A throwaway line in evidence, part of a dispute over an Auckland land deal that went wrong, resulted in Justice Downs ordering a copy of his High Court judgment be sent to Inland Revenue, potentially adding to a tax investigation into dealings by investor Lai Wei.
Yue Wang was in court suing over losses claimed to have resulted from a failed deal to purchase land in a new subdivision on Scott Road at Hobsonville in west Auckland. Mr Wang said in evidence that his past business dealings with Mr Wei were complicated by the fact that Mr Wei was at the time under investigation by Inland Revenue and wanted to hide his involvement. A money-go-round involved payments being routed through a bank account in the name of Mr Wei’s mother.
The two were in court because a joint venture arrangement to develop three sites off Scott Road had collapsed. The original intent was to build homes on each site, then sell them all. Mr Wang subsequently decided to develop one of the lots as a home for himself and family. This required a tripartite agreement between Mr Wang, their joint venture company and the Scott Road subdivider to have Mr Wang replaced as the named purchaser of his desired lot. The subdivider never signed off. The deal collapsed.
Their joint venture company was ordered to pay damages for breach of the Fair Trading Act. It falsely represented the transfer to Mr Wang was valid and enforceable when it wasn’t.
Damages for wasted costs of $29,686 were awarded; Mr Wang’s cost of commissioning plans and getting building consent.
A further claim for $245,000 as the opportunity lost from enjoying an increase in the property’s market value was dismissed. There was no proved link between the misrepresentation and any potential loss of profit.
Wang v. Future Urban Ltd – High Court (20.09.23)
23.159