Gao v Browns Bay Seaview Limited

[2023] NZHC 845

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2022-404-001855

[2023] NZHC 845

BETWEEN

SEN GAO

Plaintiff

YULING YANG
Second Applicant

AND

BROWNS BAY SEAVIEW LIMITED

First Respondent

WINTER FOREST HOLDINGS LIMITED
Second Respondent

VICTOR JIA

Interested Party

Hearing:

18 April 2023

Appearances:

G Credo for the Applicants

M Kirkland for the Respondents
W Alexander for the Interested Party

Judgment:

19 April 2023

JUDGMENT OF ASSOCIATE JUDGE GARDINER

This judgment was delivered by me on 19 April 2023 at 4.00 p.m. pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar Date.......................................

Solicitors:

Norling Law Ltd, Auckland

Teresa Chan Law Ltd, Dunedin M Kirkland, Dunedin

GAO v BROWNS BAY SEAVIEW LTD [2023] NZHC 845 [19 April 2023]

Introduction

[1]    The first respondent, Browns Bay Seaview Limited (BBSL) is a company owning a building named ‘The Victor’. The second respondent, Winter Forest Holdings Limited (WFHL) is the sole shareholder of BBSL.

[2]    The Victor is a six-storey apartment building with two basement carparking levels, and eight commercial units on the ground floor. The development of The Victor is complete and many of the units have been sold to third parties.

[3]    Yuling Yang, the second applicant, owns 51 per cent of the shares in WFHL. It is common ground that these shares are held on bare trust for the first applicant, Sen Gao.

[4]    Victor  Jia, the interested party, holds 49 per cent of the shares in WFHL. Mr Jia is the sole director of both BBSL and WFHL.

[5]    It is common ground that Mr Gao advanced over $15 million towards development of The Victor from late 2018.

[6]    Mr Gao and Ms Yang have applied for orders under ss 178 or 179 of the Companies Act 1993 (the Act) requiring BBSL to make available detailed financial and other information concerning The Victor, and requiring WFHL to make available a full set of draft financial reports for the year ended 31 March 2022. They also seek access to the respondents’ accounting software (such as Xero) to produce reports and extract financial information. Alternatively, they seek orders authorising Ms Diana Li and Mr Arron Boote from William Buck Chartered Accountants to inspect and make copies of, or take extracts from, the documents described, and to have access to the respondents’ accounting software.

[7]    A considerable portion of the application was resolved by consent prior to the application being set down for a hearing.1

1      Minute of Venning J dated 9 December 2022.

[8]    BBSL and WFHL were opposed to providing these remaining categories of information to the applicants:

(a)signed contracts between BBSL and any suppliers or contractors, which have a value of less than $100,000;

(b)the current market values of the unsold units at The Victor;

(c)information with respect to the stages of completion of The Victor; and

(d)supporting documentation and confirmations in relation to expenditure incurred on The Victor’s development.

[9]    The respondents opposed these aspects of the application saying that the information requests were too broad and undefined, collating and providing the information would be unduly onerous, or, in the case of current market valuations, they did not hold any such information.

[10]   With some encouragement by the Court, the parties were able to reach an agreed position on the remaining categories of information sought by the applicants.

Orders

[11]By consent, I order:

(a)The applicants are entitled to obtain, at their own cost, their own valuations of units at ‘The Victor’ and the respondents and the interested party will take all steps to allow this to occur.

(b)The  respondents  and  the   interested   party   are   to   provide   by  16 May 2023 any invoices, receipts, financing documents, and signed contracts between BBSL, WFHL, and their related entities (which comprise Civic Torwin Construction Corporation Limited, Qixuan International Trading Limited, The Victor Body Corporate Limited, and Mr Jia in his personal capacity).

(c)There is no issue as to costs in this proceeding.

(d)The parties are directed to file a further memorandum updating the Court as to compliance with these orders and those of Venning J,2 by 20 June 2023.

Associate Judge Gardiner

2 Minute of Venning J dated 9 December 2022 at [9].