Dalton v Hong - [2019] NZHC 2321

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2018-404-0957

[2019] NZHC 2321

UNDER the Companies Act 1993, Part 16 (Liquidations)

IN THE MATTER

of an application pursuant to s 261 and s 266 by applicants for order to produce AND a cross-application for directions declaratory orders against the Applicant Liquidators

BETWEEN

SIMON DALTON and MATTHEW KEMP

as liquidators of CHARMING GROUP (NZ) LIMITED (In Liquidation)
Applicants

AND

BOON GUNN HONG

Respondent

Hearing: On the papers

Counsel:

A Ho for the Applicants Respondent in person

Judgment:

13 September 2019

RESERVED JUDGMENT (NO. 3) OF ASSOCIATE JUDGE SMITH

This judgment was delivered by me on 13 September 2019 at 4.00 pm, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Solicitors / Counsel:
Martelli McKegg, Auckland B G Hong, Auckland

DALTON v HONG [2019] NZHC 2321 [13 September 2019]

[1] The background of the matter is fully set out in my judgment of 30 August 2018,1 and I will not repeat that background in this judgment. In that judgment, I directed that Mr Hong was to produce for my inspection certain documents sought by the applicant liquidators under s 266 of the Companies Act 1993, for which privilege had been claimed. Those documents were produced by Mr Hong.

[2] I considered the documents provided by Mr Hong, and in my reserved judgment (No. 2) dated 26 June 2019 2 I ruled that he need not produce to the liquidators certain of them. In respect of certain other documents, I sought further submissions from Mr Hong.

[3] Mr Hong has now filed a memorandum setting out his further submissions. The further submissions were filed with the approval of Ms Cheng, one of the directors of Charming Group.

[4] My rulings on each of the documents on which I sought further submissions are set out below.

Documents 3, 4, and 5 forming part of Mr Hong's computer file described as
"annC&ricLI_claimed legal privilege\annC&ricLI_re Gerry Rea\"

[5] There were three documents remaining for consideration on this file, being the documents numbered 3, 4, and 5 (referred to at paragraphs [15] and [16] of my judgment of 26 June 2019).

[6] Mr Hong does not now oppose the production of documents 3 and 4 (email dated 9 November 2017 from Mr Hong to Ms Cheng providing certain advice relating to the business accounts or affairs of Charming Group). Documents 3 and 4 are to be produced to the liquidators within 15 working days.

[7] Document 5 was another email exchange between Ms Cheng and Mr Hong on 9 November 2017. Mr Hong and Ms Cheng oppose the production of this document, on the basis that it contains private and confidential advice between Mr Hong and

1 Dalton v Hong [2018] NZHC 2266.
2 Dalton v Hong [2019] NZHC 1473.

Ms Cheng, not relating to the business or affairs of Charming Group. Mr Hong also notes that his email comprising part…

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 Dalton v Hong

Details

AGLC: Dalton v Hong [2019] NZHC 2321
Case: [2019] NZHC 2321
Decision Date: 13 September 2019

CaseChat Overview and Summary

The High Court of New Zealand was presented with an application by Simon Dalton and Matthew Kemp, the liquidators of Charming Group (NZ) Limited, who sought an order for the production of documents from Boon Gunn Hong under the Companies Act 1993. The primary legal issue was whether certain documents, which Hong claimed to be privileged, should be produced to the liquidators. The court had to determine the ownership of privilege over these documents and whether the documents related to the business or affairs of Charming Group.

Associate Judge Smith reviewed the documents and the submissions made by Hong. The court ruled that some documents could be produced to the liquidators as they were related to the business affairs of Charming Group, and any privilege would be jointly owned by Charming Group and its directors. However, some documents were deemed to contain personal and confidential communications not related to the business affairs of Charming Group. The court directed Hong to produce redacted versions of certain documents to the liquidators within 15 working days. Additionally, the court directed that certain other documents need not be produced as they were personal communications not related to the business affairs of Charming Group.

In summary, the court carefully considered the nature of the documents and the claim of privilege, determining that while some documents were subject to privilege, others were not due to their relation to the business affairs of Charming Group. The final orders required Hong to produce redacted versions of certain documents within 15 working days and not to produce others. The court also noted that costs could be dealt with on the papers if the parties could not agree on their own.

Orders