HND Holding Ltd v Lau

[2023] NZHC 2211

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2023-404-1689

[2023] NZHC 2211

UNDER

Section 142 Land Transfer Act 2017

IN THEMATTER

of an application for an order removing caveat no. 12780915.1 (North Auckland Registry)

BETWEEN

HND HOLDING LIMITED

Applicant

AND

EE KUOH LAU

Respondent

Hearing:	16 August 2023
Appearances:	R O Parmenter for Applicant Respondent in person
Judgment:	16 August 2023

JUDGMENT OF LANG J

[on application for order removing caveat]

This judgment was delivered by Justice Lang On 16 August 2023 at 1.00 pm

Pursuant to r 11.5 of the High Court Rules Registrar/Deputy Registrar

Date:…………………………

Solicitors/counsel:
Ganda & Associates/R O Parmenter, Barrister, Auckland

Copy to: Mr E K Lau

HND HOLDING LTD v LAU [2023] NZHC 2211 [16 August 2023]

[1]    HND Holding Ltd (HND) holds a registered mortgage over Unit 2, 14 Haseler Crescent, Howick. This is owned by a person by the name of Daniel Shing Chung Kwok. The mortgage was registered against the title to the property on 12 August 2021.

[2]    Mr Kwok defaulted in his obligations to repay a loan he had obtained from HND. HND has entered into a contract to sell the property to a third party using its power of sale under the mortgage. It is currently prevented from completing the sale because Mr Lau has filed a caveat against the title to the property. This claims to protect the following equitable interests in the land:

(a)an interest as beneficiary under a constructive trust under which Mr Kwok is constructive trustee;

(b)an interest as purchaser of the land under an agreement for sale and purchase dated 8 June 2021;

(c)An interest as lessee of the land under a pre-paid lease of the property pursuant to which he is entitled to rent the property from 8 June 2021 until 8 June 2024.

[3]    HND now seeks an order under s 142 of the Land Transfer Act 2017 that the caveat be removed so it can complete the sale of the property. Settlement of the sale is to take place today.

Background

[4]    Mr Kwok now owes HND more than $16 million. This debt is secured over several properties, including that at Haseler Crescent. Given the size of the debt, interest will obviously be accruing at a significant rate.

[5]    This is now the third occasion on which Mr Lau has attempted to prevent a financier from exercising its power of sale under a mortgage. The case appears to be very similar to a situation that arose in July 2023 when Mr Lau lodged a caveat against a title to a property in Flat Bush claiming to have exactly the same interests as he

claims in relation to the Haseler Crescent property. Van Bohemen J held that these were not sufficient to defeat the power of the mortgagee to sell the property using its power of sale under the mortgage.1

[6]    Mr Lau subsequently tried to prevent the same mortgagee from exercising its power of sale by lodging a notice of claim against the property. This purported to protect his interests under a relationship property agreement that was allegedly entered into with the director of the owner of the property. I have made an order removing the notice of claim in a judgment issued contemporaneously with this judgment.2

Decision

[7]    The directors of HND have never had knowledge of the interests Mr Lau claims he holds in the mortgaged property and have never consented to them. I am satisfied the caveat is a thinly veiled attempt by Mr Lau to derail the mortgagee sale process. The interests that he claims cannot prevent HND from exercising its power under the mortgage to sell the property following default by Mr Kwok. It follows that the application must be granted.

Result

[8]    I make an order under s 142 of the Land Transfer Act 2017 that caveat number 12780915.1 (North Auckland Registry) be removed from the land contained in identifier NA102B/948.

Costs

[9]    Mr Lau must pay costs to HND on a category 2B basis together with disbursements as fixed by the Registrar.

Lang J

1      Goodmore Investments (New Zealand) Ltd v Lau [2023] NZHC 1983.

2      Goodmore Investments (New Zealand) Ltd v Lau [2023] NZHC 2214