Feng v Mills
[2025] NZCA 90
•3 April 2025 at 9.30 am
| IN THE COURT OF APPEAL OF NEW ZEALAND I TE KŌTI PĪRA O AOTEAROA |
| CA519/2024 |
| BETWEEN | WEIQIANG FENG |
| AND | DAVID LAWRENCE MILLS AND FIONNA EILEEN MILLS AS TRUSTEES OF THE MILLS FAMILY TRUST |
| Court: | Thomas and Woolford JJ |
Counsel: | T J P Bowler for Applicant |
Judgment: | 3 April 2025 at 9.30 am |
JUDGMENT OF THE COURT
A The application for an extension of time is declined.
BThe applicant must pay the respondents’ costs calculated for a standard interlocutory application on a band A basis and usual disbursements.
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REASONS OF THE COURT
(Given by Thomas J)
Mr Feng applies for an extension of time under r 29A of the Court of Appeal (Civil) Rules 2005 (the Rules) to appeal a decision of the High Court striking out Mr Feng’s claim against the respondents and dismissing his application to set aside a bankruptcy notice.[1]
Background
[1]Feng v Mills [2023] NZHC 2674 [judgment under appeal].
The respondents, the trustees of the Mills Family Trust, agreed to sell a property at 22 Manapau St, Meadowbank, Auckland, to Mr Feng. Mr Feng nominated Mr Wang as purchaser under the sale and purchase agreement. Mr Wang then failed to settle and the respondents sold the property at a loss.[2] They sought to recover their loss by way of an application for summary judgment.
[2]We take the background from the judgment under appeal.
On 7 December 2022, Lang J granted summary judgment jointly and severally against Messrs Feng and Wang in the sum of $756,597.31.[3] Mr Feng was represented but did not take any steps to defend himself against the application for summary judgment. There was no appearance by or for Mr Wang.
[3]Mills v Feng [2022] NZHC 3278.
Mr Feng applied for a stay of execution of the summary judgment pending the respondents’ enforcement of their judgment against Mr Wang and the outcome of Mr Feng’s High Court proceeding filed on 19 April 2023 against Mr Wang, Ray White Remuera, and the respondents (the 972 proceeding). The High Court declined the application.[4]
[4]Mills v Feng [2023] NZHC 1199.
In accordance with an order for substituted service,[5] the respondents served a bankruptcy notice on Mr Feng on 2 May 2023. That day, Mr Feng filed an application to set aside the bankruptcy notice.
[5]Mills v Feng HC Auckland CIV-2023-404-212 (24 April 2023) (Minute of Associate Judge Taylor).
On 2 August 2023, the respondents filed an application to strike out the parts of the 972 proceeding that related to them. Mr Feng subsequently filed an amended statement of claim dated 6 August 2023, which continued to include the respondents.
On 26 September 2023, in the judgment under the proposed appeal, Associate Judge Taylor struck out Mr Feng’s claim on the basis that none of his arguments were tenable.[6] The Judge also dismissed Mr Feng’s application to set aside the bankruptcy notice on the basis he had no genuine triable cross-claim in relation to the judgment debt that could have been used as a defence in the action in which the relevant judgment was given.[7]
[6]Judgment under appeal, above n 1, at [30].
[7]At [33].
On 22 August 2024, Judge Taylor dismissed Mr Feng’s application for a stay of the judgment.[8]
[8]Mills v Feng [2024] NZHC 2354 at [24].
On 21 October 2024, Associate Judge Brittain adjudicated Mr Feng bankrupt.[9]
[9]Mills v Feng [2024] NZHC 3067 at [40].
Mr Feng’s notice of appeal was filed on 12 August 2024, just under a year out of time given the judgment under appeal was delivered on 26 September 2023.
Grounds of application
The grounds of Mr Feng’s application for an extension of time are:
(a)he will be highly prejudiced if an extension of time is not granted;
(b)there will not be any prejudice to the respondents given the short delay; and
(c)the respondents are partly responsible for the delay due to their refusal to agree to an extension of time for the filing of the notice of appeal.
Mr Feng was self-represented. He applied for leave to appeal within time, believing that was necessary. Despite minutes issued by the High Court[10] confirming that leave was not required for an appeal against either the strike-out decision or the bankruptcy notice, Mr Feng maintains that he was not so advised.
[10]Mills v Feng HC Auckland CIV-2023-404-212 (31 October 2023 and 9 April 2024) (Minutes of Associate Judge Taylor).
Mr Feng submits that, while there is no prejudice to the respondents, there would be “serious and unfair consequences” for him if he is precluded from pursuing his appeal because he will lose his right to bring his claim against the respondents as well as related claims against other parties.
In respect of his substantive appeal, Mr Feng’s submissions on strike out are as follows:
(a)the respondents were aware that Mr Feng was not the actual purchaser of the property in question;
(b)the respondents were the principals for their agent, Ray White Remuera, and therefore the respondents are liable for all actions carried out by Ray White Remuera;
(c)the respondents failed to mitigate their loss when the property was resold below market value;
(d)the respondents are liable as principals for any breaches by their agent, Ray White Remuera, of the Fair Trading Act 1986;
(e)the Judge erred in finding Mr Feng did not have a counterclaim, set-off, or cross-demand against the respondents; and
(f)Mr Feng was not legally represented in relation to the strike-out application.
Mr Feng’s submissions on the refusal to set aside the bankruptcy notice are as follows:
(a)the Judge erred in holding that the outcome of the application to set aside the bankruptcy notice relied solely on the conclusions reached in relation to the strike-out application; and
(b)Mr Feng was not legally represented at the hearing of the application to set aside the bankruptcy notice.
Mr Feng maintains a third party is prepared to fund his appeal.
Opposition
The respondents oppose the application on the grounds that:
(a)although the initial delay is explained by Mr Feng being self‑represented at the time, two lengthy periods of delay have not been explained:
(i)although Mr Feng contends that he believed leave was required, Judge Taylor’s minute dated 31 October 2023 recorded that no leave was required to file an appeal against the strike out; and
(ii)the 9 April 2024 orders of Judge Taylor recorded that leave was not required in respect of the bankruptcy decision:
(b)Mr Feng has been represented since May 2024; and
(c)an appeal would be vexatious and without merit.
The respondents point out that, since summary judgment was entered against Mr Feng in December 2022, Mr Feng has sought to avoid service and has opposed all enforcement steps.
Furthermore, the respondents submit that Mr Feng originally filed his notice of appeal and the application for an extension of time because he sought to rely on the appeal as a ground for opposing or delaying adjudication. Mr Feng has since been adjudicated bankrupt, and so it is unclear whether he still wishes to pursue the appeal, particularly as he has not appealed the adjudication decision.
Analysis
The ultimate question when considering whether to grant or decline an extension of time to appeal under r 29A is what the interests of justice require in the particular circumstances of the case.[11] Relevant considerations include:[12]
(a)the length of the delay;
(b)the reasons for the delay;
(c)the conduct of the parties, particularly of the applicant;
(d)any prejudice or hardship to the respondent or to others with a legitimate interest in the outcome; and
(e)the significance of the issues raised by the proposed appeal, both to the parties and more generally.
[11]Almond v Read [2017] 1 NZLR 801, [2017] NZSC 80 at [35]–[40].
[12]At [38].
The merits of the proposed appeal may also be relevant, although any consideration of them must be relatively superficial.[13]
[13]At [39(c)].
Applying those principles to the present case, in our view the length of the delay is long, and the reasons given for it weak. Although Mr Feng was originally self-represented and operating under the understanding that leave to appeal was required, no explanation is provided for the delays that occurred upon Mr Feng acquiring representation. In any event, considerable time has elapsed since the Court advised Mr Feng that leave was not required.
In terms of prejudice or hardship to them, the respondents note that they have incurred considerable costs obtaining judgment and then seeking to have that judgment enforced against Mr Feng. The respondents say, and this has not been contradicted, that Mr Feng has sought to avoid and oppose all steps to enforce the summary judgment entered against him in December 2022.
This is also a case where the merits of the proposed appeal are relevant. Mr Feng’s proposed appeal appears to have no merit. Judge Taylor dealt with each of the grounds raised by Mr Feng for resisting strike out. His conclusions were in accordance with settled law:
(a)Mr Feng was liable under the sale and purchase agreement and financial arrangements between Messrs Feng and Wang were irrelevant to their joint and several liability under the agreement;[14]
(b)the fact Mr Feng did not view the property and the property was not valued prior to signing the sale and purchase agreement was irrelevant to his liability under the agreement;[15]
(c)there was no tenable argument that the respondents failed to mitigate their loss;[16] and
(d)the respondents were not “in trade”, so the Fair Trading Act did not apply.[17]
[14]Judgment under appeal, above n 1, at [30(a)].
[15]At [30(b)].
[16]At [30(c)].
[17]At [30(d)].
The Judge then correctly applied his conclusions on the strikeout to Mr Feng’s application to set aside the bankruptcy notice. Furthermore, Mr Feng has now been adjudicated bankrupt.
We conclude it would not be in the interests of justice to grant the extension sought.
Result
The application for an extension of time to appeal is declined.
The applicant must pay the respondents’ costs calculated for a standard interlocutory application on a band A basis and usual disbursements.
Solicitors:
Neilsons Lawyers, Auckland for Applicant
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