A plaintiff commenced an action in British Columbia seeking to enforce a default judgment obtained in China. The Chinese lawsuit came about because of a commercial dispute between a Chinese manufacturer of construction machinery, the plaintiff, and a Chinese distributor. It was alleged that the owners of the Chinese distributor, who reside in Canada, had personally guaranteed the debts of the Chinese distributor. This allegation was not opposed by the defendants in the British Columbia enforcement action.
In defence to the enforcement action, the Defendants plead that the Chinese default judgment was obtained fraudulently because: 1) the defendants were not served in accordance with Chinese rules; and 2) certain material documents were not disclosed to the Chinese court.
The defendants brought a motion for the production of documents, some of which the plaintiff admitted did exist and were not disclosed to the Chinese court. Despite these admissions, the plaintiff opposed the defendants’ motion. The court found that “it remain[ed] an issue whether the failure to inform the Intermediate Peoples Court of Longyn, Fujian Province, China of the existence of the [documents] represents a fraud on that court.” Accordingly, the British Columbia court ordered the production of various documents but refused to order the production of others.
Read the Lonking (China) Machinery Sales Co. Ltd. v Zhao, 2017 BCSC 2154 case here.