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George Foulidis, left, owner of Boardwalk cafe, speaks with Martin Gladstone, candidate for city council, today.Rita Smith

A Beaches businessman is starting legal action against front-running mayoral candidate Rob Ford over Mr. Ford's allegations of corrupt dealings with city hall.

George Foulidis, owner of the Boardwalk Pub on Lakeshore Boulevard, says that Mr. Ford damaged his reputation when Mr. Ford criticized a sole-sourced deal between Mr. Foulidis and the city to extend the pub's lease to 2028.

Last month Mr. Ford was quoted as saying the deal "stinks to high heaven." When Mayor David Miller called that an irresponsible smear, Mr. Ford released a statement on his website saying: "I think it's corruption, Mayor Miller doesn't."

Mr. Foulidis says the deal extending his lease was a fair one negotiated with city officials. He said he had no say in the city's decision not to have others bid for the right to run the concession at Woodbine Beach. He admitted contributing to a previous re-election campaign of local councillor Sandra Bussin but said he was merely exercising his democratic right, not underhanded influence.

He claimed that Mr. Ford was playing politics by alleging corruption. Mr. Ford has made fighting waste at city hall the centrepiece of his campaign.

"He has no evidence," said Mr. Foulidis, "and it's just political posturing."

Fraser Macdonald, a spokesman for Mr. Ford's campaign team, said they haven't received a statement of claim, and don't yet have a response to Mr. Foulidis's comments.

"We're going to wait for our legal counsel to receive anything," he said. "We're waiting and listening to see what's in the statement of claim."