Yoonwoo C & C Development Corp v Huh - [2019] NZHC 2986

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2018-404-664

[2019] NZHC 2986

UNDER the Insolvency Act 2006

IN THE MATTER OF

the bankruptcy of JAE HO HUH

BETWEEN

YOONWOO C & C DEVELOPMENT CORP

Plaintiff

AND

JAE HO HUH

Defendant

CIV-2019-404-608

BETWEEN

YOONWOO C & C DEVELOPMENT CORP

Judgment Creditor

AND

JAE HO HUH

Judgment Debtor

Hearing: 11 November 2019

Appearances:

B Saldanha for the Plaintiff/Creditor

O Collette-Moxon and E Boshier for the Defendant/Debtor

Judgment:

11 November 2019

ORAL JUDGMENT OF ASSOCIATE JUDGE R M BELL

Solicitors:
Duncan Cotterill, Auckland Jackson Russell, Auckland Counsel:
O V Collette-Moxon, Barrister, Auckland

YOONWOO C & C DEVELOPMENT CORP v HUH [2019] NZHC 2986 [11 November 2019]

[1] On 20 November 2018 Davison J gave summary judgment to Yoonwoo C & C Development Corporation against Mr Huh by formal proof.1 I am dealing with two matters:

(a)Mr Huh’s application to set aside that judgment; and

(b)Yoonwoo’s application to adjudicate Mr Huh bankrupt.

[2] The parties are Korean. Yoonwoo is a corporation which has never carried on business in New Zealand. Mr Huh comes from Korea. He now has New Zealand permanent residence. In Korea he ran a group of companies called the Dae Joo Group, which was involved in property development and construction. In 2006 to 2007 the annual turnover of the group was in the order of $NZ7 billion and it employed about 35,000 staff. He was president of many of the companies. The businesses failed. He got into tax disputes with the Korean government. In January 2008 he was no longer involved in day-to-day operations of the company and turned over managerial responsibility for the Dae Joo Group to another man. He claims that his companies went bankrupt because the Korean Government blocked certain bank accounts. He has lived more or less permanently in New Zealand since 2009 while travelling overseas from time to time. He will not return to South Korea because the government may take action against him for alleged breaches of its tax laws. Other creditors have taken action against Mr Huh. I dealt with him in an earlier proceeding – CIV- 2014- 04-3372 where he was examined as a judgment debtor.

[3] Mr Huh was one of four defendants Yoonwoo sued in two proceedings in a District Court in Korea. The other defendants were companies in the Dae Joo Group. The proceedings went to a form of conciliation which resulted in agreed outcomes. The District Court recorded those outcomes. In the first proceeding, the defendants agreed to pay Yoonwoo ₩890 million and, in the second, ₩1,050,000,000. The judgment debts come to ₩1,940,000,000 Korean won. The judgment debts also carry interest. ₩1,940,000,000 is about $NZ2.127 million.

1 Yoonwoo C & C Development Corp v Huh [2018] NZHC 3015.

[4] In CIV-2018-404-664, Yoonwoo sued Mr Huh on these judgments. He was served by substituted service. He took no steps to defend the proceeding. Davison J heard the summary judgment…

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.

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Details

Case: [2019] NZHC 2986
Decision Date: 11 November 2019

CaseChat Overview and Summary

Yoonwoo C & C Development Corp, a Korean corporation, obtained a default judgment against Jae Ho Huh, a Korean national now resident in New Zealand, for debts arising from proceedings in South Korea. Yoonwoo applied for a bankruptcy order against Mr Huh. Mr Huh applied to set aside the summary judgment. The court had to decide whether Mr Huh had a substantial ground of defence to the claim, whether the delay in applying to set aside the judgment was reasonably explained, and whether Yoonwoo would suffer irreparable injury if the judgment was set aside. The court found that the judgments obtained in South Korea were binding on Mr Huh. However, Mr Huh had an arguable defence that the South Korean court did not have jurisdiction over him because he was not properly served with the proceedings and did not submit to the court's jurisdiction. The court set aside the summary judgment and dismissed the bankruptcy application. Yoonwoo was ordered to pay the costs of the summary judgment application. The substantive proceeding was set for a five-day hearing beginning 15 February 2021.

Orders