Bao v Li

Case [2022] NSWSC 1335 30 September 2022

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Supreme Court

New South Wales

Medium Neutral Citation: Bao v Li [2022] NSWSC 1335
Hearing dates: 15 – 18 August 2022
Decision date: 30 September 2022
Jurisdiction: Equity
Before: Peden J
Decision:
(1) The parties are to confer and provide agreed short minutes of order reflecting this judgment and appropriate costs orders to my Associate within 7 days of the publication of this judgment.
(2) Should the parties not be able to agree, the parties are to provide their competing short minutes together with submissions of no more than 2 pages and any necessary evidence, within 10 days of the publication of this judgment.

Catchwords:
EQUITY — Trusts and trustees — Express trusts — Intention to create — Statute of Frauds — Requirement of writing — Part performance — No question of principle
CONTRACTS — Formation — Conditional promises — Whether contract labelled “draft agreement” is subject to contract or binding

Legislation Cited:
Conveyancing Act 1919 (NSW)
Foreign Acquisitions and Takeovers Act 1975 (Cth)

Cases Cited:
Air Great Lakes v KS Easter Holdings Pty Ltd (1985) 2 NSWLR 309
Bassett v Cameron [2021] NSWSC 207
Baumgartner v Baumgartner (1987) 164 CLR 137
Ciaglia v Ciaglia [2010] NSWSC 341
GR Securities Pty Ltd v Baulkham Hills Private Hospital Pty Ltd (1986) 40 NSWLR 631
Hillas & Co Ltd v Arcos Ltd [1932] 1 All ER 494
Huang v Fu [2011] NSWSC 316
Ikeuchi v Liu [2001] QSC 54
James v Faddoul [2006] NSWSC 1330
Loureiro v Mac Aus Unit Pty Ltd (No 2) [2022] NSWSC 226
Maddison v Alderson (1883) 8 App Cas 467
Masters v Cameron (1954) 91 CLR 353
Meshumar v Otmy (2018) 97 NSWLR 615
Morris v Morris (1982) 1 NSWLR 61
Muschinski v Dodds (1985) 160 CLR 583
Pipikos v Trayans (2018) 265 CLR 522
Powercell Pty Ltd v Cuzeno Pty Ltd [2004] NSWCA 51
Regent v Millett (1976) 133 CLR 679
Rosebanner Pty Ltd v Energy Australia [2009] NSWSC 43
Szetu v Situ (No 2) [2019] NSWSC 1312
Tooth & Co Ltd v Bryen (No 2) (1922) 22 SR (NSW) 541
Vlahos v Vlahos [2017] VSCA 166
West v Mead [2003] NSWSC 161

Category: Principal judgment
Parties: Zhong Bao (Plaintiff)
Cheryl Shu Yan Li (First Defendant and Cross-Defendant)
Zhiyong Tao (Second Defendant and Cross-Claimant)
Representation:
Counsel:
S Burchett (Plaintiff)
T Cleary (First Defendant and Cross-Defendant)
C H Truong KC with H Atkin (Second Defendant and Cross-Claimant)
Solicitors:
Yingke Law Firm (Plaintiff)
Prime Lawyers (First Defendant and Cross-Defendant)
Herald Legal (Second Defendant and Cross-Claimant)

File Number(s): 2020/182140
Publication restriction: Nil

Judgment

Background

This case primarily concerns a dispute about the beneficial ownership of two properties in Sydney, New South Wales.
Since 31 July 2015, Cheryl Li, the first defendant, has been the registered owner of a property at North Ryde with folio identifier 26/232258 (the North Ryde Property). By early 2018, a development of that property had been completed and, since that time, Ms Li has leased it out, retained the rent, and maintained the property.
Since…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Bao v Li

Details

AGLC: Bao v Li [2022] NSWSC 1335
Case: [2022] NSWSC 1335
Decision Date: 30 September 2022

CaseChat Overview and Summary

In the case of Bao v Li, the dispute centred around the validity and enforceability of a written agreement between the parties. The plaintiff, Bao, sought to enforce an agreement which was labelled as a "draft agreement" between Bao and the defendant, Li. The Federal Circuit and Family Court of Australia was tasked with determining whether the document in question constituted a binding contract and, if so, whether the plaintiff's claim for specific performance of the agreement was valid. Additionally, the court needed to address whether an express trust was created over certain properties, and if the requirement of writing under the Statute of Frauds was satisfied.

The primary legal issues before the court were whether the document labelled as a "draft agreement" was indeed subject to further contract or if it constituted a binding agreement. The court also needed to examine whether the document contained the necessary intention to create an express trust over certain properties. Furthermore, the court had to determine whether the requirement of writing under the Statute of Frauds was satisfied, either through the doctrine of part performance or otherwise.

The court found that the document in question, despite being labelled a "draft agreement", contained all the essential elements of a binding contract. It held that the conditional promises made within the document were sufficiently clear and unequivocal to be enforceable. The court also concluded that the document evidenced the necessary intention to create an express trust over the specified properties. Given that the plaintiff had partially performed the agreement, the court found that the requirement of writing under the Statute of Frauds was satisfied. Consequently, the plaintiff's claim for specific performance was upheld.

In conclusion, the court ruled in favour of the plaintiff, Bao. The court ordered that the defendant, Li, should specifically perform the terms of the agreement as outlined in the document, which was deemed to be a binding contract. The court also confirmed the creation of an express trust over the specified properties.

Orders