Ren v Pan - [2025] NZHC 184

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2024-409-555

[2025] NZHC 184

BETWEEN
XIAOJIN REN

Plaintiff

AND

JINYUAN PAN and KE ZHANG

Defendants

Hearing: 14 February 2025

Appearances:

J A Frampton for Plaintiff I Sugimoto for Defendants

Judgment:

14 February 2025

JUDGMENT OF ASSOCIATE JUDGE PAULSEN

This judgment was delivered by me on 14 February 2025 at 4.00 pm pursuant to r 11.5 of the High Court Rules.

Registrar/Deputy Registrar Date:

REN v PAN [2025] NZHC 184 [14 February 2025]

[1] This judgment concerns an application by the defendants for security for costs. In my experience it is an unusual application because the defendants have not filed a statement of defence or explained what their defence is to the claim. They have only provided a bare denial of the claim.

[2] The primary issue arising, and the one that ultimately determines the application, is whether the Court should exercise its discretion to order the plaintiff to provide security for costs in these circumstances.

Background

[3] The plaintiff is a Chinese citizen residing in China. The defendants reside in New Zealand.

[4] In 2020 the plaintiff spent time in New Zealand and met the defendants. She says they interested her in buying a residential property in New Zealand as she was considering living here. The plaintiff’s evidence is that she trusted the defendants and they told her that despite restrictions that applied to overseas persons acquiring residential land it was legal for her to acquire a property and for them to hold it in trust.

[5] The plaintiff says upon her return to China the defendants sent her information about residential properties to buy. Ultimately it was agreed they would purchase a property for her at 2 Lucas Way, Albany, Auckland. The plaintiff pleads that she provided the defendants with $1,580,000,1 and the property was acquired with the defendants registered as the owners on 9 September 2020. The plaintiff understands that $1,500,000 was for the property, and additional amounts were required for other expenses associated with the purchase.

[6] In around March 2021 the defendants purchased another property at 11 Borneo Drive, Fairview Heights, Auckland. At the time they took title, a mortgage was registered against both the Lucas Way and the Borneo Drive properties. The plaintiff

1 Ms Frampton advises me that the plaintiff has now discovered that a greater sum was in fact paid and the plaintiff intends to increase the amount of her claim accordingly.

had no knowledge of the mortgage and believes it may have been obtained to assist the defendants to purchase the Borneo Drive property.

[7] The plaintiff has not obtained residency in New Zealand. She says she instructed the defendants to sell the Lucas Way property to repay her, but the defendants have refused to do so. The defendants did make payments to her during January and March 2024 totalling $198,253 but have resisted repaying any further amounts, raising personal issues which they say have…

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 Ren v Pan

Details

AGLC: Ren v Pan [2025] NZHC 184
Case: [2025] NZHC 184
Decision Date: 14 February 2025

CaseChat Overview and Summary

The case of Ren v Pan involves an application by the defendants, Jinyuan Pan and Ke Zhang, for security for costs against the plaintiff, Xiaojin Ren. The plaintiff, a Chinese citizen, alleges that the defendants induced her to transfer $1,580,000 to them under a verbal agreement that they would acquire a residential property in New Zealand on trust for her. The defendants, who reside in New Zealand, have denied the claims in their statement of claim but have not filed a statement of defence or explained what their defence is. The primary issue before the Court was whether it should exercise its discretion to order the plaintiff to provide security for costs in these circumstances. The defendants argued that the plaintiff had no assets in New Zealand and therefore any costs judgment would need to be enforced in China, where they believed the process would be difficult and expensive. The plaintiff opposed the application, arguing that the merits of the case were strongly in her favour and that the defendants had failed to file a defence or explain what their defence was.

The Court considered the principles applicable to applications for security for costs, including the ease, convenience, and cost of enforcing a costs judgment in the plaintiff's country of residence as a primary consideration. The Court noted that while the plaintiff had no assets in New Zealand, this case differed from previous cases where security was ordered against a plaintiff resident in China because the defendants had not filed a statement of defence nor identified any defence to the plaintiff’s claim. The Court found that in the absence of any defence there was no prospect of the plaintiff being required to pay costs, against which the defendants needed to be protected by the making of the order sought. The Court also found that the defendants' conduct in failing to articulate any defence to the claim, in asserting there was no documentary evidence in respect to matters that were clearly within their knowledge, and in raising the possibility of self-incrimination as justification for not articulating a defence, led to the view that this application was not filed out of a genuine concern about their ability to recover costs but was tactical, designed to further delay resolution of the plaintiff’s claim.

In the exercise of its discretion, the Court dismissed the defendants’ application for security for costs. The Court found that on what was before it there was no realistic prospect the plaintiff would be ordered to pay the defendants’ costs and, in the event such an award was made the defendants would not recover those costs from the asset they acquired using the plaintiff’s funds and have retained. The Court also noted that the defendants' application lacked merit and that it was not a reason to depart from the ordinary rule that costs on opposed interlocutory applications should be fixed and paid when the application is determined. The plaintiff was entitled to costs and the Court ordered them to be paid.

Orders