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Tan v Tan

Tan v Tan

Case [2024] NZHC 3370 14 November 2024

Summary Judgment

Recognition of Foreign Judgments

Fraud Exception

Natural Justice

Admissibility of Evidence

Civil Litigation & Procedure

International Law

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IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2024-404-873

[2024] NZHC 3370

BETWEEN
BAOSHAN TAN

Plaintiff

AND

WILLIAM (YUANHUI) TAN

Defendant

Hearing: 23 August 2024

Appearances:

K Morrison and KL Chiu for the Plaintiff T Ashley for the Defendant

Judgment:

14 November 2024

JUDGMENT OF ASSOCIATE JUDGE SUSSOCK

This judgment was delivered by me on 14 November 2024 at 3 pm pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Solicitors:
Meredith Connell, Auckland Forrest Harrison, Auckland

TAN v TAN [2024] NZHC 3370 [14 November 2024]

Introduction

[1] The plaintiff, Baoshan Tan (Baoshan), seeks summary judgment of his claim for recognition and enforcement of a judgment of the Intermediate People’s Court of Haikou City (IPC) of the People’s Republic of China (PRC) issued on 3 June 2020.¹

[2] Before a foreign judgment can be enforced in New Zealand it must be recognised by a New Zealand Court. Once an order for recognition is made all of the usual consequences of having a New Zealand judgment flow including being able to enforce payment of the remaining judgment sum.

[3] The judgment sum ordered the defendant, William (Yuanhui) Tan (William), to pay the principal amount of RMB 2,780,000 plus interest of 24 per cent to the date of payment from the following dates:

(i)on RMB 2,700,000 from 30 November 2016 (less RMB 20,000 that has already been paid by the defendant);
(ii)on RMB 50,000 from 8 February 2018; and
(iii)on RMB 30,000 from 3 July 2018.

[4] In addition, the judgment ordered that delayed performance interest is payable on the principal of RMB 2,780,000 until payment if William failed to pay the judgment sum within 10 days (calculated by Baoshan’s counsel as 0.0175 per cent per day from 20 June 2020).

[5] Following the judgment, Baoshan obtained an order in PRC to sell a property owned by William, receiving RMB 859,444 in sale proceeds. The proceeds have been applied to the accrued interest, with the principal amount of RMB 2,780,000 plus remaining interest of RMB 2,220,968.05 still outstanding as at 31 August 2021. Interest continues to accrue.

¹ I refer to the plaintiff and defendant by their first names given they share a surname. I intend no disrespect in doing so and confirm they are not related.

[6] There is no treaty for recognition of judgments between PRC and New Zealand so recognition is considered at common law. William accepts the three prerequisites for recognition at common law are satisfied in this case but opposes summary judgment on the basis of two of the three settled exceptions:²

(a)that the judgment was obtained by fraud; or

(b)that the proceedings in which the judgment was obtained were contrary to natural justice.

[7] Baoshan says William has not clearly pleaded the fraud exception and is instead seeking to re-examine the merits of the Chinese Court’s decision, submitting that this is not appropriate in an application for recognition. Furthermore, Baoshan says there…

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 Tan v Tan

Details

AGLC: Tan v Tan [2024] NZHC 3370
Case: [2024] NZHC 3370
Decision Date: 14 November 2024

CaseChat Overview and Summary

In the High Court of New Zealand, Baoshan Tan, the plaintiff, sought summary judgment to enforce a judgment from the Intermediate People's Court of Haikou City, China, against William Tan, the defendant. The Chinese court ordered William to pay a principal amount of RMB 2,780,000 plus interest, but William opposed the enforcement, alleging the judgment was obtained through fraud or was contrary to natural justice. Baoshan argued that William did not clearly plead fraud and was instead re-examining the merits of the Chinese court's decision. The court assessed whether Baoshan had established that William's defence was not reasonably arguable.

The court found that while William did not explicitly use the word "fraud" in his pleading, the allegation of dishonesty was sufficiently particularised and consistent with the fraud exception. The court considered evidence from the Chinese proceedings and concluded that there were inconsistencies in Baoshan's statements before the Intermediate People's Court and before the District People's Court, raising questions about Baoshan's honesty. Additionally, Baoshan did not directly address key parts of William's evidence, such as the timeline of his interactions with the lender, Ms. Li. The court held that there was sufficient evidence to require an explanation, and therefore, the fraud exception applied.

Regarding the natural justice exception, the court noted that William was represented by a lawyer during the appeal but had limited opportunity for cross-examination, which may have deprived him of a fair opportunity to present his defence. The court found that it was reasonably arguable that William did not have a fair opportunity to present his defence on the appeal, and thus, the natural justice exception also applied.

The court declined Baoshan's application for summary judgment and reserved costs until the determination of the substantive proceeding, with a preliminary view that costs may be payable from the date of the filing of the amended notice of opposition and supporting affidavits.

Final orders:
1. Baoshan's application for summary judgment is declined.
2. The parties are directed to confer on the issue of costs and, if unable to agree, to file memoranda of no more than three pages (excluding schedules) by specified dates.

Orders