Introduction [1] Background facts [5] Mr Zhong’s case [26] Mr Wang’s case [30] The High Court judgment [33] Analysis of competing submissions [40] Abuse of process issue [40] Specificity to support caveat [43] The estate or interest claimed by Mr Zhong [59]
(i) General [59]
(ii) The Quistclose claim [63]
(iii) Claim based on constructive trust [86] Availability of alternative remedies [99] Result [103]
Introduction
[1] Mr Zhong appeals against an order removing caveats lodged by him against two properties registered in the name of Mr Wang and his ex-wife, Jue Jin. The order was made by Associate Judge Doogue in the High Court at Auckland on 29 November 2005. An order staying execution of the judgment was made on 14 December 2005. Pending determination of this appeal, the caveats remain registered against the titles.
[2] Mr Zhong claims an interest in the two titles of land as a beneficiary under a constructive trust. Mr Wang is alleged to be the trustee.
[3] Mr Wang denies the trust alleged by Mr Zhong. He contends that he and his former wife hold the properties as trustees for the beneficiaries of The Great Shanghai Family Trust. That Trust is said to have been settled by Mr Wang in (he thinks) early 2001. Mr Wang says he is but “one of a number of discretionary beneficiaries” of the Trust.
[4] Judge Doogue held that the caveats could not be sustained because the evidence did not disclose a caveatable interest in the properties in question. That finding is challenged on appeal.
Background facts
[5] The affidavits filed on the application to remove the caveats reveal conflicts between the primary witnesses. Those conflicts cannot be resolved without cross-examination. For that reason (and without making any determination on the merits of each party’s case), we rely primarily on the evidence of Mr Zhong to determine this appeal.
[6] In August 2001, Mr and Mrs Zhong arrived in New Zealand for a short holiday. A third party arranged a meeting between Mr Zhong and Mr Wang at the Stamford Plaza Hotel in Auckland on 12 or 13 August 2001. An immigration consultant was also present at that meeting.
[7] Mr Zhong and his family intended to emigrate from the People’s Republic of China to New…
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
AGLC
Zhong v Wang [2006] NZCA 242
Case
[2006] NZCA 242
Decision Date
CaseChat Overview and Summary
The appeal in Zhong v Wang was heard before the Court of Appeal of New Zealand. Mr Zhong lodged caveats against two properties registered in the name of Mr Wang and his ex-wife, seeking to claim an interest in the properties as a beneficiary under a constructive trust. Mr Wang denied the trust and claimed to hold the properties as a trustee for the beneficiaries of The Great Shanghai Family Trust. The primary issue before the Court was whether Mr Zhong had established a reasonably arguable case that he had a beneficial interest in the properties, either under a Quistclose or a constructive trust. The Court found that the caveats described the interest claimed sufficiently, and there was a clear link between the claimed interest and Mr Wang. The Court held that the nature of the transaction between Mr Zhong and Mr Wang did not give rise to a Quistclose trust, but there was a basis to argue that Mr Wang was a fiduciary for Mr Zhong and that the dissipation of the funds involved in the acquisition of the properties involved a breach of Mr Wang's fiduciary duties to Mr Zhong. The appeal was allowed, and the orders removing the caveats were set aside. Costs were awarded in favour of Mr Zhong.