XU v LIU [2020] NZHC 921

XU v LIU [2020] NZHC 921

Given prolonged non-compliance with the security for costs order since 24 December 2019, the stay of proceedings caused by breach of an unless order, the substantial prejudice to the defendants, absence of adequate explanation or evidence that the default will be rectified in time to retain the fixture, and after balancing interests (with limited weight given to possible COVID‑19 impact and solicitors' failure to appreciate seriousness), the Court ordered dismissal unless the plaintiffs paid $60,000 security and applied to be relieved of the stay by 5:00 pm 29 May 2020.

Citation
[2020] NZHC 921
Parties
First Plaintiff: Jiangang Xu; Second Plaintiff: Youzhi Zhu; First Defendant: Jin Liu; Second Defendant: Ping Wang
Court
High Court
Jurisdiction
New Zealand
Judgment Date
6 May 2020
Procedural Posture
Civil Proceeding (high Court) / Pre Trial Interlocutory: Security for Costs, Stay and Application to Dismiss
Outcome
Unless order: proceeding will be dismissed unless plaintiffs pay security for costs of $60,000 and apply to discharge the current stay by 5:00 pm 29 May 2020; defendants entitled to costs
Legal Topics
Security for Costs, Stay of Proceedings, Freezing Order, Dismissal for Non Compliance, Costs
Civil Procedure Civil Litigation Remedies Security for Costs Stay of Proceedings Freezing Order Dismissal for Non Compliance Costs

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Parties

Jiangang Xu

First Plaintiff

Youzhi Zhu

Second Plaintiff

Jin Liu

First Defendant

Ping Wang

Second Defendant

Procedural Posture

Civil Proceeding (high Court) / Pre Trial Interlocutory: Security for Costs, Stay and Application to Dismiss

Legal Issues

  1. 1 Whether the proceeding should be dismissed for the plaintiffs' failure to pay ordered security for costs
  2. 2 Whether the stay (resulting from non-compliance with an unless order) should be discharged or the plaintiffs relieved of its consequences
  3. 3 Whether the plaintiffs' explanation (financial difficulty/COVID‑19) justifies further extension

Ratio Decidendi

Given prolonged non-compliance with the security for costs order since 24 December 2019, the stay of proceedings caused by breach of an unless order, the substantial prejudice to the defendants, absence of adequate explanation or evidence that the default will be rectified in time to retain the fixture, and after balancing interests (with limited weight given to possible COVID‑19 impact and solicitors' failure to appreciate seriousness), the Court ordered dismissal unless the plaintiffs paid $60,000 security and applied to be relieved of the stay by 5:00 pm 29 May 2020.

Court Disposition

Unless order: proceeding will be dismissed unless plaintiffs pay security for costs of $60,000 and apply to discharge the current stay by 5:00 pm 29 May 2020; defendants entitled to costs

Orders

  • Unless the plaintiffs pay security for costs of $60,000 and apply to discharge the current stay by 5:00 pm Friday 29 May 2020, the proceeding is dismissed.
  • Defendants are entitled to costs. If costs cannot be agreed, defendants to file and serve a memorandum not exceeding three pages within 15 working days and plaintiffs to file and serve a memorandum not exceeding three pages within 10 working days thereafter; costs to be determined on the papers.