Wu v Stalex Property Limited
[2022] NZCA 634
•16 December 2022 at 2.30 pm
| IN THE COURT OF APPEAL OF NEW ZEALAND I TE KŌTI PĪRA O AOTEAROA |
| CA413/2022 [2022] NZCA 634 |
| BETWEEN | YIHENG WU |
| AND | STALIX PROPERTY LIMITED |
| AND | STRESS FREE CHAIRS, DINING AND LOUNGE LIMITED |
| Court: | Courtney J |
Counsel: | Appellant in Person |
Judgment: | 16 December 2022 at 2.30 pm |
JUDGMENT OF COURTNEY J
[Review of Deputy Registrar’s decision]
The application for review of the Deputy Registrar’s decision is declined.
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REASONS
Mr Wu has appealed a decision of Associate Judge Lester striking out his application for an order requiring a property sold by the Registrar of the High Court to be transferred back into his name.[1] A Deputy Registrar declined to dispense with security for costs. Mr Wu seeks a review of that decision.
Background
[1]Wu v Stalix Property Ltd [2022] NZHC 2005 [High Court strike out decision].
The appeal has its roots in proceedings brought in the High Court in Christchurch — CIV 2018-409-612 (the 612 proceedings) and CIV 2018-409-238 (the 238 proceedings). The 612 proceedings were brought by Ms Li against Mr Wu, who is her former husband, and his mother, Ms Fan. Ms Li sought the division of relationship property, particularly the former family home in Christchurch. The 238 proceedings were brought by Ms Fan against Mr Wu and Ms Li in which Ms Fan asserted that the property was subject to a constructive, resulting, implied and/or express trust in her favour.
The proceedings were consolidated and determined by Gendall J in a judgment dated 27 September 2019 (the substantive judgment). The Judge largely upheld Ms Li’s claim in finding that the property was relationship property to which Ms Li was entitled to a half share. However, he also held that Ms Li’s half share was subject to a relationship debt of $522,800 owing to Ms Fan.[2] Mr Wu did not appeal this substantive judgment. Ms Fan filed an appeal out of time.
[2]Li v Wu [2019] NZHC 2461.
In 2020 Gendall J made orders requiring Mr Wu to facilitate access to the property for the assessment of weathertightness (the facilitation order). Mr Wu applied unsuccessfully for a stay of that order.[3] At the same time as the Judge declined the stay application, he also made orders requiring Mr Wu and/or Ms Fan to pay the updated amount owed to Ms Li into the High Court pending determination of Ms Fan’s application for an extension of time to appeal the substantive judgment.[4] Ms Fan was ultimately refused an extension of time to appeal the substantive judgment[5] and was refused leave to appeal to the Supreme Court.[6] Mr Wu was refused leave to file an appeal out of time against the facilitation order[7] and was refused leave to appeal to the Supreme Court.[8]
[3]Li v Wu [2021] NZHC 209.
[4]At [60].
[5]Wu v Li [2021] NZCA 137 [Court of Appeal judgment].
[6]Fan v Wu [2021] NZSC 67 [Supreme Court judgment].
[7]Court of Appeal judgment, above n 5.
[8]Supreme Court judgment, above n 6.
On 28 September 2021 Gendall J made an order that the property be sold by the Registrar of the High Court.[9] Ms Fan applied unsuccessfully for a stay of the order.[10] She argued that the substantive judgment had not determined her claim to the beneficial ownership of the property because it referred only to the 612 proceedings and not the 238 proceedings. Osborne J described this argument as “entirely misconceived”.[11]
[9]Li v Wu [2021] NZHC 2552 at [34].
[10]Li v Wu [2022] NZHC 333 [Osborne J decision].
[11]At [25].
The sale of the property proceeded. Stalix Property Ltd (Stalix) was the purchaser. Mr Wu and other members of his family refused to leave the property. Stalix obtained an order for possession. Mr Wu applied for an order that the property be transferred back into his name. He argued that the sale process undertaken by the Registrar was unlawful because it was not supported by a valid judgment of the Court. Specifically, the intituling of the substantive judgment referred only to the 612 proceeding. This argument was based on the same argument advanced previously by Ms Fan. Associate Judge Lester considered it to be without merit. He struck out the proceeding as an abuse of process.[12]
The Deputy Registrar’s decision
[12]High Court strike out decision, above n 1.
Mr Wu’s notice of appeal against Associate Judge Lester’s decision was accepted for filing on 16 August 2022 and security for costs was set at $7,060 pursuant to r 35 of the Court of Appeal (Civil) Rules 2005. Mr Wu applied under r 35(6) for security for costs to be dispensed with or reduced on the basis of impecuniosity. The respondents opposed the dispensation or reduction of security for costs.
The Deputy Registrar, having made inquiries of the High Court, rejected the assertion of impecuniosity. The balance of the sale proceeds of the property is currently being held in a trust account on behalf of Ms Fan. The High Court Registrar estimates the amount to be about $500,000 (although Ms Fan asserts that it is only $345,936.45). The amount has not been disbursed because Ms Fan has failed to provide bank account details and authority to disburse the funds to her. In these circumstances the Deputy Registrar has concluded that there is a source of funds from which the security of costs could be paid and was accordingly not satisfied as to the appellant’s impecuniosity.
Moreover, the Deputy Registrar has concluded that there is no merit in the appeals because the proposed ground of appeal is one that has already been considered and rejected by the High Court.[13] Nor was the Deputy Registrar satisfied that there is any public interest factor. To the contrary, she considered that there may be an element of vexatiousness, given the history of unsuccessful appeals and unmet costs relating to the judgments issued in relation to the property.
Review of the Deputy Registrar’s decision
[13]High Court strike out decision, above n 1; and Osborne J decision, above n 10.
The principles relating to the payment of security for costs were canvassed thoroughly by the Deputy Registrar in her decision. In summary, security for costs may be dispensed with where costs are unlikely to be ordered against an appellant or where the appellant cannot pay or will suffer severe hardship if payment is required.[14] Where impecuniosity is relied on, security will generally be dispensed with only if “it is right to require the respondent to defend the judgment under challenge without the usual protection as to costs provided by security.”[15] Security is usual and exceptional circumstances are required before it will be dispensed with. The discretion to dispense with security should be exercised so as to “preserve access to the Court of Appeal by an impecunious appellant in the case of an appeal which a solvent appellant would reasonably wish to prosecute”.[16] Where there are genuine cases of public importance, security for costs may be dispensed with even if impecuniosity is not established.[17]
[14]Reekie v Attorney-General [2014] NZSC 63, [2014] 1 NZLR 737 at [19].
[15]At [21] and [31].
[16]At [35].
[17]Banks v Ports of Auckland Ltd [2015] NZCA 150, (2015) 22 PRNZ 461; Siemer v Complete Construction Ltd [2020] NZCA 350.
Mr Wu filed an extensive submission as part of the application for review of the Deputy Registrar’s decision. The issue of impecuniosity is not addressed at all. Rather, the submission seeks to establish novel points of law arising from the appellant’s view as to the correct application of the High Court Rules 2016. These arguments come back to the underlying assertion that there was an error by the High Court in the delivery of the substantive judgment dealing with the consolidated proceedings. There is no merit in this argument, and it has been considered and rejected by the High Court.
The availability of the sale proceeds and the failure to address the issue of impecuniosity leads inevitably to the conclusion that Mr Wu is not impecunious and that the Deputy Registrar’s decision was correct.
The application for review of the Deputy Registrar’s decision is declined.
Solicitors:
Harmans, Christchurch for First and Second Respondents
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