Deng v Lu - [2015] NZHC 2585

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2015-404-931 [2015] NZHC 2585

BETWEEN
QINGQI DENG

Applicant

AND

YULIANG LU AND HONGYU YANG Respondents

CIV-2015-404-1760

BETWEEN WEIJIE DENG Applicant

ANDYULIANG LU AND HONGYU YANG Respondents

Hearing:
8 October 2015

(with additional submissions: 13 October 2015 (respondents)
and 16 October 2015 (applicants)

Appearances:

D K Wilson for Applicants
P J Wright and A Sinclair for Respondents

Judgment:

21 October 2015

JUDGMENT OF ASSOCIATE JUDGE OSBORNE [as to Caveats]

This judgment was delivered by me on pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date……………

DENG v LU [2015] NZHC 2585 [21 October 2015]

Two applications

[1] Two applications are being dealt with at one hearing. One is an application for leave to lodge a second caveat. The other is an application for an order that a caveat not lapse.

An agreement for sale and purchase

[2] The applicants are respectively a father (in the 931 proceeding) and a son (in the 1760 proceeding). In early 2015 the son at auction signed an agreement to purchase an Auckland property (the agreement). The father subsequently lodged a caveat against the title claiming an interest arising from his nomination as purchaser under the agreement. The respondents, being the registered proprietors of the property, initiated the caveat lapsing procedures under the Land Transfer Act 1952.
The father unsuccessfully applied for an order that his caveat not lapse.1 The father

had relied on a deed of nomination whereby the son had nominated the father (and his wife) to take title to the property. Associate Judge Doogue found that there were irreconcilable factual disputes between the parties as to the specific details of the agreement for sale and purchase which were not capable of resolution (against the applicant) in a caveat proceeding.2 But his Honour found that, by reason of a subsequent document by which the son (as nominator) and his parents (as nominees) cancelled the earlier nomination, the father did not have an equitable right to enforce the agreement.3 Accordingly, Associate Judge Doogue dismissed the father ’s application (the first judgment).

[3] Counsel for the respondents immediately had the order of Associate Judge

Doogue sealed and the caveat removed from the title.

[4] Too late, the father sought recall of the first judgment. The father filed a notice of appeal in the Court of Appeal on 29 July 2015 and sought a stay of the first
judgment pending the outcome of the appeal.

1 Deng v Lu [2015] NZHC 1531.
2 At [26].
3 At [29] to [36].

[5] For the father, Mr Wilson recognises that by reason of the immediate sealing of the order and the removal of the caveat, this Court is unable to recall the judgment.4 He submits that a further caveat would provide appropriate protection of the applicants’ rights under the agreement.

[6] On 21 July 2015, the son lodged a caveat against the title to the Auckland property claiming an estate or interest pursuant to the agreement.…

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 Deng v Lu

Details

AGLC: Deng v Lu [2015] NZHC 2585
Case: [2015] NZHC 2585
Decision Date: 21 October 2015

CaseChat Overview and Summary

The High Court of New Zealand Auckland Registry dealt with two applications in the case of Deng v Lu. The first application was for leave to lodge a second caveat, and the second was for an order that a caveat not lapse. The applicants, Qingqi Deng (the father) and Weijie Deng (the son), sought to protect their interests in a property purchase agreement. The respondents, Yuliang Lu and Hongyu Yang, were the registered proprietors of the property.

The legal issues included whether the father had a right to lodge a second caveat after his first caveat had lapsed and whether the son's caveat should be allowed to lapse. The court had to consider the strength of the applicants' cases, the effect of the proposed orders on the parties, and whether the applicants had bona fides in pursuing their claims.

The court found that the father's application for leave to lodge a second caveat should be granted. The court recognised the ambiguity in the pre-auction agreement and the subsequent auction agreement. The court concluded that the applicants had a good argument that they were entitled to have their pre-payment taken into account on settlement. The court also found that the applicants' intent to pursue substantive relief was genuine, despite the delay in initiating such proceedings.

The court decided that the son's caveat should lapse. The court held that the son had assigned all his rights and interests in the property to the father through a deed of nomination. The court reasoned that a second caveat by the son would serve no useful purpose, as the father's caveat would adequately protect their interests.

The final orders included granting leave to the father to lodge a second caveat, subject to conditions that he promptly initiate and pursue a substantive proceeding for specific performance or an appeal. The son's caveat was ordered to lapse immediately upon the registration of the father's second caveat. Costs were reserved for further consideration.

Orders