Executive Summary: Key Legal and Evidentiary Issues

• Defendants 1046598 B.C. Ltd. and Wansu Jiang applied to set aside default judgments obtained against them in connection with a commercial lease dispute over premises on Robson Street in Vancouver.
   
• Central to the application was whether the defendants' failure to respond to the notice of civil claim was wilful or deliberate, given contested questions about whether proper service had been effected on Ms. Jiang.
   
• Ms. Jiang deposed that she had no knowledge of the proceedings until around February 9, 2026, having separated from her husband and no longer residing at the Skilift property where substituted service was directed.
   
• The Miracle Feeds v. D. & H. Enterprises Ltd. framework governed the court's analysis, requiring the defendants to demonstrate their non-response was not wilful, that the application was brought promptly, and that a defence worthy of investigation existed.
   
• Defendants raised a potentially meritorious defence based on the plaintiff's alleged failure to complete agreed-upon repairs and improvements to the leased premises, which caused the Company to suffer ongoing losses.
   
• Fairness and equity considerations were weighed against the plaintiff's concern that setting aside the judgments — given foreclosure proceedings on Ms. Jiang's Skilift property — could ultimately preclude recovery on the underlying claim.
   

Facts of the case

Alpex Equities Inc. is a rental management company that owns and manages a rental building on Robson Street in Vancouver. On December 3, 2020, Alpex and 1046598 B.C. Ltd. (the "Company") entered into a lease agreement for commercial premises to be used as a clothing store. The Company paid a $50,000 deposit, and Alpex agreed to undertake certain repairs and make specified improvements to the premises before the Company took possession. The five-year lease term formally began on November 18, 2023, though the Company began occupying the premises in July 2023. The lease required both a basic monthly rental and additional rent; the Company only ever paid the basic rent and disputed liability for the additional rent. Defendant Wansu Jiang, the sole director of the Company, entered into a personal indemnity agreement whereby she agreed to indemnify Alpex from any loss, costs, or damages arising from the Company's failure to pay rent. In around the middle of December 2024, the Company abandoned the premises.

Policy and contractual terms at issue

The lease provided for a basic monthly rental amount as well as additional rent obligations. The plaintiff claims that rent was underpaid throughout the period the Company occupied the premises. The defendants dispute liability for the additional rent and further allege that Alpex failed to perform the repairs and improvements it had contractually agreed to complete before the Company took possession. Ms. Jiang's indemnity agreement made her personally liable for any rent shortfall under the lease. The application to set aside the default judgments was governed by Rule 3-8(11) of the Supreme Court Civil Rules and the discretionary factors set out in Miracle Feeds v. D. & H. Enterprises Ltd., [1979] B.C.J. No. 1965.

Reasoning and analysis

Justice Walker addressed three questions under the Miracle Feeds framework. On the first question — whether the defendants' failure to respond was wilful or deliberate — the court found in their favour. Ms. Jiang deposed that she had not lived at the Skilift Place, West Vancouver property since around March 2025 due to her separation from her husband, Mr. Duyu, and that the email address used for substituted service (duyu1989@hotmail.com) belonged to her husband, not to her. The court acknowledged that Alpex's own representative had previously communicated with "Dino" (Mr. Duyu) through that email during the lease period, and that plaintiff's counsel was aware of two other email addresses connected to the Company — soo0213@gmail.com and jws@jwsjws.com — neither of which was used to deliver the notice of claim. The court declined to conclude that Ms. Jiang had access to the husband's email simply because she had appended screenshots of emails sent to that address, noting that Mr. Du Yu appeared to have been involved in the store. The court further declined to infer from the Company's proper service under s. 9-1(a) of the Business Corporations Act, S.B.C. 2002, c. 57 that Ms. Jiang herself had notice of the claim.

On the second question — whether the application was brought as soon as reasonably possible — the court found that Ms. Jiang became aware of the proceedings around February 9, 2026, retained counsel around February 13, 2026, and the application was filed on March 4, 2026, satisfying the promptness requirement. On the third question — whether a defence worthy of investigation existed — the court accepted that the defendants' claim that Alpex breached the lease by failing to complete the agreed repairs, and that the defendants might be entitled to set off any proven losses against those claimed by the plaintiff, constituted at least a defence worthy of investigation. Photographs attached to Ms. Jiang's affidavit provided some evidentiary support for the alleged deficiencies. The court also noted that the quantum of additional rent, how it was calculated, and what was communicated to the defendants remained unclear. While the court acknowledged the plaintiff's fairness argument — namely, that the Skilift property was already subject to two separate foreclosure proceedings and setting aside the judgments could prevent recovery — Justice Walker determined that the interests of justice, weighed through the Miracle Feeds analysis, required the default judgments to be set aside.

Ruling and overall outcome

The defendants' application was granted. Justice Walker set aside both default judgments: the judgment against 1046598 B.C. Ltd. filed on September 9, 2025, and the judgment against Wansu Jiang filed on December 12, 2025. The defendants were given leave to file a response to the plaintiff's notice of civil claim within 14 days of the order. The Registrar of Land Titles was directed to cancel the registered charge on PID 009-665-935, Lot 1, Block B, District Lot 815, Plan 9624. Costs of the application were ordered to be in the cause. No monetary award was made in favour of either party at this stage of the proceedings.