COURT FILE NO.: CV-21-00000725

DATE: 20220526

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

ALEXANDER CHANG and GUSTAVO CHANG

Plaintiffs

– and –

HIU HUNG HO aka RACHEL HO aka RACHEL HIU HUNG HO

Defendant

Peter J. Ngan, Counsel for the Plaintiffs

Yonatan Lipetz, Counsel for the Defendant

HEARD: February 15, 2022

REASONS FOR DECISION

Overview

[1] The Plaintiffs bring this motion for summary judgment against the Defendant, Hiu Hung Ho, for $538,000 representing only the principal loaned to the Defendant. They are foregoing their claim for loan charges/fees and interest to simplify and expedite the granting of summary judgment.

[2] In the interim, before the hearing of this motion, the Defendant consented to partial summary judgment in favour of the Plaintiff, Gustavo Chang, for $300,000. The remaining $238,000 is what remains in dispute on the motion.

[3] For the reasons outlined below, the motion for summary judgment in relation to the remaining $238,000 is dismissed. The matter is ordered to proceed to trial.

Summary of Facts

[4] Alexander Chang (“Alex”) and the Defendant were real estate agents working in the same brokerage where they would often share commissions. The Defendant is a family friend having known Alex’s wife for over 10 years. The Defendant is also a close friend of Alex’s brother, Gustavo Chang (“Gustavo”), the other Plaintiff in this action.

[5] On November 4, 2019, Alex purportedly loaned the Defendant $50,000 by bank draft payable to a male by the name of Xue Jian Zou as per the request of the Defendant. According to Alex, the loan was in relation to a real estate transaction for a client. The client agreed to pay the amount back with daily interest of 12%.

[6] Alex maintains that on November 18, 2019, he loaned the Defendant another $53,000. Of this amount, $50,000 was made payable to Re/Max West Realty as requested by the Defendant. The other $3,000 cash was handed to the Defendant. The Plaintiff has included the Re/Max receipt to demonstrate this loan was used by the Defendant as part of the deposit for her own purchase of 44 East Humber Drive, Vaughan.

[7] On November 19, 2019, according to Alex, the Defendant borrowed a further $54,000 from the Plaintiffs. The $54,000 was advanced by way of a $50,000 bank draft payable to Re/Max West Realty Inc. and $4,000 in cash paid directly to the Defendant. Again, the $50,000 was used by the Defendant as part of a deposit towards a purchase of 44 East Humber Drive, Vaughan. Again, the Plaintiff, Alex, relies upon a receipt paid to Re/Max in the amount of $50,000.

[8] On November 20, 2019, Alex loaned another $3,000 cash to the Defendant at her request. According to the Plaintiffs, a total of $160,000 was loaned out to the Defendant as of November 20, 2019.

[9] On December 11, 2019, the Defendant wrote two personal cheques totalling $185,000 to Alex. Alex maintains these amounts were repayment for the principal of $160,000 with $25,000 as interest and fee charges for the loans. The two cheques in the amounts of $150,000 and $35,000 were deposited the same day by Alex but were subsequently returned by the Plaintiff’s bank due to insufficient funds in the Defendant’s bank account.

[10] Alex advised the Defendant that her two repayment cheques were dishonoured and not cashable. The Defendant offered various excuses, initially blaming the banks, and ultimately claimed that her client friend lied to her and gave her a fake bank draft which she allegedly deposited into her bank account. In various text messages, the Defendant assured that she would personally pay back the $160,000.

[11] Around the beginning of July 2020, the Defendant started to ask the Plaintiffs to lend her a further $300,000 to repay monies she borrowed from other creditors for her purchase of 44 East Humber Drive, Vaughan. The Defendant at the same time asked for more time to pay back the $160,000 she owed. The Defendant wrote three post-dated cheques to the Plaintiffs as an inducement to lend her the $300,000.

[12] To further gain the Plaintiffs’ confidence in her ability to repay the money, the Defendant also provided a Manulife statement as of May 31, 2020, showing that she had $1,203,692.58 in her account.

[13] On July 6, 2020, the Defendant asked Alex to lend her $10,000 for the mortgage application fee for her purchase of 44 East Humber Drive, Vaughan. Alex agreed and did a transfer of $10,000 from his RBC account to her RBC account that day.

[14] On August 4, 2020, Alex also loaned the Defendant another $50,000 by personal cheque payable to Hui Lin Zou at the Defendant’s request.

[15] On November 9, 2020, Alex paid Edmund Tai, Alex’s cousin, by personal cheque, $8,000 because the Defendant’s commission rebate cheque to Edmund Tai was returned NSF. He also claims this amount from the Defendant.

[16] According to Alex, as of January 27, 2021, the Defendant also owed him $10,000 in unpaid shared commissions, loan fees and accrued interest.

[17] The Defendant signed an acknowledgment of debt of $538,000 by presenting a repayment plan to the Plaintiffs.

[18] In addition to the $300,000 which has been acknowledged by the Defendant, the Plaintiffs submit that the following amounts remain outstanding:

November 4, 2019 $ 50,000

November 18, 2019 $ 53,000

November 19, 2019 $ 54,000

July 6, 2020 $ 3,000

August 4, 2020 $ 50,000

November 9, 2020 $ 8,000

January 27, 2021 $ 10,000

TOTAL: $ 238,000

[19] While the Defendant admits to owing the $300,000 to Gustavo, she maintains that she does not owe any money to his brother, Alex.

[20] The Defendant claims that she was forced to sign the repayment plan. According to the Defendant, the Plaintiffs threatened litigation against her when she asked for time to pay back the funds she borrowed from Gustavo (namely, $300,000).

[21] According to the Defendant, it is only in response to these threats that she signed an agreement acknowledging a debt of $538,000. She now disputes that she owes Alex or Gustavo anything beyond the $300,000.

[22] The Defendant swore an affidavit claiming that Alex loaned $225,000 to her husband, Bing Qin Cao, to assist him in the purchase of a Japanese restaurant. The three loans were in the amount of $165,000, $50,000, and $10,000 respectively. According to the Defendant, these loans were made by way of cheques, delivered to either her spouse or his lawyer, Henry K. Hui. According to the Defendant, she did not receive any funds from these loans.

Test: Motion for Summary Judgment

Is there a Genuine Issue Requiring a Trial?

[23] Pursuant to Rule 20.04(1) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, the court shall grant summary judgment if it is satisfied there is no genuine issue requiring a trial. Animating the interpretation of Rule 20.04(1) is Rule 1.04 which requires that the rule be liberally construed to secure the just, most expeditious and least expensive determination of a proceeding on its merits having regard to the complexity of the issues and the amounts involved.

[24] The judge in deciding whether to grant summary judgment must ask: can the full appreciation of the evidence and issues that is required to make dispositive findings be achieved by way of summary judgment, or can this full appreciation only be achieved by way of trial? A trial is not required if the judge on the motion can 1) achieve a fair and just adjudication; 2) make the necessary findings of fact; 3) apply the law to those facts; and 4) the motion is a proportionate, more expeditious and less expensive means to achieve a just result rather than going to trial. As the Supreme Court explained in Hryniak v. Mauldin, 2014 SCC 77, 2014 SCC 7, [2014] 1 SCR 87, at para. 50:

These principals are interconnected and all speak to whether summary judgment will provide a fair and just adjudication. When a summary judgment motion allows the judge to find the necessary facts and resolve the dispute, proceeding to trial would generally not be proportionate, timely or cost effective. Similarly, a process that does not give a judge confidence in her conclusions can never be the proportionate way to resolve a dispute. It bears reiterating that the standard for fairness is not whether the procedure is as exhaustive as a trial, but whether it gives the judge confidence that she can find the necessary facts and apply the relevant legal principals so as to resolve the dispute. [Emphasis added.]

[25] According to the Defendant, the nature of the evidence relied upon by the Plaintiffs is inconclusive and is not sufficient to justify judgment in the Plaintiffs’ favor with respect to the $238,000. A trial is required to settle the dispute regarding the specific amounts owed.

[26] Certain bank drafts are made out to unknown males and supported only by the Plaintiffs’ assertion that they are owed by the Defendant.

[27] The Defendant has maintained that the loans were made by Alex to her husband. She has conceded that she received the $300,000 from Gustavo. She contests that she owes the further $238,000 sought by the Plaintiffs.

[28] In this case, there are clear contradictions in the Defendant’s evidence. The statement of defence and her affidavit assert that the amounts claimed relate to loans advanced to her husband. She denies owing any money to the Plaintiffs beyond the $300,000. However, during her cross-examination, the Defendant acknowledged that she was loaned money by the Plaintiffs but did not recall the specific amounts. In her cross-examination, there is also no reference to amounts being loaned by Alex to her husband.

[29] A review of the affidavit and documentary evidence filed in support of the Plaintiffs’ position contains cheques to various named individuals who are not the Defendant.

[30] Certain amounts claimed by the Plaintiffs are clearly supported by the evidentiary record. More specifically, the amount of $185,000 which the Defendant sought to pay back in December of 2019 seems to be a clear debt owed.

[31] In my view, however, the outcome of this case will turn heavily on assessments of credibility. I am not satisfied that this is an appropriate case to be decided by way of summary judgment. Again, as noted in Hryniak v. Mauldin, supra., at para. 50:

It bears reiterating that the standard for fairness is not whether the procedure is as exhaustive as a trial, but whether it gives the judge confidence that she can find the necessary facts and apply the relevant legal principals so as to resolve the dispute [Emphasis added].

[32] I am not satisfied on the record before me that I can make the necessary findings to resolve the dispute in this case.

[33] Accordingly, in relation to the $238,000 which remains in dispute, the Plaintiffs’ motion for summary judgment is dismissed. The matter is to proceed to trial.

[34] Judgment for the $300,000 which is not in dispute is granted in favour of the Plaintiffs.

[35] Given the circumstances of this case, the costs of this motion are to be determined in the cause.

Justice C.F. de Sa

Date: May 26, 2022