Li v 110 Formosa (NZ) Limited - [2019] NZCA 98

IN THE COURT OF APPEAL OF NEW ZEALAND

I TE KŌTI PĪRA O AOTEAROA

CA81/2019
[2019] NZCA 98

BETWEEN	JUN LI Appellant
AND	110 FORMOSA (NZ) LIMITED First Respondent MENG WANG Second Respondent GOLDEN BEACHLANDS HOLDINGS LIMITED Third Respondent JENNY AND EAMON HOLDINGS LIMITED Fourth Respondent ARTHUR LOO AND FUI LOONG CHAN, TRADING AS LOO & KOO BARRISTERS & SOLICITORS, NOTARY PUBLIC Fifth Respondents

Counsel:	D Connor for Appellant D Grove for First Respondent A J B Holmes and L Mannis for Second, Third and Fourth Respondents H M Twomey and R C Woods for Fifth Respondents
Judgment: (On the papers)	8 April 2019 at 4 pm

JUDGMENT OF CLIFFORD J

AThe application is granted. Van Bohemen J’s judgment of 5 February 2019 is stayed pending the determination of Mr Li’s appeal to this Court against that judgment.
BThe parties are to file an agreed timetable for the filing of the case on appeal and submissions, with these to be completed by 5 pm on 8 May 2019.

____________________________________________________________________

REASONS

Introduction

In this proceeding Mr Li is appealing a judgment of van Bohemen J given in the High Court in Auckland on 5 February 2019.[1] In that judgment van Bohemen J declined to stay a judgment of Fitzgerald J involving a dispute concerning ownership of a property.[2] In doing so, van Bohemen J ordered the discharge of a caveat (the Caveat) Mr Li had registered against the property in question.
[1]Li v 110 Formosa (NZ) Ltd [2019] NZHC 70.
[2]Li v 110 Formosa (NZ) Ltd [2018] NZHC 3418.
Mr Li now applies, with urgency asserted, for a stay of the judgment under appeal pending the hearing of that appeal.

Background

The background to Fitzgerald J’s judgment is relatively straightforward, the background to this application less so.

The substantive dispute

Mr Li and the second respondent, Meng Wang, entered into certain arrangements whereby they would participate through a corporate vehicle in the purchase of the Formosa Golf Course at Gulf Harbour (the Formosa Property). As conceived at one point, the vehicle to acquire the Formosa Property was the fourth respondent, Jenny and Eamon Holdings Ltd (JEHL). At some point, the third respondent Golden Beachlands Holdings Ltd (GBHL) was to perform that function. As matters transpired, a third company 110 Formosa (NZ) Ltd (110 Formosa), acquired the Formosa Property.
Mr Li paid his initial contribution of $4.8 million as part payment of the $12.16 million, in exchange for which he understood he was to receive a 32 per cent interest in the corporate vehicle. Mr Wang, asserting that the $4.8 million that originated from his family, denied any obligation to Mr Li as regards 110 Formosa’s purchase of the Formosa Property.
Mr Li commenced proceedings in the High Court. Mr Li sued 110 Formosa alleging a constructive trust; 110 Formosa, Mr Wang and others for breach of fiduciary duty and knowing assistance; Mr Wang for breach of contract; and Mr Wang and others for unjust enrichment, monies had…

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: [2019] NZCA 98
Decision Date: 8 April 2019 at 4 pm

CaseChat Overview and Summary

The Court of Appeal of New Zealand heard an appeal by Mr Li against the High Court's decision to discharge a caveat he had placed on a property. Mr Li sought a stay of the judgment pending the appeal, arguing that he had a beneficial interest in the property and the caveat should remain in place. The appeal raised issues about the interpretation of the consent order under which the caveat was initially registered and the consequences of the High Court's judgment on the status of the caveat.

The court examined the background of the case, noting the complex arrangements between the parties regarding the purchase of the Formosa Golf Course. The dispute centred on whether Mr Li had a beneficial interest in the property and if the caveat should remain registered pending the appeal. The court considered the consent order, which stated that the caveat should not lapse pending the determination of Mr Li's main proceeding. The court also noted the potential prejudice to Mr Li if the caveat was discharged before his appeal was determined.

The Court of Appeal granted Mr Li's application for a stay of the judgment pending the appeal. The court reasoned that the appeal was not hopeless and that the caveat should remain in place to protect Mr Li's potential beneficial interest in the property. The court acknowledged the potential prejudice to the other parties but found that it could be addressed through further agreements or orders from the High Court. The court set a timetable for the appeal to be heard urgently and directed the parties to agree on a schedule for filing the case and submissions.

The court's decision ensured that Mr Li's potential beneficial interest in the property was protected pending the determination of his appeal. The stay of the judgment allowed the appeal to proceed without prejudice to Mr Li's rights, and the urgent timetable aimed to resolve the dispute as quickly as possible.

Orders