In an attempt to find a better life for herself and her children, a Korean resident hoping to find permanent residency in the Comox Valley is owed more than $350,000, concluded a B.C. Supreme Court judge in Nanaimo earlier this month.
In his reasons for judgment on March 26, Justice Dev Dley said the case highlights greed and opportunism capitalizing on the vulnerabilities of immigrants who seek residency in Canada.
Me Hee Kim, 51, wanted to immigrate to Canada with her young children and free herself from an abusive marriage in Korea.
One way for Kim to enhance her application for residency was to show that she had a specialized skill that was needed by an existing Canadian business. She agreed to purchase Hana Korean Restaurant (now closed) in September 2013 which was located at 168 5th St. in Courtenay from Ae Sun Choi for $93,000 and to cover operating expenses.
Dley noted Kim had limited life skills and depended upon others to assist her with adapting to life in Canada. He added Kim was seen by her fellow workers to be subservient to Choi, even though Kim was the restaurant owner.
Over the course of the next year, Kim paid more than $380,000 for what Choi said was inventory and operating costs.
When Kim became concerned about the expenses and questioned the fees, Choi locked the doors to the restaurant and ultimately terminated her support of Kim’s residency application. Kim did not receive Canadian residency and has returned to Korea.
Dley explained in his reasons when Kim purchased the restaurant, she did not seek the assistance of an accountant or lawyer, and said she trusted Choi. After signing the purchase agreement, Kim began working in the restaurant but the operation of the business continued to be administered by Choi.
Kim agreed to pay Choi $3,500 per month to run the restaurant. She continued to work in the kitchen and did not venture into the front part as she had no concept as to how to operate the cash register.
“…It defies common sense that the business required a capital injection in excess of $350,000 to cover expenses when there is scant evidence to support such a proposition,” wrote Dley in his reasons.
Dley explained Choi did not receive any significant funds from any source other than Kim. Choi acknowledged that at least $250,000 received from Kim was used to purchase her house on Idiens Way in Courtenay.
In July 2014, Kim sent an email to immigration consultant Brandon Kwak in which she stated it was costing her “a significant amount of money … to keep the restaurant running.”
In October 2014, Kim met with Choi and asked for business records, and indicated she was now going to run the restaurant. One day later, Choi locked the doors and withdrew her support for Kim’s residency application.
“It was obvious to Ms. Choi that Ms. Kim was vulnerable. What may have started out as an arrangement to benefit both parties quickly turned into a predatory scheme to extract money out of Ms. Kim on the pretext that it was necessary to keep the restaurant functioning.”
There was no satisfactory resolution for Kim, and after returning to Korea, she instructed her lawyer to file a complaint of embezzlement against Choi and her husband.
Dley concluded there was no question Choi was enriched. He assed the total amount paid by Kim to be $480,000, but deducted $103,000 for the purchase price and a fee for a “secret sauce,” leading $377,000 as purported operating losses.
He also determined there is a direct connection between the funds advanced by Kim and the Idiens Way property.
Choi bought the home for $455,000 funded partly by a $200,000 mortgage. She admitted that at least $250,000 of money received from Kim went into the purchase of the home, and Kim’s proportionate share of the acquisition costs amount to 56 per cent.
He concluded Choi’s property will be impressed with a constructive trust giving Kim a 56 per cent interest but capped at the monetary amount of the judgment (to ensure Kim does not receive a windfall in the event the property value has increased.)
Dley ordered Choi to pay in Canadian dollars, the amount necessary to purchase 300,000,000 Korean Won ($352,226 CND).