Fuati v Peng - [2018] NZHC 3283

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV 2018-404-0848

[2018] NZHC 3283

BETWEEN
MUSABA YOUFU FUATI and JUN JIN

Applicants

AND

YUCHEN PENG

First Respondent

WONDER INTERNATIONAL LIMITED
Second Respondent

ASB BANK LIMITED
Third Respondent (Non-Party)

ANZ BANK NEW ZEALAND LIMITED
Fourth Respondent (Non-Party)

BANK OF NEW ZEALAND
Fifth Respondent (Non-Party)

WESTPAC BANKING CORPORATION

Sixth Respondent (Non-Party)

Hearing: 13 December 2018

Appearances:

N J Scampion for the applicants

D Zhang for the first and second respondents No appearance for the third to sixth respondents

Judgment:

13 December 2018

JUDGMENT OF JAGOSE J

This judgment is delivered by me on 13 December 2018 at 10.00 am pursuant to r 11.5 of the High Court Rules.

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Registrar / Deputy Registrar

Counsel/Solicitors: N J Scampion, Barrister, Auckland
Amicus Law, Auckland

FUATI v PENG [2018] NZHC 3283 [12 December 2018]

Background

[1] On 11 May 2018, the applicants obtained orders freezing, in particular, the first and second respondents’ funds in identified New Zealand and Chinese bank accounts. The first respondent, Yuchen Peng, had notice of those orders by 14 May 2018.

[2] Ms Peng’s response to the applicants’ ancillary disclosure orders illustrated, on 14 May 2018, she transferred substantial sums to third parties, including to her boyfriend, Zuoru Jin. (Freezing orders have extended to Mr Jin’s accounts.) The applicants apprehend further transfers are being made from her Chinese bank accounts.

[3] The applicants have applied for Ms Peng accordingly to be held in contempt, as a means of coercing compliance with the freezing orders. They seek ancillary disclosure orders against the third to sixth respondents (the “Banks”) as to their particular information and documents relating to Ms Peng’s activities on 14 May 2018. The Banks have not taken any step in relation to the sought orders, and the first and second respondents abide my decision.

Discussion

[4] Under HCR 32.3(1), I may make an order ancillary to a freezing order if I ‘consider it just’. Such orders generally are “to ensure the freezing order can be properly policed and is effective”.1 I am not entirely convinced the present ancillary order sought can be said to assist with the freezing order’s supervision and efficacy, but it may have that derivative quality if there is a basis to ground disciplinary pursuit of the contempt application. Given the lack of opposition to its making, I will make that order.

[5] I therefore do not need to consider the applicants’ alternative application for variation of the disclosure order against Ms Peng to require her to provide such information and documents. I record Ms Peng indicates she would resist compliance with such orders on grounds of her privilege against self-incrimination, which the

1 Monasterio v Bujak HC Christchurch, CIV 2008-409-1901, 21 August 2009 at [26].

applicants contend she has waived. But, as I observed to counsel, I am not prepared to determine those claims and contentions in the abstract.

[6] The applicants also seek directions regarding the…

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 [2018] NZHC 3283
Case: [2018] NZHC 3283
Decision Date: 13 December 2018

CaseChat Overview and Summary

In the High Court of New Zealand, the applicants, Musaba Youfu Fuati and Jun Jin, sought to enforce and extend freezing orders against Yuchen Peng and Wonder International Limited. The applicants sought orders to compel banks to provide documents and account statements to monitor compliance with the freezing orders, and sought to hold Ms Peng in contempt for allegedly transferring funds in breach of the orders. The first and second respondents opposed the application, while the third to sixth respondents, being various banks, did not appear.

The court considered whether it was appropriate to make the ancillary disclosure orders sought by the applicants to assist in monitoring the effectiveness of the freezing orders, and whether there was a basis to ground disciplinary pursuit of the contempt application. The court also considered the appropriate level of Ms Peng’s maximum monthly spending under the freezing order and its monitoring.

The court found that while the ancillary orders sought may not directly assist in the supervision and efficacy of the freezing orders, they may have that derivative quality if there is a basis to ground disciplinary pursuit of the contempt application. The court made the ancillary disclosure orders sought by the applicants, and found that the level of Ms Peng’s maximum monthly spending under the freezing order should be monitored by requiring the banks to provide contemporaneous copies of their periodic statements of accounts subject to the freezing orders. The court reserved leave to all parties to apply to discharge or vary the order requiring the banks to provide account statements.

The court ordered the third to sixth respondents to provide affidavits and documents relating to Ms Peng’s activities on 14 May 2018, and to provide the applicants with contemporaneous copies of their periodic statements of accounts subject to the freezing orders. The court reserved costs for determination in conjunction with the applicants’ contempt order application.

Orders