Zhang v Guan - [2017] NZHC 2710

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV 2016-404-2217 [2017] NZHC 2710

BETWEEN
QIANGLI ZHANG

Plaintiff

AND

ZUNLONG GUAN First Defendant

HUANRUI LIU Second Defendant

JING JIANG Third Defendant

ZENGMIN HOU Fourth Defendant

Hearing: On the papers

Judgment:

6 November 2017

JUDGMENT OF DUFFY J

This judgment was delivered by me on 6 November 2017 at 3.30 pm pursuant to
Rule 11.5 of the High Court Rules.
Registrar/ Deputy Registrar

Solicitors / Counsel
Yu Lawyers, Balmoral
Glaister Ennor, Auckland
E J Werry, Auckland
Daniel Zhang, Auckland

ZHANG v GUAN COSTS [2017] NZHC 2710 [6 November 2017]

[1] I refer to paragraph [7] of the minute of 19 May 2017, in which I indicated that when memoranda on costs were received I would consider whether they could be dealt with on the papers or not. I now have memoranda on the question of costs.

[2] I am now sufficiently informed to determine whether costs should be ordered against the third defendant, Jing Jiang, and her lawyers. Accordingly, I shall now do so.

[3] Some understanding of the background to the costs application is required.

Background

[4] The first defendant Zunlong Guan and Ms Jiang are apparently mother and son. When first served with the proceeding Mr Guan apparently engaged Richard Zhao, solicitor, and Daniel Zhang, barrister, to act for Mr Guan and Ms Jiang. Later Ms Jiang instructed Northern Legal Ltd to act for her. The New Zealand Law Society’s Register of Lawyers currently records that Ms Puhan is the director of Northern Legal Ltd.

[5] Documents filed in this proceeding for Ms Jiang are stated to be filed by Norther Legal Ltd. The solicitor acting is recorded as James Guy. Correspondence annexed to an affidavit sworn by Ms Jiang in this proceeding and dated 8 May 2017 is written by Northern Legal Ltd and signed by James Guy, who then described himself as a senior associate of Northern Legal Ltd. The New Zealand Law Society’s Register of Lawyers currently records Mr Guy as practising as a sole practitioner who is also a consultant to Norther Legal Ltd. It is not clear to me if Mr Guy’s status has changed since he first began filing court documents for Ms Jiang.

[6] Either Ms Jiang or her lawyers formed the view that Mr Zhao and Mr Zhang had taken steps on Ms Jiang’s behalf without proper instruction to do so and in circumstances where those steps were unlikely to succeed. The steps were: (a) an application by Mr Guan and Ms Jiang to stay these proceedings; and (b) opposition to the plaintiff’s application to strike out the stay application brought by Mr Guan

and Ms Jiang (the subsequent applications). This led to Ms Jiang’s present lawyers (at this point I am not clear on whether her solicitor is Mr Guy, as a sole practitioner, acting on instructions from Northern Legal Ltd; or Northern Legal Ltd with whom Mr Guy has contracted…

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 Zhang v Guan

Details

AGLC: Zhang v Guan [2017] NZHC 2710
Case: [2017] NZHC 2710
Decision Date: 6 November 2017

CaseChat Overview and Summary

In Zhang v Guan, the court was tasked with determining the appropriate costs following a costs application made by Jing Jiang against her former legal representatives, Richard Zhao and Daniel Zhang. Jiang had initially engaged Zhao and Zhang to act on her behalf in the proceedings but later instructed Northern Legal Ltd to act for her instead. Jiang and her new legal team filed a costs application against Zhao and Zhang, seeking to recover costs incurred from the filing of certain applications that were considered misconceived. Zhao and Zhang protested jurisdiction and opposed the costs application, arguing that the court lacked jurisdiction to award costs against former legal representatives and that the costs application was misconceived.

The court considered the arguments and found that the costs application was indeed misconceived, as it did not follow the proper procedure as outlined in Harley v McDonald. The court held that the appropriate course of action for Jiang would have been to initiate civil proceedings against Zhao and Zhang for their alleged unauthorised actions or to lodge a complaint with the New Zealand Law Society. The discontinuance of the costs application indicated that Zhao and Zhang had achieved some measure of success. However, the court also found that Jiang's new legal team could have handled the matter better and that all parties had acted in a manner that was not conducive to a sensible and cost-effective outcome.

Consequently, the court ordered Jiang to pay Zhao and Zhang category 2B costs in the sum of $12,599.50. The court found that there was no basis for an award of indemnity or increased costs, and no costs were awarded against Jiang's lawyers, Michael Lenihan and Ms Puhan. Jiang had the option to seek reimbursement from her lawyers if she believed it was warranted.

Orders