) and Mr. Doukas (as the president of Nemesis) signed an agreement entitled “FLOVEST LLC, Members, Transferor’s and Transferee’s Consent and Approval of Transfer of Ownership” (“December FLOVEST Agreement”). Debtor’s Ex. 142. By the December FLOVEST Agreement, Mr. Bavelis purported to transfer to Nemesis all of FLO-HIO’s right, title and interest in 100% of its membership interest in FLOVEST. The other member of FLOVEST — MAQ Management — was named on the first page of the December FLOVEST Agreement for the purpose of providing consent, but neither Mr. Qureshi nor anyone else signed the December FLOVEST Agreement on behalf of MAQ Management. Mr. Bavelis did not make Mr. Qureshi aware of the December Agreements, and Mr. Qureshi did not learn of them until some time later. Debtor’s Ex. 173 at 57-58.
A few hours after Mr. Doukas left the shopping center in Boca Raton, he sent Mr. Bavelis a text message indicating that he was going to visit Mr. Qureshi to finalize the deal. Debtor’s Ex. 67 at GB 004055. In another text message he sent that same night, Mr. Doukas told Mr. Ba-velis: “I promise I will finish [Mr. Qure-shi] and he will lose everything[.] I will be there all the time now and I will get the note from First Southern bank[.] I don’t want Anything to happened to you[.] I an entering his house now....” Debtor’s Ex. 67 at GB 004055.
Mr. Doukas later returned to the Bavel-ises’ home to obtain financial information regarding the Bavelis-Qureshi LLCs. As Mrs. Bavelis testified, “he came back to *300 our house and he asked George to give him all the financial information about all these companies he had with Qureshi.” Tr. at 412:18-21. “And I remember [Mr. Bavel-is] had a stack of papers that, you know, whatever he asked of George he would just give it to him.” Tr. at 412:21-28. “So he took the papers and he said, “I struck a deal with Mahammad, this is it, we’re finished. I’m going to take this to him so he can sign it and then I’ll bring your papers and we’re done.” Tr. at 412:23-27.
Mr. Bavelis received no cash or any other remuneration in exchange for the December Agreements. “The only thing he wants is to be indemnified,” Mr. Doukas testified. Tr. at 852:10. Yet neither Mr. Doukas nor any of his companies ever provided Mr. Bavelis any effective indemnification for his potential liability arising from his guarantees of the debts of the Bavelis-Qureshi LLCs. GMAQ had no bank debt, so Mr. Bavelis had no exposure on any guarantee of such debt with respect to GMAQ. It is convenient for Mr. Doukas, therefore, that the only agreement that arguably provided Mr. Bavelis any indemnification on account of his guarantees appears in the December GMAQ Agreement, which states that Nemesis “agrees to indemnify George A. Bavelis and hold him harmless with respect to any and all claims incurred as a result of his being a member of GMAQ, LLC.” GMAQ Agreement at 2. See also Tr. at 1006.
With respect to those Bavelis-Qureshi LLCs that actually had bank debt guaranteed by Mr. Bavelis — BMAQ and FLO-VEST — the indemnification language is either much more limited or nonexistent. The December BMAQ Agreement states: “Nemesis agrees to

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/8495784. Public record. Not legal advice.