Zhu v Chen HC Auckland CIV-2009-404-3620

[2011] NZHC 729

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2009-404-3620

BETWEEN  XUE YING ZHU Plaintiff

ANDHUA CHEN First Defendant

ANDALI MOHAMMED PARKAR Second Defendant

ANDCHERIE LOUISE PARKAR Third Defendant

ANDTHE HAT FACTORY 2006 LIMITED Fourth Defendant

ANDCLASSIC LIVING LIMITED Fifth Defendant

ANDJIAN HUA LIAO Sixth Defendant

ANDHUA CHEN AND JIAN HUA LIA (AS TRUSTEES OF THE H CHEN FAMILY TRUST)

Seventh Defendants

Hearing:         3 June 2011

Appearances: A Ram and F Deliu for the Plaintiff

No appearance for the Defendants

Judgment:      7 June 2011 at 5:00 PM

JUDGMENT OF PETERS J

This judgment was delivered by me on 7 June 2011 at 5:00pm pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date: ........................................

ZHU v CHEN AND ORS HC AK CIV-2009-404-3620 7 June 2011

[1]      This judgment follows a hearing of the plaintiff’s claim on 3 June 2011, on a

“formal proof” basis.

[2]      In the first cause of action of her statement of claim filed on 17 June 2009, the plaintiff seeks judgment in respect of various advances which she alleges she made to one or more of the defendants.  The particulars of the alleged advances are set out in paragraphs 11 to 36 of the statement of claim.

[3]      Having heard counsel for the plaintiff, and having considered the pleadings and affidavits filed in the proceedings, I find that the plaintiff has proved on the balance of probabilities that she made some of the alleged advances to some defendants.

[4]      The fact that the plaintiff made many of the advances which she alleges is not in dispute.  However, the plaintiff alleges that she made the vast majority of those advances to the first defendant.  The response of the first defendant, however, as it appears from his affidavits, is that the plaintiff in fact advanced the funds to the fourth or fifth defendants or for their benefit and that he, personally, is not liable to repay those funds.

[5]      The plaintiff has filed an affidavit sworn by an accountant, Mr Nair.  In his affidavit, amongst other things Mr Nair addresses whether there is any evidence that the funds advanced were, in fact, paid to the fourth or fifth defendants, or applied for their benefit.  In many cases Mr Nair has come to the conclusion that there is not any such evidence.   I relied to some extent on this affidavit, although note that it is incorrect in some instances and so I have had to treat it with some caution.  I took the view, however, that if indeed the funds had been advanced to the fourth or fifth defendants it would have been a simple matter for the first defendant to adduce some evidence that this in fact was the case.  Absent that, I have accepted the plaintiff’s evidence as to the correct debtor.

[6]      My decision in respect of those advances which I consider proved are as follows.

[7]      There will be judgment for the plaintiff against each of the first and sixth defendants in the sum of $100,000.00, together with interest thereon at 7.6 per cent per annum from 4 November 2005, being the date of the advance, until the date of judgment.  Interest accrues thereafter at the rate prescribed in s 87(1) Judicature Act

1908 and is to be calculated in accordance with the said s 87(1) (“prescribed rate”).

Paragraph 13 Statement of Claim

[8]      There will be judgment for the plaintiff against the first defendant in the sum of  $100,000.00,  together  with  interest  thereon  at  7.6 per  cent  per  annum  from

16 December  2005,  being  the  date  of  the  advance,  until  the  date  of  judgment. Interest accrues thereafter at the prescribed rate.

Paragraph 15 Statement of Claim

[9]      There will be judgment for the plaintiff against the first defendant in the sum of  $200,000.00,  together  with  interest  thereon  at  10 per  cent  per  annum  from

28 July 2006, being the date of the advance, until the date of judgment.   Interest accrues thereafter at the prescribed rate.

Paragraph 17 Statement of Claim

[10]     There will be judgment for the plaintiff against the first defendant in the sum of RMB (Renminbi) 800,000.00, together with interest thereon at 10 per cent per annum from 15 September 2006, being the date of the advance, until the date of judgment.  Interest accrues thereafter at the prescribed rate.

Paragraph 19 Statement of Claim

[11]     There will be judgment for the plaintiff against the first defendant in the sum of RMB 200,000.00.  There is no evidence as to the interest rate, if any, at which the principal sum was advanced and, accordingly, I make no order as to interest to the date of judgment.  Interest accrues after the date of judgment at the prescribed rate.

[12]     There will be judgment for the plaintiff against the first defendant in the sum of RMB 550,000.00, together with interest thereon at 12 per cent per annum from

13 March 2007, being the date of the advance, until the date of judgment.  Interest accrues thereafter at the prescribed rate.

Paragraph 23 Statement of Claim

[13]     There will be judgment for the plaintiff against the first defendant in the sum of RMB 100,000.00, together with interest thereon at 12 per cent per annum from

19 March 2007, being the date of the advance, until the date of judgment.  Interest accrues thereafter at the prescribed rate.

Paragraph 27 Statement of Claim

[14]     There will be judgment for the plaintiff against the fifth defendant in the sum of USD 76,000.00, together with interest thereon at 10 per cent per annum from

13 June 2007, being the date of the advance, until the date of judgment.   Interest accrues thereafter at the prescribed rate.

Paragraph 29 Statement of Claim

[15]     There will be judgment for the plaintiff against the first defendant in the sum of RMB 300,000.00.  There is no evidence as to the interest rate, if any, at which the principal sum was advanced and, accordingly, I make no order as to interest to the date of judgment.  Interest accrues after the date of judgment at the prescribed rate.

Paragraph 31 Statement of Claim

[16]     There will be judgment for the plaintiff against the first defendant in the sum of RMB 330,000.00, together with interest thereon at 10 per cent per annum from

1 August 2007, being the date of the advance, until the date of judgment.  Interest accrues thereafter at the prescribed rate.

[17]     There will be judgment for the plaintiff against the fourth defendant in the sum of $60,000.00, together with interest thereon at 10 per cent per annum from

25 August 2007, being the date of the advance, until the date of judgment.  Interest accrues thereafter at the prescribed rate.

Paragraph 35 Statement of Claim

[18]     There will be judgment for the plaintiff against the first defendant in the sum of RMB 450,000.00, together with interest thereon at 10 per cent per annum from

18 June 2008, being the date of the advance, until the date of judgment.   Interest accrues thereafter at the prescribed rate.

[19]     The plaintiff has not proved beyond reasonable doubt that she made any of the  other  payments  which  are  alleged  or,  if  she  did,  that  they were  loans.    In particular, the payment described in paragraph 25 of the statement of claim was a payment for share capital in the fourth and/or fifth defendants.

[20]     Counsel for the plaintiff advised me that the plaintiff did not propose to pursue the second and subsequent causes of action set out in the statement of claim and that she abandoned those accordingly.

[21]     Counsel for the plaintiff sought costs against the first defendant, including an order for increased or indemnity costs.

[22]     Counsel submitted that the basis for seeking increased or indemnity costs was that, by initially defending the proceedings and then ceasing to do so, the first defendant  had  caused  the  plaintiff  to  take  unnecessary  steps  and  thereby  had increased her costs.

[23]     I am not persuaded that this is a case for awarding increased or indemnity costs.

[24]     It is implicit in a costs award that a party has been unsuccessful.  I am not aware of anything in the first defendant’s conduct of this case which would make it appropriate to award increased or indemnity costs.

[25]     I award costs to the plaintiff on a 2B basis on those claims on which I have found the first defendant is liable.  Disbursements are to be as fixed by the Registrar. The plaintiff is to exclude from her calculation of costs any sum arising from the hearings which were to take place on 2 and 16 May 2011.  The plaintiff was not in a position to proceed on those dates or, if she was, had filed necessary documentation too late for the hearing to be able to proceed.

[26]     The plaintiff is to submit a draft judgment reflecting the above orders by

10:00 am, 10 June 2011.

...................................................................

PETERS J

Solicitors/Counsel:

Mr F C Deliu, Barrister, Auckland – Email:  [email protected]

Amicus Lawyers, Auckland – Email: [email protected]