Estate of Lu - [2021] NZHC 631

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2020-404-000696

[2021] NZHC 631

UNDER

AND
the Insolvency Act 2006

IN THE MATTER OF

an application by JIANPING WANG, company director, of Christchurch, for an order that the deceased estate of JIHONG LU be administered by an appointee under Part 6 of the Insolvency Act 2006

Hearing: On the papers

Judgment:

26 March 2021

JUDGMENT OF WYLIE J

[Costs]

This judgment was delivered by Justice Wylie On 26 March 2021 at 12.00 noon
Pursuant to r 11.5 of the High Court Rules Registrar/Deputy Registrar

Date:…………………………

Solicitors/counsel:
Davidson Legal/R B Stewart QC and G Slevin, Christchurch Couch Harlowe Kovacevich/Ben Liu & Co, Auckland
K Davenport QC and A E Isaacs, Auckland

Re Estate of Jihong Lu [2021] NZHC 631 [26 March 2021]

Introduction

[1] These proceedings have not had an auspicious start. The applicant, Jianping Wang, sought that the deceased estate of Jihong Lu be administered by an appointee under Part 6 of the Insolvency Act 2006. However, the application filed did not seek such an order.

[2] When the matter was called before me on 30 July 2020, Mr Slevin, appearing for Mr Wang, made an oral application for an order that the application filed should also be treated as an application that the late Mr Lu’s estate be administered under Part 6 of the Act. I declined this application in an oral ruling and, the following day, issued reasons for that ruling.1

[3] Mr Wang then sought leave to appeal my judgment. I granted leave on 16 September 2020.2 The Court of Appeal heard the appeal on 25 November 2020. It issued its judgment on 21 December 2020.3 It allowed the appeal and amended the application made by Mr Wang as sought in the oral application of 30 July 2020. It dealt with costs in that Court, but made no orders in respect of costs in this Court.

[4] Mr Wang, through his counsel, now seeks costs on the application for leave to appeal heard in this Court.

Submissions

[5] Mr Slevin, in a memorandum filed on behalf of Mr Wang, noted that costs are in the discretion of the Court. He accepted that Mr Lu and Mrs Zhang are not named as parties on the intituling in this Court and that they are described in the judgment as interested parties, but he argued that they fully participated in the leave application and that they opposed the grant of leave. He argued that they are parties as defined by r 1.3 of the High Court Rules 2016, having been added to the proceeding. He argued that Mr Wang should not be penalised for counsel’s error in failing to initially advert to the need for an order under s 379 of the Insolvency Act. He accepted that, under

1      Re Estate of Jihong Lu [2020] NZHC 1894.
2      Re Estate of Jihong Lu [2020] NZHC 2415.
3      Wang v Lu

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.

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Details

Case: [2021] NZHC 631
Decision Date: 26 March 2021

CaseChat Overview and Summary

Jianping Wang, a company director, filed an application for the estate of the deceased Jihong Lu to be administered by an appointee under Part 6 of the Insolvency Act 2006. However, the initial application did not explicitly request this order, leading to complications. Mr Wang subsequently sought leave to appeal the decision of Justice Wylie, which was granted by the Court of Appeal, thereby amending the application as requested. Mr Wang now seeks costs associated with the application for leave to appeal.

The primary legal issue before the court was whether Mr Wang should be awarded costs for the application for leave to appeal. Mr Wang's counsel argued that the failure to initially include the necessary order in the application was an oversight, and that Mr Wang should not be penalised for this error. In contrast, Mr Lu and Mrs Zhang, who were not named parties but actively opposed the leave application, contended that the appeal was unnecessary and that Mr Wang should bear the costs due to his counsel's failure.

Justice Wylie ruled that Mr Wang was entitled to the costs for the application for leave to appeal. The court acknowledged that while the initial omission was an error, it did not constitute disqualifying conduct warranting a refusal of costs. The court also noted that Mr Lu and Mrs Zhang had effectively participated in the proceedings, opposing both the oral application to amend and the subsequent application for leave to appeal, thus rendering them liable for costs. The court fixed costs in favour of Mr Wang and against Mr Lu and Mrs Zhang in the sum of $7,648, plus disbursements of $550, with their liability for costs being joint and several.

Orders