Eric Delouya

The plaintiffs brought a motion for contempt against the Lin Defendants for failing to comply with previous court orders, including a Mareva injunction, which required them to provide affidavits of assets, submit to examinations under oath, and provide a monthly accounting.

The Lin Defendants failed to attend the examinations, failed to provide the required information, and could not be located.

The court declined to make a formal finding of contempt at this stage, noting it is a remedy of last resort.

Instead, the court issued a declaration of breach, struck the Lin Defendants' pleadings, froze their assets without allowance for business expenses, and set a timetable for the plaintiffs to move for default judgment.

This endorsement follows a Mareva injunction order, addressing outstanding issues of asset disclosure, living and business operating expenses, and limitations to the injunction.

The court ordered the Lin Defendants to attend examinations on their assets within two weeks, validated service on them as of November 15, 2022, and directed them to file a Statement of Defence within 30 days.

The Mareva injunction was continued, and the parties were ordered to re-attend to finalize limitations and expenses.

The court also addressed the potential sale of two Bentley vehicles held overseas.

The plaintiffs, Li Yang (Canada) Holdings Co. Ltd. and Daniel Executive (Canada) Holdings Corp., sought a Mareva injunction against multiple defendants involved in an alleged multi-layered fraud scheme concerning luxury vehicle exports.

The court found a strong prima facie case for breach of contract, fraudulent misrepresentation, and conspiracy against the Lin Defendants (LYSR Management Ltd., 2708042 Ontario Inc., 2786584 Ontario Inc., Rina Shinchi, Yangguang Lin) and the Zheng Defendants (Wei Zheng, Location Way Inc.).

The court also found a real risk of asset dissipation, noting the defendants' fraudulent conduct and attempts to mislead.

The motion was dismissed against Zi Mu Li and Renxiangyu Zhang due to insufficient evidence.

The Mareva injunction was granted against the remaining defendants to prevent asset dissipation.