Lana K. L. Li

Our client, Business Development Bank of Canada, had obtained judgment against the corporate debtors and an individual guarantor.  Efforts by Kornfeld’s Lana Li to locate property of the guarantor to satisfy that judgment involved identification of White Willow Investments, a company owned by the guarantor which in turn owned property that was assessed at $6.2 million and generating rents of some $24,000 per month.

To overcome the challenges of a seizure and sale of shares in a privately held company which can be fraught with liquidity and valuation issues, Lana obtained an Order in November 2019 for the appointment of an Equitable Receiver over the assets and property of the guarantor, and thereby gained control over the shares in White Willow Investments. Equitable receiverships are a rarely-used tool requiring the creditor to establish “special circumstances”. Lana was able to obtain the order without notice, based on evidence that the guarantor had been storing and selling equipment of a corporate debtor, without accounting for it or notifying our client.

The receivership was successful, and some two months later, based on arrangements to fully pay the Judgment against the guarantor plus the costs of the receivership, the Receiver was discharged.

Our client successfully resisted efforts by her deceased spouse’s brother to challenge their common law relationship and to challenge her right to administer her spouse’s estate.  The case required the B.C. Supreme Court to consider time limitations, evidence to prove a common law relationship and whether notice of court applications are required in this case.

The deceased passed away in 2014, without having a Will, when he and our client had been living together for about four years.  He owned two properties in Hong Kong.  During the course of her administration of her spouse’s estate, our client was advised that Hong Kong did not recognize common law marriages.  She then obtained a court declaration in British Columbia that she and the deceased were “spouses” under B.C. law, having  lived together in a marriage-like relationship for over two years.

The deceased’s brother challenged our client’s right to claim an interest in the Hong Kong properties as the deceased’s “spouse”, and to administer the estate, on the basis that they were “merely boyfriend and girlfriend” and that he had not been given proper notice of her applications for the declaration and for her administration of the deceased’s estate.

Kornfeld’s Lana Li presented considerable evidence that our client and the deceased were spouses, including affidavits from mutual friends as to their observations, photographs of the couple, government documents confirming the deceased’s residence at our client’s house, and emails and texts from the deceased.  In contrast, the brother relied upon his “impressions” of the couple, even though he had never visited them in B.C. and presented emails, which the Court found actually supported our client’s case.  A last-minute lengthy Affidavit from the deceased’s father, to support the brother’s application, was given little weight.  For example, the father claimed he never saw our client’s wreath at the deceased’s funeral referring to the deceased as her husband but our client produced a photograph of the two of them standing next to that wreath at the funeral.  The Court determined that our client  had “soundly refuted” the father’s evidence.

In the end, the Court concluded that our client and the deceased were indeed “spouses” at the time of the deceased’s death, and as a result, our client was the sole beneficiary of the estate. While our client was required to give notice of the declaration application, she did not have to give notice to the deceased’s family of her administration of the deceased’s estate.  The Court also agreed with Lana’s argument that the brother’s applications were time-barred under the Limitations Act.