Second of two parts: A dramatic B.C. court case reveals how one family’s riches from China became the subject of a bitter lawsuit after allegations of misappropriation against a family friend entrusted with investing the funds in B.C. real estate.

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The two met while working together at the Beijing Opera House Theatre, one of China’s most famous cultural treasures.

Tong (Tony) Zhang Jr. was in charge of stage layout and props. His romantic partner, Danyang Yang, was an opera singer.

Their positions at the opera were only their day jobs, however. During the 2010s, the couple were also busy in Beijing’s ultra-hot real estate market.

In a lawsuit that pits Zhang’s family against the Yin family, B.C. Supreme Court Justice Gordon Funt described how the opera employees, neither of whom “enjoyed exceptional remuneration,” eventually moved $45 million to $60 million into B.C. properties through what they thought was a trusted friend.

Much of their money ended up in about a dozen houses and properties in Vancouver, West Vancouver, Burnaby, Surrey and Richmond.

Funt described how the couple employed by the Beijing Opera made a “large fortune by hitting the market at the right time” in China. They would find out when and where to line up for the chance to buy a pre-sale apartment for a 20 per cent downpayment, which they would later flip for a handsome profit.

The couple became so successful in Beijing’s then-hot market, the judge said, that they “lived in a very nice home in Beijing,” had a chauffeur, two nannies and “a number of upmarket vehicles.”

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All the while the couple were dreaming of Canada, specifically Metro Vancouver.

In Canada, they hoped to escape the one-child policy of the People’s Republic of China, which they said could force a woman to have an abortion.

The problem, the couple allege in a B.C. court case that has gone on for more than five years, is that their financial shift to Canada was betrayed by a Vancouver-based friend and business partner, Hang Yin, also known as “Uncle Yin.”

When the couple began to transfer their wealth overseas in 2015, the judge said, Yin “misappropriated millions” from them, diverting it through numbered companies into various Metro Vancouver properties he and his family controlled.

In addition to finding Yin “evasive” and scolding him for failing to report his vast assets to Canada Revenue Services, Funt fined Yin $25,000 for contempt of court, maintaining “it will carry a significant stigma for Mr. Yin in the broader community.”

The judge also didn’t believe Hang Yin’s daughter, Yu Yin. While benefiting greatly from the properties her father had misappropriated, the judge said the daughter falsely claimed she couldn’t communicate in English, despite a bachelors degree in economics from the University of B.C.

In contrast, Funt expressed empathy for the Beijing Opera couple’s dream of a better life.

At one point, the judge referred to how Yang, the opera singer, gave testimony in an “uncontrolled, poignant voice” about her wish to come to B.C. to give birth.

“Yes, it’s true that the purpose of that trip was to give birth to my second child. … At that time, the Chinese government did not allow couples to have second child. If I insisted to give birth, then I would receive a penalty from my employer and they would punish me, or even worse yet, they could do some extreme measures, such as terminate my pregnancy by force,” Yang said.

“I’m sorry. Canada is a very tolerant country. We thought it would be a wise idea to give birth to our second child and third child here.”

With her husband crossing the Pacific Ocean to Canada with her, Yang had her second child in a Vancouver-area hospital in 2014. She gave birth to her third child in a Vancouver-area hospital in 2017. Both times the couple flew back to China. China’s one-child policy ended in January 2016.

Zhang and Yang had planned to stay in China, even while much of their real-estate riches had been shifted to Canada. But when a West Vancouver private school contacted them and said it had spots available, they moved to Canada in 2018, receiving permanent resident status.

They then realized their Metro Vancouver assets were not secure. And their properties in China also ran into big trouble, mostly because of Tong Zhang’s father, Chunli Zhang, a Communist Party bureaucrat who had built his own real estate empire but was being investigated for corruption.

About six years ago, China’s authorities seized 30 properties from Zhang Sr. And since they had accused Zhang Sr. of concealing some properties by transferring them to family members, documents show they also confiscated 19 properties from Zhang Jr. That was despite Zhang Sr. never being convicted of corruption.

The B.C. Supreme Court judge determined it was not his task to rule on the legitimacy of the Zhang family’s wealth in Canada, despite the references that had been made during the six years of hearings to B.C.’s Cullen Commission into money laundering.

Since Zhang Jr. died in 2022 of leukemia at aged 35, while the lawsuit was being fought, the judge made an effort to protect Zhang’s reputation from suggestions he had been a lawbreaker. The judge did so in an effort to comfort Zhang’s pre-teenage children.

“I will add, because Mr. Zhang Jr. has died and one or more of his three young children may wish to read these reasons in the future,” the judge said, “there was no suggestion, or evidence whatsoever, that their father was engaged in the drug trade or some other criminal activities.”

The judge did note, however, that Zhang was known to “keep large amounts of cash in his master bedroom.” In addition, the court heard that his chauffeur frequently delivered “duffle bags of cash” to various people, including Yin.

“I confess to some disquiet in envisioning duffle bags of cash,” the judge said. But he declined to determine whether transferring cash in such a way was illegal.

In the end, Funt ruled Zhang’s family, through his estate, is entitled to recover most of the almost $60 million he had moved out of China into Canada.

Those properties include several houses in the 400-block of West 41st in Vancouver (adjacent to the Oakridge Park project); two West Vancouver mansions with views of English Bay; five properties in Burnaby; three empty properties on the 6800-block of Number 3 Rd. in Richmond; and a commercial property near the corner of 32 Avenue and 140 Street in Surrey.

dtodd@postmedia.com