Qu v Zeng

[2018] NZHC 1395

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2015-404-2256

[2018] NZHC 1395

BETWEEN

JIAN JUN QU

First Plaintiff

JIAN PING WANG
Second Plaintiff

YAN QU
Third Plaintiff

J M BUILDING MATERIALS COMPANY LIMITED

Fourth Plaintiff

FORMODA REAL ESTATE DEVELOPMENT COMPANY LIMITED
Fifth Plaintiff

AND

JUN ZENG

First Defendant

J & H DEVELOPMENT LIMITED

Second Defendant

Hearing:	13 June 2018
Appearances:	G Blanchard QC and C Jiang for the Plaintiffs P Hamlin for the Defendants
Sentencing:	13 June 2018

SENTENCE OF WOODHOUSE J

QU v ZENG [2018] NZHC 1395 [13 June 2018]

[1]                   Mr Zeng, you may remain seated for the moment. I am going to explain briefly the sentence I am going to impose. I have not heard anything today – and I was not really expecting to – to indicate to me that there should not be a sentence of community work. I had already indicated that that was my view. So I am now going to v explain the sentence and impose it on you.

[2]                   Madam Registrar, if you could deliver the full reasons now to counsel so there is no uncertainty about where we are at. Mr Zeng, what is being handed out is the full reasons for my decision that you breached the orders and that you are in contempt of court. In the document handed out, which is my full judgment, I have also responded to the submissions Ms Manuson made on your behalf on the question of penalty. You will get a chance to read that. It sets it out much more fully.

[3]                   As I have said Mr Zeng, I have concluded that you acted in contempt of the freezing orders and you are to be sentenced for that contempt.

[4]                   Six freezing orders were made against you and the second defendant, J & H Development Ltd, between 30 September 2015 and 29 May 2017. The plaintiffs alleged that there were seven breaches of those orders by you and J & H Development Ltd, that the breaches were in contempt of court, and that you should be punished for your contempt by imprisonment for six weeks.

[5]                   As you know, I am satisfied there was breach by you and J & H Development Ltd in relation to the failure to file an affidavit of assets and four further breaches by you Mr Zeng. As I have just explained to Mr Hamlin, who was not acting for you at the time of the hearing before me, the failure to file that affidavit of assets, on my conclusions, had very significant consequences and was a very serious breach of the court order and contemptuous. And that is because, on my findings, at the time of that first order, when it was served on you in October 2015 I think it was, you had at your disposal a sum well in excess of $1 million – on my conclusions, around $1.6 million

–  and you then disposed of it over the subsequent period. Had you filed that affidavit, and fully disclosed matters, those assets could have been subject to the freezing order. And in contempt of the order, you failed to file that affidavit and disclose what you had.

[6]                   The plaintiffs itemised seven breaches of the order in total. Two of those alleged breaches I concluded were not breaches. But as a matter of arithmetic, I have concluded that there were seven acts by you which were in contempt of the court orders. That is because one of the alleged breaches, relating to that Golden Mountain account of yours, involved four separate transactions, and I concluded you were in contempt in relation to three.

[7]                   The reasons for my conclusions that there were breaches of the orders and that these were in contempt of court, together with reasons as to the nature of the penalty to be imposed on you, are recorded in a written judgment which has just been delivered to counsel.

[8]                   On penalty, the plaintiffs did not seek imposition of a penalty on J & H Development Ltd but, as I have said, they sought an order that you be imprisoned for six weeks. In the alternative, the plaintiffs submitted that there should be a sentence of community work if I was not persuaded that there should be imprisonment.

[9]                   Although I received detailed submissions on penalty, as I have indicated, at the time of the original hearing – and there were comprehensive submissions from Ms Manuson to the effect that there should be no penalty at all, even if you were in contempt of court – I have had a further discussion this morning, as you have heard, with Mr Hamlin on your behalf. I have explained to him the essence of my provisional view that there should be a sentence of community work, without indicating the hours. But, for reasons I outlined to Mr Hamlin, I consider this is serious contempt of court. And in light of that advice to Mr Hamlin, no further submissions needed to be made on your behalf, except for Mr Hamlin’s advice that he has explained a community work sentence to you and you have advised that there is no difficulty in carrying out that sentence.

[10]I am in no doubt that a penalty should be imposed. As I indicated to Mr Hamlin

–  and I have already said in as many words – I assess the gravity of your contempt to be reasonably high. You acted deliberately and I am satisfied you acted with knowledge that you were defying the court orders. This was serious misconduct on your part in response to the serious orders against you made by this court. The gravity

of your contempt has been compounded by your response to the plaintiffs’ application and the affidavits that were filed.

[11]               Notwithstanding the seriousness of the contempt, I am not persuaded that this is a case requiring imprisonment – and I have already recorded that in the results judgment. Imprisonment should only be imposed for the most serious cases and only as a last resort. Your contempt is not in that category.

[12]               I am also satisfied that a fine would not be appropriate. You were adjudicated bankrupt in July 2017. Neither counsel sought imposition of a fine. And Mr Hamlin advised this morning that you are presently unemployed.

[13]               My provisional conclusion, recorded in the results judgment, that there should be a sentence of community work, remains. A sentence of community work must be for a minimum of 40 hours with a maximum of 400 hours. I am satisfied that a sentence of 250 hours community work properly addresses the gravity of your contempt of court. I also consider that a sentence of community work, for a reasonably lengthy period – and 250 hours is reasonably lengthy – is likely to have a more salutary effect on you than imprisonment.

Formal sentence

[14]Would you please stand and I will impose the sentence.

[15]Mr Zeng, you are sentenced to 250 hours community work.

[16]               Although this sentence has been imposed as a result of the plaintiffs’ application in a civil proceeding, it is a sentence imposed on you in accordance with the Sentencing Act 2002. An order for the sentence of community work is now to be served on you and will be served before you leave the court.

[17]               That explains what is immediately required of you and no doubt Mr Hamlin will provide any further information you need.

[18]If you would remain in court and that order will be served.

Woodhouse J

Solicitors / Counsel:

Mr G Blanchard QC, Barrister, Auckland

Mr P McKendrick and Ms C Jiang (plaintiffs’ instructing solicitors), Glaister Ennor, Solicitors, Auckland

Mr P Hamlin, Barrister, Auckland

Ms A Manuson, Mrs R Reed and Ms E Hong (defendants’ instructing solicitor), Prestige Lawyers Ltd, Auckland