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A security guard rushes Lai Changxing, left, away from the media after an Immigration and Refugee Board detention hearing in Vancouver, B.C., on Monday July 11, 2011.Darryl Dyck/ The Canadian Press

A week short of what may be his last legal bid to stay in Canada, Chinese fugitive Lai Changxing remains behind bars, after a surprise evening court ruling blocked an order he be released.

Federal lawyers sought Mr. Lai's continued detention just hours after Immigration and Refugee Board member Leeann King ruled Tuesday that he should be freed from custody while awaiting a July 21 court challenge to his deportation.

However, a hastily convened, rare night session of the Federal Court put Mr. Lai's release on hold, to give the Canada Border Services Agency time to appeal Ms. King's decision.

The ruling by Mr. Justice James O'Reilly was handed down shortly before 9 p.m.

If Mr. Lai loses his legal argument later this month, he is scheduled to be deported July 25 to face long-standing smuggling and bribery charges in China.

He has been held at the North Fraser Pretrial Centre since his arrest by government agents a week ago.

Mr. Lai, a former peasant with a Grade 4 education, amassed a fortune by importing consumer goods into the bustling port city of Xiamen during the wild, wide-open capitalist frenzy that consumed parts of China in the 1990s.

Chinese authorities subsequently charged him with smuggling products into the country, while bribing public officials to look the other way.

Mr. Lai admits skirting the law but contends he was merely taking advantage of perceived loopholes in the murky custom regulations of the time.

During his long fight to stay in Canada, Mr. Lai has argued he cannot receive a fair trial in China, since his guilt has been predetermined, and that he faces a risk of being tortured while in custody.

After four years of consideration, Immigration Canada officials concluded last week that Mr. Lai is not in danger of torture if returned to China.

They relied on a Chinese undertaking to give Canadian diplomats access to Mr. Lai in prison to ensure he is not being harmed.

Darryl Larson, a lawyer for Mr. Lai, scoffed at the deal. "Somehow, a non-binding, non-legal agreement not to torture Mr. Lai is supposed to give him some comfort."

Also Wednesday, the CBSA responded to allegations from David Matas, another Lai lawyer, that the agency had breached a court undertaking not to rush Mr. Lai's deportation.

In an e-mailed statement, the agency said the commitment was made in 2005 and did not apply to the current situation.

Mr. Matas termed the CBSA response "absolute flimflammery."

At next week's court hearing, Mr. Matas is expected to argue that little has changed in China since a 2007 Federal Court ruling found Canada needed to take the risk of torture seriously.

Meanwhile, Jeremy Brown, an assistant professor at Simon Fraser University, provided a different portrait of Mr. Lai than his depiction in China as a vile, criminal kingpin. At one point, former premier Zhu Rongji likened Mr. Lai to "a turtle egg." Mr. Zhu added that he deserved to be executed "three times over."

Prof. Brown said Mr. Lai responded willingly to an invitation to talk to his fourth-year Chinese history class.

"I found him a charming guy, a funny guy. Personally, he was easy to sympathize with," he recounted. "He came off almost humble, and clueless in a way, having to rely on others because of his lack of English."

Prof. Brown said he doesn't mean to minimize the allegations against Mr. Lai. "Having lived in China, I can understand he's not clean, but he was playing the game at the time."

He added Mr. Lai is likely justified in fearing what might happen to him in China. "Clearly, torture happens in Chinese prisons. He's scared. I would be scared, too."

Prof. Brown said Chinese assurances that Mr. Lai will not be mistreated might protect him for a year or two, given the high-profile nature of the case. "But that could change at any time, and there's not much Canada could do about it."