Article content

A judge has found that a woman who had agreed to purchase a home in North Vancouver but failed to complete the sale after the foreign buyer tax went into effect had breached her contract.

B.C. Supreme Court Justice Lisa Warren also ordered Kyeonga Jeong, who is from Korea but has been living in Canada for a number of years, to give up her $180,000 deposit on the home at 515 Alpine Court.

We apologize, but this video has failed to load.

tap here to see other videos from our team. Try refreshing your browser, or B.C. judge orders homebuyer who balked at foreign buyer tax to give up $180,000 deposit Back to video

In June 2016, Jeong entered into a $2.6-million sales contract with Sandra Wilkie, the owner of the home, and paid the deposit, which was held in trust by her real estate agent. The completion date of the sale was set for October 2016.

But about two months after the sale, in August 2016, the then-Liberal government imposed the 15-per-cent tax on foreign nationals purchasing property in Metro Vancouver in a bid to cool skyrocketing home prices.

The tax applied to purchases completing on or after the date the tax went into effect, even if the underlying contract was entered into prior to August.

The tax increased the property transfer tax payable by Jeong by nearly $400,000, representing a 15-per-cent increase in the total cost of completing the transaction.

Neither Jeong nor Wilkie were aware that the tax was about to be imposed at the time of the sale. Jeong did not complete the sale in October.

Jeong, who lives at another residence in North Vancouver, claimed that it was impossible for her to complete the sale because she didn’t have the resources. She also claimed at one point that the tax was a “targeted discriminatory” tax.

Wilkie filed a lawsuit claiming that Jeong had breached the contract by failing to complete the sale. She sought a declaration that the contract was binding and an order that Jeong direct her agent to pay the deposit to Wilkie.

Jeong, in turn, claimed that the new tax was unforeseen and had frustrated the contract and that she should be entitled to keep her deposit.