Having paid a defrauded property owner compensation, government sued fraudster Hui Zhang who forged the owner’s signature to sale of a residential property in the Auckland suburb of Highland Park.
The High Court was told owner Wai Kar Wong lived in Hong Kong. He had rented Highland Park to a tenant who subsequently entered into a relationship with Hui Zhang. The two hatched a plot to defraud Mr Wong. Title to Highland Park was transferred to Zhang after forging Mr Wong’s signature. Mr Wong did not learn of the fraud until after a mortgagee sale by Westpac, enforcing borrowing by Zhang. Title to Highland Park remained with the innocent purchaser from Westpac. Mr Wong was paid $668,188 compensation by government, for the loss of his property.
The Land Transfer Act provides a crown guarantee of registered interests in land. Security of title reduces borrowing costs for the benefit of creditors and debtors alike. Anybody purchasing an interest in land, not guilty of fraud, keeps that registered interest with government compensation paid to the victim of any prior fraud. The Act permits government to then recover from the fraudster.
Justice Moore ordered Zhang pay $687,800: the $668,200 compensation paid Mr Wong plus $19,600 costs incurred. Legal proceedings were served on Zhang in prison. He did not defend the claim.
Registrar General of Land v. Zhang – High Court (15.05.19)
19.087