Court of Appeal for Ontario

Date: 2025-09-11 Docket: COA-24-CV-0294

Judges: Miller, Paciocco and Coroza JJ.A.

Parties

Between

Kyoung Hwa Lee and Young Sea Guak Plaintiffs (Appellants)

and

Myoung Ja Chang a.k.a. Myoungja Chang a.k.a. Myoung-Ja Chang a.k.a. Myoung Ja Yoon a.k.a. Myoungja Yoon a.k.a. Myoung-Ja Yoon and Kwang Eui Chang a.k.a. Kw Angeui Chang a.k.a. Kwang-Eui Chang and Ji Young Chang a.k.a. Jenny Chang a.k.a. Jenny Ji Young Chang a.k.a. Ji-Young Chang and Bo Young Chang a.k.a. Bonnie Chang a.k.a. Bonnie Bo Young Chang a.k.a. Bo-Young Chang

Defendants (Respondents)

Counsel

For the Appellants: Sang Joon Bae

For the Respondents: Steven S. Hong and Jimmie Z. Chen

Hearing and Appeal

Heard: May 28, 2025

On appeal from: The judgment of Justice Audrey P. Ramsay of the Superior Court of Justice, dated February 28, 2024, with reasons reported at 2024 ONSC 580.

Reasons for Decision

Overview

[1] At the conclusion of the hearing, we dismissed the appeal with reasons to follow. These are our reasons.

[2] The appellants, Kyoung Hwa Lee and Young Sea Guak appeal a judgment dismissing their claim for the repayment of money transferred to the respondents, Myoung Ja Chang and Kwang Eui Chang. The appellants advance several grounds of appeal in their factum. In oral argument, counsel advanced three submissions. We will address those submissions in these reasons. We are satisfied that there is no merit to the other grounds advanced in the factum.

Background

[3] The appellants reside in Seoul, in the Republic of Korea. The appellants met the respondents in 1998 in Seoul.

[4] When the respondents immigrated to Canada in 2000, the appellants sent their daughter with them so she could attend a Canadian school. The respondents agreed to provide room and board to the daughter and did so for approximately 11 years.

[5] Between 1999 and 2008, the appellants wire transferred a total of $183,000 to the respondents. An additional $30,000 was transferred to the respondents in 2010 for the repayment of a credit card loan from Hyundai (the "Hyundai Capital Loan").

[6] The appellants allege that two of the transfers were for investments, and the remainder were loans to the respondents. The appellants assert that the largest transfer of $100,000 in 2001 was for a joint investment into real estate. The respondents used the money to purchase a residential property (the "Cummer House") for $550,000 in 2001. The respondents sold it in 2016 for $2,340,000. The appellants allege that once the Cummer House was sold, they expected to be repaid the principal amount and profits from the sale.

[7] The respondents acknowledged the Hyundai Capital Loan debt, though they contend that a significant portion of the credit card was repaid. The respondents disputed the remainder of the appellants' claims. They argued that the wire transfers were not loans or investments but payments for room and board, art lessons, and transportation costs for the appellants' daughter while she was living with them in Canada.

[8] At trial, the appellants sought damages in the amount of $533,000 for breach of contract, fraudulent misrepresentation, deceit, unjust enrichment, breach of fiduciary duty, and fraudulent conveyance. The appellants also sought an order for equitable relief and a declaration that the proceeds of the sale of the Cummer House were held in constructive trust for the appellants. They sought aggravated and exemplary damages in the amount of $200,000, punitive damages in the amount of $200,000, and unspecified special damages.

[9] The trial judge dismissed the appellants' action, and their claims. She also ordered the appellants to pay costs in the amount of $177,123.68, all-inclusive.

Issues

[10] The appellants submit that the trial judge made three errors in her reasons:

[11] First, the appellants submit that the trial judge erred by excluding an important transcript of a recording.

[12] Second, the appellants submit that the trial judge erred in dismissing their claim in unjust enrichment.

[13] Third, the appellants argue that the trial judge erred in her application of the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B.

Analysis

a. Exclusion of Transcript

[14] First, the appellants submit that the trial judge erred in neglecting to admit a transcript of a recorded conversation between the appellant, Kyoung Hwa Lee, and the respondent, Ms. Chang, that took place on January 2, 2017. The appellants assert that Ms. Chang admitted in this conversation that she had an obligation to repay the debt that arose upon the sale of the Cummer House. The appellant, Kyoung Hwa Lee, had surreptitiously recorded the conversation. The conversation was in Korean, so the appellants also introduced a translated transcript in English.

[15] The trial judge had concerns about the reliability of the translation and concluded that the translation was not "reliable, relevant, nor probative of any issues". The appellants contend that the trial judge erred in excluding this evidence. We disagree. The trial judge noted the parties disputed the accuracy of the translation, there was no evidence that the translator was an accredited translator or that he had listened to the recording. Therefore, she concluded that the transcripts were not reliable. We see no basis to interfere with her decision.

[16] Moreover, it is not clear to us that the trial judge did not admit the transcript into evidence. The trial judge found that the content of the transcript was ambiguous and that the words used by Ms. Chang did not amount to an admission of the debts claimed in the action. The trial judge concluded that "even though the evidence was adduced at trial, it is not probative as to the existence of the impugned loans and investment". In our view, it was open to the trial judge to place little weight on this evidence. Overall, we see no reversible error in her treatment of this evidence.

b. Dismissal of Unjust Enrichment Claim

[17] Second, the appellants submit that the trial judge erred in dismissing their claim for unjust enrichment. The elements of the test for establishing unjust enrichment are not controversial: (1) an enrichment of the defendant; (2) a corresponding deprivation of the plaintiff; and (3) the absence of a juristic reason for the enrichment: Garland v. Consumers Gas Co., 2004 SCC 25, [2004] 1 SCR 629, at para. 30. According to the appellants, once the trial judge found that no contract existed between the parties, there was no juristic reason for the enrichment. Therefore, she erred by denying recovery: Garland, at para. 44.

[18] We reject this submission. It was the appellants' burden before the trial judge to establish that there was an enrichment, deprivation, and the absence of a juristic reason that should deny them recovery. Considering the trial judge's reasons as a whole, we do not accept the appellants' submission that she found that there was no contract between the parties. To the contrary, she found that there was an agreement that the appellants would pay the respondents for the daughter's homestay expenses. However, the trial judge was simply not able to ascertain the precise terms of the agreement. We read the trial judge's reasons as a finding that the appellants: (1) had not established that the payments enriched the respondents; and (2) failed to show that there was an absence of a juristic reason to deny recovery. Accordingly, this ground of appeal must fail.

c. Statute-Barred Claims

[19] Third, the appellants argue that the trial judge erred in her application of the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B by barring their claims. The trial judge found that the appellants had knowledge, or ought to have had knowledge of, the facts underlying the claims by February 2011, or December 2015 at the very latest. The Statement of Claim was not filed until January 2018.

[20] The trial judge found that the appellants failed to rebut the presumption that the claims were discovered on the day the act or omission took place. Regarding the Hyundai Capital Loan, the appellant Myoung Ja made an assignment into bankruptcy in September 2017. Therefore, even if the debt was not discoverable prior to the expiration of the limitations period, the appellants' claim is stayed pursuant to the Bankruptcy and Insolvency Act, R.S.C., 1985, c. B.3.

[21] The trial judge considered and ultimately rejected two of the appellants' submissions: (1) that the parties entered into a forbearance agreement that would have suspended the limitations period; and (2) that the respondents' acknowledgement of the debts in various emails and text messages restarted the limitation period anew: Limitations Act, at s. 13. In the trial judge's view, the appellants did not act with due diligence when the respondents failed to repay the purported loans after several requests for repayment were made.

[22] We view this ground of appeal as an attempt to relitigate factual findings made by the trial judge. For example, counsel for the appellants placed considerable emphasis on text messages that had been exchanged between the parties relating to the acknowledgement of debts. The trial judge dealt with these texts in her reasons. She was unable to find that any of the text messages represented clear and unambiguous acknowledgements of the debts by the respondents.

[23] Absent any palpable and overriding error there is no basis to disturb the trial judge's factual findings. Consequently, we reject this ground of appeal.

Costs Appeal

[24] Finally, the appellants seek leave to appeal the trial judge's costs order. The appellants made no submissions on this ground of appeal in their written and oral arguments. We see no merit in the costs appeal. There is no basis to disturb the trial judge's discretionary costs order.

Disposition

[25] For these reasons, the appeal is dismissed. Leave to appeal costs is refused. The respondents are entitled to costs of the appeal fixed in the agreed upon amount of $12,000 all-inclusive.

"B.W. Miller J.A."

"David M. Paciocco J.A."

"S. Coroza J.A."