



COURT OF APPEAL FOR BRITISH COLUMBIA




Citation:



Cheng v. Yu,









2011 BCCA 62




Date: 20110204

Docket: CA038422

Between:



Yuan Chu Cheng

Respondent

(Plaintiff)

And

Jun Ying Yu, Xiao
Ping Yu and Rui Pang

Appellants

(Defendants)

And

Gui
Xiong Pang and his estate

Defendants




Before:



The Honourable Madam Justice Newbury





The Honourable Madam Justice Kirkpatrick





The Honourable Madam Justice Garson




On appeal from: Supreme
Court of British Columbia, August 26, 2010
(
Cheng v. Yu
, Vancouver Registry S103891)

Oral Reasons for Judgment




Counsel for the Appellant:



K.W. Wince





Counsel for the Respondent:



H. Guo





Place and Date of Hearing:



Vancouver, British
  Columbia

February 4, 2011





Place and Date of Judgment:



Vancouver, British
  Columbia

February 4, 2011








[1]

KIRKPATRICK J.A.
: The appellants, Jun Ying Yu, Xiao Ping Yu, and
Rui Pang are, respectively, the widow, sister-in-law, and daughter of the
deceased, Gui Xiong Pang, who is alleged to have executed a letter of guarantee
in the Peoples Republic of China on 12 March 2007.

[2]

The letter of guarantee, as translated, reads:

I would like to agree to provide a guarantee
for
Guangdong Zhonggu Sugar Industry Group Co., Ltd
to borrow the sum of
Six Hundred Thousand Yuan
Only (
600,000.00
yuan only) from Mr.
Cheng
Yuanchu
. The manner of guarantee:
guarantee of joint liability
. If I
fail to repay it on time, I agree to pay off the said sum based on all property
of my family. All members of my family have no any dispute for the said action
of guarantee. This is to certify that Letter of Guarantee hereby.

Guaranteed by Pang Guixiong (signature)

March 12, 2007

[3]

The appellants appeal with leave from the 26 August 2010 order of the
Supreme Court that dismissed the appellants application to dismiss the
respondents claim on the guarantee, pursuant to the then Rule 18A of the
Rules
of Court
.

[4]

The chambers judge concluded that due to conflicts in the evidence,
inadequate submissions concerning applicable law and jurisdiction, and the fact
that the case was in its infancy in this jurisdiction, it would be unjust to
give judgment in the case, citing the well-known factors in
Canadian
Imperial Bank of Commerce v. Charbonnages de France International S.A.
,
[1994] 10 W.W.R. 232. The chambers judge dismissed the application and directed
the parties to attend a case management conference.

[5]

In their statement of defence, the appellants pleaded that the Supreme
Court should decline jurisdiction on the basis that the guarantee was made in
the Peoples Republic of China and at the material times the plaintiff and the
defendant Gui Xiong Pang were residents of China.

[6]

At the hearing of the appeal, counsel for the respondent advised that a
court in the Peoples Republic of China heard a trial concerning the validity
of the guarantee in question in this case and reserved judgment on 5 January
2011. That advice is apparently confirmed by the summons dated 10 November 2010
issued by the Intermediate Peoples Court of Zhanjiang City Guandong Province
found in the respondents appeal book. Counsel for the respondent advised that
if the judgment is in her clients favour, she will seek to enforce the
judgment in Canada and execute against the appellants property situate in
Canada.

[7]

In these circumstances, it seems to me that because the Chinese court
has evidently assumed jurisdiction and is poised to deliver judgment on the
very subject matter of the action in British Columbia, comity demands that we
decline jurisdiction.

[8]

Furthermore, it is plain from the guarantee itself that it could not be
enforced in Canada under the Canadian law of guarantee. The guarantee, made in
China, is sought to be enforced against persons who did not sign the guarantee
and in the absence of evidence that they agreed to be bound by the guarantee. There
is no reasonable prospect of success in the respondents prosecution of the
guarantee against the appellants in Canada.

[9]

I would allow the appeal and dismiss the respondents action with costs
to the appellants both of the Rule 18A application and of the appeal.

[10]

NEWBURY J.A.
: I agree.

[11]

GARSON J.A.
: I agree.

[12]

NEWBURY J.A.
: The appeal is allowed. The action is dismissed with
costs.

The Honourable Madam Justice Kirkpatrick


