After their Auckland joint venture property deal went sour, Bin Hu disputed that one million dollars paid to her up front by Yang Wang was a personal loan due for repayment. End result: she was ordered to pay the disputed one million; this after seeing Mr Wang take full control of their property development, buying in at a mortgagee sale.
The High Court was told Ms Hu agreed in December 2020 to buy a property in Auckland waterfront suburb St Heliers for $12.3 million. Her contract was for deferred settlement: March 2022.
The court was told Ms Hu is an experienced property developer. She had plans to redevelop the St Heliers site.
When signing, Ms Hu needed to find one million; payment of the deposit.
An acquaintance, then working for the Chinese Construction Bank, got in touch with Mr Wang.
Mr Wang paid one million dollars into Ms Hu’s solicitors’ trust account, placed to the credit of Ms Hu and receipted as ‘deposit funds from Yang Wang to Hu Bin to purchase [the St Heliers property].’ There was no written agreement between the two regarding terms of their arrangement.
Some eight months later, the St Heliers project was restructured: Ms Bin transferred her right to buy across to a joint venture company owned by family trusts controlled separately by Mr Wang and Ms Hu.
Their project was not a success. Mr Wang bought in at a mortgagee sale, assuming sole control of the St Heliers development.
Some three years after paying his one million dollars to Ms Hu’s lawyers, Mr Wang sued Ms Hu claiming this money was a loan, yet to be repaid.
In the High Court, Ms Hu confusingly claimed some of this money was in fact her own contribution to the St Heliers deposit while also claiming that the entire one million dollars was from the outset Mr Wang’s equity contribution to the failed project.
Associate Judge Lester ruled Ms Hu’s various explanations lacked credibility.
The evidence was that Mr Wang’s one million dollar payment was a personal loan to Ms Hu. This was an oral agreement for an interest free loan.
At time of this loan, there was no discussion or evidence of the subsequent transformation of their relationship into joint venture partners for the St Heliers project.
Ms Hu was held liable to repay the loan.
Wang v. Hu – High Court (2.10.24)
25.003