Lee v Alhardan

[2023] NZCA 195

IN THE COURT OF APPEAL OF NEW ZEALAND

I TE KŌTI PĪRA O AOTEAROA

 CA138/2023
 [2023] NZCA 195

BETWEEN	JINGMIN LEE Appellant
AND	MAHMOUD ALHARDAN Respondent

Court:	Miller, Goddard and Katz JJ
Counsel:	D W Grove for Appellant C T Patterson for Respondent
Judgment: (On the papers)	29 May 2023 at 10.00 am

JUDGMENT OF THE COURT

AThe appeal is allowed.

B        The order made by the High Court on 16 February 2023 adjudicating Mr Lee bankrupt is set aside. 

CCosts are reserved.

DDirections as set out in paragraph [10].

EThe Registrar is directed to release the security for costs paid in respect of this appeal to Mr Lee by payment to his solicitor’s trust account.

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REASONS OF THE COURT

(Given by Goddard J)

The appeal

1. Mr Lee appeals to this Court from an order made by the High Court on 16 February 2023 adjudicating him bankrupt.  That adjudication was based on a default judgment entered against Mr Lee, his wife Ms Gao and an associated company, Oriental Works Ltd, on 27 June 2022 in the District Court (District Court default judgment). 

The parties agree that the appeal should be allowed

1. The District Court default judgment was set aside by the District Court on 15 May 2023 as against all three defendants.[1]

   [1]Alhardan v Gao [2023] NZDC 9204.

2. In light of the decision setting aside the District Court default judgment, counsel for Mr Lee and for Mr Alhardan have filed a joint memorandum seeking an order allowing the appeal and quashing the bankruptcy order without a hearing or the need to take any further steps.  The Official Assignee abides the Court’s decision in relation to Mr Lee’s bankruptcy, and has halted administration of his estate pending that outcome. 

3. In these circumstances it is clearly appropriate for the appeal to be allowed and the adjudication set aside.

4. Mr Lee seeks costs. He proposes directions for the determination of his claim for costs, which are reflected in the directions set out at [10] below.

5. The parties agree that an order should be made that the security for costs paid in respect of this appeal be released to Mr Lee by payment to his solicitor’s trust account.

Result

1. The appeal is allowed.

2. The order made by the High Court on 16 February 2023 adjudicating Mr Lee bankrupt is set aside. 

3. Costs are reserved.

4. We make directions as follows:

   (a)Mr Lee may file submissions on costs (not exceeding five pages) by Friday 9 June 2023.

   (b)Mr Alhardan may file submissions on costs (not exceeding five pages) by Friday 23 June 2023.

   (c)Mr Lee may file any submissions strictly in reply by Friday 30 June 2023.

   (d)Costs will then be determined on the papers.

5. The Registrar is directed to release the security for costs paid in respect of this appeal to Mr Lee by payment to his solicitor’s trust account.

Solicitors:
Julia Xu Lawyers, Auckland for Appellant
Octagon Law, Auckland for Respondent