CHEN v AUCKLAND WEIHAO INVESTMENTS LIMITED [2021] NZCA 421

CHEN v AUCKLAND WEIHAO INVESTMENTS LIMITED [2021] NZCA 421 [1 September 2021]IN THE COURT OF APPEAL OF NEW ZEALANDI TE KŌTI PĪRA O AOTEAROACA646/2020[2021] NZCA 421BETWEEN LIYUN CHENApplicantAND AUCKLAND WEIHAO INVESTMENTSLIMITEDRespondentCA95/2021BETWEEN LIYUN CHENApplicantAND AUCKLAND WEIHAO INVESTMENTSLIMITEDRespondentCourt: Clifford and Courtney JJCounsel: Applicant in personJ A Wickes for Respondent in CA646/2020D K Wilson for Respondent in CA95/2021Judgment:(On the papers)1 September 2021 at 11.30 amJUDGMENT OF THE COURTA The application for an extension of time to appeal in CA646/2020 is granted.Ms Chen must file her notice of appeal by 29 September 2021.B The application for an extension of time to apply for the allocation of ahearing date and file the case on appeal in CA95/2021 is declined.____________________________________________________________________REASONS OF THE COURT(Given by Clifford J)Introduction[1] These are applications by Ms Chen for extensions of time:(a) in CA646/2020, to commence an appeal;1 and(b) in CA95/2021, to apply for the allocation of a hearing date and file thecase on appeal.2BackgroundCA646/2020[2] In October 2019, Ms Chen agreed to purchase an Auckland property(the Property) from the respondent, Auckland Weihao Investments Ltd (Weihao).The sale and purchase agreement was not conditional on finance. Shortly beforesettlement a change of terms was agreed. Weihao would provide three-month vendorfinance on conditions as to security, including a second mortgage over the Property.[3] Those conditions were never finalised. A dispute arose. On 26 June 2020Ms Chen lodged a caveat over the Property (the first caveat) to protect her interestsunder the sale and purchase agreement. On 21 July 2020 Weihao cancelled thatagreement and applied for the first caveat to lapse. Ms Chen in turn applied for anorder under s 143 of the Land Transfer Act 2017 that the first caveat be sustained.[4] On 18 September 2020 Associate Judge Gardiner declined Ms Chen'sapplication to sustain the first caveat.3 The next day, Ms Chen lodged a second caveat,claiming a beneficial interest under a constructive trust.1 Court of Appeal (Civil) Rules 2005, r 29A.2 Rule 43(2) and (3).3 Chen v Auckland Weihao Investments Ltd [2020] NZHC 2450.[5] On 12 October 2020 Ms Chen applied to the High Court for leave to appealAssociate Judge Gardiner's decision declining to sustain the first caveat. Ms Chen didnot, in fact, need leave to appeal. That was not drawn to her attention until the matterwas put before the Associate Judge. In a minute of 3 November 2020 she observed:[2] The application to which the judgment relates is a standaloneproceeding, not an interlocutory application. Accordingly, the requirement forleave of this Court in s 56(3) of the Senior Courts Act 2016 does not apply.The applicant may appeal to the Court of Appeal as of right.[3] The applicant filed her application for leave on 12 October 2020.This was within the time for an application for leave or an appeal. However,her application did not come to my attention until now. The time to appeal tothe Court of Appeal has expired. The applicant will need to request anextension of time under s 29A of the Court of Appeal (Civil) Rules 2005.For the purposes of that application, I record that the applicant's delay in filingan appeal is attributable to an error in this Court in processing her applicationfor leave.[6] On 6 November 2020 Ms Chen filed such a request as CA646/2020.CA95/2021[7] Weihao challenged the second caveat. Ms Chen applied to the High Courtto sustain it. That application came before Associate Judge Bell on 10 February 2021and was dismissed by him in a careful and comprehensive oral judgment that sameday.4 Ms Chen appealed that judgment to this Court on 3 March 2021 as CA95/2021.That appeal was deemed abandoned on 4 June 2021. Ms Chen had not, as requiredby r 43(2), within the three-month period following the bringing of that appeal,applied for the allocation of a hearing date or filed the case on appeal. On 8 June 2021Ms Chen, as provided for by r 43(3) filed her application in CA95/2021 for anextension of that period of three months in which to apply for a hearing date and filethe case on appeal.4 Chen v Auckland Weihao Investment Ltd [2021] NZHC 156.AnalysisCA646/2020[8] Ms Chen was entitled as of right to appeal the Associate Judge's decisiondeclining her application to sustain the first caveat. In error, but within the timeallowed for her to exercise that right, she filed her leave application. That applicationwas also within time, if leave had in fact been required.[9] The time for filing her of as of right appeal expired before her error was drawnto her attention. That error was, as the Associate Judge recorded in her minute of3 November, attributable to an error by the High Court. When the situation was drawnto her attention in that minute Ms Chen promptly filed this application.[10] The delay is not significant and has caused the respondent little, if any,prejudice. The respondent nevertheless opposes the grant of an extension of time,attributing to Ms Chen's appeal the "clearly hopeless" characterisation fromAlmond v Read.5[11] We accept the merits of Ms Chen's appeal do not, to the extent they areapparent thus far, appear at all strong. But given the circumstances, particularly thecause of the delay being attributable to an error of the Court, in our view this is not anoccasion where lack of merit should be determinative, notwithstanding a brief delayin rule compliance.[12] We therefore grant Ms Chen's application for an extension of time to appealthe Associate Judge's decision of 18 September 2020.6 We remind Ms Chen that shemust file her notice of appeal by 29 September 2021.75 Almond v Read [2017] NZSC 80, [2017] 1 NZLR 801 at [39(c)].6 Chen v Auckland Weihao Investments Ltd, above n 3.7 Court of Appeal (Civil) Rules, r 29A(3)(b).CA95/2021[13] The touchstone for a r 43 extension of time, as it is for one under r 29A, is theinterests of justice.8 As this Court confirmed in Schmidt v Ebada Property InvestmentsLtd, once r 43 is triggered the intended appellant, instead of being able to appeal as ofright, requires this Court to exercise a "positive discretion".9 The factors relevant tothe exercise of that discretion include the reasons why the appeal has not beenprosecuted diligently, whether the appeal is "genuinely arguable",10 as well as thelength of the delay.[14] Whilst the delay, albeit unexplained, was short this is in our view a situationwhere the interests of justice do not call for an extension of time to be granted.As Associate Judge Bell's decision demonstrates,11 a challenge to the decisiondeclining to sustain the second caveat is not genuinely arguable. Moreover, Ms Chenfiled the second caveat in reaction to Associate Judge Gardiner's decision declining tosustain her first caveat. As we have granted the extension of time in CA646/2020,Ms Chen may now challenge that decision directly. That counts against the grant ofan extension.[15] We decline Ms Chen's application in CA95/2021 accordingly.Result[16] The application for an extension of time to appeal in CA646/2020 is granted.Ms Chen must file her notice of appeal by 29 September 2021.[17] The application for an extension of time to apply for the allocation of a hearingdate and file the case on appeal in CA95/2021 is declined.Solicitors:Loo & Koo, Auckland for Respondent in CA646/20208 My Noodle Ltd v Queenstown Lakes District Council [2009] NZCA 224, (2009) 19 PRNZ 518.9 Schmidt v Ebada Property Investments Ltd [2012] NZCA 452 at [7], citing Harris v Davies [2007]NZCA 358 at [8] and Russell v Commissioner of Inland Revenue (2006) 22 NZTC 19,807 at [10](CA).10 At [7], citing Russell v Commissioner of Inland Revenue, above n9, at [10].11 Chen v Auckland Weihao Investment Ltd, above n 4.