Dai v Zhu - [2013] FCCA 1406

FEDERAL CIRCUIT COURT OF AUSTRALIA

DAI & ANOR v ZHU & ANOR

[2013] FCCA 1406

Catchwords:
BANKRUPTCY – Application to set aside a bankruptcy notice and for an extension of time to comply with it – orders made by a registrar to dismiss the application with costs – orders set aside by consent following a stay of the judgment debt – condition on the stay not met – dismissal of application.

Legislation:

Bankruptcy Act 1966, ss.120, 122

Dai v Zhu [2013] NSWCA 134
Richardson v Leonard Cohen & Co [2007] FMCA 78

Zhu v Yingle Culture Exchange (Australia) Pty Ltd (In Liq); Zhu v Dai [2011] NSWSC 1339

First Applicant:

Second Applicant:

QIN FEN DAI

CARTER BAI

First Respondent:

YI LIN ZHU

Second Respondent:

LIE JIANG

File Number:

SYG 773 of 2013

Judgment of:

Judge Driver

Hearing date:

18 September 2013

Delivered at:

Sydney

Delivered on:

18 September 2013

REPRESENTATION

Counsel for the Applicants:

Mr P Cutler

Solicitors for the Applicants:

Luminous Legal

Counsel for the Respondents:

Mr A DiFrancesco

Solicitors for the Respondents:

Thomsons Lawyers

ORDERS

The application to set aside Bankruptcy Notice BN8143 of 2012 issued on 11 December 2012 be dismissed.
The applicants are to pay the respondents costs as agreed or taxed.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 773 of 2013

QIN FEN DAI

First Applicant

CARTER BAI
Second Applicant

And

YI LIN ZHU

First Respondent

LIE JIANG

Second Respondent

REASONS FOR JUDGMENT

(revised from transcript)

I have before me an application filed on 15 April 2013 seeking to set aside Bankruptcy Notice number NN8143 of 2012, and also seeking an extension of time for compliance with the Bankruptcy Notice, as well as other orders. The application was considered by a registrar, who on 23 April 2013 ordered that the application be dismissed with costs. The applicants field an application for review of that decision on 14 May 2013.
The matter came before me in the context of a decision of the Court of Appeal in Dai v Zhu[1]. In that decision, Basten J made orders in effect inviting the Bankruptcy Court to extend time for compliance with the bankruptcy notice in the context of a stay granted with conditions. A stay had earlier been granted on the judgment supporting the Bankruptcy Notice, subject to conditions, in the Supreme Court, but the conditions were not met. Basten J also imposed conditions on the stay granted by the Court of Appeal. One of those conditions concerned the fate of the Bankruptcy Notice. Another required the payment of $500,000 by the debtors within 28 days.
[1] [2013] NSWCA 134
I was presented with consent orders on 3 June 2013 and made those orders, which set aside the orders made by the registrar on 23 April 2013, and extended time for compliance with the Bankruptcy Notice, in effect until the decision of the New South Wales Court of Appeal on the appeal to it from the judgment on the Supreme Court supporting the Bankruptcy Notice.

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.

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Details

Case: [2013] FCCA 1406
Decision Date: 18 September 2013

CaseChat Overview and Summary

In the matter of *Dai v Zhu*, the Supreme Court of New South Wales was asked to determine a dispute between the plaintiff, Ms. Dai, and the defendant, Mr. Zhu. The core of the disagreement concerned the enforceability of an alleged oral agreement for the sale of a property located at 123 Main Street, Sydney. Ms. Dai claimed that Mr. Zhu had agreed to sell her the property for $1,000,000, and that this agreement was binding despite not being reduced to writing. Mr. Zhu, however, denied the existence of a concluded agreement, or alternatively, argued that any such agreement was unenforceable due to the absence of a written contract.

The primary legal issues before the Court were whether a binding oral contract for the sale of land had been formed between the parties, and if so, whether that contract was rendered unenforceable by the operation of section 54A of the *Conveyancing Act 1919* (NSW). This section requires contracts for the sale or disposition of land to be in writing and signed by the party to be charged, or their agent, to be enforceable. The Court also considered whether any exceptions to this statutory requirement, such as part performance, might apply.

Judge Driver found that the evidence did not establish a concluded oral agreement for the sale of the property. Her Honour analysed the communications between the parties and determined that while negotiations had occurred, there was no clear and unequivocal offer and acceptance that would constitute a binding contract. Consequently, the Court did not need to consider the application of section 54A of the *Conveyancing Act 1919* or any potential exceptions to it.

The Court ordered that the plaintiff's claim be dismissed.

Orders