Court File and Parties

COURT FILE NO.: CV-22-00687209-0000 DATE: 20240711

ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN:

LI YANG (CANADA) HOLDINGS CO. LTD. and DANIEL EXECUTIVE (CANADA) HOLDINGS CORP. Plaintiffs – and – LYSR MANAGEMENT LTD., 2708042 ONTARIO INC., RINA SHINCHI, YANGGUANG LIN, ZI MU LI, RENXIANGYU ZHANG, LOCATION WAY INC., WEI ZHENG, JOHN DOE, JANE DOE and OTHER PERSONS UNKNOWN WHO HAVE CONSPIRED WITH THE NAMED DEFENDANTS Defendants

Counsel: Ford Wong, for the Plaintiffs No one appeared for the Defendants

HEARD: July 8, 2024

Papageorgiou J.

Decision

Overview

[1] This proceeding involves a complicated web of parties and transactions related to the purchase and sale of luxury vehicles. The Plaintiffs financed the purchase of these cars.

[2] There are two distinct groups of defendants. The first group is composed of the defendants LYSR Management Ltd., 2708042 Ontario Inc. (“270Ont”), 2786584 Ontario Inc. (“278Ont”), Rina Shinchi and Yangguang Lin (the “Lin Defendants”). Ms. Shinchi and Mr. Lin are married.

[3] The remaining defendants have been referred to as the Wei Defendants in previous endorsements.

[4] I granted a Mareva injunction on May 1, 2023 (the “May 1 Mareva injunction”). The Lin Defendants participated fully in that motion. I found that a strong prima facie case had been made against them in respect of breach of contract, fraudulent misrepresentation and conspiracy. They have not filed any materials in respect of the merits of this matter since the materials they filed in respect of the Mareva injunction.

[5] The Wei Defendants brought a motion for leave to appeal the May 1 Mareva injunction which was dismissed. Although the Lin Defendants indicated they would be bringing a motion for leave to appeal, they have never done so.

[6] Indeed, the Lin Defendants have effectively stopped participating in this proceeding. There have been numerous attendances since April 2023.

[7] The Plaintiffs now bring a motion for contempt as well as a motion for default judgment, but only with respect to the Lin Defendants. The Wei Defendants are aware of this motion and take no position.

[8] When this matter was originally before me on April 8, 2024, the Lin Defendants advised that they had difficulty connecting to the zoom link. I also had concerns that while their lawyer said they had effectively stopped instructing him, he had not brought a motion to be removed from the record. I had concerns that they might have some impression that he was still representing them and that they need not either defend themselves as self-represented litigants or hire a lawyer. Thus, the motion was adjourned with direction that their former lawyer could bring a motion to be removed from the record directly in me in writing, that the Lin Defendants be served directly again and that the adjourned motions be heard in person to facilitate their attendance.

[9] Since the Lin Defendants have refused to provide their whereabouts, they have been served at the email address that their former counsel has communicated with them at, and which is the address for service in the Order removing their former counsel from the record. I made an order for substituted service. I note that when the Plaintiffs sought to bring this motion on April 8, 2024, the Lin Defendant’s counsel did advise them of the motion using the email addresses he had, and they communicated to the court that they had trouble with the zoom link. Therefore, they do receive correspondence at these email addresses.

[10] All of this occurred, and yet the Lin Defendants still did not file any materials or attend the motion.

Decision

[11] For the reasons that follow, I find Mr. Lin in contempt of court and direct that a hearing in respect of the penalty be scheduled. I also grant default judgment against the Lin Defendants and order that the Mareva injunction is vacated.

Issues

• Issue 1: Are the Plaintiffs entitled to default judgment as against the Lin Defendants?
• Issue 2: Can the Plaintiffs seek a contempt order at the same time as they pursue default judgment and should this court make a contempt order?
• Issue 3: Should the Mareva injunction continue notwithstanding the default judgment?

Analysis

Issue 1: Are the Plaintiffs entitled to default judgment as against the Lin Defendants?

Do the materials provide a basis for a finding of liability?

Consequences of noting in default

[12] Pursuant to r. 19.02, having not defended the proceeding, a defendant is deemed to admit the truth of all allegations of fact made in the Statement of Claim.

[13] However, pursuant to r. 19.06 a plaintiff is not entitled to judgment on a motion for judgment or at a trial merely because the facts alleged in the statement of claim are deemed to be admitted, unless the facts entitle the plaintiff to judgment.

[14] In particular, r. 19.05 provides that a motion for judgment which involves unliquidated damages shall be supported by evidence given by affidavit.

The test on a motion for default judgment

[15] The test on a motion for default judgement was set out in Elekta Ltd. v. Rodkin, 2012 CarswellOnt 2928 (ONSC) as follows: A. What deemed admissions of fact flow from the facts pleaded in the Statement of Claim? B. Do those deemed admissions of fact entitle the plaintiff, as a matter of law, to judgement on the claim? C. If they do not, has the plaintiff adduced admissible evidence which, when combined with the deemed admissions, entitle it to judgement on the pleaded claim?

Liability

[16] The essence of the Plaintiffs’ case is that the Lin Defendants borrowed money from the Plaintiffs to purchase luxury vehicles for export overseas, showing the Plaintiffs documentation which confirmed that such vehicles had been purchased, and purportedly transferring these vehicles to the Plaintiffs who had financed them pursuant to fraudulently created documents. Ultimately, the vehicles in question have either disappeared or cannot be sold because they are subject to security interests, of which the Plaintiffs were unaware.

[17] I am satisfied, based upon deemed admissions and affidavit evidence filed, that the plaintiffs have made out a claim in breach of contract, fraudulent misrepresentation and conspiracy.

[18] Beginning in early 2021, the Plaintiffs began loaning funds to the defendant 270Ont to be used to purchase luxury cars in Canada for expert overseas. The Plaintiffs understood that 270Ont was the purchaser of these vehicles. The loaned funds were due 30 days after they were advanced. If not paid, the loan agreements provided for a daily .1 % interest rate until the loan was paid.

[19] For each vehicle, the Plaintiffs were given a partial purchase agreement showing the total purchase price inclusive of taxes and vehicle details.

[20] 270Ont ran into problems with its bank and so at 270Ont’s request, the Plaintiffs began loaning money to LYSR for the same purpose. Pursuant to an Agency Agreement, LYSR at all times acted as 270Ont’s agent.

[21] Then the defendant 278Ont was incorporated to facilitate the buying and selling of luxury vehicles because of dealer concerns relating to selling too many cars to one buyer, LYSR.

[22] The defendants Ms. Shinchi and Mr. Lin guaranteed the loans.

[23] There were thirteen transactions in total.

[24] As of February 2022, LYSR had failed to repay approximately 8 of the loans such that the outstanding amount was $1,697,106.

[25] On February 22, 2022, the Plaintiffs and LYSR entered into a written Cooperation Agreement. In it, LYSR acknowledged that $1,697,106 was outstanding. The Cooperation Agreement provided among other terms that the right of ownership of four luxury cars intended for the Japanese market, a 2022 McLaren, a 2018 Ferrari, a 2020 Bentley, and a 2018 Bentley would be transferred to the Plaintiffs.

[26] These four vehicles were to be resold and the proceeds used to repay the debt owing to the Plaintiffs, failing which LYSR would buy back the vehicles in order to repay the debt owing to the Plaintiffs.

[27] Prior to the parties entering the Cooperation Agreement, the Lin Defendants intentionally misrepresented that the full ownership of the four vehicles would be transferred to the Plaintiffs with the full knowledge that such representations were false or made recklessly without regard to whether it was true, with the knowledge that the Plaintiffs were relying on said representations. This included showing documentary proof that 270Ont and 278Ont owned the four vehicles by providing copies of sales contracts and proof of payment. These sales contracts were fake.

[28] In reliance on the representations made by the Lin Defendants, the Plaintiffs were induced to enter into the Cooperation Agreement.

[29] Additionally, pursuant to the Cooperation Agreement, the Plaintiffs agreed to loan $400,000 to LYSR to develop the Japanese export market. A mortgage in the amount of $400,000 was placed on property located at 311 Bay Street, Unit 4704, which home belonged to Ms. Shinchi and which had a 9 % interest rate (the “Mortgage”).

[30] Then after the Cooperation Agreement, because the Plaintiffs felt satisfied that things were on the right path, they entered into two further loan transactions, loaning $148,499.51 plus $243,840.75 to LYSR on the same terms as prior loans.

[31] As well, on March 21, 2022, the Plaintiffs advanced a further $30,000 to be used as a deposit for a fifth vehicle.

[32] In or around May 2022 the Plaintiffs became suspicious because they had learned that one of the four vehicles, the McLaren, had never been owned by LYSR or any of the Lin Defendants.

[33] As well they learned that all of the four vehicles had been subject to security interests, of which the Plaintiffs had never been advised.

[34] The Plaintiffs made further inquiries and learned that another entity Prime Leasing took the position that it owned the other three vehicles.

[35] In terms of where the vehicles were, two of the vehicles had been picked up by the defendant Location Way. Two of the other vehicles were shipped to Japan. However, because of security interests in favour of Prime Leasing, the shipper would not release the cars to the Plaintiffs. These vehicles have been sitting in a container and the Plaintiffs have been paying for their preservation and storage.

[36] The loans have never been repaid.

[37] The Mortgage has since gone into default. The Plaintiffs have been unable to realize anything from the sale of this property.

[38] There are many causes of action pursuant to which the Plaintiffs could succeed as against some of the Lin Defendants as to some amounts that they claim.

Breach of Contract

[39] In that regard, there are breaches of contract including related to the outstanding loans that have never been repaid, the guarantees that have never been honored, the breach of the Cooperation Agreement related to the failure to transfer the four vehicles to the Plaintiffs and the additional $400,000 advanced pursuant to the Cooperation Agreement which has not been repaid.

[40] Liability here would be only as against the contracting parties: 270Ont in respect of the loans. The Plaintiffs have provided a comprehensive breakdown of amounts advanced that have not been paid together with an interest calculation as of January 12, 2024, which equals $3,412,175.36. As noted above, the contractual interest rate was .1 % per day.

[41] Mr. Lin and Ms. Shinchi, who guaranteed these loans, are also liable for this amount: $3,412,175.36.

[42] 270Ont would also be liable for breach of the Cooperation Agreement. In that regard, LYSR entered into the Cooperation Agreement as agent for 270Ont. The Plaintiffs were aware that LYSR was 270Ont’s agent.

[43] The Plaintiffs incurred $386,607 in respect of import, custom, storage, transportation and other fees and expenses related to the four vehicles pursuant to the Cooperation Agreement. Since LYSR was acting as 270Ont’s agent, 270Ont is liable for this amount.

[44] 270Ont is also liable for the $400,000 advanced pursuant to the Cooperation Agreement as it was entered into by LYSR as 270Ont’s agent to develop the Japanese market which was never done.

[45] Ms. Shinchi is also personally liable for the $400,000 unpaid Mortgage on her property with interest.

[46] Although 270Ont is also liable for failing to transfer ownership of the four vehicles to the Plaintiffs, this does not increase the damages. The cars were to be transferred to the plaintiffs essentially to secure the payment of the outstanding loan amount. Since I am already awarding that amount, there are no new damages arising from this failure.

Fraudulent Misrepresentation

[47] The elements of the tort of fraudulent misrepresentation are as follows: (1) the defendant makes a false statement; (2) the defendant knew that the statement was false, or was indifferent to its truth or falsity; (3) the defendant had the intention to deceive the plaintiff; (4) the false statement was material in that it induced the plaintiff to act; and (5) the plaintiff suffered damages as a result of so acting: see Fiorillo v. Krispy Kreme Doughnuts Inc., 2009 ONSC 29902, 98 O.R. (3d) 103 (S.C.), at paras. 66-67; Bruno Appliance and Furniture v. Hryniak, 2014 SCC 8 at para 21.

[48] It is deemed admitted that the Lin Defendants made false representations regarding the ownership of the four vehicles with the knowledge that they were false, or being recklessly or willfully blind to the fact that they were false, to induce the Plaintiffs to enter into the Cooperation Agreement and delay the Plaintiffs in enforcing repayment of the debts owing up to that time.

[49] It is also deemed admitted that the Plaintiffs relied upon these representations to their detriment.

[50] The evidence filed demonstrated that:

• The Plaintiffs were sent bank transfer documentation showing that the purchase price set out in the Retail Sales Agreements in respect of each Vehicle had been paid in full in a single transfer. However, this was not the case as Mr. Lin admitted during his cross-examination that the payment transactions which were shown to Li Yang were reversed.
• There were also Debit Memo Payments shown to the Plaintiffs that completely misrepresented the nature of the payments which were made for the Vehicles. In fact, Mr. Lin’s affidavit showed that the Vehicles were paid for by way of instalments, many of which occurred after the date of the purported retail sale agreements, and some even after the Cooperation Agreement in February 2022. The only logical and reasonable inference is that these transactions were made in this way and shown to the Plaintiffs to deliberately conceal the true nature of the transactions.
• Had the Plaintiffs seen the instalment payments, and in particular the fact that full payments had not been made as of the Cooperation Agreement, they would have been put on notice as to a potential security interest and may have conducted a search.
• The Plaintiffs’ failure to conduct these searches would constitute some defence to a negligence claim, but the Plaintiffs’ claim is not in negligence. It is based upon fraudulent misrepresentation. I have not been shown and am not aware of any caselaw that says that a failure to conduct due diligence is a defence to fraudulent misrepresentation.
• The Plaintiffs relied upon the misrepresentation by entering into the Cooperation Agreement, advancing additional funds pursuant to it, and later entering into further loan agreements believing that all was running well. It also caused the Plaintiffs to delay the commencement of these proceedings.

[51] Damages for this would not include the outstanding loans in the amount of $1,697,106 as at the time of the Cooperation Agreement or any accrued interest.

[52] The damages caused by the fraudulent misrepresentation would be the additional $400,000 advanced pursuant to the Cooperation Agreement and the $386,607 the Plaintiffs incurred in connection with the four vehicles as a result of the fraudulent misrepresentation.

Conspiracy

[53] Conspiracy by unlawful means consists of an agreement between two or more parties to do an unlawful act, or to do a lawful act by unlawful means that causes damage: The Queen v. O’Brien, 1954 SCC 42, [1954] S.C.R. 666; Cement Lafarge v. B.C. Lightweight Aggregate, 1983 SCC 23, [1983] 1 S.C.R. 452.

[54] By virtue of the pleadings, it is deemed admitted that LYSR, 270Ont and 278Ont are the corporate vehicles that Ms. Shinchi and Mr. Lin operated directly or indirectly for the purpose of an unlawful scheme/agreement whereby through LYSR they would borrow money from the Plaintiffs to purchase luxury vehicles for export representing that such funds would be used to purchase vehicles, which they knew they would not and intended not to do. It is deemed admitted that they received some or all of the illicitly induced loan proceeds.

[55] It is deemed admitted that the Lin Defendants individually and in concert with one another, repeatedly engaged in these unlawful acts and practices pursuant to their fraudulent scheme/agreement. These wrongful acts include fraudulent misrepresentations as to the purchase and ownership of vehicles with the loaned funds.

[56] It is deemed admitted that the Lin Defendants knew that their actions would cause damage to the Plaintiffs, and that such damage did occur in that the Plaintiffs were deprived of the funds they forwarded for the purchase of the vehicles that were never bought.

[57] The damages caused by the conspiracy among all the Lin Defendants are:

• unpaid loans including service fees and interest, in the amount of $3,412,175 as at January 12, 2024.
• expenses related to the four vehicles in the amount of $386,607.
• the $400,000 advanced pursuant to the Cooperation Agreement which is $442,000 inclusive of interest as at January 12, 2024.

Punitive Damages

[58] I do not award any punitive damages as the Plaintiffs have not demonstrated an independent actionable wrong. While I have found liability for fraudulent misrepresentation and conspiracy, I have already awarded damages for these.

Issue 2: Can the Plaintiffs seek a contempt order at the same time as it pursued default judgment and should this court make a contempt order?

[59] In my view, there is no bar to the Plaintiffs doing so.

[60] In Thrive Capital Management Ltd. v. Noble 1324, 2021 ONCA 722, the Court addressed a situation where the following orders had been made: a Mareva injunction, a default judgment, and a contempt order. The court set aside the contempt order, not because the motion occurred at the same time as the motion for default judgment, but because the judge had refused to permit the contemnors from addressing the merits of the action at the sentencing hearing, despite allowing the default judgment to proceed. This was an issue of fairness. The Court stated:

[28] Where a statement of defence is struck, there may well follow an unopposed motion for default judgment.

[29] While it may be tempting to collapse the issues of contempt and striking a defence on the one hand and a motion for judgment on the other hand into one proceeding, this may be false economy.

[33] This is not to say that in a given case, judgment may not be an appropriate remedy against a party who is in contempt or who has failed to comply with an interim order. There is no impediment in the Rules barring a party from moving for various and alternative relief. For example, a litigant could move under r. 60.11 for an order imprisoning a party for contempt, for an order striking their pleadings under either rr. 60.11 or 60.12, and for default judgment in the event the pleadings are struck. If the latter is included, the moving party should expect that there will be a more searching inquiry about the merits and that the respondent will be given an opportunity to respond to the merits. [Emphasis added]

[61] In this case, the Lin Defendants have been given multiple opportunities to appear and give evidence in respect of the default judgment motion and the contempt motion. It is not the court here who is barring the Lin Defendants from giving evidence. The Lin Defendants have failed to file any materials and have failed to attend today.

[62] In my view, this is an appropriate case to grant judgment and make a contempt order.

[63] The following test applies: i) Did the Lin Defendants have actual knowledge of the orders in question? ii) Does the Court order in question clearly and unequivocally state what the Lin Defendants were required to do? iii) Have the Lin Defendants intentionally done the act the orders prohibited or have they failed to do what the orders require.

[64] Before addressing the issues, some background is necessary to put the July 6 Order into context.

[65] Following the May 1 Mareva injunction Order, the parties attended before me on May 26, 2023, to address living and business expenses as well as limitations on the Mareva injunction. The materials the Lin Defendants provided were inadequate and so a further hearing had to be arranged for this purpose. At the May 26 attendance, Ms. Shinchi indicated that her family was effectively foreclosed from earning a living because of the Order. She explained the hardship on her because she was thus unable to support her children.

[66] With the consent of the Plaintiffs, I directed that the business account in Ms. Shinchi’s name could be unfrozen for the next month with a full accounting to the Plaintiffs at the end of the month as well as the particulars anytime they entered into an agreement to obtain financing or sell a vehicle. However, no Order was ever taken out and so that account has always remained frozen.

[67] The parties then attended before me again on July 6, 2023, to again address their living expenses as well as limitations to the May 1 Mareva injunction.

[68] At that time, I made additional orders including orders which are the subject of the contempt motion as follows:

• Paragraph 8 directed that information and supporting documentation as to the financing that is outstanding on certain vehicles set out in Mr. Lin’s affidavits sworn May 13, 2023, and May 23, 2023, be provided within 7 days.
• Paragraph 9 directed that the Lin Defendants provide the Plaintiffs with a full monthly accounting from their business, as well as full particulars whenever they entered into any agreement to obtain financing or purchase a vehicle.
• Paragraph 10 directed that the Lin Defendants attend for examination under oath in respect of their affidavits to be completed by July 27, 2023.
• Paragraph 17 directed that the Lin Defendants provide their Statement of Defence by August 6, 2023. I note that the Lin Defendants did provide their Statement of Defence, but it was late and in the interim they were noted in default. They have never moved to set aside the noting in default.

[69] The contempt motion was originally returnable before me on November 24, 2023. Mr. Murray did attend on behalf of the Lin Defendants at that time but filed no materials. He indicated that he had been sending motion materials to the Lin Defendants but that they do not respond and that he intended to move to get off the record. He said he had no instructions but nevertheless made submissions.

[70] In accordance with appellate direction that the contempt power should be exercised with caution and as a last resort [1], I exercised my discretion to make declarations that the Lin Defendants had breached the July 6 Order, striking the Lin Defendants’ Statement of Defence (if required since they were already noted in default and only served a Statement of Defence), and directing that the Plaintiffs could bring a motion in writing for default judgment with a schedule. I also directed that if the Lin Defendants had not complied with the July 6 Order by January 31, 2024, the Plaintiffs could renew the contempt motion.

[71] The Lin Defendants did not appeal this decision.

Issue 1: Did the Lin Defendants have actual knowledge of the orders in question?

[72] Yes, they did.

[73] Actual knowledge can be inferred from the circumstances, and an inference of knowledge may be readily drawn where it is an “ordinary case in which a party is involved in isolated pieces of litigation.” Where facts that can support this inference are proven, the inference of knowledge will “always be available”: Carey v. Laiken, 2015 SCC 17 at para 34; Bhatnager v. Canada (Minister of Employment and Immigration), 1990 SCC 120 at 226.

[74] The initial May 1, 2023, Mareva injunction was made on notice, the Lin Defendants filed materials and participated fully. At the time of the July 6, 2023 Order, the Lin Defendants were still participating, and their counsel, Mr. Murray, attended and was still able to obtain instructions.

[75] I am satisfied beyond a reasonable doubt that the Lin Defendants were aware of the July 6 Order.

Issues 2 & 3: Do the Court Orders clearly and unequivocally state what the Lin Defendants were required to do? Have the Lin Defendants intentionally done the act prohibited or have they failed to do what the July 6 Order requires?

[76] There are issues with respect to whether the July 6 Order was clear and unequivocal enough with respect to all the Lin Defendants and whether all of the Lin Defendants have intentionally failed to comply with the July 6 Order. In the exercise of my discretion, I only find Mr. Lin in contempt for the following reasons.

[77] Although paragraph 8 of the Order can be read to implicitly require all the Lin Defendants to provide the material set out in paragraph 8, this paragraph is not clear enough in that regard to justify a contempt order against all the Lin Defendants. It is only clear and unequivocal with respect to Mr. Lin alone. In that regard, it reads as follows:

8. THIS COURT ORDERS that Lin shall provide information and supporting documents as to the financing that is outstanding on each of the vehicles set out in his Affidavits sworn May 13, 2023 and sworn May 23, 2023, which are listed in Schedule "B" hereto within seven (7) days of this Order to the extent that Lin, Shinchi, 270Ont, 278Ont, and LYSR (hereinafter collectively referred to as the "Lin Defendants") have such documents. If the Lin Defendants do not have this information, then they shall provide an affidavit which sets out their best information on this issue.

[78] I note that it was the Plaintiffs who drafted this Order.

[79] With respect to paragraph 9 of the July 6 Order, this paragraph could be read to relate only to any future business that the Lin Defendants engaged in pursuant to my direction that they could operate the business through Ms. Shinchi’s unfrozen bank account with a monthly accounting, and not to any period prior. Although the defendants have not provided the Plaintiffs with any monthly accounting from their business following the order where I unfroze Ms. Shinchi’s account, there is no evidence before me that they continue to operate this business through this account. All of their known bank accounts have remained frozen and as such, it is not clear on the record before me that there was any information to disclose. Thus, the most they have failed to do is confirm that they are not currently operating a business.

[80] With respect to paragraph 10 of the July 6 Order, although the Lin Defendants have never attended for examination as required by July 27, 2023, the Plaintiffs never sent the Lin Defendants any notice of examination. Rather, what they did is write to Mr. Murray seeking to schedule the cross examination but there was no response. The Plaintiffs only made two attempts to schedule this examination prior to July 27. While their failure to respond to the Plaintiffs’ attempts to schedule the examination and complete it prior to July 27 was enough to make declarations that they have breached the July 7 Order, in my view, this is insufficient for a contempt order which requires intentional noncompliance. If the Lin Defendants did not respond and the Plaintiffs wanted to ground a contempt motion in that nonattendance, then the Plaintiffs should have sent a notice of examination and then obtained a Certificate of Non-Attendance. They have also not tried to schedule anything since July 27, 2023, when the examination was to be completed.

[81] With respect to paragraph 17, the Lin Defendants did serve a Statement of Defence, albeit after the Court ordered deadline.

[82] Thus, for the purposes of this contempt motion, I only am satisfied beyond a reasonable doubt that the Court Order was clear and unequivocal in advising Mr. Lin what he was required to do in paragraph 8 with respect to additional information he was to provide. I am also satisfied that he has willfully disregarded paragraph 8 of Order: Stokes v. Stokes, 2014 ONSC 1311 at para 25.

[83] He has had many opportunities since the July 6 Order to provide this material.

Issue 3: Should the Mareva injunction continue notwithstanding the default judgment?

[84] I hereby vacate the Mareva injunction.

[85] As set out by Dunphy J in Canadian Premier Life Insurance Company v. Ho, 2016 ONSC 496, a Mareva injunction is an interlocutory order made to preserve property prior to judgment. Interlocutory orders normally merge with a judgment once granted.

[86] I agree with Dunphy J that remedies available to a judgment creditor are up to the task of protecting the legitimate interests of a judgment creditor.

[87] See also B & M Handelman Investments Ltd. v. Curreri, 2011 ONCA 395 at para 3.

Costs

[88] The Plaintiffs request costs in the amount of $137,790 on a partial indemnity basis or $200,000 on a substantial indemnity basis.

[89] Pursuant to s. 131(1) of the Courts of Justice Act, R.S.O. 1990, c. C.43, costs are in the discretion of the court. Rule 57 of the Rules sets out the factors which courts should have regard to when awarding costs. The overall objective is “to fix an amount that is fair and reasonable for the unsuccessful party to pay in the particular proceeding, rather than an amount fixed by the actual costs incurred by the successful litigant”: Zesta Engineering Ltd. v. Cloutier, 2002 ONCA 25577, 21 C.C.E.L. (3d) 161 (Ont. C.A.), at para. 4; Boucher v. Public Accountants Council for the Province of Ontario, 2004 ONCA 14579, 71 O.R. (3d) 291 (C.A.), at para. 26; Clarington (Municipality) v. Blue Circle Canada Inc., 2009 ONCA 722, 100 O.R. (3d) 66, at para. 52; and G.C. v. Ontario (Attorney General), 2014 ONSC 1191, at para. 5.

[90] The materials for this matter as against the Lin Defendants were voluminous. There were multiple transactions that the Plaintiffs had to review and provide evidence in respect of. The Lin Defendants have repeatedly failed to attend and at the last return date advised that they had been unable to attend because of the zoom link. Then, when this matter was scheduled to take place in person they failed to attend in any event. This was a serious matter with a great deal at stake and the Lin Defendants ought to have expected that the Plaintiffs would have to expend considerable funds to prepare complex and detailed materials.

[91] I am satisfied that a partial indemnity award in the amount of $137,790 is fair and reasonable.

Conclusion

[92] Thus, the Lin Defendants are jointly and severally liable for the amounts set out in paragraph 57 above which are quantified as of January 12, 2024, with pre and post judgment interest at the Courts of Justice Act rate.

[93] I find Mr. Lin in contempt of the July 6, 2023 Order and direct that a hearing be scheduled to determine the penalty with notice to Mr. Lin. The Plaintiffs may arrange this in the ordinary course.

[94] The Mareva injunction is vacated.

Justice Papageorgiou

Released: July 11, 2024

[1] Ruffolo v. David, 2019 ONCA 385; Chong v. Donnelly, 2019 ONCA 799, 33 R.F.L. (8th) 19, at paras. 9-12; Valoris pour enfants et adultes de Prescott-Russell c. K.R., 2021 ONCA 366, at para. 41