Ningfei Du’s Remuera property was ‘red-stickered’ following Auckland’s 2023 Anniversary Weekend torrential rain, leading purchasers David Youn and Miji Sunwoo to cancel their $10.6 million purchase because a lack of access meant the property was not liveable as at settlement date.
Land on part of the one hectare property slipped downhill, killing a neighbour when his house was crushed. One corner of the foundations on Mr Du’s Arney Road dwelling was left exposed.
Mr Du subsequently spent just over one million dollars stabilising the property, later suing purchasers Mr Youn and Ms Sunwoo, claiming they had no right to cancel. The property was now habitable.
Legal argument centred on fine print in their agreement for sale and purchase.
Mr Du argued the 31 January 2023 contract settlement date had been deferred and that his subsequent demand for payment of the agreed price, less estimated loss of the property’s value following the landslip, was valid.
Justice van Bohemen ruled there was never any agreement to defer settlement. The purchasers’ right to cancel had to be assessed on the facts as known at settlement date: 31 January.
At that date, an Auckland City engineer had ‘red stickered’ the property, using powers under the Building Act to prohibit entry or occupation.
It was irrelevant, Justice van Bohmen ruled, that a subsequent detailed engineering inspection saw the property instead ‘yellow stickered;’ allowing access weeks later to all parts of the house, bar the main bedroom and outdoor decking.
Arney Road is built across three levels; with four bedrooms, five living areas, four bathrooms and a large kitchen.
The fact no-one was permitted to live at the property as at settlement date, meant the purchasers were entitled to cancel, Justice van Bohemen said. In legal jargon, the property was ‘untenantable.’
Justice van Bohemen ordered Mr Du refund the purchasers’ $1.063 million deposit.
Mr Du, as vendor, had received this deposit when the sale went unconditional, less $251,200 deducted for real estate agent commission.
The High Court was told that when his Arney Road sale went unconditional, Mr Du immediately signed up to buy a replacement property for $3.7 million at Mellons Bay in Auckland suburb Howick.
He was unable to pay for Mellons Bay on settlement date after the Arney Road sale stalled. He on-sold Mellons Bay eleven months later, at a $320,000 loss. In the interim, he rented Mellons Bay, before later shifting back to Arney Road, the court was told.
Du v. Youn – High Court (24.03.25)
25.091