Fortune Arising Development Limited v JCD NZ Limited

[2025] NZHC 1169

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV 2025-404-750

[2025] NZHC 1169

UNDER

the Property Law Act 2007 and Part 19 of the High Court Rules

IN THE MATTER

of an order for possession under section 244 of the Property Law Act 2007

BETWEEN

FORTUNE ARISING DEVELOPMENT LIMITED

Applicant

AND

JCD NZ LIMITED

Respondent

Hearing:	12 May 2025
Appearances:	L J McDougall for the Applicant
Judgment:	15 May 2025

JUDGMENT OF HARVEY J

This judgment is delivered by me on 15 May 2025 at 12pm pursuant to r 11.5 of the High Court Rules

……………………………… Deputy Registrar

Solicitors:
Anthony Harper, Auckland

FORTUNE ARISING DEVELOPMENT LTD v JCD NZ LTD [2025] NZHC 1169 [15 May 2025]

Introduction

[1]    Fortune Arising Development Ltd (Fortune) owns premises at 66–80 Broadway, Newmarket, Auckland. On 2 August 2021, Fortune agreed to lease its premises to JCD NZ Ltd (JCD). Since October 2024, JCD has failed to pay the rent and outgoings owed under the lease. On 20 January 2025, a notice and statutory demand was served on an employee of JCD. The notice required JCD to remedy the breaches by paying outstanding rent, outgoings and costs by 3 February 2025. JCD has not paid and has taken no steps to settle the claim or defend the proceedings.

[2]    Fortune seeks to cancel the lease and orders that JCD yield up possession within 24 hours following judgment.1 Orders are sought that JCD remove all its goods and chattels from the premises under the supervision of Fortune or its agent within 48 hours after it takes possession of the premises. Fortune also seeks payment of outstanding rent, outgoings, costs and interest.

[3]    On 20 February 2025 the director of JCD claimed he had not received the documents and asked that they be sent to the offices of Turner Hopkins. Their director also contacted Fortune’s solicitors proposing settlement. As at the date of hearing, no payments have been made, no settlement has been reached and JCD remains in possession of the premises.

[4]    On 21 March 2025 the premises was sold by Fortune to 80 Broadway Holding Ltd or 80 BHL, a related entity incorporated to purchase the property. Mr Huan Ma is the development manager for both Fortune and 80 BHL. An issue has been raised as to whether Fortune or 80 BHL is the correct party with standing to bring this application.

[5]    On 1 May 2025, Wilkinson-Smith J directed that the applicant file an updating memorandum by 9 May 2025 concerning the quantum of loss claimed and whether the description of the applicant required amendment. Counsel filed a memorandum as directed, along with a further affidavit in support from Mr Ma.

1     This includes relinquishing all access codes and keys and to deliver same to William Wang of Bayleys.

Discussion

[6]    Regarding the standing issue, Mr McDougall submitted that the recent sale of the premises by Fortune to 80 BHL did not affect in any material way the Fortune’s standing, citing Patel v Digital Printing Group Ltd and ss 232 to 234 of the Act in support.2 I accept counsel’s arguments, supported by the authorities mentioned, that Fortune has standing to continue with the proceedings.

[7]    Fortune seeks orders that JCD pays $204,326.91 comprising $176,063.05 for rent and outgoings as set out in paragraph [12] of the updating affidavit of Mr Ma affirmed 9 May 2025. This includes: $168,992.60 including GST for unpaid rent for the period 1 October 2024 to 1 May 2025; $5,756.60 penalty interest for the period 1 October 2024 to 8 May 2025: and $1,313.85 for unpaid water rates for the period 7 October 2024 to 16 April 2025. In addition, solicitor client costs of $28,263.86 are sought being $26,814.91 in legal costs and $1,448.95 in disbursements. Interest is also sought, per s 22 of the Interest on Money Claims Act 2016, from the date of judgment until repayment.

[8]    As foreshadowed, to date JCD has not engaged in the proceedings despite having been served. Overall, while I raised with counsel the possibility of a formal proof hearing, on reflection, I consider that the approach taken by Gault J in James Ward Trustee Company Ltd v Rui Travis Jarm3 and Radich J in Hope Resources Trust Board v Cole4 is appropriate. In other words, this matter can be dealt with as a formal proof on the papers without the need for a hearing.

[9]    In short, I am satisfied that the debt is due, that the proper procedural steps have been taken by Fortune to first, issue a notice under the Property Law Act, and second, to then provide time within which JCD was required to remedy its breaches of the lease. As mentioned, JCD has failed to pay the amounts due or to provide acceptable settlement proposals. JCD has taken no steps in the proceedings. In such circumstances, I accept that Fortune is entitled to the orders it is seeking. Section 251

2     Patel v Digital Printing Group Ltd (2008) 10 NZCPR 30. See also Mitre 10 (New Zealand) Ltd v Thistle Dome Holdings Limited [2016] 2 NZLR 846; and

3     James Ward Trustee Company Ltd v Rui Travis Jarm [2025] NZHC 937.

4     Hope Resources Trust Board v Cole [2025] NZHC 1093.

of the Property Law Act provides that, where the court makes an order cancelling a lease, it can order the lessee to pay rent up to the date of cancellation and to pay reasonable compensation for the breach of the lease. I also accept that that the applicant is entitled to damages for unpaid rent and outgoings payable under the lease until the date of cancellation or (if later) the date possession is yielded. The applicant is entitled to its legal costs and disbursements relating to the default and enforcement, as well as interest at the default rate.

Decision

[10]Orders are now issued, per ss 244-246 of the Property Law Act 2007 that:

(a)the lease dated 2 August 2021 between Fortune and JCD for 66-80 Broadway, Newmarket is cancelled;

(b)Fortune is entitled to immediate possession of the property and JCD is to vacate and remove any of its property within 48 hours;

(c)JCD must pay Fortune:

(i)rent and outgoings as at 9 May 2025 of $176,063.05;

(ii)solicitor client costs of $28,263.86;

(iii)interest per s 22 of the Interest on Monies Claims Act 2016 from the date of judgment until repayment.

Harvey J