Executive Summary: Key Legal and Evidentiary Issues

• Appeal concerned whether the debtor had the financial means to comply with a $300,000/month payment order.

• The appellant challenged the registrar’s reliance on her disclosed net worth as evidence of ability to pay.

• Substantial historical payments and financial documents supported the registrar’s conclusions.

• The appellant's claim that liquidity issues and project cash flows hindered payments was rejected.

• Court found the appellant deliberately chose to stop payments despite financial capacity.

• The appeal was dismissed, and costs were awarded to the respondent on Scale B.

Facts and outcome of the case

This case arises from a failed real estate development project in Burnaby, British Columbia, initially financed by GC Capital Inc. In 2018, GC Capital lent $4.5 million to two companies involved in the project. Helen Chan Sun and David Grewal personally guaranteed the loan. The guarantors provided security interests and net worth declarations to secure the financing. After the borrowers defaulted in 2019, GC Capital obtained a foreclosure judgment in 2020 for over $5.3 million.

In 2021, GC Capital and Ms. Sun entered into a settlement agreement under which she agreed to pay approximately $5.6 million in installments. Although she initially made some substantial payments, Ms. Sun ceased payments in mid-2022. GC resumed enforcement efforts, including contempt applications and debtor examinations. In 2024, the registrar ordered Ms. Sun to pay $300,000 per month starting in February 2025 until the judgment was satisfied. This order followed lengthy proceedings and analysis of her disclosed net worth, which was estimated at over $20 million as of late 2023.

Ms. Sun appealed the registrar’s order on two grounds: first, that the registrar erred in finding she had the financial capacity to make the monthly payments; second, that the registrar failed to consider the liquidity of her assets and cash flow constraints. She argued her assets were tied up in development projects and not readily accessible.

The Supreme Court of British Columbia rejected the appeal, concluding there was ample evidence that Ms. Sun possessed the financial ability to comply with the payment order. The court pointed to her pattern of making large payments when it suited her procedural interests and her significant shareholder loan receivables and real estate holdings. It found her refusal to continue payments was a voluntary decision, not a consequence of insolvency or lack of liquidity.

The judgment amount originally stood at approximately $5,332,811.87 plus interest, awarded against the mortgagors and guarantors in 2020. After partial payments by Helen Chan Sun, the outstanding balance was reduced to just over $3 million by December 2024. In the 2025 appeal, GC Capital Inc. prevailed in defending the registrar’s enforcement order requiring monthly payments of $300,000. The court dismissed the appeal and awarded costs to GC Capital on Scale B.