A B.C. Supreme Court judge ruled that a close associate of Richmond real estate and immigration lawyer Hong Guo abused the court process for a baseless claim.
In her April 19 verdict, Justice Heather MacNaughton said that Wolfgang Richter and his company, Richter and Associates Inc., used the courts in a bid to “extort a settlement payment” over a failed real estate deal.
Beginning in March 2021, Richter sued 1075 Nelson Street Development Holdings Inc. and Henson Developments Ltd. and its CEO Xuexin “Henry” Liu and filed certificates of pending litigation against 1075 Nelson.
1075 Nelson was the registered owner of 1059 and 1075 Nelson Street, assessed last year at $16.4 million each, and formerly held the lands as agent, bare trustee and nominee for Henson.
MacNaughton’s verdict said Guo, a 2018 Richmond mayoral candidate and who once worked in the Chinese Communist government’s state council, claimed in a WeChat message on March 2, 2021 that she had a buyer lined up to offer Henson $110 million.
Henson had conditionally agreed the previous month to sell the Nelson lands to Montreal-based Brivia Group Ltd. and enter a joint venture to build a 60-storey condo tower. Brivia was to have 54% interest and Henson 46%, and retire the existing Nelson mortgages worth $77 million.
Henson’s lawyer advised Richter on March 19, 2021 that the Nelson lands were under an unconditional contract and it could not entertain any other offers.
“Mr. Liu’s uncontroverted evidence is that no agreement was ever reached with Richter Inc. The negotiations that were facilitated by Ms. Guo were for a back-up offer in the event that Brivia did not waive the conditions in the Brivia agreement,” MacNaughton wrote.
Liu is also director of Evervan Enterprises Group Ltd. and Vanluxu Enterprises Ltd., companies that jointly owned property on Wentworth Avenue in West Vancouver. He swore in an affidavit about a February 2021 agreement to sell that land to 1291059 BC Ltd., a numbered company controlled by Hong Xu, a friend of Guo.
Liu’s evidence said Guo brought an unnamed caucasian man to meetings, to discuss the properties. The numbered company claimed in a March 5, 2021 court filing that it had a deal to buy the lands and registered CPLs against the property. The claim was settled a week and a half later when the numbered company received $900,000 to relinquish the claim.
A division of Brivia bought 2510 and 2480 Wentworth in May 2021. The two properties were assessed at a combined $18.9 million last year.
MacNaughton wrote that Richter used the numbered company’s notice of claim as a template for his action, and that that Richter’s true purpose was not to advance a genuine claim, but register the CPLs for “collateral and improper purposes.”
“In his submissions, Mr. Richter said that he commenced the action and filed the CPLs to let Brivia know what he said was the dishonourable nature of Mr. Liu, the person they were dealing with. The amended claim pleads no facts supporting an agreement or an interest in land. Material facts within the pleading were misleading in order to present what appeared to be a legitimate claim. The only reasonable inference that can be drawn is that the action was commenced, and the CPLs registered, as leverage to obtain a settlement as had been achieved in 1291’s action, albeit in very different circumstances.”
The judge did not admit an affidavit filed by Richter because it was filed late without explanation and contained inadmissible hearsay, unidentified sources of information and argument. “Although Mr. Richter is not legally trained, he is a sophisticated business person,” she said. (Richter is a former high school teacher who founded a company promoting the Garibaldi at Squamish ski resort near Squamish now proposed by the Aquilini Investment Group and the Squamish Nation’s Nch’kay Development Corp.
Although Guo was not a party to the lawsuit, MacNaughton’s ruling referred to Guo’s ongoing battle to remain licensed as a lawyer in B.C.
“While the action purports to be filed by Richter Inc., acting through its authorized representative Mr. Richter, without counsel, the address for service is Ms. Guo’s law firm,” she wrote.
“Ms. Guo has an extensive disciplinary history with the Law Society of British Columbia. It includes two findings of professional misconduct, one on November 4, 2020, and the other on May 20, 2021. She is currently facing another citation for professional misconduct, dated July 23, 2021. It includes a number of allegations of: practicing while suspended, breaching Law Society orders, making misrepresentations to the Law Society, dishonesty and misrepresentations to others, and acting in a conflict of interest.”
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