Judge orders sale of home given to teen

A judge ordered the sale of a Vancouver home after finding title to the property was fraudulently transferred by the owners, who had been implicated in a multi-million-dollar business fraud in Washington state.

Mary Yang and her husband Samuel Zhu bought the property at 4885 Narvaez Drive near Prince of Wales Secondary in April 2003. In November 2008, they transferred title to the two-storey, six-bedroom home, which has an assessed value of $6 million, to Yang’s then-14-yearold daughter as well as Yang’s sister and the sister’s husband.

The property transfer came as a substantial claim was being made against Yang and her husband arising from their business dealings in the United States.

In November 2015, a jury in Washington state found Yang was liable for US$7.2 million for fraudulent conduct related to a company called Prima Technology.

That judgment was later increased to more than US$11 million.

A default judgment against Zhu, a former general manager at Prima Technology, was later determined to be more than US$10 million.

Improper bank transfers amounting to millions had been made from a company called Alux Inc., of which Mary Yang was the sole shareholder.

The Superior Court of Snohomish County found Zhu used Prima employees without authorization to assist Alux and allowed Alux to invoice Prima’s customers for products belonging to Prima.

In 2016, the B.C. Supreme Court ordered the Washington state judgments be registered against Yang and Zhu, with Prima able to recover about $500,000 from Yang in B.C.

Prima, which became aware of the transfer of the Vancouver home, then sought a court order in B.C. that the conveyance of the Narvaez home was void. Prima also sought an order for the property to be sold.

In a ruling posted at the court’s website Tuesday, B.C. Supreme Court Justice Kenneth Affleck said the evidence was “overwhelming” that Yang was aware before she transferred the property that large claims had been made against her in the U.S.

Yang argued Prima’s claim was barred by the passage of time, but the judge rejected those arguments.

The defendant also claimed the transfer of property was not fraudulent because it was consistent with a Chinese tradition of giving property to children who then permit their parents to remain living at the home.

But the judge said there was no evidence before him of such a custom apart from Yang’s bare assertion.

“Moreover, she was only 42 years old at the time of the conveyance when she transferred title in her home to her 14-year-old daughter and other close relatives,” the judge said. “It is plausible that there is a ‘Chinese custom’ of parents leaving property to their children, but to do so at a relatively young age of 42 years is not plausible.”

The judge said there were a number of “badges of fraud” that proved Yang’s intention was fraudulent, including that she continued to live in the home after the conveyance, and that the transfer appeared to have divested her of her most substantial asset.

“In my opinion, there is a compelling inference that the conveyance of the real property was intended to defeat a potential judgment creditor, namely the plaintiff,” said Affleck.

The judge declared the property transfer was void and ordered it be sold in partial satisfaction of the Washington state judgments.

The judge said any sale of the property would be subject to approval of the court.