Lawsuits filed against owners of mid-income condos

B.C. Housing has filed 14 new lawsuits against owners in a Victoria condo complex, alleging they abused an affordable-housing program.

Vivid, an 135-unit condo building in downtown Victoria, was billed as a pilot for an affordable home ownership program for middle-income earners. It was built by Chard Developments with a $53-million low-interest loan from the B.C. government.

But now the government is going after buyers accused of not fulfilling the terms of the contract, which in part required them to have household income of less than $150,000 a year and to live in the unit as their primary residence for two years.

The addition of the new lawsuits added last week in B.C. Supreme Court create a total of 22 cases, said the ministry.

“The building is intended to supply much-needed affordable housing to people with middle-incomes so they can afford to live in the community they know and love,” said Housing Minister Ravi Kahlon in a statement.

“It is infuriating that the old government left loopholes that allowed investors and speculators to take advantage of the system and fraudulently purchase units at the Vivid at the Yates building in Victoria.”

The project was built as part of a B.C. Liberal government program, said the ministry.

Since the investigation into the Vivid building started in 2021 — prompted by reports that some of the units were being rented in violation of the contract — additional safeguards have been put in place, including requirements that buyers must be residents of B.C. and not own other property.

The lawsuits filed this week accuse the owners of undermining the program by not living in their purchased units. B.C. Housing is seeking to have owners sell back the units to B.C. Housing for the original purchase price, less legal costs and taxes, and punitive damages.

So far, 19 units have ben returned to B.C. Housing, said the ministry. Of those, nine have been resold to qualified buyers with the remaining 10 listed for sale.

Among the new claims is one against Guo Ming Kuang and Hui Ci Chen, who identified themselves as retired Victoria residents. They purchased a unit in 2018 for $279,680 in 2017. As of July 2023, that property was worth $383,000.

Another defendant is Erik Vagle, a Vancouver investment broker, who purchased a unit for $303,600 in 2018. That unit is now worth $388,000, according to B.C. Assessment.

In both claims, B.C. Housing allege the defendants have not lived in the strata unit as their principal residence, and have not informed B.C. Housing of breaching the purchase agreement and the affordable home ownership covenant.

The allegations have not been proven in court.

Another owner, Victoria realtor Janet Yu of Sutton Group West Coast Realty, was slapped with a lawsuit in 2022.

The claim alleges Yu purchased a unit at Vivid in 2018 for $486,720 and made a “significant personal profit” of $52,000 in commissions on 11 other units she helped sell to buyers who shouldn't have qualified for the program. The claim says Yu never lived in the unit.

“The conduct of the defendant in applying for and receiving a subsidized housing unit, never using the unit for its intended purpose, and subsequently refusing to return the unit is egregious and reprehensible,” said the claim.

In a response to the claim, lawyer Michael Hutchison said Yu does not speak English as her first language and, “with the exception of short and occasional visits to family,” was a resident of the strata unit from the time the title was transferred to her “and has continued to do so.”