Commissioner of the Australian Federal Police v Xin (No 2)

[2024] NSWSC 1606

Supreme Court

New South Wales

Medium Neutral Citation:

Commissioner of the Australian Federal Police v Xin & Ors (No 2) [2024] NSWSC 1606

Hearing dates:

30 September 2024

Date of orders:

13 December 2024

Decision date:

13 December 2024

Jurisdiction:

Common Law

Before:

Faulkner J

Decision:

(1) An order pursuant to rule 10.14(3) of the UCPR that service of the documents set out in Schedule One to the Notice of Motion filed on 5 August 2024 be taken to have been served on Liangfang Shen on 20 April 2023.

(2) An order pursuant to rule 10.14(1) of the UCPR that instead of service, the documents specified in Schedule Two to the Notice of Motion filed on 5 August 2024, together with a copy of these orders, be emailed to Liangfang Shen at the email address specified in Prayer 3 of the Notice of Motion.

(3) An order pursuant to r 10.14(2) of the UCPR that the documents specified in Order (2) above be taken to have been served on Liangfeng Shen upon the sending of the email specified in Order (2) above.

Catchwords:

CIVIL PROCEDURE – UCPR 10.14 (substituted and informal service generally) – defendants located in a Hague Convention country – practicability of personal service of the originating process – application for an order under UCPR 10.14(3) that originating process be taken to have been served – no inconsistency with UCPR 11A – orders made

Legislation Cited:

Civil Procedure Act 2005 (NSW), ss 56, 57

Hague Conference on Private International Law (1980)

Proceeds of Crime Act 2000 (Cth), ss 18, 19, 92, 93

Uniform Civil Procedure Rules 2005 (NSW), rr 2.1, 6.1, 10.1, 10.6, 10.14, 10.20, 10.21, 11.3, 11.4, 11A.2, 11A.3, 11A,4, 11A.5, 14.3, 22.4, 51.41

Cases Cited:

Alstom Limited v Sirakas [2010] NSWSC 669

Amos Removals & Storage v Small [1981] 2 NSWLR 525

ASIC v Sweeney No.2 [2001] NSWSC 477

Australian Information Commission v Facebook Inc [2020] FCA 531

Capral Limited v DNV AS [2024] NSWSC 96

Ford, in the matter of Careers Australia Group Ltd (in liq) v Mansfield [2022] FCA 173

Independent Liquor & Gaming Authority v Melco Resorts & Entertainment Limited [2022] NSWSC 294

Jacobsen v Jacobsen [2017] NSWSC 1590

Laurie v Carroll (1958) 98 CLR 310; [1958] HCA 4

Volkswagen Aktiengesellschaft v Schlunk (1988) 486 US 694

Category:

Procedural rulings

Parties:

Commissioner of the Australian Federal Police (Plaintiff)
Liangfang Shen (Eleventh Defendant)

Representation:

Counsel:
W Liu (Plaintiff)
No appearance (Eleventh Defendant)

Solicitors:
Criminal Assets Litigation, Australian Federal Police (Plaintiff)

File Number(s):

2023/0032255

JUDGMENT

Introduction

1. These proceedings are brought by the Commissioner of the Australian Federal Police against 20 defendants under the Proceeds of Crime Act 2000 (Cth) (which I will refer to as the Statute). The defendants are a mixture of natural persons and corporations, all of which have been served except for the eleventh defendant, Ms Liangfang Shen. Having made various attempts to serve Ms Shen in China, the Commissioner now seeks orders under the Uniform Civil Procedure Rules 2005 (NSW) rr 10.6 or 10.14.

Background

2. The Commissioner commenced the proceedings on 31 January 2023 by filing a Summons and thereafter obtaining ex parte restraining orders under ss 18 and 19 of the Statute. The property which is the subject of the restraining orders is comprised of numerous items, including real property, bank accounts, cryptocurrency and cars. Without going into unnecessary detail, the restraining orders were made in the context of criminal proceedings being brought against a number of individuals, including Mr Steven Hoitou Xin (first defendant) and Ms Yi Ming Wang (second defendant).

3. Ms Shen is the mother of Mr Xin and the mother-in-law of Ms Wang.

4. Amongst the items of property which are the subject of restraining orders are two ANZ bank accounts in the name of Ms Shen. The bank accounts contain approximately $15,000 AUD. Whilst the restraining orders remain in place, the two bank accounts may not be disposed of or otherwise dealt with by any person, including Ms Shen. The two bank accounts are subject to a restraining order under each of s 18 and s 19 because they are suspected, respectively, to be under the effective control of Mr Xin and to be the proceeds or the instrument of specified offences.

5. More specifically, the Court made the following relevant orders on 31 January 2023:

“46.   Pursuant to section 18(2)(c) of the Act, the property specified in Schedule Twenty-Nine, being property of Liangfang Shen that is subject to the effective control of Steven Hoitou Xin, must not be disposed of or otherwise dealt with by any person except in the manner and circumstances specified in these orders.

…

85.   Pursuant to section 19 of the Act, the property specified in Schedule Twenty-Nine, must not be disposed of or otherwise dealt with by any person except in the manner and circumstances specified in these orders.”

6. In each case, Schedule Twenty-Nine is in the following terms:

“Schedule Twenty-Nine

Item 1:   Chose in action enforceable against the ANZ in respect of bank account number 012-215 218421203 in the name of Liangfang Shen.

Item 2:   Chose in action enforceable against the ANZ in respect of bank account number 012-215 218421211.”

7. The ex parte restraining orders were based on the evidence provided by the Commissioner to the Court. The evidence was contained in an Affidavit of 466 pages made by Federal Agent Scott Michael Mathews, together with the even more voluminous exhibits to that Affidavit.

8. Mr Xin and Ms Wang are both residents of Australia. They were each served personally and are now legally represented in the proceedings.

9. Ms Shen is a Chinese citizen who is resident in mainland China.

10. Evidence adduced by the Commissioner in support of the current application sets out the communications between the Commissioner and Ms Shen which have occurred since 31 January 2023. In view of the orders sought by the Commissioner, it is necessary to set out some of the detail of that evidence.

11. From as early as 8 February 2023, the Commissioner has liaised with the Vice Consul for the Australian Federal Police based at Guangzhou in China. The Vice Consul has sworn an Affidavit dated 16 January 2024 in which he describes oral communications with Ms Shen. The Vice Consul does not speak or read Chinese. He has not therefore spoken directly to Ms Shen. Direct communication with Ms Shen has been undertaken by a locally employed Chinese staff member who, although not a qualified translator, is a native Mandarin speaker.

12. The Vice Consul’s Affidavit states in paragraph [8]:

“On 27 March 2023, at approximately 10:13am, AFP Guangzhou Office telephoned the Shen Mobile Number and held a telephone call with Shen, during which Shen identified herself as Lianfang Shen. Further during this call, Shen:

a.   was informed that:

i.    on 31 January 2023, the Commissioner of the AFP had made an application for restraining orders in the Supreme Court of New South Wales, Australia, and that restraining orders were made over various items of property, including two bank accounts which Shen may have an interest in;

ii.   Shen was named as the eleventh defendant in the proceedings in Australia; and

iii.   AFP Guangzhou Office sought to arrange a time to meet with Shen so that she could be provided with the relevant court documents;

b.    agreed to attend the Australian Consulate on 29 March 2023 at 2:00pm to accept receipt of the Service Documents, but asked whether she could change the meeting time if required; and

c.    was advised that AFP Guangzhou Office would contact her on 28 March 2023 to confirm the date and time for the meeting described immediately above.”

13. Ms Shen did not attend the Australian Consulate on 29 March 2023 about which there were further communications. The Vice Consul’s Affidavit states as follows in paragraph [12]:

“On the morning of 30 March 2023, AFP Guangzhou Office telephoned the Shen Mobile Number and held a further telephone call with Shen, who:

a.    advised she was still out of Guangzhou;

b.   advised that two of her family members had previously received relevant documents;

c.    queried whether her brother could receive the documents on her behalf, (but noting that the brother would not be prepared to attend if it meant he would have to sign anything to acknowledge receiving the documents);

d.   questioned whether the documents would be in Chinese language; and

e.   advised that she would call back in her own time.”

14. There followed a number of weeks during which numerous telephone conversations occurred, usually initiated by the Vice Consul and the locally employed Chinese staff member, although once or twice by Ms Shen. The conversations addressed arrangements for Ms Shen to collect the documents personally, sending the documents by email and Ms Shen’s nomination of a named Australian solicitor to receive documents for her, although the solicitor subsequently said she had no instructions to accept documents for Ms Shen. After the aborted nomination of an Australian solicitor, there were a number of communications on 19 April 2023. The Vice Consul’s Affidavit states as follows in paragraphs [26]-[29]:

“26   On 19 April 2023 at approximately 11:51am, AFP Guangzhou Office received a call from Shen’s WeChat account, during which Shen asked whether she could receive documents by email as her brother was not available. Shen indicated that her family had asked her to receive the documents via email and Shen explained she had not used her email for a long time, and would ask her son to find out. Shen was asked if the email ‘box’ is her own email address and Shen confirmed ‘yes’. Shen was advised that this would be no problem and was asked to provide the email address as soon as possible.

27   On 19 April 2023 at approximately 1:41pm, AFP Guangzhou Office received a WeChat message from Shen’s WeChat account, where Shen advised that her email address is [redacted] (Shen Email Address).

28   On 19 April 2023 at approximately 1:41pm, AFP Guangzhou Office sent a WeChat message to Shen’s WeChat account, asking Shen to confirm that the email address (the Shen Email Address) was her own.

29   On 19 April 2023 at approximately 1:52pm, AFP Guangzhou Office called Shen via Shen’s WeChat account, during which Shen was asked to confirm that the Shen Email Address was her own, which Shen confirmed.”

15. On 20 April 2023, an Australian Federal Police officer sent emails to Ms Shen’s email address to which were attached English copies of the Summons, the Vice Consul’s Affidavit, the restraining orders, a letter from the Commissioner to Ms Shen and the judgment of the Court pursuant to which the restraining order had been made on 31 January 2023.

16. The Vice Consul’s Affidavit states in paragraph [33] as follows:

“On 20 April 2023 at about 10:15am, AFP Guangzhou Office called the Shen Mobile Number and advised Shen that AFP in Australia had sent 4 emails to Shen’s [redacted] email box. Shen was asked whether she received all 4 emails. Shen stated that she had received the emails, but she couldn’t understand them. Shen then asked AFP Guangzhou Office ‘why do you ask so many details?’ Shen was informed that confirmation was required that Shen had received all of the emails. Shen stated please let ‘them’ know I have received the emails.”

17. On 31 July 2023 orders were made in the proceedings extending the time for service of the Summons on Ms Shen until 31 January 2024.

18. On 23 January 2024, the Commissioner filed a Notice of Motion seeking orders for service of documents in the proceedings on Ms Shen. On 6 February 2024, the Registrar dismissed the motion but extended the time for service of the Summons upon Ms Shen to 28 February 2025.

19. On 4 April 2024 an Australian Federal Police officer, Ms Li, and a certified interpreter telephoned Ms Shen. An Affidavit from the interpreter dated 5 August 2024 states that during the conversation with Ms Shen words to the following effect were said:

“Ms Li:   “Ms Shen, do you recall last year someone form the Australian Federal Police contacted you about serving some court documents in civil proceedings in which you are named as a defendant?”

Ms Shen:   “Yes.”

Ms Li:   “Do you also recall receiving some documents form the Australian Federal Police last year in April via email? This is the email address you sent to our Australian Federal Police representative via WeChat.”

Ms Shen:   “I do recall.”

Ms Li:   “Ms Shen, have you had the time to read these documents or obtain a lawyer in relation to the proceedings?”

Ms Shen:   “I have acquired some understanding about it through a friend”.

…

Ms Li:   “Thank you. Can I please confirm your email address again, being [redacted]? Again, this is the same email address you sent to our Australian Federal Police representative via WeChat in April last year.”

Ms Shen:   “That’s correct.”

Ms Li:   “Ms Shen, I will attend to having these court documents translated as soon as I can. Once these documents are translated, I will serve you with those translated documents via your nominated method of service, being via email.”

Ms Shen:   “Ok.””

20. This was the last occasion upon which communication was made directly with Ms Shen. On two subsequent occasions Ms Li and the certified interpreter called Ms Shen’s mobile telephone number. Each time it was answered by an unknown man who said that Ms Shen was sick and unable to talk.

21. On 30 April 2024, Ms Li sent an email to Ms Shen to which was attached a Chinese translated copy of the Summons and the restraining orders made on 31 January 2023, together with an explanatory letter from the Australian Federal Police dated 5 April 2024.

22. At no time has Ms Shen filed a Notice of Appearance. There is no evidence of Ms Shen retaining an Australian solicitor to act for her.

23. The Commissioner anticipates that the criminal proceedings against Mr Xin are unlikely to conclude within 12 months. There is a possibility that they may conclude sooner if a plea is entered but the likelihood and timing of a plea is speculative based on the evidence before the Court on this application.

Service under the Hague Convention

24. In order to seek service under the Hague Convention, the requirements of the Chinese authorities include a full translation of all documents to be served. In this case the Commissioner estimates that it will cost approximately $50,000 to translate the relevant documents, which include the lengthy Affidavit and exhibits upon which the Commission relied when obtaining the restraining orders in January 2023.

25. There is evidence that the formal procedure for the service of documents under the Hague Convention will take more than 12 months and may or may not ultimately be successful.

26. To date, the Commissioner has not taken any steps to pursue service under the Hague Convention, other than obtaining the estimates set out above.

Application by the Commissioner

27. Against this background, the Commissioner seeks orders as set out in the Notice of Motion filed on 5 August 2024, as follows:

“1 Pursuant to rule 10.6 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR), service of the documents set out in the Schedule to this Motion on Shen was served, by agreement between the Commissioner of the Australian Federal Police and Lianfang Shen (Shen) by email to [redacted] on 20 April 2023.

2 In the alternative to prayer 1 above, an order pursuant to rule 10.14(3) of the UCPR that service of the documents set out in Schedule One to this Motion on Shen be taken to have been effected by email sent by the Commissioner of the Australian Federal Police to Shen at [redacted] on 20 April 2023.

3 An order pursuant to rule 10.14(1) and (2) of the UCPR that service of the documents set out in Schedule Two to this Motion be taken to be effected, upon the Commissioner of the Australian Federal Police emailing the documents to Shen at [redacted], at the time and date the emails are sent.”

28. The Schedule One documents are the Summons filed on 31 January 2023, the restraining orders made on the same date and the lengthy Affidavit in support. The Schedule Two documents are various documents generated in the proceedings subsequent to January 2023, such as the Amended Summons, a number of Notices of Motion (including this one) and various interlocutory Affidavits.

29. The Commissioner’s primary position is that the Court ought to make orders for substituted service under the UCPR 10.14. For the attempts at service which have already been made, an order is sought under r 10.14(3). Regarding documents to be served in the future, orders are sought under rr 10.14(1)
    and (2).

30. The Commissioner submits that the above history shows that service on Ms Shen is not practicable and therefore the precondition to the Court making orders under UCPR 10.14 is satisfied. The Commissioner submits that the Court ought to make orders in this case, especially because the proceedings are brought under the Statute and thereby expose Ms Shen to the forfeiture of the funds in the two bank accounts.

31. The Commissioner emphasises that under s 92 of the Statute, forfeiture may occur without further order of the Court. It is submitted that it is in Ms Shen’s interests for her to be served. The Commissioner further submits that the evidence shows that the documents have already been brought to the attention of Ms Shen. Should the order set out in Prayer 2 of the Notice of Motion be made, the emailing of documents, including the Summons and the existing restraining orders on 20 April 2023, will be taken to have been effective service.

32. The Commissioner’s alternative position is that the communication on 19 April 2023 between the Vice Consul, the locally employed Chinese staff member and Ms Shen, when viewed in context of the conversations leading up to that date (especially the telephone conversation on 27 March 2023) constituted an agreement by Ms Shen to be served by email. The Commissioner in effect seeks a declaration to the effect that the emailing of documents on 20 April 2023 constituted effective service pursuant to that agreement as permitted by UCPR 10.6.

Statutory provisions

33. Part 10 of the UCPR provides for service of documents generally. UCPR 10.1 provides that a party that files a document must serve a copy of the document on each other active party. Being an originating process, the Summons must be personally served on Ms Shen: UCPR 10.20(2)(a). UCPR 10.21(1) provides:

10.21    How personal service effected generally

(1)   Personal service of a document on a person is effected by leaving a copy of the document with the person or, if the person does not accept the copy, by putting the copy down in the person's presence and telling the person the nature of the document.

34. UCPR 10.6 and 10.14 are relevant to the current application. They relevantly provide:

10.6    Service in accordance with agreement between parties

(1)    In any proceedings, any document (including originating process) may be served by one party on another (whether in New South Wales or elsewhere) in accordance with any agreement, acknowledgment or undertaking by which the party to be served is bound.

…

(2)    Service in accordance with subrule (1) is taken for all purposes (including for the purposes of any rule requiring personal service) to constitute sufficient service.

…

10.14 Substituted and informal service generally

(1)    If a document that is required or permitted to be served on a person in connection with any proceedings--

(a)    cannot practicably be served on the person, or

(b)    cannot practicably be served on the person in the manner provided by law,

the court may, by order, direct that, instead of service, such steps be taken as are specified in the order for the purpose of bringing the document to the notice of the person concerned.

(2)    An order under this rule may direct that the document be taken to have been served on the person concerned on the happening of a specified event or on the expiry of a specified time.

(3)    If steps have been taken, otherwise than under an order under this rule, for the purpose of bringing the document to the notice of the person concerned, the court may, by order, direct that the document be taken to have been served on that person on a date specified in the order.

(3A)    An application for an order under this rule must be supported by an affidavit by the applicant that includes--

(a)    a statement as to the applicant's knowledge of the whereabouts of the person to be served, and

(b)    a statement as to any communications that have occurred between the applicant and the person to be served since the cause of action in the proceedings arose (including any communications by telephone, fax or electronic mail).

(4)    Service in accordance with this rule is taken to constitute personal service.

35. Part 11 of the UCPR relevantly provides for service of documents outside of Australia. UCPR 11.4(1) and Schedule 6 specifies the circumstances in which an originating process may be served outside of Australia without leave of the Court. Schedule 6 relevantly provides:

SCHEDULE 6 – Service outside of Australia without leave

An originating process may be served outside of Australia without leave in the following cases—

…

(d)   when the claim—

(i)   is for an injunction to compel or restrain the performance of any act in Australia,

…

(e)   when the subject matter of the claim is land or other property situated in Australia, or any act, deed, will, instrument, or thing affecting such land or property, or the proceeding is for the perpetuation of testimony relating to such land or property,

…

(h)   when any person outside of Australia is—

(i)    a necessary or proper party to a proceeding properly brought against another person served or to be served (whether within Australia or outside Australia) under any other provision of these rules,

…

(j)   when the claim arises under an Australian enactment and—

(i)    any act or omission to which the claim relates was done or occurred in Australia, or

(ii)    any loss or damage to which the claim relates was sustained in Australia, or

(iii)    the enactment applies expressly or by implication to an act or omission that was done or occurred outside Australia in the circumstances alleged, or

(iv)    the enactment expressly or by implication confers jurisdiction on the court over persons outside Australia (in which case any requirements of the enactment relating to service must be complied with),

…

(n)   when the claim is founded on a cause of action arising in Australia,

…

(p)    when the claim concerns the construction, effect or enforcement of an Australian enactment,

…

(s)   when the claim, so far as it concerns the person to be served, falls partly within one or more of the above paragraphs and, as to the residue, within one or more of the others of the above paragraphs.

…

36. The claims made by the Commissioner in these proceedings, including the claims for the restraints over the two ANZ accounts which have been imposed under the Statute, fall within Schedule 6. At the very least, they are claims to restrain the performance of acts in Australia (paragraph (d)(i)), the subject matter of the claims is property situated in Australia (paragraph (e)) and they are claims which concern the enforcement of an Australian enactment (paragraph (p)). The Summons may be served outside of Australia without leave of the Court (UCPR 11.4(1)).

37. Part 11A of the UCPR provides for service of documents outside of Australia under the Hague Convention. UCPR 11A.2 provides as follows:

11A.2    Provisions of this Part to prevail

The provisions of this Part prevail to the extent of any inconsistency between those provisions and any other provisions of these rules.

38. Division 2 of Part 11A addresses service in a Convention country, such as China. The relevant provisions are rr 11A.3 and 11A.4 which provide:

11A.3    Application of Division

(1)    Subject to subrule (2), this Division applies to service in a Convention country of a local judicial document.

(2)    This Division does not apply if service of the document is effected, without application of any compulsion, by an Australian diplomatic or consular agent mentioned in Article 8 of the Hague Convention.

11A.4    Application for request for service abroad

(1)    A person may apply to the Registrar, in the Registrar's capacity as a forwarding authority, for a request for service in a Convention country of a local judicial document.

(2)    The application must be accompanied by 3 copies of each of the following documents--

(a)    a draft request for service abroad, which must be in the approved form,

(b)    the document to be served,

(c)    a summary of the document to be served, which must be in the approved form,

(d)    if, under Article 5 of the Hague Convention, the Central Authority or any additional authority of the country to which the request is addressed requires the document to be served to be written in, or translated into, the official language or one of the official languages of that country, a translation into that language of both the document to be served and the summary of the document to be served.

(3)    The application must contain a written undertaking to the Court, signed by the legal practitioner on the record for the applicant in the proceedings to which the local judicial document relates or, if there is no legal practitioner on the record for the applicant in those proceedings, by the applicant--

(a)    to be personally liable for all costs that are incurred--

(i)    by the employment of a person to serve the documents to be served, being a person who is qualified to do so under the law of the Convention country in which the documents are to be served, or

(ii)    by the use of any particular method of service that has been requested by the applicant for the service of the documents to be served, and

(b)    to pay the amount of those costs to the Registrar within 28 days after receipt from the Registrar of a notice specifying the amount of those costs under rule 11A.6(3), and

(c)    to give such security for those costs as the Registrar may require.

(4)    The draft request for service abroad--

(a)    must be completed (except for signature) by the applicant, and

(b)    must state whether (if the time fixed for entering an appearance in the proceedings to which the local judicial document relates expires before service is effected) the applicant wants service to be attempted after the expiry of that time, and

(c)    must be addressed to the Central Authority, or to an additional authority, for the Convention country in which the person is to be served, and

(d)    may state that the applicant requires a certificate of service that is completed by an additional authority to be countersigned by the Central Authority.

(5)    Any translation required under subrule (2)(d) must bear a certificate (in both English and the language used in the translation) signed by the translator stating--

(a)    that the translation is an accurate translation of the documents to be served, and

(b)    the translator's full name and address and his or her qualifications for making the translation.”

39. Upon the Registrar being satisfied that these requirements have been complied with, the Registrar must forward the documents to the Central Authority (or an alternatively nominated additional authority) of the country in which service is to be effected: UCPR 11A.5(1). When the Registrar receives a Certificate of Service from the Central Authority, the parties will be notified.

Substituted and informal service under UCPR 10.14

40. Despite the form of the Notice of Motion, the Commissioner’s primary position is that the Court ought make an order under UCPR 10.14.

41. Unlike UCPR 10.14(1), the provision relevant to the present application, UCPR 10.14(3), does not refer to the practicability of service on the person. Rather, it is concerned with whether steps have already been taken for the purpose of bringing the relevant document to the notice of the person concerned. If such steps have been taken, the Court may make an order under UCPR 10.14(3) regardless of the practicability or impracticability of further steps being taken. In such a case, an order under UCPR 10.14(3) may be appropriate to facilitate the just, quick and cheap resolution of the real issues in the proceedings (see Capral Limited v DNV AS [2024] NSWSC 96 at [65] (Nixon J)).

42. The Commissioner nonetheless has taken a cautious approach and submits that the Summons, the lengthy supporting Affidavit and the restraining orders cannot practicably be served on Ms Shen, and that it is a matter relevant to the exercise of the Court’s discretion to make an order under UCPR 10.14(3).

43. For the purposes of UCPR 10.14(1) (and the Commissioner’s submissions on UCPR 10.14(3)), impracticability requires something more than inconvenience but not so much as impossibility: Alstom Limited v Sirakas [2010] NSWSC 669 at [40] (Palmer J). Practicability is concerned with that which is sensible or realistic: Capral Limited v DNV AS at [52]-[53]. Practicability is to be determined according to the circumstances of the case and must have regard to the requirement to do justice to the plaintiff who has demonstrated a prima facie case which may be defeated if personal service is insisted upon and the requirement to do justice to the defendant who is entitled to receive proper and efficacious notice of the proceedings: Alstom Limited v Sirakas at [40].

44. Short of making an application for service under the Hague Convention, the Commissioner’s evidence demonstrates that everything which might realistically or sensibly be done personally to serve Ms Shen has already been done.

45. The Commissioner could still make an application for service under the Hague Convention, but he submits that service by that means would not be practicable because of the delay and the cost. In relation to the delay, the submission ought not be accepted. Even if service under the Hague Convention will take another 12 months, there is unlikely to be any material progress in these proceedings within that timeframe. Under s 92 of the Statute automatic forfeiture of the money in the two ANZ bank accounts will not occur in the near future and possibly not for a year and half. If there is a plea, there may be the prospect of automatic forfeiture occurring earlier, but in such a case it would be open to the Commissioner to make an application under s 93 to extend the time before the ANZ bank accounts are forfeited. Presumably the Commissioner would make that application if Ms Shen has not yet been served when forfeiture would otherwise occur.

46. However, the estimated cost of pursuing service under the Hague Convention is likely to exceed the value of the two ANZ bank accounts. The cost of the translation work required by the Chinese Central Authority has been estimated at $50,000. It may be more. In addition, resources of the Commissioner, including legal resources, will have to be devoted to pursuing service under the Hague Convention. Resources of the Court Registrar, acting as the forwarding authority under UCPR 11A.4(1), will also be required. By virtue of s 57(1)(c) of the Civil Procedure Act 2005 (NSW) the finite resources of the Court is a relevant consideration to the exercise of the Court’s discretion under UCPR 10.14(3). In the circumstances of this case I accept the Commissioner’s submission that service on Ms Shen under the Hague Convention is not practicable for the purposes of UCPR 10.14(1). I will take impracticability of service into account in the exercise of the discretion under UCPR 10.14(3).

47. However, as the text makes clear, the most important consideration under UCPR 10.14(3) is the steps which have already been taken for the purpose of bringing the documents to the notice of Ms Shen.

48. The Commissioner’s evidence demonstrates that the Summons and other documents have been brought to Ms Shen’s attention in a way which permits her sufficiently to understand the provenance, essential meaning and importance of the documents. I am satisfied that the sufficiency of the steps which have already been taken may be inferred from the following matters:

1. On 27 March 2023 the AFP Guangzhou Office described the nature of the documents to Ms Shen;

2. On 20 April 2023 English copies of the Summons and other documents were emailed to Ms Shen, receipt of which was acknowledged by her;

3. On 4 April 2024 Ms Shen told Ms Li that she had acquired some understanding of the documents;

4. On 30 April 2024 Chinese copies of the Summons, restraining orders and the AFP’s explanatory letter were emailed to Ms Shen; there is no evidence that the email bounced back;

5. Ms Shen is aware that two of her family members have also received the documents, which must mean her son, Mr Xin, and Ms Wang; this fact makes clear that Ms Shen knows enough about the documents to understand their relationship to the criminal proceedings against Mr Xin and Ms Wang;

6. Ms Shen is aware that lawyers are acting for Mr Xin and Ms Wang in relation to the documents; and

7. Ms Shen previously discussed the nomination of an Australian solicitor to deal with the documents for Ms Shen’s own purposes.

49. Given that steps have already been taken sufficiently to bring the documents to Ms Shen’s notice it is appropriate to make an order under UCPR 10.14(3) that the documents emailed to Ms Shen on 20 April 2023 be taken to have been served on her on that date. The effect of that order is that sending the email is taken to constitute personal service: UCPR 10.14(4).

50. As a further reason why an order ought to be made under UCPR 10.14(3) the Commissioner submits that it is in Ms Shen’s interests for service formally to be made on her. The Commissioner points out that Ms Shen is currently exposed to the risk that any interest she has in the ANZ bank accounts will be automatically forfeited under s 92 of the Statute. Formal service will permit Ms Shen to make any application she wishes to make in the proceedings in order to have her interest in the bank accounts excluded from the restraining orders and, ultimately, any forfeiture which occurs. The difficulty with this submission is that the documents have already been brought to Ms Shen’s attention. Thus Ms Shen is already able to take any steps in the proceedings which she considers appropriate in her own interests. She would first have to file a Notice of Appearance (UCPR 6.1(1)), but as a named defendant she would be entitled to do so without any further order of the Court. Formal service on Ms Shen would not add anything to her current ability to protect her interests.

51. It is further appropriate to make the orders in accordance with Prayer 3 of the Notice of Motion so as to facilitate service of the documents listed in Schedule Two. In this respect, the evidence makes clear that the email address specified in Prayer 3 is Ms Shen’s email address.

The Hague Convention

52. Quite properly on an ex parte application, the Commissioner has raised an issue about whether it is open to the Court to make an order for substituted or informal service under UCPR 10.14 in circumstances where China is a signatory to the Hague Convention. As set out above, UCPR 11A.3(1) provides that Division 2 (including UCPR 11A.4) “applies to service in a Convention country of a local judicial document” and UCPR 11A.2 provides that Part 11A (including UCPR 11A.4) “prevails to the extent of any inconsistency” between it and any other provisions of the UCPR. UCPR 11A.4 provides that a person “may” apply to the Registrar for a request for service in a Convention country of a local jurisdiction document.

53. The Commissioner submits that there is nothing in Part 11A which precludes an order being made under UCPR 10.14(3). The Commissioner relies on a number of cases where an order for substituted service has been made (or contemplated with apparent approval) even though the person to be served is located in a Convention country: Independent Liquor & Gaming Authority v Melco Resorts & Entertainment Limited [2022] NSWSC 294; Jacobsen v Jacobsen [2017] NSWSC 1590 at [135]; Capral v DNV AS; Australian Information Commission v Facebook Inc [2020] FCA 531; Ford, in the matter of Careers Australia Group Ltd (in liq) v Mansfield [2022] FCA 173.

54. Where there is a judicial document from one Convention country to be served on someone located in another Convention country, the Hague Convention specifies how service is to be effected. This is apparent from the Preamble to the Convention which provides:

“The States signatory to the present Convention,
Desiring to create appropriate means to ensure that judicial and extrajudicial documents to be served abroad shall be brought to the notice of the addressee in sufficient time,
Desiring to improve the organisation of mutual judicial assistance for that purpose by simplifying and expediting the procedure,
Have resolved to conclude a Convention to this effect and have agreed upon the following provisions:”

55. It is also apparent from Article 1 which relevantly provides:

“The present Convention shall apply in all cases, in civil or commercial matters, where there is occasion to transmit a judicial or extrajudicial document for service abroad.”

56. The text makes clear that the provisions of the Hague Convention presupposes that there is a judicial document “to be served abroad” and that there is an “occasion to transmit a judicial document for service abroad”. The Hague Convention is not concerned with the anterior question of whether the judicial document has to be served abroad (Volkswagen Aktiengesellschaft v Schlunk (1988) 486 US 694 at 700) much less the question of whether a judicial document has to be served at all. For proceedings before the Supreme Court of New South Wales, those anterior questions are determined by the Uniform Civil Procedure Act and the Uniform Civil Procedure Rules.

57. UCPR 10.1 requires that a party that files a document must serve a copy on each other active party. As set out above, UCPR 10.20(2)(a) requires the Summons to be served on Ms Shen personally. The specifics of personal service are addressed in UCPR 10.21. As Ms Shen is in China, the UCPR requirements for personal service mean that she must be served abroad.

58. However, the requirement of service under UCPR 10.1(1) applies “unless the court orders otherwise”. The chapeau of UCPR 10.20(2) states that the requirement that an originating process be served personally is “except as otherwise provided by these rules”. One rule which otherwise provides is UCPR 10.14(1). In the circumstances specified in that rule, the Court may order that “instead of service” steps specified in the order be taken for the purpose of bringing the document to the notice of the person concerned. The nature and effect of an order under UPCR 10.14(1) is that “service” is dispensed with. UCPR 10.14(1) contemplates that the Court may be willing to dispense with “service” because it is satisfied that the substituted steps specified in the order will achieve the purpose of service and thereby make service unnecessary.

59. The operation of UCPR 10.14(1) is confirmed by UCPR 10.14(2) which provides that the Court’s order may direct that the document “be taken to have been served” on a date specified in the order etc. An order under UCPR 10.14(1) does not operate so that taking the steps specified in the order will constitute “service”. Rather, once the steps have been taken the document will be taken to have been served by virtue of the Court’s order. Both rr 10.14(1) and (2) presuppose that “service” will not in fact occur. As Austin J said in ASIC v Sweeney No.2 [2001] NSWSC 477 at [58] “substituted service is not service at all. It is a procedure by which the Court makes an order for certain things to be done instead of service”.

60. Despite the heading of UCPR 10.14 (“Substituted and informal service generally”), UCPR 10.14(1) and (2) provide for a substitute for service, not for service by substituted means.

56. Construed harmoniously, UCPR 10.14(3) operates in the same way. An order under UCPR 10.14(3) operates to dispense with “service”. The Court may be willing to make such an order if it is satisfied that steps have already been taken for the purpose of bringing the document to the notice of the person concerned.

57. In this respect, it must be remembered that service of documents is the servant, not the master. Leaving aside claims in personam where the jurisdiction of the Court does not arise other than by service on the defendant (eg Louie v Carroll (1958) 98 CLR 310; [1958] HCA 4), the purpose of service is to ensure procedural fairness by bringing to the attention of a person matters which the person needs to know in order to ensure any subsequent interference with the person’s rights does not occur without the person having an opportunity to be heard (see Independent Liquor & Gaming Authority v Melco Resorts & Entertainment Limited at [2] (Ball J)). The requirement that the person be served, and provision for the means by which that is to be achieved, serve that purpose. Service is an important servant because it allows for a measure of certainty in the process and it relieves the Court of having to enquire into the efficacy of the steps taken in the circumstances of each case. However, the ultimate objective is procedural fairness.

58. Service also provides a practical procedural framework for progressing a case, such as calculating the date by which a defence must be filed (UCPR 14.3(1)), interrogatories must be answered (UCPR 22.4(1)) or the incompetency of an appeal objected to (UCPR 51.41(1)). In this respect, it is noteworthy that both UCPR 10.14(2) and (3) are concerned to address the date on which the document is taken to have been served.

59. The provisions of UCPR 10.14 are to be construed in this light. They are concerned not so much with the means of “service” but with taking steps for the purpose of bringing the document to the notice of the person concerned.

60. In this context, the Hague Convention and UCPR Part 11A have no application where the Court makes an order under UCPR 10.14(3). An order under UCPR 10.14(3) answers the anterior question of whether the judicial document has to be served at all. The effect of the order is that there is no judicial document “for service abroad”. Nor is there an occasion to transmit a judicial document “for service abroad”. By virtue of the Court’s order, service has been dispensed with. The same applies to an order under UCPR 10.14(1)

61. UCPR 11A.2 addresses the circumstance where there is inconsistency between the provisions of UCPR Part 11A and any other provisions in the UCPR. There is no inconsistency between Part 11A which addresses service in a Convention country, and UCPR 10.14(3) which addresses the anterior question of whether service is required.

62. There is nothing in UCPR 11A which precludes orders being made under UCPR 10.14 in this case.

Service in accordance with agreement between the parties

68. In light of the orders to be made under UCPR 10.14(3) it is not necessary to determine the Commissioner’s alternative contention about UCPR 10.6. Had it been necessary I would have rejected it.

69. The evidence of an agreement by which Ms Shen is said to be bound is set out above. To obtain an order under UCPR 10.6 it is necessary for the Commissioner to prove that an agreement occurred in the conversation between Ms Shen and the locally employed Chinese staff member on 19 April 2024. The Commissioner correctly submits that what was said on that occasion is to be understood in the context of what was said in the earlier conversations, especially the conversation on 27 March 2023. Even in that context, the words spoken on 19 April 2023 did not constitute an agreement for the purposes of UCPR 10.6. The evidence rises no higher than an agreement to “receive” documents. There was no agreement that receipt would constitute personal service for the purposes of the proceedings in the Supreme Court of New South Wales. It cannot be said that there has been service in accordance with an agreement as required by UCPR 10.6.

70. UCPR 10.6 also refers to service in accordance with and “acknowledgement” by which the person to be served is bound. Whilst “agreement” and “undertaking” contemplate an arrangement made before service occurs, “acknowledgement” suggests that a communication which occurs after service may provide a basis for service under UCPR 10.6(1). Assuming that is right, the conversation with the Australian Federal Police officer and the official translator on 4 April 2024 cannot be relied upon to establish the necessary acknowledgement. The conversation occurred almost a year after the event said to have been acknowledged. Having regard to the passage of time and the words used by Ms Shen, she should not be taken to have acknowledge that service occurred for the purpose of the proceedings. Once again, the evidence does not establish an acknowledgement that goes any higher than her receipt of the documents.

Orders

71. I make the following orders:

1. An order pursuant to rule 10.14(3) of the UCPR that service of the documents set out in Schedule One to the Notice of Motion filed on 5 August 2024 be taken to have been served on Liangfang Shen on 20 April 2023.

2. An order pursuant to rule 10.14(1) of the UCPR that instead of service, the documents specified in Schedule Two to the Notice of Motion filed on 5 August 2024, together with a copy of these orders, be emailed to Liangfang Shen at the email address specified in Prayer 3 of the Notice of Motion.

3. An order pursuant to r 10.14(2) of the UCPR that the documents specified in Order (2) above be taken to have been served on Liangfeng Shen upon the sending of the email specified in Order (2) above.

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Decision last updated: 13 December 2024