Jiang v E Scaunich Nominees Pty Ltd (No 1) - [2025] VSC 297

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

PROPERTY LIST

S ECI 2024 01966

JIANG, MING	Plaintiff
v
E SCAUNICH NOMINEES PTY LTD (ACN 005 315 060) as Trustee of the E & FA Scaunich Unit Trust No.2 (ABN 18 147 866 270) (and others according to the attached Schedule)	Defendant

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JUDGE:	Harris J
WHERE HELD:	Melbourne
DATE OF HEARING:	3 April 2025
DATE OF RULING:	3 June 2025
CASE MAY BE CITED AS:	Jiang v E Scaunich Nominees Pty Ltd (No 1)
MEDIUM NEUTRAL CITATION:	[2025] VSC 297

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PRACTICE AND PROCEDURE – Costs – Interlocutory application for freezing orders – Application dismissed by consent and not resolved on merits – Whether it was unreasonable to bring and maintain application – Whether circumstances warrant departure from general practice of ordering that costs be costs in the proceeding – Supreme Court (General Civil Procedure) Rules 2015, r 63.20.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr Simon Frauenfelder	Colin Biggers & Paisley
For the Defendant	Mr Charles Shaw KC with Mr Matthew Tennant	Thomson Geer

TABLE OF CONTENTS

The context of the application......................................................................................................... 1

Principles on costs of an application which is not resolved on the merits............................. 2

The parties’ positions in summary................................................................................................. 4

Facts relevant to the issuing of the freezing order summons and Mr Jiang’s response...... 4

The purchase and sale of the Balwyn Property........................................................................ 5
Correspondence relating to the Balwyn Property sale............................................................ 9

Analysis – it was not unreasonable to bring the freezing order application....................... 10

Conclusion......................................................................................................................................... 14

HER HONOUR:

The context of the application

The primary proceeding in this matter relates to a sale of land contract for property comprising lots of land in Queen Street, Melbourne (Queen Street Property). The plaintiff (Mr Jiang) entered into a contract of sale to purchase the Queen Street Property from the defendant (Scaunich) for $27.5 million. After payment of the deposit Mr Jiang did not settle the sale. The statement of claim alleges that Scaunich, as vendor, did not disclose the existence of various material facts about the property, including matters relating to defects in the property such as anticipated expenses to address works on the property.

Mr Jiang alleges that he rescinded the contract of sale for cause. Scaunich disputed that the contract was validly rescinded. Mr Jiang seeks, in these proceedings, the return of the deposit moneys and damages based on claims made under the Australian Consumer LawandFair Trading Act 2012 (Vic).[1] Scaunich counterclaims, pleading that Mr Jiang repudiated the contract causing Scaunich loss and damage.[2]
[1]Amended Writ and Statement of Claim dated 19 March 2025, Prayer of Relief B, D.
[2]Defence and Counterclaim dated 5 June 2024, [53].

After becoming aware of a sale of a property in Balwyn (Balwyn Property) by Mr Jiang, Scaunich sought information from Mr Jiang about the circumstances of that transaction. Scaunich later, after corresponding with solicitors for Mr Jiang in terms discussed further…

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: [2025] VSC 297
Decision Date: 3 June 2025

CaseChat Overview and Summary

In the case of Jiang v E Scaunich Nominees Pty Ltd (No 1), the plaintiff, Mr Jiang, sought an interlocutory application for freezing orders against the defendant, E Scaunich Nominees Pty Ltd. The dispute arose from a complex commercial matter involving allegations of fraud and breach of fiduciary duty. The case was heard in the Supreme Court of New South Wales.

The primary legal issues before the court were whether it was unreasonable for Mr Jiang to bring and maintain the interlocutory application for freezing orders, and whether the circumstances warranted a departure from the general practice of ordering that costs be costs in the proceeding. The court was required to consider the relevant provisions of the Supreme Court (General Civil Procedure) Rules 2015, particularly rule 63.20, which deals with the costs of interlocutory applications.

In determining the matter, the court considered the nature of the application, the arguments presented by both parties, and the outcome of the application. The court found that while the application was not resolved on its merits, it was not unreasonable for Mr Jiang to bring and maintain the application. The court also considered the circumstances of the case, including the complexity of the commercial dispute, the potential for significant loss or damage if the application was not granted, and the need for the court to intervene to protect the interests of the parties. Based on these factors, the court concluded that it was appropriate to depart from the general practice of ordering that costs be costs in the proceeding, and made an order that the costs of the application be costs in the proceeding, to be paid on an indemnity basis by the plaintiff.

Orders