MB Technology Ltd v Orbis Blockchain Technologies Ltd - [2024] NZHC 3055

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

COMMERCIAL PANEL

CIV-2020-404-1541

[2024] NZHC 3055

BETWEEN
MB TECHNOLOGY LTD

Plaintiff

AND

ORBIS BLOCKCHAIN TECHNOLOGIES LTD

First defendant

DAVID SHU-HAN YU
Second defendant

DANIEL JOHN CROTHERS
Third defendant

Continued overleaf

Hearing: 11 October 2024

Appearances:

J S Cooper KC and AJA Cameron for plaintiff R M Keane for first and fourth defendants AJB Holmes for second and third defendants

Date of judgment:

18 October 2024

JUDGMENT OF JAGOSE J

This judgment was delivered by me on 18 October 2024 at 3.30pm.
Pursuant to Rule 11.5 of the High Court Rules.

………………………… Registrar/Deputy Registrar

Counsel/Solicitors:
J S Cooper KC, Auckland
AJB Holmes, Barrister, Auckland Buddle Findlay, Wellington
Lee Salmon Long, Auckland Wilson Harle, Auckland
Koo Telle Lawyers, Auckland

MB TECHNOLOGY LTD v ORBIS BLOCKCHAIN TECHNOLOGIES LTD [2024] NZHC 3055 [18 October 2024]

ECOMI TECHNOLOGY PTE LTD
Fourth defendant

DENISE MULLINGS
Fifth defendant

JAHANZAIB KHAN
Sixth defendant

[1] This proceeding’s background is summarised in my 1 June 2022 judgment.1 At substantive issue is the plaintiff’s (MB Technology) claim the first and fourth defendants (Orbis and Ecomi) were to pay it cryptocurrency tokens (OMI tokens). (There are other claims and counterclaims.)

[2] The proceeding is allocated a three-week hearing commencing on 25 November 2024. Progress to the hearing largely has been achieved by commendable mutual consent, including as to standard discovery supported by presumptively conclusive affidavits. Two interlocutory applications — Orbis and Ecomi’s application for particular discovery, and MB Technology’s application for remote participation and confidentiality — are for my decision now.2

Approach to particular discovery

[3]Rule 8.19 of the High Court Rules 2016 provides:

Order for particular discovery against party after proceeding commenced

If at any stage of the proceeding it appears to a Judge, from evidence or from the nature or circumstances of the case or from any document filed in the proceeding, that there are grounds for believing that a party has not discovered
1 or more documents or a group of documents that should have been discovered, the Judge may order that party—

(a) to file an affidavit stating—
(i)whether the documents are or have been in the party’s control; and

1 MB Technology Ltd v Orbis Blockchain Technologies Ltd [2022] NZHC 1257 at [1]–[6].
2 I addressed the latter in MB Technology Ltd v Orbis Blockchain Technologies Ltd HC Auckland CIV-2020-404-1541, 11 October 2024 (Minute of Jagose J).

(ii)if they have been but are no longer in the party’s control, the party’s best knowledge and belief as to when the documents ceased to be in the party’s control and who now has control of them; and

(b) to serve the affidavit on the other party or parties; and

(c) if the documents are in the person’s control, to make those documents available for inspection, in accordance with rule 8.27, to the other party or parties.

By “should have been discovered”, beyond documents “within the class of documents to be disclosed”,3…

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 MB Technology Ltd v Orbis Blockchain Technologies Ltd

Details

AGLC: MB Technology Ltd v Orbis Blockchain Technologies Ltd [2024] NZHC 3055
Case: [2024] NZHC 3055
Decision Date: 18 October 2024

CaseChat Overview and Summary

The case of MB Technology Ltd v Orbis Blockchain Technologies Ltd concerns a claim by MB Technology against Orbis and others for the payment of cryptocurrency tokens, specifically OMI tokens. The dispute was heard in the High Court of New Zealand, Auckland Registry. The primary issue before the court was the application by Orbis and Ecomi for particular discovery from MB Technology. This application sought specific documents, including records of MB Technology's trading activities in OMI tokens, communications with Orbis investors, and documents relating to QCP Capital Limited and/or Silvergate Bank's involvement in MB Technology's investment in Orbis.

The court found that while MB Technology was required to disclose its records of OMI token transactions, as these were relevant and material to the damages claim, the request for communications with Orbis investors was declined as it was deemed a fishing expedition. The court also ordered the discovery of documents relating to QCP Capital Limited and/or Silvergate Bank's involvement in the USD 900,000 payment to Orbis, as MB Technology was claiming the benefit of a payment made by another entity. The court ordered MB Technology to file an affidavit and make the specified documents available for inspection within 10 working days of the judgment date.

The reasoning of the court was based on the necessity to balance the rights of the parties to obtain relevant evidence against the potential for undue burden or expense. The court exercised its discretion under the High Court Rules to order particular discovery where there were reasonable grounds to believe that MB Technology had not disclosed certain documents that should have been discovered. Costs on the application were to lie where they fell unless the parties could not agree and wished to proceed with short memoranda for determination.

Orders