Chen v Chen - [2024] NZHC 186

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2023-404-1984

[2024] NZHC 186

BETWEEN
GUO JIAN CHEN and HAI YAN LIU

Applicants

AND

HUI CHEN and HONGYUN ZHU

Respondents

Hearing: 12 February 2024

Appearances:

D K Wilson Applicants

R O Parmenter for Respondents

Judgment:

15 February 2024

JUDGMENT OF ASSOCIATE JUDGE LESTER

This judgment was delivered by me on 15 February 2024 at 2:30 pm pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar
……

CHEN v CHEN [2024] NZHC 186 [15 February 2024]

[1] The applicants (the purchasers) apply to sustain a caveat over a property owned by the respondents (the vendors). I shall refer to the parties by their Christian names to avoid confusion.

[2] In December 2021, Guo and Hai agreed to purchase 144 Nixon Road, Taupaki, Auckland (the property) from Hui and Hongyun. The agreement was on the ADLS tenth edition form (the contract). Settlement was to occur on 18 November 2022. The purchase price was $5,500,000.00 with a 10 per cent deposit, which was paid. The property is 5.8241 ha on which there is a warehouse. Guo and Hai intended to subdivide the property and by agreement were permitted to store items in the warehouse. Guo and Hai did not have to pay rent for the use of the warehouse but it is common ground for the purposes of this application that they had possession of the warehouse by agreement.

[3] In November 2022, by an exchange of emails between the parties’ solicitors, the settlement date was extended to 30 June 2023. That the November 2022 variation required Guo and Hai to:

(a)pay a further deposit of $200,000.00 by 21 November 2022 (which was paid);

(b)pay a further deposit of $1,500,000.00 on 15 March 2023;

(c)interest at five per cent per annum on the balance of the purchase price from 18 November 2022 to 30 June 2023, with that interest payable on settlement date. The sum upon which interest was to be paid would be adjusted as the further deposits were paid;

(d)assuming the further deposits were paid, Guo and Hai could continue to use the warehouse rent free until 30 June 2023;

(e)if the further deposits were not paid then Guo and Hai were to vacate the warehouse immediately and Hui and Hongyun could issue a three

working day notice in respect of the unpaid deposit pursuant to the contract;

(f)the November 2012 exchange of emails recorded that if the further deposits were not paid then the contract would be cancelled and the deposits forfeited; and

(g)the November 2022 variation provided that Guo and Hai would have the right to extend settlement to 31 July 2023 and if that was the case, then they would pay interest on the purchase price from 30 June 2023 to 31 July 2023 at five per cent. If Guo and Hai did not settle on 31 July 2023, then they would have to…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Chen v Chen

Details

AGLC: Chen v Chen [2024] NZHC 186
Case: [2024] NZHC 186
Decision Date: 15 February 2024

CaseChat Overview and Summary

In the High Court of New Zealand, the case of Chen v Chen involved a dispute between Guo and Hai, the purchasers, and Hui and Hongyun, the vendors, over the ownership of a property in Taupaki, Auckland. The applicants sought to sustain a caveat over the property, which was originally agreed to be sold for $5,500,000.00 with a 10 per cent deposit. The legal issues before the court were whether the Property Law Act 2007 (PLA) notice was properly served and if the vendors were entitled to retain more than 10 per cent of the purchase price as a deposit. The court found that the PLA notice was properly served to the purchasers' solicitors, who had ostensible authority to receive it. Furthermore, the vendors were only entitled to retain 10 per cent of the purchase price as a deposit, which amounted to $200,000.00. Consequently, the court sustained the second caveat to the extent that it protected an equitable lien to recover $200,000.00 of the $750,000.00 deposit. The applicants were ordered to pay the respondents' costs on a 2B basis, reduced by 33 per cent to represent the mixed success, and the respondents were entitled to disbursements as fixed by the Registrar.

Orders