A member of a Vancouver family whose multimillion-dollar property holdings include some of the city’s most run-down rental housing is facing a $1.2-million tax judgment and the possible forced sale of the family home to pay the money owed.
Land-title documents show the judgment against Pal Sahota, filed in June, 2019, was obtained by the Minister of National Revenue and is registered against interests in three properties, including the family’s long-time residence on Angus Drive.
The family has come under renewed public scrutiny this month after a deal was reported showing that the City of Vancouver paid millions to expropriate two of the family’s Downtown Eastside properties – the crumbling Balmoral and Regent hotels. The Globe and Mail became aware of the tax judgment when reviewing documents after the settlement with the city.
For decades, the Sahotas have rented out hundreds of units of the cheapest housing in the area, often flouting municipal bylaws, even as tenants and advocates pleaded for increased oversight from the city and province. A 2018 Globe investigation found the reclusive family’s holdings – about 40 properties in and around the city – was worth an estimated $218-million.
The family rarely sells any of its properties and fought the city in court to try to stop the expropriation of the shuttered Regent and Balmoral, a process that ended with an agreement last month. The value of the deal was not disclosed – at the insistence of the Sahotas – but The Globe has reported that the city paid at least the $7.5-million discussed in a confidential 2018 memo to council from staff.
The family has been led by Mr. Sahota, his brother Gurdyal and their sister Parkash, or Pash. The Globe has learned through public documents and conversations with people close to the family that Ms. Sahota, the matriarch, died in January at the age of 90. The Globe recently obtained a death certificate from B.C.’s Vital Statistics Agency for a Parkash Kaur Sahota, age 90, with a birthplace of India, that lists the date of death as January 23, 2020.
The judgment, which remains outstanding, does not specify what type of tax is owed, referring only to assessments “under one or more” of Canada’s Income Tax Act, Canada Pension Plan or Employment Insurance Act.
But it gives the Canada Revenue Agency the right to seek a court order to have the properties sold and proceeds used to pay taxes owed, said Andrew Bury, a partner at Gowling WLG’s Vancouver office who specializes in loan security enforcement.
“That judgment can be turned to cash if the creditor is aggressive and goes to court and gets their money back,” Mr. Bury said.
The three properties listed on the 2019 tax judgment together have an assessed value of about $5.7-million, according to B.C. Assessment records.
All are residential properties on the city’s west side.
The CRA said it could not comment on specific cases because of confidentiality reasons. Evan Cooke, a lawyer who has recently represented the family in negotiations with the city, did not respond to an e-mailed request for comment.
When The Globe called Pal Sahota’s cellphone number Wednesday, a man who answered said he had no idea about the tax troubles and had no comment about the recent deal with the city for the twin hotels.
Ms. Sahota studied architecture at the University of B.C. in the 1970s. For decades, she was in control of the family’s real estate holdings, according to Ajantha (Sam) Dharmapala, a former employee who is now a rental-housing activist.
“Pash was the main character behind all these properties,” said Mr. Dharmapala, who worked for the Sahotas as a desk clerk and bookkeeper from 2008 until 2016. “She was working hard for her whole life to build this – it’s not Pal, it’s not Gudy.”
She would regularly tour the Sahotas’ various rental properties up until a decade ago, when illness and her advanced age kept her close to the ramshackle family home in Vancouver’s upscale Kerrisdale neighbourhood.
Several blocks north of the their home sits another Sahota property that has been empty since Vancouver police raided an illegal cannabis grow operation in 2011 that was run by an employee of the family’s Astoria Hotel.
In May, 2019, Ms. Sahota secured a permit from the city to build a duplex on the property at the same time as the family was at loggerheads with the city over the proposed expropriation of its Downtown Eastside hotels.
A city spokesperson e-mailed a statement Wednesday saying each development is approved on its own merit, but the permitting department is not allowed to take into account the applicant’s other dealings with the city. In a brief e-mail statement late Wednesday afternoon, Mayor Kennedy Stewart said this needs to be the case so failed applicants can’t sue the city over allegations of bias.
Meanwhile, the future of another Sahota property linked to cannabis appears less bright.
Kash Heed, a former provincial attorney-general and police officer who now consults in the legal cannabis industry, said the Sahotas have likely failed in their attempt to get licensed by Health Canada to grow the plant in an industrial park on the coast of Howe Sound, northwest of Vancouver.
In an interview two weeks ago, Mr. Heed told The Globe that he was hired by the family a year ago to come up with a business plan to get Sunshine Coast Cannabis Farms growing cannabis four years after they filed their application with the federal regulator. Mr. Heed said the project’s sunk costs were “a significant amount in excess of the value” of the land, which was last assessed at $2-million.
“My conclusion was that their project was not viable,” said Mr. Heed, who has consulted on more than two dozen similar cannabis projects. “They were not happy.”
With research from Stephanie Chambers in Toronto
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