Bad Advice Cost FN $150k
Do you think it would be a good idea to take immigration legal advice from a real estate agent? If you are reading this post, you are already trying to learn about Canadian immigration laws and policies. You are clearly more informed than Ms Hongxia Zhang, a foreign national from China. She was in the process of applying for Permanent Resident status and she decided to purchase property in BC.
Ms Zhang’s real estate agent advised her that she would not have to pay the 20% BC foreign buyer tax if she had been granted a confirmation of permanent resident of Canada. As noted by the Vancouver Sun:
At the court hearing in the case, Zhang told B.C. Supreme Court Justice Carla Forth that she’d been misled by her realtor that the foreign buyer tax would not apply if she’d been granted a confirmation of permanent residence in Canada.
She claimed that she did not learn until after she’d paid the deposit, but before the completion date, that she needed to be in Canada before the completion date to avoid the foreign buyer tax and explained that since she was in Hong Kong, she had to apply for a travel exemption, which was refused by Canadian immigration officials.
To give you some background, Ms Zhang was in the process of purchasing property in BC for $2,950,000.00 CAD – almost $3M CAD. She had signed the contract and she had agreed to the conditions. She agreed to pay $150,000.00 CAD deposit for the property.
A consultation with an immigration lawyer costs between $200 to $600. We try to help as many clients as possible so we have been keeping our fees low. Part of the reason we have 4.8/ 5 stars on Google is because clients know they can book a consultation and get clear, legal advice.
Why didn’t Ms Zhang spend $200 to speak with an immigration lawyer before she signed a $2,950,000.00 CAD contract?
As noted by Madam Justice Forth in her decision:
[27] Ms. Zhang claims she was misled by her relator that the Foreign Buyer Tax would not apply if she had been granted a Confirmation of Permanent Residence. She claims she did not learn until after she paid the Deposit, but before the Completion Date, that she needed to be in Canada before the Completion Date to avoid the Foreign Buyer Tax. Ms. Zhang explained that since she was in Hong Kong she had to apply for a travel exemption, which was refused by Immigration, Refugees and Citizenship Canada (“IRCC”). As a result, she was not able to be in Canada at the time of the Completion Date.
It seems when Ms Zhang realized she was subject to the 20% BC foreign buyer tax and she would have to pay $600,000.00 CAD to the BC government as tax, she backed out of the deal.
Zhang wanted to avoid paying the 20 per cent foreign buyer tax levied by the provincial government.
The seller sued as they have a signed contract. The deal was done. The seller, of course, sued and Ms Zhang lost.
In her testimony, Ms Zhang maintained that she was following the advice of her real estate agent:
Regarding Zhang’s claim that she was told the foreign buyer tax did not apply to her situation when in fact it did apply to her case, the judge said she could make no finding on that question since the real estate agent was not before the court.
“Even if she did receive that advice, it does not change the nature of the contractual obligation to the plaintiff,” said the judge, who accepted that the failure to complete the sale amounted to a repudiation of the contract.
To be clear, even during a court proceeding where, presumably, she would have learned not to take legal advice from real estate agents, she maintained her position that she was following the advice of her agent.
Ms Zhang has been ordered to pay $150,000.00 CAD. This case would have been easily avoided if this foreign national had simply booked a consultation with an immigration lawyer.
