Liu v Jiang pka Kang - [2025] NZHC 1212

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2023-404-1018

[2025] NZHC 1212

BETWEEN
MINYING LIU

First Plaintiff

YUHUAN LI
Second Plaintiff

AND

KUPE HEYOKA JIANG previously known as WETEX KANG

First Defendant

MANUKA WHENUA HOLDING LIMITED

Second Defendant

1668 HONEY LIMITED (in liquidation)
Third Defendant

continued overleaf…

Hearing: 8 May 2025

Counsel

M J van Zyl/ G Chan for the plaintiffs First defendant in person

Date of Judgment:

19 May 2025

JUDGMENT OF ASSOCIATE JUDGE BRITTAIN

This judgment was delivered by me on 19 May 2025 at 2.30 pm.
Pursuant to Rule 11.5 of the High Court Rules.
………………..
Registrar/Deputy Registrar

Solicitors:
Norling Law Ltd, Auckland:

LIU v JIANG [2025] NZHC 1212 [19 May 2025]

AND HONEY SCIENCE MANUKA HONEY
LIMITED (in liquidation) Fourth Defendant
1201 OKAU ROAD LIMITED
Fifth Defendant
NORTH HONEY LIMITED (in
liquidation)
Sixth Defendant

Introduction

[1] The plaintiffs, Minying Liu and Yuhuan Li (Mrs Liu and Mr Li), are a retired couple from China. Between 2018 and 2022, they invested approximately $960,000 in the second to sixth defendants, companies associated with the first defendant, Kupe Jiang (Mr Jiang). The companies were in the honey business, and no longer trade.

[2] Mrs Liu and Mr Li are dissatisfied with the outcome of their investments. The third, fourth and sixth defendants are now in liquidation. In this proceeding, Mrs Liu and Mr Li bring causes of action against the defendants alleging shareholder oppression, breach of fiduciary duty by Mr Jiang, conversion, and breach of contract. The causes of action against the third, fourth and sixth defendants are effectively stayed under the Companies Act 1993 (CA), because those companies are in liquidation.

[3]Mr Jiang applies for:

(a)an order striking out all claims on the grounds that they are an abuse of process; and

(b)alternatively, an order that the plaintiffs pay security for costs of

$100,000 on the grounds that they reside in China.

[4] Mrs Liu and Mr Li oppose strike-out. They accept that an order for security for costs is appropriate, but they dispute the quantum of $100,000 sought by Mr Jiang.

[5] At the conclusion of the hearing on 8 May 2025, I indicated that the application for strike-out would be declined and security for costs for the next stage of the proceeding would be fixed at $5,200. This judgment confirms those orders and gives my reasons.

Procedural background

[6] When the proceeding was commenced, the plaintiffs pursued various applications for freezing orders. None were successful.

[7] On 5 February 2024, the plaintiffs applied to strike out Mr Jiang’s statement of defence. The application was scheduled for a hearing on 10 July 2024, but Mr Jiang sought an adjournment. A hearing was not ultimately necessary, because on 8 July 2024, the Court made an order requiring Mr Jiang to file and serve a more explicit statement of defence.1

[8] On 31 October 2024, Gault J awarded costs of $9,993.20 against Mr Jiang in respect of the…

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: [2025] NZHC 1212
Decision Date: 19 May 2025

CaseChat Overview and Summary

In the High Court of New Zealand, Minying Liu and Yuhuan Li, a retired couple from China, brought claims against Kupe Jiang, previously known as Wetex Kang, and several associated companies, alleging shareholder oppression, breach of fiduciary duty, conversion, and breach of contract. The companies in question were involved in the honey business and are now in liquidation. Jiang sought to strike out the claims, arguing that the proceeding was an abuse of process intended to extract a settlement, and alternatively, sought security for costs of $100,000. Liu and Li opposed the strike-out but accepted that some security for costs was appropriate, albeit less than $100,000. The Court found that Jiang had not established that Liu and Li were pursuing the proceeding in bad faith, and the claims were sufficiently tenable to warrant further litigation. The Court set security for costs at $5,200, reflecting that Jiang was self-represented, and ordered Jiang to pay Liu and Li's costs on a 2B basis with a 50 percent uplift for certain steps. The proceeding was allocated a case management conference to address various procedural matters.

The Court declined Jiang's application to strike out the proceeding, finding that Liu and Li's claims, though disputed, were not so untenable as to justify a strike-out. The Court held that the allegations of oppressive conduct, including the sale of properties, misappropriation of funds, and conversion, went beyond mere management decisions and could justify relief under section 174 of the Companies Act 1993. The Court also found that Jiang's application for strike-out lacked merit and caused unnecessary expense, justifying an increase in costs. Security for costs was set at $5,200, considering Jiang's status as a self-represented litigant. Jiang was ordered to pay Liu and Li's costs on a 2B basis with a 50 percent uplift for specific steps in the proceeding. The Court further directed that the Registry should not accept any counterclaim from Jiang in person without approval from a judge and that Jiang's filing fee for the counterclaim should be returned. A case management conference was scheduled to address further procedural matters.

Orders