B.C. court decision explains story behind $750K listing for half of 5-bedroom Richmond house

A recent B.C. Supreme Court decision is shedding some light on a bizarre real estate listing offering "undivided half interest" in a five-bedroom home in Richmond for $750,000. The home in question is seen in this photo from the listing. (Realtor.ca)

A recent B.C. Supreme Court decision is shedding some light on a bizarre real estate listing offering "undivided half interest" in a five-bedroom home in Richmond for $750,000. 

The listing made headlines last month not only for the strange ownership arrangement, but also for its self-aware tone. 

"Yes, unusual it is," the description reads, at one point.

The listing, which has been up for 193 days, urges would-be purchasers to do their homework, asking them to consider questions like, "Who would I be sharing ownership with?" and "Does the other half want to sell?"

"WE DO NOT KNOW THESE ANSWERS," it adds, in all-caps. "Please call your Realtor and ask for the explanation with documents posted."

SALE PART OF OWNER'S US$17M DEBT IN CHINA

The court decision issued Monday and posted online Tuesday explains, to some extent, the situation behind the sale. 

It begins by noting that the home's co-owner, defendant Chuming Qiao, owes "more than $17 million" to the plaintiff – a company called Asia Growth VIII LP – under an "arbitral award" issued in China in 2018.

The decision later explains that the award in Asia Growth's favour against Qiao was US$17 million, which is a little more than $23 million at Wednesday's Bank of Canada exchange rate. 

According to Justice Sandra Wilkinson's decision, Qiao has co-owned the property on Lockhart Road since 2003 with his wife Liping Qin.

While court documents don't specify the exact address of the property featured in the listing, CTV News has confirmed through a title search that it is the same house.

The listing agent declined an interview with CTV News for a previous story about this property.

"The house is Mr. Qiao’s only known exigible asset in British Columbia," the decision reads, later noting that Asia Growth had received a court order allowing it to sell Qiao's 50-per-cent interest in the property in February 2022, and had begun the process of listing it in "early 2023."

TRANSFER TO DAUGHTER WAS 'FRAUDULENT CONVEYANCE'

While these details are all covered in the court decision issued Monday, they're not what the decision was about. Rather, the decision was about an application filed by Qiao and Qin's daughter, Yan Qiao.

In October 2021, title to the property was transferred from Chuming Qiao to Yan Qiao, with Qin remaining a joint tenant, according to the decision. The effect was to transfer the elder Qiao's 50-per-cent ownership to his daughter, and Asia Growth soon filed a lawsuit seeking to have the change reversed on the grounds that the transfer was a "fraudulent conveyance."

The Qiao family did not file a response to Asia Growth's claim, nor did they engage in any communication with the company or its lawyers for more than a year, according to the decision.

This led to a default judgment in Asia Growth's favour in January 2022, allowing the company to begin the process of selling Qiao's interest in the property.

The basis for Monday's decision was an application by Yan Qiao asking the court to set aside the default judgment on the grounds that she was never properly served with notice of Asia Growth's lawsuit.

For a variety of reasons, Wilkinson dismissed the application.

DAUGHTER CLAIMED SHE WAS LIVING IN CHINA

The crux of Yan Qiao's argument that she was not properly notified of the claim against her was an affidavit she filed claiming that she was residing in China at the time various notices and documents were delivered to the door of the Richmond home.

She told the court she was unaware of the legal proceedings and had no reason to believe there were any concerning her.

Wilkinson's decision notes that these assertions were "inconsistent with prior statements to the Land Title and Survey Authority of British Columbia (LTSA) and the Minister of Finance."

"By her own statements made to the LTSA and the Ministry of Finance, the property was her primary residence and had continually been her primary residence for nearly 19 years before the transfer," the decision reads.

"She admits in her first affidavit that she was residing in 'Vancouver' from January 2020 to March 2023. A reasonable inference is that she was living at the property when the notice of civil claim was alternatively served on Dec. 7, 2021. She does not depose that she resided at any specific address. She has provided no explanation for her apparent ignorance of dozens of legal documents delivered by Asia Growth to the attention of her father, and later, herself during the January 2020 to March 2023 period."

The judge further noted that, if the younger Qiao's affidavit asserting she was in China was correct, it would amount to an admission that she had fraudulently evaded property transfer and non-resident taxes at the time the property title was transferred to her name.

Similarly, the Qiao family had lawyers in both B.C. and China who had professional obligations to notify their clients of pending litigation against them, Wilkinson noted, concluding it was likely that both lawyers had fulfilled those obligations and the family had willfully ignored the case.

"The result of the conflicting evidence before me is that Ms. Qiao’s evidence in this proceeding lacks credibility and is unreliable," the decision reads. "She has not provided a plausible explanation for her alleged lack of knowledge of the proceeding."

'BADGES OF FRAUD'

Yan Qiao also sought to have the default judgment set aside under a different section of the B.C. Supreme Court rules that gives judges the discretionary power to do so.

Qiao claimed she had a meritorious defence against Asia Growth's lawsuit, and that the court should set aside the default judgment to allow her to make that defence.

Both father and daughter told the court the transfer of the property was a repayment of a debt the elder Qiao owed to a company owned by the younger.

However, the idea of loan repayment is nowhere to be found in the property transfer documents, according to the decision.

"The defendants all certified to the Land Title Office that the consideration for an inter-family transfer was '$1 and natural love and affection,'" the decision reads. "Now, Ms. Qiao deposes that the transfer was consideration for repayment of an inter-family loan. The transfer forms provide contemporaneous evidence that may be preferred over the after-the-fact evidence provided in response to (a Fraudulent Conveyance Act) action."

Wilkinson concluded that there were "a number of badges of fraud present in connection with the transfer," including the fact that the elder Qiao was insolvent at the time and that the transfer "was initiated with haste" as soon as the younger Qiao found out about her father's debt to Asia Growth.

"Asia Growth will suffer prejudice if the default judgment is set aside," the decision reads. "The $17,000,000 USD arbitral award was made in March of 2018, and very little of that has been recovered to date. It would be contrary to the interests of justice to allow Mr. Qiao to continue to avoid judgment enforcement by relying on affidavits that contradict earlier certified representations made to the LTSA and Minister of Finance."

Accordingly, Wilkinson dismissed Yan Qiao's application. 

With files from CTV News Vancouver's Andrew Weichel