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Fuati v Peng

Fuati v Peng

Case [2019] NZHC 1859 1 August 2019

Freezing Orders

Jurisdiction

Standing

Real Risk of Dissipation

Civil Litigation & Procedure

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IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2018-404-000848

[2019] NZHC 1859

UNDER Part 32 of the High Court Rules

BETWEEN

MUSABAYOUFU FUATI

First Plaintiff/Applicant

AND

JUN JIN

Second Plaintiff/Applicant

AND

YUCHEN PENG

First Defendant/Respondent

AND

ZUORU JIN

Second Defendant/Respondent

Hearing: 27 February and 18 March 2019

Appearances:

N Scampion for Plaintiffs/Applicants D Zhang for Defendants/Respondents

Judgment:

1 August 2019

JUDGMENT OF TOOGOOD J

This judgment was delivered by me on 1 August 2019 at 4.00 pm Pursuant to Rule 11.5 High Court Rules

Registrar/Deputy Registrar

FUATI v JIN [2019] NZHC 1859 [1 August 2019]

Introduction

[1] The plaintiffs, Mr Musabayoufu Fuati and Mr Jun Jin, allege that the first defendant, Ms Yuchen Peng, borrowed a total of NZ$900,000 from them on the basis that she would repay that sum on or before 4 April 2018, together with interest at 18 per cent per annum. They say that Ms Peng repaid NZ$156,942.54 but the balance remains outstanding.

[2] Ms Peng does not admit the alleged debt. A second defendant, Zuoru Jin (referred to as Nick Jin), has been joined to the proceeding. He, too, denies he is liable to the plaintiffs. The matter goes to trial on 11 November 2019.

[3] This judgment reviews freezing orders made previously by this Court over the assets of Nick Jin.

Procedural background

[4] Wonder International Ltd (WIL) is a company of which Ms Peng is the sole director and shareholder.

[5] On 10 May 2018, Moore J made freezing orders in respect of Ms Peng’s and WIL’s assets and ordered ancillary disclosure by Ms Peng, WIL and four New Zealand banks to ascertain the existence, value, and whereabouts of assets falling within the scope of the freezing order. The banks complied with the disclosure order, but Ms Peng and WIL did not.

[6] The freezing order was due to expire on 20 June 2018 (having been extended twice). The plaintiffs applied for the continuation of the freezing order until further order of the Court. Courtney J granted that application on 17 August 2018.1

[7] The plaintiffs then sought freezing orders in relation to assets owned by Nick Jin. Broadly, this was on the basis that he was Ms Peng’s boyfriend and that she had transferred a total of $270,873.65 to him.

1 Fuati v Peng [2018] NZHC 2134.

[8]Lang J granted the orders on 23 October 2018. The Judge said:

[3] I am prepared to grant the application on a limited basis because I consider the applicants have established a good arguable case that Mr Jin may well be the recipient of monies transferred to him by Ms Peng. The freezing orders are not at this stage to extend beyond any bank account in Mr Jin’s name or in relation to which he may have signing authority. If the applicants acquire information suggesting that funds belonging to the applicants may have been channelled into other assets, they have leave to apply to…

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 Fuati v Peng

Details

AGLC: Fuati v Peng [2019] NZHC 1859
Case: [2019] NZHC 1859
Decision Date: 1 August 2019

CaseChat Overview and Summary

In the case of Fuati v Peng, the plaintiffs, Mr Musabayoufu Fuati and Mr Jun Jin, alleged that Ms Yuchen Peng had borrowed NZ$900,000 from them and failed to repay the balance, which stood at NZ$743,057.54, along with interest. The plaintiffs further sought freezing orders over the assets of Zuoru Jin, who they claimed received money from Ms Peng, his girlfriend, knowing it was owed to the plaintiffs. The central legal issue was whether the plaintiffs had established a good arguable case against Zuoru Jin for claims of money had and received or breach of trust. The Court found that the plaintiffs' claims were factually flawed and misconstrued in law. Specifically, the plaintiffs did not have a good arguable case of money had and received because they did not pay any money to Zuoru Jin. Moreover, the Court found that the plaintiffs' claim of breach of trust was speculative and lacked the necessary certainty of intention, subject-matter, and objects. As such, the Court set aside the freezing orders over Zuoru Jin's assets and ordered that Zuoru Jin was entitled to costs on a Category 2B basis. The freezing orders over Ms Peng's assets remained in place.

Orders