Gong v Zhang - [2019] NZHC 574

IN THE HIGH COURT OF NEW ZEALAND PALMERSTON NORTH REGISTRY

I TE KŌTI MATUA O AOTEAROA TE PAPAIOEA ROHE

CIV-2018-454-61

[2019] NZHC 574

UNDER the Property Law Act 2007

IN THE MATTER

of application under Part 6 Subpart of the Act

BETWEEN

YAOMING GONG

Plaintiff

AND

SHIJUN ZHANG

First Defendant

SHIJUN ZHANG AND JIAN HUA HOU (AS TRUSTEES), TRUST NAME UNKNOWN

Second Defendants

Hearing:
14 February 2019

(Further submissions and evidence filed 21 February 2019 and 26 March 2019)

Appearances:

S F Clark for Plaintiff

Judgment:

26 March 2019

JUDGMENT OF CLARK J

Introduction

[1] On 8 May 2018 the plaintiff, Dr Gong, obtained summary judgment against the first defendant for the sum of $604,985.29 plus future interest (the judgment debt).

[2] The first defendant has not paid the judgment debt. The plaintiff has filed this proceeding under the Property Law Act 2007 (the Act). His case is that as a consequence of the first defendant’s disposition of property which was subject to a

GONG v ZHANG [2019] NZHC 574 [26 March 2019]

freezing order, the first defendant is unable to pay the judgment debt. The plaintiff seeks either:

(a)an order requiring the second defendants to pay the judgment debt to the first defendant; or

(b)an order vesting in the first defendant the property at 25D Riverglade Drive, Hamilton, Certificate of Title SA67D/214 (the Property).

[3]The claim proceeded by way of a formal proof hearing.

Background

[4] The plaintiff and first defendant have been in litigation since 2014 when Dr Gong commenced two proceedings against Mr Zhang.

[5] It is not necessary for the purpose of determining the claim before me that I traverse the history to the disputes. It is touched upon in a High Court judgment dealing with interrogatories and discovery disputes1 and in the judgment of the High Court delivered 15 April 2016 declining the first defendant’s application to set aside or vary freezing and ancillary orders made on 27 November 2015.2

[6] There is also a decision of the High Court in a third proceeding granting Dr Gong’s application for an interim freezing order over the Property, along with an ancillary order requiring Mr Zhang to file and serve a list of assets. That judgment was delivered on 1 March 2018.3

[7]For the purpose of the present claim the following are the key pleaded facts:

(a)On 22 December 2014, in the course of the two proceedings to which I refer at [4] above, the first defendant disposed of his major asset, the Property, to a trust. The Property was transferred to Shijun Zhang and

1      Gong v Zhang [2014] NZHC 2838.
2      Gong v Zhang [2016] NZHC 705 at [64].
3      Gong v Zhang [2018] NZHC 297.

Jian Hua Hou presumed to be the trustees of the trust to which the transfer was made.

(b)The plaintiff became aware of the transfer and, on 5 June 2015, placed the first defendant on notice that the transfer was considered a disposition of property that prejudiced 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.

Keep reading for free

Create a free CaseChat account to read Gong v Zhang and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2019] NZHC 574
Decision Date: 26 March 2019

CaseChat Overview and Summary

In the High Court of New Zealand, Dr Yaoming Gong, the plaintiff, brought an application against Shijun Zhang, the first defendant, and Jian Hua Hou and an unknown trust, the second defendants. The application was made under subpart 6 of the Property Law Act 2007, seeking an order either to require the second defendants to pay the judgment debt to the first defendant or to vest in the first defendant the property at 25D Riverglade Drive, Hamilton. Dr Gong had obtained summary judgment against the first defendant for the sum of $604,985.29 plus future interest. The first defendant had not paid the judgment debt, and Dr Gong contended that the first defendant had disposed of property in a manner that prejudiced Dr Gong as a creditor. The legal issues were whether the disposition met the statutory requirements for a claim under subpart 6 and whether the statutory prerequisites were satisfied. The court found that the disposition was by way of gift, the disposition was made after 31 December 2007, and the first defendant was aware of the risk of incurring debts beyond his ability to pay. The court also found that the statutory prerequisites were satisfied, and an order was made vesting in the first defendant the property at 25D Riverglade Drive, Hamilton. The plaintiff was entitled to costs awarded on a solicitor-client basis.

Orders