NEPTUNE BIO-INNOVATIONS PTY LIMITED v NEW ZEALAND EZ-HEALTH BIOTECH LIMITED [2021] NZHC 1280

NEPTUNE BIO-INNOVATIONS PTY LIMITED v NEW ZEALAND EZ-HEALTH BIOTECH LIMITED[2021] NZHC 1280 [2 June 2021]IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYI TE KŌTI MATUA O AOTEAROATĀMAKI MAKAURAU ROHECIV-2021-404-000459[2021] NZHC 1280IN THE MATTER of debt recoveryBETWEEN NEPTUNE BIO-INNOVATIONS PTYLIMITEDPlaintiffAND NEW ZEALAND EZ-HEALTH BIOTECHLIMITEDDefendantHearing: 1 June 2021Appearances: O J Ward for the PlaintiffNo appearance by or on behalf of the DefendantJudgment: 2 June 2021JUDGMENT OF WOOLFORD JThis judgment was delivered by me on Wednesday, 2 June 2021 at 11:30 ampursuant to r 11.5 of the High Court Rules.Solicitors: Stace Hammond, Auckland, for the Plaintiff[1] The plaintiff, Neptune Bio-Innovations Pty Limited, seeks judgment for therecovery of a debt owed to it by the defendant, New Zealand EZ-Health BiotechLimited. The plaintiff commenced these proceedings and applied for summaryjudgment against the defendant on 24 March 2021. The proceeding was served on thedefendant at its registered office on 21 April 2021. No steps have been taken by thedefendant to defend the claim. No notice of opposition or statement of defence hasbeen filed. There was no appearance by the defendant when the application forsummary judgment was called on 1 June 2021.Factual background[2] In April 2020, the defendant contracted with the plaintiff to procure rawmaterials to the value of AUD$1,228,500. The plaintiff agreed to the defendant'spayment proposal (40 per cent up front and 60 per cent balance within three days ofthe plaintiff's delivery of the product). The plaintiff procured the raw materials.[3] On 6 May 2020, the plaintiff issued the defendant a tax invoice in the sum ofAUD$1,228,500 for the raw materials. The defendant made a part payment ofAUD$491,400 with AUD$737,100 remaining unpaid. On or about 28 May 2020, theplaintiff delivered the product. Despite the plaintiff delivering the product, paymentof the balance of the tax invoice was not made within the agreed timeframe of threedays.[4] On 24 September 2020, the plaintiff's Australian lawyer issued a demand letterto the defendant seeking payment of the debt within seven days. On 9 October 2020,the plaintiff served a statutory demand on the defendant requiring payment of theoutstanding debt.[5] On 19 October 2020, the lawyer acting for the defendant responded to theplaintiff's statutory demand stating that it had been served in error as the defendantwas acting as an agent in New Zealand only for Hong Kong EZ-Health InvestmentsHolding Group Limited (HK EZ-Health) and was not a party to the contract betweenthe plaintiff and HK EZ-Health. Accordingly, the defendant was not a debtor to theplaintiff.[6] In support of their claim, the defendant's lawyer produced a copy of an"authorisation letter" dated 7 February 2020 and addressed to New Zealand EZ-HealthBiotech Limited (EZ EZH). It states:Due to the impact of roits [sic] in Hong Kong, Hong Kong EZ-HealthInvestment Holdings Group Limited ("HK EZH") has difficulties in payingout to overseas suppliers. From now on, HK EZH authorises NZ EZH toconduct overseas purchasing business on its behalf.Discussion[7] I am satisfied on the basis of the uncontested affidavit evidence that the allegedagency arrangement was never disclosed to the plaintiff. The following factors alsoestablish that the defendant is appropriately a debtor to the plaintiff:(a) On or around 22 April 2020, the defendant generated a purchase orderaddressed to the plaintiff for 630 kilograms of Lactoferrin 95 per centat a price of AUD$1,228,500. It was in the name of New Zealand EZ-Health Biotech Limited with a New Zealand Business Number(NZBN): 9429047539983. The order also specified the registeredoffice as 25 Hackett Street, Saint Marys Bay, Auckland 1011.(b) On 27 April 2020, the defendant emailed the plaintiff:Hi Ganthi,Here's purchase order PO-EZ20200422-01 forAUD 1,228,500.00.Delivery due date, address and instructions are included in thepurchase order.If you have any questions, please let us know.Thanks,New Zealand EZ-Health Biotech Limited(c) The tax invoice issued by the plaintiff to the defendant was part paid bythe defendant, with a debt of AUD$737,100 remaining unpaid.(d) All discussions the plaintiff had were with a representative of thedefendant, namely, Dr Cissie Chen (Operations Manager), with aNew Zealand mobile telephone number of .62.(e) Dr Chen is also the wife of Jiaying Ni, one of the directors of thedefendant.Result[8] I am satisfied that there is no arguable defence to the plaintiff's claim. Theplaintiff is entitled to the judgment it seeks. There will be judgment for the plaintiffagainst the defendant in the sum of AUD$763,158.47, which includes the principalsum of AUD$737,100, interest of AUD$12,147.06 pursuant to the Interest on MoneyClaims Act 2016, and costs totalling AUD$13,911.41 on a 2B basis.________________________________Woolford J