Kuang v Cai - [2020] NZHC 1255

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2020-404-40

[2020] NZHC 1255

UNDER the Land Transfer Act 2017

IN THE MATTER OF

Caveat 11325730.1 lodged against Record of Title NA18A/470.

BETWEEN

CONNIE KUANG

Applicant

AND

YALI CAI

Respondent

Hearing: 3 June 2020

Appearances:

Paul Pang for the Applicant Chen Jiang for the Respondent

Judgment:

8 June 2020

JUDGMENT OF ASSOCIATE JUDGE R M BELL

This judgment was delivered by me on 8 June 2020 at 3:00pm
pursuant to Rule 11.5 of the High Court Rules

…………………………. Registrar/Deputy Registrar

Solicitors:
Integritas Law Firm (M S P Pang), Auckland, for the Applicant Glaister (Chen Jiang), Auckland, for the Respondent

KUANG v CAI [2020] NZHC 1255 [8 June 2020]

[1] Connie Kuang applies to sustain caveat 11325730.1 lodged against the record of title to the residential property at 64 Juniper Road, Sunnynook, Auckland. The caveat says:

Connie Kuang claims a beneficial estate or interest in 64 Juniper Road, Sunnynook, Auckland, in all of the land in NA18A/479 under a resulting trust or a constructive trust of which Yali Cai is trustee and Connie Kuang is the beneficiary.

[2] Yali Cai, the registered proprietor of 64 Juniper Road, also owns a commercial property at 26 Uxbridge Road, Howick, Auckland. Ms Kuang has lodged a caveat against the record of title for that property too, alleging a constructive or implied trust. This case is concerned only with the caveat over the Juniper Road property.

[3] Ms Kuang’s claim to an interest in the Juniper Road property is based on two payments. The first is $57,500 she paid in October 2018. That was the deposit under an agreement Mr Cai had made to buy Juniper Road. The price was $1.15m. Mr Cai paid $364,750. He financed the rest of the purchase price, $747,000, with a loan from Cressida Capital One Ltd, secured by a first mortgage. The deposit paid by Ms Kuang was five per cent of the price.

[4] The second payment was for $155,000 to Mr Cai on 15 November 2018. That was for a transaction involving the property at 26 Uxbridge Road, Howick. Ms Kuang was not the payer.

[5] Mr Cai denies that Ms Kuang has an interest in the Juniper Road property. Alternatively, he says that if she does have a claim to an interest in the property, it can be adequately protected by removing the caveat and substituting a fund to be held until there is a final decision on her claim to an interest.

[6] As background to the present application, Mr Cai needs to refinance his loan from Cressida Capital One Ltd. The loan was initially for one year. It has been

extended until later this month. Mr Cai has paid all the interest under the loan and has repaid some of the principal, which now stands at $440,000. Cressida says that if the loan is not refinanced, it will look to its remedies under the loan…

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 Kuang v Cai

Details

AGLC: Kuang v Cai [2020] NZHC 1255
Case: [2020] NZHC 1255
Decision Date: 8 June 2020

CaseChat Overview and Summary

The applicant, Connie Kuang, sought to sustain a caveat lodged against a property located at 64 Juniper Road, Sunnynook, Auckland. The respondent, Yali Cai, the registered proprietor of the property, opposed the application. Kuang claimed an interest in the property under a resulting or constructive trust. Cai argued that if Kuang did have an interest, it could be adequately protected by removing the caveat and substituting a fund to be held until a final decision on her claim. The court found that Kuang did not have a caveatable interest in the property. Although she made two payments totalling $212,500, neither gave rise to a resulting trust. The first payment was a conditional gift to facilitate the purchase of another property, and the second was a payment made in the context of a sham agreement. Kuang could not claim an interest in the property because she did not intend to make a gift to Cai. Instead, her remedy was a restitutionary claim for the return of the $212,500. The court exercised its discretion to remove the caveat and substitute a fund of $63,500 to protect Kuang’s interest. The caveat was ordered to lapse, Kuang’s application was dismissed, and Cai was awarded costs on a category 2 basis.

Orders