Single investor bought up 10 out of 91 townhouses as presales in Richmond project using numbered companies, court case reveals

By ThinkPol Staff

A single investor, using numbered companies, bought up 10 out of the 91 townhouses as presales at a development project in Richmond, BC, according to a recently concluded BC Supreme Court case.

In 1042056 B.C. Ltd. v. Elegant Alexandra Gate Project Ltd[1]https://www.canlii.org/en/bc/bcsc/doc/2018/2018bcsc314/2018bcsc314.html?searchUrlHash=AAAAAQAHcmVhbHRvcgAAAAAB&resultIndex=1, 1042056 B.C. Ltd. and 1042060 B.C. Ltd are seeking $600,000 from the Elegant Alexandra Gate Project Ltd, the developer of “Mandarin Walk” project at Stolberg Street.

The following is a summary of the court proceedings.

The director of 1042056 B.C. Ltd. and 1042060 B.C. Ltd. is Pa Hung Leung, while Jatinder Minhas is the authorized representative of the Elegant partnership.

In May 2015, Francis Lau, a realtor with Coldwell Banker introduced Mr. Leung to the investment opportunity at Mandarin Walk.

Mr. Leung met with Mr. Minhas, who knew each other previously, signed two memorandums of understanding ‒ one for each company ‒ regarding presale contracts.

The MOU states that the investor’s numbered companies “are in the process of negotiating with [the defendant] to enter into the pre-sale contracts to purchase the ten (10) townhouse units (pricing details per Schedule “AA” attached herein) of the phase one construction (Building “C”) …”

Paragraph 16 of the MOU stipulates that the developer will compensate the investor $30,000 plus taxes and interest for each of the townhouses if the contract is cancelled.

However, the terms of contracts of purchase and sale of the townhouse units themselves did not incorporate paragraph 16.

The investor paid the initial deposit to the developer’s solicitor on On July 28, 2015, to be held in trust as per the terms of the contract.

In December 2015, the investor learned that a building permit had not been issued for the property, and in May 2016, Coast Capital Savings Credit Union commenced foreclosure proceedings against the property.
The investor filed the lawsuit on July 15, 2016, seeking the $600,000 in damages ‒ $300,000 in respect of each MOU for ten townhouse units each at $30,000.

The developer filed a statement of defence denying that denied that the MOUs are enforceable contracts.

The Honourable Madam Justice Maisonville dismissed the investor’s claim.

“I find, in all of the circumstances, that the MOUs were not enforceable options to purchase land supported by consideration for purchase and sale of the townhouse units,” the judge wrote delivering the judgment. “There was no consideration for the MOUs. In the alternative, should I be wrong, I find that the MOUs were simply agreements to agree and there is no action sustainable here brought by the plaintiffs as against the defendants.”

Citing that numbered companies are used to hide property ownership and dodge taxes, BC’s NDP government introduced measures to crackdown on them in the provincial budget.

“Numbered companies, offshore and domestic trusts, and stand-in owners hide the true source of the capital that is flowing into our real estate market,” Finance Minister Carole James said in her budget speech. “A lack of transparency in our land registry means true ownership is not clear. We’re going to change that.”

References   [ + ]

1. https://www.canlii.org/en/bc/bcsc/doc/2018/2018bcsc314/2018bcsc314.html?searchUrlHash=AAAAAQAHcmVhbHRvcgAAAAAB&resultIndex=1

6 Responses to Single investor bought up 10 out of 91 townhouses as presales in Richmond project using numbered companies, court case reveals

  1. nonconfidencevote says:

    Wow 1
    I dont want one townhouse.
    I want ten.

    Yeesh.
    And the gubmint cant see whats going on all around them even when the voters are screaming bloody murder??????????

    But I guess when one realizes the Liberal gubmint was in the back pocket of real estate developers and ubersalesmen like #1 Realtor Bob Rennie……it all begins to make sense.

  2. Bill Ferguson says:

    This particular article generated a great deal of discussion on my “Metro Vancouver Housing Collapse” FB site today; feel free to join us and share your own “News and views” about the biggest housing bubble this region has ever seen.

    • nonconfidencevote says:

      Your site sounds interesting…..
      Facebook?
      Sorry Dude.
      I dont want the entire world to know my date of birth, hair color, fave color, movie, DNA, etc etc etc.

      Facebook….the Ministy of Truth’s latest foray into advertising.

      Not interested.
      And apparently, according to the stats……..more and more former facebook people……..are’nt interested either.

      • nonconfidencevote says:

        P.S.
        As I recall…….
        Garth Turner says stop flogging your blog… on his blog.

        P.P.S.
        His site doesnt use Fakebook either.

  3. Anonymous says:

    when i read this shit my blood boils and i want there to be a crusade with Richmond as the epicentre

  4. nonconfidencevote says:

    Gee.
    I wonder how the IDIOT that bought 10 condos as the market was COLLAPSING feels now?

    Nov 2018 is the WORST SALES SINCE THE GREAT DEPRESSION!

    ahahahahahahahahahahahahahahahahahahahahahaa

    Happy Housing CRASH REALTURDS

    https://www.huffingtonpost.ca/2018/12/04/vancouver-home-sales-lowest-financial-crisis_a_23608423/?utm_hp_ref=ca-british-columbia

    All I want for Christmas is my Audi lease paid, my Audi lease paid, my Audi lease paid…..

    How many Realtors does it take to work at McDonalds?
    ALL OF THEM !

    Bwahahahahahahahahahahahahahahahahahahahahahahahahahahahaahahaha

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