Jingyi & Chao (No 6)
[2025] FedCFamC1F 171
•26 February 2025
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Jingyi & Chao (No 6) [2025] FedCFamC1F 171
File number(s): SYC 3653 of 2021 Judgment of: HARPER J Date of judgment: 26 February 2025 Catchwords: FAMILY LAW – COSTS – EX TEMPORE – Property proceedings – Final hearing – Where the Court was informed on the second day of the final hearing that a receiver had been appointed for the fifth respondent 6 months previously – Where the proceedings could proceed no further until the receiver had been given an opportunity to consider the material filed in these proceedings – Where the applicant wife claims costs in the amount of $45,711.84 as scale costs or $112,200 as full indemnification – Where the Court is persuaded that it is appropriate to order the first to fourth respondents to pay the applicant wife’s costs thrown away by the adjournment of the final hearing, as agreed or assessed. Division: Division 1 First Instance Number of paragraphs: 12 Date of hearing: 26 February 2025 Place: Sydney Counsel for the Applicant: Mr Dura SC with Ms Merrett Solicitor for the Applicant: JC Legal Practice Counsel for the First, Second, Third and Fourth Respondents: Mr Condon SC Solicitor for the First, Second, Third and Fourth Respondents: Juris Cor Legal Solicitor for the Fifth Respondent: Mr Shaw of Bridges Lawyers ORDERS
SYC 3653 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS JINGYI
Applicant
AND: MR CHAO
First Respondent
MR B CHAO
Second Respondent
C PTY LTD (and another named in the Schedule)
Third Respondent
ORDER MADE BY:
HARPER J
DATE OF ORDER:
26 FEBRUARY 2025
THE COURT NOTES THAT:
A.The trial commenced on 24 February 2025 when both parenting and property issues were in dispute.
B.By consent orders made on 25 February 2025, the parties resolved their parenting dispute on a final basis.
C.On the afternoon on 25 February 2025 the Court was informed that the fifth named respondent in the proceeding had in fact been placed into receivership by a third party financier in or about November 2024.
D.On 26 February 2025 the receiver of the property of the fifth named respondent appeared by a solicitor and informed the Court that he was not in a position to express a view about the cross-claim presently filed and pressed by the fifth named respondent being a chose in action and property of the fifth-named respondent.
E.In circumstances where it is apparent that the receiver was not informed of the existence of these proceedings until the afternoon of 25 February 2025 the Court was persuaded that the balance of the trial could not proceed or be completed in the allocated time.
THE COURT ORDERS THAT:
1.The proceedings are stood over to 9.45 am on 20 March 2025 for Mention.
THE COURT FURTHER NOTES THAT:
F.On the adjourned date, the Court expects to be advised by the receiver of the fifth‑named respondent of his attitude to the cross-claim presently being prosecuted by the fifth-named respondent against the applicant.
G.On the adjourned date the Court will give consideration to allocating further hearing dates during which the part-heard matter can be completed.
THE COURT FURTHER ORDERS THAT:
2.The first to fourth respondents to pay the applicant’s costs thrown away for 26, 27 and 28 February 2025 as agreed or assessed.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
EX TEMPORE REASONS FOR JUDGMENT
HARPER J:
By reason of the proceedings being adjourned part-heard, the applicant wife (“wife”) applies by oral application for an order in her favour for costs thrown away for 25, 26, 27 and 28 February 2025.
The basis for the application is that it came to light after the trial commenced that the fifth‑named respondent, LL Pty Ltd, had been placed in receivership on 23 September 2024.
There was no dispute that the second and fourth respondents were the corporate officers who executed the report on company activities and property, being the form 507 document prescribed when an external controller is appointed to an Australian corporation. There is also no dispute that those individuals are directors of the third respondent, C Pty Ltd.
At all times since the joinder of LL Pty Ltd in March of 2024, there has been the same solicitor on the record for all respondents. It became clear after hearing from the solicitor acting for the receiver on 26 February 2025 that the trial, having commenced on 24 February 2025, could proceed no further until the receiver had been given an opportunity to consider the material relating to the proceedings, it being also undisputed that the receiver had no knowledge of the proceedings until the afternoon of 25 February 2025.
The fifth respondent claims relief against the applicant pursuant to an undertaking as to damages she gave in support of interlocutory injunctions which were ordered and then dissolved earlier in the proceedings.
Accordingly, it is not possible for the Court to settle the assets and liabilities of the parties to the relationship until the question of the fifth respondent's claim has been either determined or abandoned by the receiver.
It is quite plain that the information about the existence of the receivership was known to the second, third and fourth respondents by no later than 23 September 2024, and I infer the first respondent husband, whose position was not the subject of any detailed attempt to separate him from the other respondents.
In my view, it is beyond argument that valuable Court time and judicial resources have been wasted by the failure of the respondents to inform the applicant, not to say the Court, as soon as possible after 23 September 2024 of the appointment of the receiver.
If that information had been to hand in the last quarter of 2024, appropriate directions could have been made and the evidence, to the extent necessary, could have been tailored to reflect the reality of the receiver's appointment.
In those circumstances, I am persuaded that a costs order should now be made against the first to fourth respondents by reason of their conduct in failing to notify the applicant or the Court of the receiver's appointment.
Senior counsel for the respondents submitted that there was some reason to pursue a quantification now of those costs because there may be some aspects of them which could be the subject of legitimate dispute. The costs that are claimed by the applicant are either $45,711.84 as scale costs, or $112,200 as full indemnification if 25 February 2025 is included in the calculation.
Whilst it is often desirable especially at the conclusion of proceedings for the Court to avoid further costs by itself fixing a figure for the payment of costs, I am persuaded that in the present circumstances bearing in mind that the proceedings are part-heard, a more appropriate order is for the first to fourth respondents to pay the applicant’s costs thrown away for 26, 27 and 28 February 2025 as agreed or assessed, and I accordingly make an order in those terms.
I certify that the preceding twelve (12) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Harper. Associate:
Dated: 26 February 2025
SCHEDULE OF PARTIES
SYC 3653 of 2021 Respondents
Fourth Respondent:
LL PTY LTD (RECEIVER AND MANAGER APPOINTED) ACN …
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