Lun v Kong - [2025] NZHC 132

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2022-404-795

[2025] NZHC 132

BETWEEN
DAMIN LUN

Plaintiff/Counterclaim Defendant

AND

YONGCING KONG

Defendant/Counterclaim Plaintiff

Hearing: On the papers

Counsel:

J K Goodall KC / L C Sizer for the Plaintiff

R J Hollyman KC / B J Norling for the Defendant

Judgment:

12 February 2025

COSTS JUDGMENT OF ASSOCIATE JUDGE C B TAYLOR

This judgment was delivered by me on 12 February 2025 at 3:00pm
pursuant to Rule 11.5 of the High Court Rules

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

Solicitors:
Buddle Findlay, Auckland, for the Plaintiff Norling Law Limited, Auckland, for the Defendant

Counsel:
Jason K Goodall KC, Bankside Chambers, Auckland, for the plaintiff
R J Hollyman KC and N G Lawrence, Shortland Chambers, Auckland, for the Defendant

LUN v KONG [2025] NZHC 132 [12 February 2025]

Introduction

[1] By judgment issued by the Court on 3 October 20241 (the Judgment) the Court:

(a)dismissed the plaintiff’s (Mr Lun) application for strike-out;

(b)dismissed Mr Lun‘s application for summary judgment; and

(c)dismissed the defendant’s (Mr Kong) application for pre-summary judgment discovery.

[2] Paragraph [69] of the Judgment directed the parties to endeavour to agree costs. The parties have corresponded about costs but have not reached agreement. Accordingly, Mr Norling,2 for Mr Kong, filed a memorandum dated 27 November 2024, and Mr Goodall KC,3 for Mr Lun, filed a memorandum in response dated 4 December 2024.

Mr Kong’s position

[3] Mr Norling submits that costs should be awarded in favour of Mr Kong because:

(a)Mr Lun’s applications for summary judgment and strike-out (the SJ Application) of Mr Kong’s defence and counterclaims failed for reasons which were obvious from an early stage, in particular the need for factual matters to proceed to trial, and should not have been advanced;

1      Lun v Kong [2024] NZHC 2441.
2      The memorandum is filed by Mr Norling and Ms Cherkashina but for convenience I will just refer to Mr Norling.
3      The memorandum is filed by Mr Goodall and Mr Sizer but or convenience I will just refer    to Mr Goodall.

(b)the great majority of work preparing for and at the hearings related to Mr Lun’s failed SJ Application; and

(c)Mr Kong’s discovery application (the Discovery Application) was ancillary and only necessitated by Mr Lun’s SJ Application.

Mr Lun’s SJ Application

[4] Mr Norling submits that Mr Lun’s SJ Application should not have been advanced for the following reasons:

(a)The two applications required the Court to make findings about highly contested issues of fact, which cannot be made at the summary stage of proceedings and it should have been obvious to Mr Lun that this was the case;

(b)the pleadings plainly called into question the legitimacy of the purported “Deed of Settlement” relied upon by Mr Lun as a complete answer to all of the issues at a summary stage;

(c)the correspondence between the parties prior to and following Mr Lun filing his SJ…

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 Lun v Kong

Details

AGLC: Lun v Kong [2025] NZHC 132
Case: [2025] NZHC 132
Decision Date: 12 February 2025

CaseChat Overview and Summary

The High Court of New Zealand considered the issue of costs between the parties, Damin Lun and Yongcing Kong, following a series of unsuccessful applications by Lun. The court dismissed Lun's applications for strike-out and summary judgment, as well as Kong's application for pre-summary judgment discovery. The court was tasked with determining the appropriate costs allocation between the parties for these unsuccessful applications. The key issues involved whether Lun's summary judgment application was fundamentally flawed and whether Kong's discovery application was necessary. Kong argued that Lun's applications were obvious failures from the outset and should not have been brought, and that the majority of the work at the hearings related to Lun's failed applications. Kong also argued that his discovery application was necessitated by Lun's refusal to provide access to relevant documents. Lun, on the other hand, contended that costs should be reserved until the final determination of the proceedings or, if awarded, that each party should be awarded costs for the application they succeeded on, with these costs set off against each other.

The court decided that each party should be awarded 2B costs for the applications they were successful on. In relation to Lun's unsuccessful summary judgment application, the court found that the usual rule of reserving costs on an unsuccessful summary judgment was displaced by the unique circumstances of Lun's application to strike out or obtain summary judgment in favour of himself in respect of Kong's defences and counterclaims, rather than a summary judgment on his own cause of action. The court also found that the proceeding did not justify a change from the category 2 level of complexity, and therefore, the 3C basis for costs was not appropriate. Finally, the court deferred Kong's expert evidence expenses to the trial, when the expert evidence will be tested and accepted or rejected by the court.

The final orders were that Lun is to pay costs of $9,560 plus disbursements of $110.00, totalling $9,670.00; Kong is to pay costs of $7,648.00 plus disbursements of $110.00, totalling $7,758.00; and the respective cost orders may be set off with Lun paying the net amount to Kong.

Orders