Covering up his client’s Overseas Investment Act breach when purchasing a Helensville property cost lawyer Dr Jaeho Choi a $62,500 fine for obstruction followed by a $30,000 penalty for breaching the Act and suspension from legal practice for nearly six months.
Auckland lawyer Choi is a Korean citizen holding a New Zealand permanent resident visa. Fellow Korean Won Joo Hur agreed to buy a 18.5 hectare Helensville rural property in 2016 for three million dollars. Dr Hur is a medical practitioner. He had previously purchased property in New Zealand. He also is a New Zealand permanent resident. Lawyers then acting for Dr Hur advised very late in the piece that he would require Overseas Investment consent for his Helensville purchase, despite being a permanent resident, because he was no longer ‘ordinarily resident’ having spent too much time outside New Zealand. Dr Hur took his legal problem to Choi who recommended setting up a dummy company as interim purchaser until the question of consents was sorted out. The Overseas Investment Act prohibits these tactics.
When Overseas Investment Office made enquiries, Choi and Hur produced false documents purporting to show the interim purchaser was an independent third party. They later pleaded guilty to obstruction: Choi fined $62,500; Hur $100,000.
The two later negotiated civil penalties to be paid for admitted breaches of the Act in purchasing Helensville rural land in excess of five hectares without Overseas Investment consent. Hur was ordered to pay a further $100,000; Choi $30,000. Choi pleaded poverty, saying a greater fine would leave him bankrupt. The High Court was told Land Information had previously agreed it would accept Choi’s payment of his fine by instalments at $500 per month. Hur separately asked that his $100,000 fine be deferred for one hundred years, or alternatively paid by instalments at $100 per month. Justice Fitzgerald left any question of instalment payments to be negotiated between the two and Land Information as Overseas Investment Act regulator.
Choi was suspended from legal practice after a professional disciplinary hearing.
Land Information v. Hur & Choi – High Court (11.03.22)
22.053