But the majority owners of Vancouver Island’s Six Mile Pub, which opened in 1855, have been given 90 days to sell it themselves before a liquidator is appointed
The holding company that owns Victoria area’s Six Mile Pub has been ordered by a judge to liquidate its assets and repay the family of a now-deceased part-owner, who mortgaged his house to invest in the pub.
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B.C. Supreme Court Justice Anthony Saunders took what he termed the “draconian” measure of liquidation for the pub, which opened in 1855 and is considered B.C.’s oldest pub, but gave the majority owners 90 days to sell it themselves before a liquidator is appointed.
Eddy Ng and David Wong, who met while working in a Victoria restaurant years ago, bought the pub in 2002. Each pledged to raise $550,000, but Ng came up with only $380,000, more than half of which came from mortgaging his family home and the rest from his mother.
Ng died in 2016 but his company, Eddy Ng Management Services, through his estate and family, maintained his 40 per cent of the ownership shares in Six Mile, which is in suburban View Royal, according to the judgment.
Wong and his wife, Fanny Ching, their two companies and various other smaller investors, including employees, own about 60 per cent of the business.
After Ng’s widow, Ling Zhu Ng, couldn’t come to an agreement to sell the shares to Wong, she petitioned the court to dissolve the company that owns the pub.
The liquidation and sale is a “remedy of last resort” but it was the best way to allow the petitioners to realize their “proportionate share of the growth in value of the company’s assets,” Saunders ruled in a recent decision after a two-day hearing in November.
The pub in 2002 was valued at $3 million. In 2021, Ng had it assessed at $7 million, according to the judgment.
Saunders acknowledged that Wong “contributed considerably more in the way of ‘sweat equity’ than Eddy ever did” because Ng’s hands-on involvement was limited for years as he struggled with a drug addiction.
“I would find it unjust and inequitable to allow the company to continue to benefit from the substantial capital Eddy was initially responsible for contributing,” he said. “Now that Eddy has passed, it is proper that Eddy’s heirs have the opportunity to reap the value of his investment.”
After they bought the Six Mile in 2002, Wong ran day-to-day operations and Ng managed the kitchen, but Ng became less involved after two years, it said.
His wife said Ng couldn’t work for about a year because of a frozen shoulder, and his relationship with Wong broke down and Ng was told not to return to work, Saunders wrote.
But Wong said Ng suffered from substance abuse that he hid from his family, and Wong and the other shareholders in 2004 demanded a doctor’s note that he was drug-free if he wanted to return to work, according to the judgment.
Wong encouraged him to get treatment and when Ng asked to return to work four years later, Wong set conditions, such as continuing with his recovery, undergoing drug tests and abstaining from alcohol at work, Saunders wrote.
Ng returned in 2009 but missed work often, wouldn’t comply with drug test requests, was removed as director over a legal issue and worked only two days a week up until his death, according to the judgment.
Ling Zhu Ng denied any knowledge of her husband’s drug use or addiction but Saunders accepted Wong’s evidence about the substance abuse and neglect of duties.
After Ng died, his widow asked Wong to buy Ng’s shares but they couldn’t agree on a price, with Ling Zhu Ng asking four times what Wong was prepared to pay.
The widow, who with her son, Vincent, continued to pay off the mortgage that Ng used to buy the restaurant, filed the petition in 2024.
Saunders also found that Wong didn’t wind up the partnership when Ng struggled with his addiction and “he was content to enjoy the benefit of the substantial capital contribution made by Eddy and Eddy’s mother, without them being compensated, and with the cost of servicing the debt incurred by Eddy being burned by Eddy and his family.”
Wong and the other respondents should first have the right to sell the shares, but because the company had a history of never paying dividends, it would be hard to find a buyer for shares, Saunders wrote.
Wong in an interview said he hopes to come to an agreement with Ling Zhu Ng on a share price before the 90 days for the ordered sale is up.
“The word liquidation sounds drastic but the judge doesn’t want to wipe a business off the map,” he said. “This is part of the plan for the two conflicting sides to get back to the table” to agree on a price for the shares.
And he said he will keep the business going with bank financing, if necessary, and he emphasized the business is financially solid and has plans to remain open for years.
A message left with Ling Zhu Ng’s lawyer was not immediately returned.