Undocumented money transfers totalling $1.6 million benefitting Chongming Zhao were treated as relationship property by the High Court to be shared with his first wife Mu He, over objections that the money belonged to his relatives.
The two separated in 2014, having married in China seven years previously. Shortly after separation, Mr Zhao’s sister purchased two properties on Auckland’s North Shore in cash for a total of $1.06 million. Payment was made out of $1.2 million in Mr Zhao’s BNZ account. These funds had been recently remitted from China. Ms He said this money was relationship property. Mr Zhao said the $1.2 million in his bank account belonged to his sister and her husband. The North Shore properties were in her name. He just managed them, he said. The trial judge in the Family Court said he had ‘real doubts’ about Mr Zhao’s veracity. In July 2012, Mr Zhao and Ms He told ASB in a joint loan application that they had about one million dollars in a bank account in China.
The High Court was told there was no written evidence of the $1.2 million belonging to Mr Zhao’s sister and if it did there was no explanation as to why Mr Zhao retained control of the $140,000 left in his BNZ account after the North Shore property purchases. Justice Hinton ruled the $1.2 million transferred from China to Mr Zhao’s BNZ account was to be divided as relationship property.
Also in question was $432,000 cash used to pay off a mortgage on their former family home. Payment was made thirty months after separation. Ms He said this money was also undisclosed relationship property. In the High Court, Mr Zhao said this mortgage repayment was funded by his second wife. Previously he had claimed payment was funded out of post-separation earnings. The $432,000 mortgage repayment was sourced from assets existing at the time of his first marriage and was also relationship property, Justice Hinton ruled.
Zhao v. He – High Court (18.03.20)
20.061