Huang v Chen - [2022] NZHC 2821

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2019-404-100 CIV-2021-404-304

[2022] NZHC 2821

BETWEEN
HONGZHAO HUANG

First Plaintiff

JIEYU LU
Second Plaintiff

MATAKANA WINES LIMITED
Third Plaintiff

AND

CHRIS CHEN

First Defendant

continued: …/2

Hearing: On the papers

Counsel:

M D Pascariu for the Plaintiffs SRG Judd for the Defendants

Judgment:

31 October 2022

JUDGMENT OF GORDON J

[As to costs]

This judgment was delivered by me
on 31 October 2022 at 3 pm, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

Counsel: Solicitors:
M D Pascariu, Anderson Creagh Lai, Auckland William Gong Lawyers, Auckland SRG Judd, Barrister, Auckland

HUANG v CHEN [2022] NZHC 2821 [31 October 2022]

…/2

WAIHOPAI VALLEY VINEYARD LIMITED
Second Defendant
YI LU
Third Defendant
DON CHEN
Fourth Defendant
JINPING HUANG
Fifth Defendant
QI YANG
Sixth Defendant
ADELAIDE EDUCATION GROUP PTY LIMITED
Seventh Defendant

Introduction

[1]This is an application for costs.

[2] The proceeding concerned various financial and contractual disputes between former friends and business associates, Hongzhao (Alex) Huang and Xiaolin (Chris) Chen. There were three plaintiffs: Mr Huang, his wife Jieyu (Chrissy) Lu, and their company Matakana Wines Ltd (Matakana). There were seven defendants: Mr Chen, his company Waihopai Valley Vineyard Ltd (Waihopai),1 his wife Jinping (Jackie) Huang, his brother Don Chen (20 per cent shareholder in Waihopai), Don Chen’s company Adelaide Education Group Pty Ltd (AEG),2 Yi Lu (director and 40 per cent shareholder in Waihopai) and Qi Yang (Yi Lu’s wife).

[3] On 4 August 2022 I delivered a judgment in favour of the plaintiffs.3 I found that there was no partnership agreement between the parties and that advances totalling over $2 million made by Mr Huang to Mr Chen/Waihopai were not investments in Waihopai but loans. I also found that Mr Chen was in breach of a Joint Venture Agreement between Mr Huang, Ms Lu and Mr Chen.

[4] In summary, the plaintiffs succeeded on each of the first to eighth causes of action.4 Mr Chen succeeded in part on the third counterclaim but failed on the other five counterclaims.

[5]I ordered:

(a)Mr Chen (first defendant) to transfer the title to the Matakana land, unencumbered, to Mr Huang and Ms Lu (first and second plaintiffs);

(b)Mr Chen to pay the plaintiffs $3 million in equitable damages;

1      Chris Chen was one of two directors and three shareholders in Waihopai Valley Vineyard Ltd. He held a 40 per cent share on paper but essentially controlled the company.
2      Don Chen is one of three directors and shareholders of Adelaide Education Group Pty Ltd, which has its registered office in Australia.
3      Huang v Chen [2022] NZHC 1888.
4      It was not necessary to make a decision on the ninth cause of action.

(c)Mr Chen, and in the alternative, Waihopai, and in the further alternative, all defendants, to pay the plaintiffs $2,376,261.00 plus interest under s 12 of the Interest on Money Claims Act 2016; and

(d)Matakana Wines (third…

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 Huang v Chen

Details

AGLC: Huang v Chen [2022] NZHC 2821
Case: [2022] NZHC 2821
Decision Date: 31 October 2022

CaseChat Overview and Summary

Huang v Chen is an application for costs in a proceeding involving multiple financial and contractual disputes between former friends and business associates, Hongzhao (Alex) Huang and Xiaolin (Chris) Chen. The plaintiffs, Mr Huang, his wife Jieyu (Chrissy) Lu, and their company Matakana Wines Ltd (Matakana), successfully sued Mr Chen, his company Waihopai Valley Vineyard Ltd (Waihopai), his wife Jinping (Jackie) Huang, his brother Don Chen (20 per cent shareholder in Waihopai), Don Chen’s company Adelaide Education Group Pty Ltd (AEG), Yi Lu (director and 40 per cent shareholder in Waihopai) and Qi Yang (Yi Lu’s wife) for breaches of contract and for the recovery of loans. The plaintiffs sought $865,815.24 in costs and disbursements. The defendants argued that the plaintiffs were only entitled to scale costs and challenged the quantum of certain costs. The Court found that indemnity costs were warranted for the application for freezing orders, but not for other steps. The Court also found that increased costs were warranted for the preparation of briefs of evidence, due to delayed disclosure of financial information. Other claims for increased costs were rejected. The Court allowed the plaintiffs’ claim for expert witness fees, with a deduction for time which could have been saved by obtaining information from an available witness. The Court also identified an error in the plaintiffs’ calculation of expert fees, which resulted in a deduction from the total costs awarded. The total costs and disbursements awarded to the plaintiffs were $629,680.29, apportioned between the defendants according to their liability for the substantive judgment.

Orders