Spacemtwo Design Limited v Park - [2025] NZHC 1926

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2024-404-2254

[2025] NZHC 1926

BETWEEN
SPACEMTWO DESIGN LIMITED

Plaintiff

AND

DONGWOO PARK

First Defendant

J ROAD DESIGN LIMITED
Second Defendant

PLAN.T GROUP LIMITED

Third Defendant

Hearing: 2 July 2025

Appearances:

S Kang for Plaintiff

I M Hutcheson for Defendant

Judgment:

15 July 2025

JUDGMENT OF ASSOCIATE JUDGE PAULSEN

This judgment was delivered by me on 15 July 2025 at 11.00 am pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar Date:

SPACEMTWO DESIGN LIMITED v PARK [2025] NZHC 1926 [15 July 2025]

[1] The plaintiff (Spacemtwo) sues its former director and first defendant in this proceeding, Dongwoo Park (Mr Park), alleging he breached duties owed to it under s 131 of the Companies Act 1993 by diverting business opportunities to the second and third defendants. Against the second and third defendants, Spacemtwo claims they are liable to it for knowing receipt of the proceeds of those business opportunities.

[2] The defendants have applied for summary judgment. Mr Park says all claims that Spacemtwo may have had against him were settled under a settlement agreement entered into at the time he resigned as a director of Spacemtwo. The second and third defendants say that as the claims against them are founded on an allegation of breach of fiduciary duty that Mr Park owed Spacemtwo, they too are precluded by the settlement agreement.

[3] In opposition to the summary judgment application, Spacemtwo says it was not a party to the settlement agreement, that the settlement agreement did not by its terms settle the claims it is making, that it has unpleaded claims against Mr Park in misrepresentation and under the Fair Trading Act 1986 making summary judgment inappropriate, and that it is neither fair nor reasonable for the settlement agreement to preclude its claims.1

[4] I do not need to address all the arguments advanced. Specifically, I do not need to consider the argument that Spacemtwo was not a party to the settlement agreement. For present purposes, I proceed on the basis that it was a party. This is because Mr Hutcheson accepts that the case is unsuitable for summary judgment if I was to find that:

(a)Spacemtwo has an arguable (albeit unpleaded) case that it entered into the settlement agreement in reliance upon a misrepresentation by Mr Park as to the extent that he had diverted projects away from Spacemtwo for the benefit of himself or corporate entities with which he was associated; and

1 Contract and Commercial Law Act 2017, s 50; Fair Trading Act 1986, ss 5 and 9.

(b)the settlement agreement does not preclude Spacemtwo from pursuing claims of knowing receipt against the second and third defendants.

Background

[5] Yohan Ko and Mr Park are architectural designers. From 2018 they were in business together, and at relevant times were the only shareholders and directors of Spacemtwo. From around September 2023, Mr Park expressed a desire for the parties…

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 Spacemtwo Design Limited v Park

Details

AGLC: Spacemtwo Design Limited v Park [2025] NZHC 1926
Case: [2025] NZHC 1926
Decision Date: 15 July 2025

CaseChat Overview and Summary

The case of Spacemtwo Design Limited v Park involves a dispute between the plaintiff, Spacemtwo Design Limited, and its former director, Dongwoo Park, as well as two other companies associated with Park. Spacemtwo alleges that Park breached his fiduciary duties by diverting business opportunities to the second and third defendants. The defendants have applied for summary judgment, arguing that all claims were settled by a prior agreement. Spacemtwo contends that it was not a party to the settlement agreement, that the agreement does not settle its claims, and that it has unpleaded claims against Park for misrepresentation and under the Fair Trading Act 1986.

The central legal issues revolve around whether Spacemtwo's claims are barred by the settlement agreement and whether the settlement agreement can preclude Spacemtwo from pursuing claims of knowing receipt against the second and third defendants. The court found that Spacemtwo has an arguable case that Park misrepresented the number of diverted projects, giving rise to claims for misrepresentation and under the Fair Trading Act. The settlement agreement does not preclude Spacemtwo from pursuing these claims as it is not fair and reasonable for its terms to bind Spacemtwo. Additionally, the settlement agreement does not preclude Spacemtwo from pursuing the second and third defendants for knowing receipt. The application for summary judgment was dismissed, and the case is to proceed with a case management conference to determine further steps. Costs are reserved pending further submissions if required.

Orders