Lee v Oceania P&D Limited - [2022] NZHC 3257

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2022-404-001287

[2022] NZHC 3257

BETWEEN
SEONG HEE LEE

Applicant

AND

OCEANIA P&D LIMITED

Respondent

Hearing:
9 November 2022 (with a further telephone conference on

23 November 2022, further written submissions on 25 November
2022 and 2 December 2022)

Appearances:

L Ponniah for Applicant

J T Burley and K L Chiu for Respondent

Judgment:

6 December 2022

JUDGMENT OF ASSOCIATE JUDGE PAULSEN

This judgment was delivered by me on 6 December 2022 at 3.30 pm pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

LEE v OCEANIA P&D LTD [2022] NZHC 3257 [6 December 2022]

[1] Seong Hee Lee (Mr Lee) claims Ji Ho Ryu (Mr Ryu) and Mr Ryu’s wife, Eun Young Jung (Ms Jung), signed agreements to transfer a property at 51 Florence Avenue, Orewa (the Orewa property) to him if they failed to pay him a debt. He considers the promise confers upon him a caveatable interest in the Orewa property.

[2] On 29 April 2022, Mr Lee lodged a caveat over the title of the Orewa property. He claimed “the transfer of ownership” of the property under term loan agreements dated 26 March 2022 and 5 April 2022 which provided the Orewa property as “security for the purpose of the loan repayment in full”.

[3] The Orewa property is not owned by Mr Ryu or Ms Jung but by the respondent, Oceania P&D Ltd (Oceania). Mr Ryu is the sole director and shareholder of Oceania.

[4] Oceania applied to the Registrar-General of Land under s143(1)(b) of the Land Transfer Act 2017 to lapse the caveat, and Mr Lee now applies for an order sustaining it.

[5] Contrary to what is stated in the caveat, Mr Lee’s application initially asserted Oceania held the Orewa property for him pursuant to a resulting or constructive trust. Then, in an amended application filed the day before the hearing, he claimed it is held for him by virtue of a “bare trust, express or implied”. It is on this latter basis that Mr Lee now attempts to support the caveat.

[6] Oceania says that it was not a party to any of the documents relied upon by Mr Lee, that they do not confer upon Mr Lee any interest in the Orewa property, and that the documents were all signed under duress.

[7] There are particular factual disputes between the parties that are unsuitable for resolution on a proceeding of this type, but the issues I have to decide do not engage with those factual disputes. The principal issues are the following:

(a)Does Mr Lee’s caveat provide the particulars required by s 138 of the Land Transfer Act 2017 and reg 5 and sch 2 of the Land Transfer Regulations 2018; and

(b)Has Mr Lee satisfied the Court he has a reasonably arguable case for a beneficial interest in the Orewa property under a “bare trust, express or implied”.

(c)What are…

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.

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Details

Case: [2022] NZHC 3257
Decision Date: 6 December 2022

CaseChat Overview and Summary

The case of Lee v Oceania P&D Limited involved a dispute between Seong Hee Lee (Mr Lee) and Oceania P&D Limited (Oceania) over a property at 51 Florence Avenue, Orewa. Mr Lee lodged a caveat over the title of the Orewa property, claiming that he had a beneficial interest in the property under a bare trust. Oceania applied to the Registrar-General of Land to lapse the caveat, and Mr Lee sought an order sustaining it. The central legal issues in the case were whether Mr Lee's caveat provided the required particulars under the Land Transfer Act 2017 and whether Mr Lee had established a reasonably arguable case for a beneficial interest in the Orewa property under a bare trust.

The Court found that Mr Lee's caveat did not provide the particulars required by the Land Transfer Act 2017 and regulations. The caveat claimed that the Orewa property was provided as security under term loan agreements, while Mr Lee's application claimed a different interest under a bare trust. The Court held that a caveator cannot assert an estate or interest in land on one basis and then seek to sustain it on a different basis. The Court also found that Mr Lee had not established an arguable case for a beneficial interest in the Orewa property under a bare trust, as there was no intention to create a trust in his favour, and there was no written record signed by Oceania creating a trust in Mr Lee's favour.

As a result of these findings, the Court dismissed Mr Lee's application to sustain the caveat, and the caveat was ordered to lapse. Oceania was successful and entitled to costs.

Orders