Hou v Zhang

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2022-404-2290

[2025] NZHC 1975

BETWEEN

ZHENCHANG HOU

Plaintiff

AND

KAI ZHANG

First Defendant

TAMAKI CA LIMITED

Second Defendant

Hearing:

5 March 2025

Appearances:

MR Taylor for the Plaintiff/Applicant

MSP Pang for the First and Second Defendants/Respondents

Judgment:

17 July 2025

JUDGMENT OF ASSOCIATE JUDGE SUSSOCK

This judgment was delivered by me on 17 July 2025 at 3 pm pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Solicitors:

Matt Taylor Barrister, Auckland Integritas Law Firm Limited, Auckland

HOU v ZHANG [2025] NZHC 1975 [17 July 2025]

Introduction

[1]        In a judgment issued on 6 November 2023, I ordered specific performance of the exit clause in a property sharing agreement (PSA) between the plaintiff,

Zhenchang Hou, and the first defendant, Kai Zhang.1

[2]        The PSA related to a property in Auckland held by the second defendant, Tamaki CA Ltd (Property). Mr Zhang and his wife are directors and shareholders of Tamaki CA.

[3]        The plaintiff originally applied for summary judgment in terms of the following orders:

(a)requiring the first and second defendants to take reasonable steps to facilitate the sale of the Property;

(b)agreeing to a minimum price at which the Property will be sold, or complying with the valuation clause in the PSA (cl 9) if necessary; and

(c)after accounting for income and expenses, applying the proceeds:

(i)95.65 per cent to Mr Hou and 4.35 per cent to Mr Zhang; or

(ii)in the alternative, such other sums as the Court deems appropriate.

[4]        At the hearing, counsel for the plaintiff made it clear that the plaintiff was no longer seeking orders applying the proceeds in accordance with [3(c)] above, but instead wished to rely on the exit clause in the PSA (cl 8), as the clause provided for division of the proceeds following sale. Counsel for the plaintiff submitted that once the Property was sold, the parties would attempt to agree on the appropriate share and, only if that was not possible, would revert to the Court for further orders.

1      Hou v Zhang [2023] NZHC 3102 (Judgment).

[5]        The defendants opposed summary judgment on both technical and substantive grounds. Steps had been taken by the plaintiff following the defendant raising the technical evidential issues and so those grounds did not succeed.2

[6]        At the hearing, counsel for the defendants submitted that a significant part of their defence was in relation to apportionment given the division sought. I therefore adjourned the hearing to allow settlement discussions between the parties. No agreement was reached and the hearing resumed. The parties however asked that preparation of the judgment be delayed for a period to allow further time for settlement discussions. No agreement was reached so the parties asked that I determine the summary judgment application.

[7]        Summary judgment was then entered on 6 November 2023 for specific performance of the exit clause in the PSA. This clause required sale of the property…