Arranmore Developments Limited v Zhou

[2016] NZHC 1029

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2009-404-5440 [2016] NZHC 1029

BETWEEN

ARRANMORE DEVELOPMENTS

LIMITED Plaintiff

AND

JIAN MING ZHOU Defendant

Hearing:	18 May 2016
Appearances:	M Fisher and H L Hui for plaintiff M Moon for defendant
Judgment:	18 May 2016

(ORAL) JUDGMENT OF LANG J [on application for particular discovery]

ARRANMORE DEVELOPMENTS LTD v ZHOU [2016] NZHC 1029 [18 May 2016]

Background

[1]        In this proceeding the plaintiff sues the defendant, Ms Zhou, as the alleged purchaser of two sections in a subdivision known as Point View Park.

[2]        The  plaintiff  alleges  that  Ms  Zhou  agreed  to  buy  two  sections  in  the subdivision  and  that  she  subsequently  refused  to  complete  the  purchase.    The plaintiff initially obtained an order for specific performance against Ms Zhou, and Ms Zhou did not comply with the order.   The plaintiff then elected to sell the sections, and to sue Ms Zhou for the difference between the price she agreed to pay and the price the plaintiff subsequently obtained for the sections.

[3]        Ms Zhou’s position is that she did not sign the agreements for sale and purchase relating to the two sections.  She contends that others were involved in that process, and that she is not personally liable in respect of any of the consequences of the failure of the purchaser to complete the purchase.

[4]        The  plaintiff’s  position  will  be  that,  at  all  material  times,  Ms  Zhou’s daughter, Ms Zhang, acted as Ms Zhou’s duly authorised agent in signing documents and instructing the solicitors who were involved in the purchase of the sections.

[5]        The plaintiff has now obtained a number of documents from third parties, including Ms Zhou’s bank and the firm of solicitors who acted for the purchasers in relation to the purchase of the two sections.   These demonstrate that Ms Zhou’s original affirmation of documents was incomplete.  In particular, she did not disclose details of bank accounts she held with the ASB Bank at that time, and she did not disclose any documents that she held in relation to the solicitors who appear to have acted for her and/or her daughter in relation to the purchase.

[6]        The plaintiff now seeks particular discovery in respect of four categories of documents.   The first three categories relate to the purchase of the sections.   The fourth category relates to another transaction that occurred in 2013, when Ms Zhou’s daughter, Ms Zhang, acted as Ms Zhou’s attorney in relation to the purchase of another property.

Decision

[7]        I  am  satisfied  that  the  material  obtained  from  non-party  discovery

demonstrates that Ms Zhou’s original affirmation of documents was deficient.  It is

no answer for her to say that she was not aware that she had bank accounts with the ASB Bank at the relevant time.  Nor is it an answer for her to say that she has never instructed the solicitors who acted for the purchaser of the sections.   Taking into account the material now available, if she has held documents but has disposed of them, she must disclose that fact and must advise where she believes the documents may now be.  If documents are not in her possession but are within her control, she must disclose those documents.

[8]        I therefore propose to grant the application to the extent that it relates to categories 1 to 3, relating to the purchase of the two sections.  I do not propose to grant the application to the extent that it relates to category 4.  The plaintiff now has the power of attorney that Ms Zhou gave in favour of her daughter in respect of the purchase of that property in 2013.  This will be sufficient to enable the plaintiff to make the point that on at least one other occasion Ms Zhou has appointed her daughter to act as her agent in relation to the purchase of a property.   I do not consider it necessary for the plaintiff to go beyond that point and to seek discovery of all related documentation in respect of the transaction given that it occurred some seven years after the transactions that are the subject of this proceeding.

[9]        Ms Zhou  lives in China.   For that reason  it is not possible for her to complete a supplementary affirmation as quickly as would be possible if she lived in New Zealand.  I direct, therefore, that Ms Zhou is to file and serve no later than 20

June 2016 a supplementary affirmation of documents responding to the documents sought in categories 1 to 3 of the plaintiff’s application.

Trial date

[10]      This proceeding is to be the subject of a three day trial commencing on 28

November 2016.   In the event that any party or witness cannot accommodate this date counsel are to file a memorandum within seven days and a new date will be allocated.

Pre-trial directions

[11]      In anticipation of the trial I now make the following pre-trial directions:

a)        The close of pleadings date shall be 29 July 2016.

b)        The plaintiff shall serve its written briefs and draft index no later than

3 October 2016.

c)        The defendant shall serve her written briefs and draft index no later than 31 October 2016.

d)The plaintiff shall file and serve the common bundle of documents, chronology and synopsis of opening submissions no later than 21

November 2016.

Costs

[12]       At the request of counsel for the plaintiff I reserve costs on the present application.

Lang J

Solicitors:

Daniel Overton Goulding