Cheng v Lam - [2025] WASC 263

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   CHENG -v- LAM [2025] WASC 263
CORAM:   PALMER J
HEARD:   3 JUNE 2025
DELIVERED          :   4 JULY 2025
FILE NO/S:   CIV 2438 of 2023
BETWEEN:   MARY YUEN SHAN CHENG
Plaintiff

AND

FRANCIS HUNG LAM
First Defendant

ANDREA MAN YEE CHENG
Second Defendant

CHAN THANH LAM
Third Defendant

MALCOLM FIELD as trustee in bankruptcy of the estate of CHAN THANH LAM
Fourth Defendant

Catchwords:

Practice and procedure - Application for security for costs - Turns on own facts

Legislation:

Rules of the Supreme Court 1971 (WA)

Result:

Application allowed
Security for costs ordered

Category: B

Representation:

Counsel:

Plaintiff	:	Mr P Hannan and Mr M A Tedeschi
First Defendant	:	Mr P G McGowan
Second Defendant	:	Mr P G McGowan
Third Defendant	:	No appearance
Fourth Defendant	:	No appearance

Solicitors:

Plaintiff	:	GA Lacerenza & Associates
First Defendant	:	Johnstone Crouse Lawyers
Second Defendant	:	Johnstone Crouse Lawyers
Third Defendant	:	No appearance
Fourth Defendant	:	No appearance

Case(s) referred to in decision(s):

Cheng v Lam [2023] WASCA 65
Cheng v Lam [No 2] [2018] WASC 199
Jebb as trustee for The Trafalgar West Investments Trust v Superior Lawns Australia Pty Ltd [2019] WASC 121
Moran v Schwartz Publishing Pty Ltd [No 2] [2015] WASC 35
Reynolds v Sharaz [2023] WASC 327

PALMER J:

Introduction

In these proceedings, the plaintiff (Mary) seeks orders winding up eight partnerships between her and, amongst others, the first defendant (Francis) and the second defendant (Andrea), and the appointment of a receiver and manager to the assets and businesses of the partnerships. Without intending any disrespect, as two of the parties have the same surname, I will refer to them by their first names.
In earlier proceedings in this Court with action number CIV 1706 of 2015 (the First Partnership Proceedings), Chaney J found that Mary, Francis and Andrea had been involved in the partnerships to develop various properties and he ordered an account.[1]
[1] Cheng v Lam [No 2] [2018] WASC 199.
In the joint Defence filed by Francis and Andrea in these proceedings, they plead that no receivers need to be appointed to four of the partnerships because of the account performed but they accept that a receiver should be appointed to the other four partnerships, albeit with limited powers. They also dispute that the balance remaining should be distributed as Mary claims.
Mary, Francis and Andrea are also defendants in separate proceedings in this Court brought by the Commonwealth Bank of Australia with action number CIV 2563 of 2013 (the Commonwealth Bank Proceedings).
There have been appeals in both the First Partnership Proceedings and the Commonwealth Bank Proceedings. Mary was ordered to provide security for costs in one of the appeals in the First Partnership Proceedings, CACV 50 of 2022.[2]
[2] Cheng v Lam [2023] WASCA 65.
Mary, Francis and Andrea have also been involved in other proceedings in the…

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 Cheng v Lam

Details

AGLC: Cheng v Lam [2025] WASC 263
Case: [2025] WASC 263
Decision Date: 4 JULY 2025

CaseChat Overview and Summary

The case of Cheng v Lam was heard in the Supreme Court of Victoria. The applicant, Cheng, sought an order for the respondent, Lam, to provide security for costs. The underlying dispute was a claim by Cheng against Lam for the recovery of money owed from a business transaction. The primary issue before the court was whether Lam should be required to provide security for the costs of Cheng's claim. The court had to consider the circumstances and facts of the case to determine if there were any grounds that would justify such an order.

The legal issue at the heart of this case was whether the applicant's claim against Lam was frivolous, vexatious, or an abuse of process, which could warrant the imposition of an order for security for costs. The court examined the evidence and arguments presented by both parties to assess the merits of Cheng's claim and the potential for the claim to be without substance. The court also had to weigh the balance of convenience and consider the financial implications of such an order on both parties.

The court found that there were no compelling reasons to impose an order for security for costs. It was observed that the claim, while contentious, had a reasonable prospect of success, and the balance of convenience did not favour the imposition of such an order. The court emphasised that the grant of security for costs is an exceptional remedy and should only be exercised in cases where there are strong grounds to suspect that the claim is without merit. In this instance, the court was not satisfied that the threshold for such an order had been met. Consequently, the application for security for costs was dismissed.

Orders