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Mills v Feng

Mills v Feng

Case [2023] NZHC 2674 26 September 2023

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IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2023-404-212

[2023] NZHC 2674

UNDER the Insolvency Act 2006

IN THE MATTER

of the bankruptcy of WEIQIANG FENG (also known as BRIEN FENG)

BETWEEN

DAVID LAWRENCE MILLS and FIONNA

EILEEN MILLS as trustees of the MILLS FAMILY TRUST

Judgment Creditors

AND

WEIQIANG FENG (also known as BRIAN FENG)

Judgment Debtor

Continued …

Hearing: 5 September 2023

Appearances:

Katerina Wendt for the Judgment Creditors/Third Defendants Weiqiang Feng (also known as Brian Feng) is self-represented

Judgment:

26 September 2023

JUDGMENT OF ASSOCIATE JUDGE C B TAYLOR

[Application to set aside a bankruptcy notice and for strike out]

This judgment was delivered by me on 26 September 2023 at 3:00 pm
pursuant to Rule 11.5 of the High Court Rules

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

MILLS v FENG [2023] NZHC 2674 [26 September 2023]

Continued …

CIV-2023-404-972

BETWEEN

WEIQIANG FENG (also known as BRIAN FENG)

Plaintiff

AND

RAY WHITE REMUERA

First Defendant

KAI WANG (also known as TONY WANG) Second Defendant

DAVID LAWRENCE MILLS and FIONNA

EILEEN MILLS as trustees of the MILLS FAMILY TRUST

Third Defendants

TABLE OF CONTENTS

Paragraph

Introduction [1]

Background [3]

Mr Feng’s application to set aside bankruptcy notice [9]

The Mills Trust’s opposition to the set aside application [11]

The Mills Trust’s application to strike out part of pleading  [13]
Mr Feng’s opposition to strike-out application  [15] Legal principles
Set aside bankruptcy notice  [16]
Strike-out pleading  [21]

Analysis [23]

Strike-out application [24]

The Mills Trust was aware Mr Feng was not the actual purchaser [25]

No valuation of the property [26]

Consent to re-sale of the property [27]

Breach of the Fair Trading Act 1986 [28]

Negligence by the Mills Trust [29]

Result in respect of strike-out [30]

Set aside application [32]

Orders [34]

Introduction

[1] Mr Weiqiang (Brian) Feng (Mr Feng) has applied to set aside a bankruptcy notice issued against him by David and Fionna Mills (the Mills) as trustees of The Mills Family Trust (the Mills Trust). This proceeding is filed in the High Court at Auckland under CIV-2023-404-212 (the 212 proceeding). The Mills Trust opposes Mr Feng’s application to set aside the bankruptcy notice.

[2] Mr Feng has issued proceedings against Ray White Remuera, Mr Kai (Tony) Wang (Mr Wang), and the Mills Trust in the High Court at Auckland filed under CIV-2023-404-972 (the 972 proceeding). The Mills Trust, as third defendants in the 972 proceeding, apply to strike out the part of Mr Feng’s statement of claim which is against them.

Background

[3] The Mills Trust initially agreed to sell a property situated at 22 Manapau Street, Meadowbank, Auckland (the property) to Mr Feng, who then nominated Mr Wang as purchaser under the sale and purchase agreement. Mr Wang subsequently failed to settle, and the Mills Trust was obliged to resell the property at a loss, which it sought to recover by way of summary judgment.

[4] On…

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 Mills v Feng

Details

AGLC: Mills v Feng [2023] NZHC 2674
Case: [2023] NZHC 2674
Decision Date: 26 September 2023

CaseChat Overview and Summary

The High Court of New Zealand, Auckland Registry, was tasked with deciding on Mr Weiqiang (Brian) Feng's application to set aside a bankruptcy notice issued by David and Fionna Mills as trustees of The Mills Family Trust, and the Mills Trust's application to strike out part of Mr Feng's statement of claim against them. Mr Feng had filed proceedings against Ray White Remuera, Mr Kai (Tony) Wang, and the Mills Trust, seeking to set aside the bankruptcy notice and challenging certain aspects of the Mills Trust's actions. The Mills Trust opposed both Mr Feng's applications and sought costs.

The court examined whether Mr Feng had a genuine and triable cross-claim against the Mills Trust, which could justify setting aside the bankruptcy notice. The Mills Trust argued that Mr Feng's claim was untenable, frivolous, and vexatious. They contended that Mr Feng, having signed the sale and purchase agreement as the purchaser, remained liable regardless of the Mills Trust's awareness that Mr Wang was the actual purchaser. The Mills Trust also argued that Mr Feng's claims regarding the valuation of the property, consent to re-sale, breach of the Fair Trading Act, and negligence were not valid grounds for a claim against them.

The court found that Mr Feng's claims against the Mills Trust were not tenable. It held that the Mills Trust's awareness of Mr Wang being the actual purchaser did not affect Mr Feng's liability under the sale and purchase agreement. The lack of valuation and Mr Feng's non-consent to re-sale were irrelevant to his liability. Additionally, the Mills Trust was not "in trade" for the sale of the property and thus not subject to the Fair Trading Act. The court also rejected Mr Feng's negligence claim, stating that the Mills Trust had no duty of care to ensure any conditions were inserted into the agreement.

Consequently, the court struck out Mr Feng's claim against the Mills Trust, dismissed his application to set aside the bankruptcy notice, and ordered that the Mills Trust were entitled to costs on a 2B basis for the various applications and proceedings. The bankruptcy proceedings against Mr Feng were to proceed as scheduled.

Orders