Antigua: Chinese investor moves to settle debt and avoid jail time

LOOP: Yida Zhang, the Chinese investor behind Antigua and Barbuda’s controversial Special Economic Zone, is teetering on the edge of imprisonment as a crucial debt payment deadline approaches. CLICK HERE TO JOIN OUR WHATS APP GROUP

Last Friday, Zhang wired over US$4 million from a Hong Kong bank to his law firm in Antigua in a desperate attempt to prevent incarceration and the forced sale of shares in his company, Yida International Investment Antigua Limited. CLICK HERE TO JOIN OUR WHATS APP GROUP

The payment, intended for Lux Locations, a real estate company, must reach its destination by November 24 to avoid immediate consequences. Zhang also faces a looming deadline of December 31 to settle an outstanding US$440,000 balance. Failure to meet these deadlines will result in a 14-day imprisonment at His Majesty’s Prison (HMP) for contempt of court.

High Court judge Justice Rene Williams handed down the suspended jail sentence Friday afternoon, cautioning Zhang through a Chinese translator about the severity of the penalties.

 If Zhang falls short on the payments, a court review on January 26, 2024, is scheduled, where he could be sentenced.

Directors of Lux Locations, Nadia and Sam Dyson are also waiting anxiously, having been in legal battles with the investor since 2014 when they were promised a nine per cent commission valued at US$5.4 million.

Earlier this month, a High Court judge ordered that Zhang’s worldwide assets be frozen until he pays the judgement debt. CLICK HERE TO JOIN OUR WHATS APP GROUP

Background

Real estate agent Lux Locations facilitated the purchase of land from Asian Village Antigua at a cost of US$60 million in 2014. They were promised a nine per cent commission rate in return.

When Zhang did not pay, the directors of Lux Locations took him to court for the first time in 2017, citing a deliberate refusal to pay.

 During the hearing, a third party – architect Johann Hesse – who was to get four per cent of the commission for lobbying the Government for approvals needed for the purchase, agreed to forego his share of the profits, which meant that the investor only had to pay US$3 million to the Dysons.

He was also ordered to pay interest at the rate of eight per cent per annum and legal costs (including sales tax) of US $345,000 in 21 days.

After making an initial payment of more than US$700,000, Zhang claimed that he did not understand the consent order from the court.

In an affidavit, he claimed that when he signed the consent order, he misunderstood the nature of the document he was signing and thought it was a release of Hesse’s claim for commission.

 He did not realise that it was in fact a settlement agreement.

Zhang then launched a counter-attack.

On July 3, 2017 he commenced an action against Lux and its proprietors along with two other defendants claiming damages for conspiracy in a sum of US $6.3million. His claim alleged that the defendants had conspired to raise the purchase price of the land from US$30m to US$60m and that the Dysons had made misrepresentations on which he had relied.

In October 2017, a local judge granted an interim injunction to stop Zhang from taking any step to dispose either of his shares or of any of the land owned by his company while the Dysons applied for an order for the sale of shares in Yida Ltd. That order was granted in September 2023 after the Privy Council overturned orders by the High Court and the Court of Appeal in favour of Zhang.

Friday’s hearing was originally set for a judgment summons requiring Zhang to make a case as to why he should not be imprisoned after Lux Locations filed an application in court in March requesting that he be committed to His Majesty’s Prison (HMP) for deliberate non-payment.

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