Liu v Lam

Case [2024] NSWSC 1306


Supreme Court


New South Wales

Medium Neutral Citation: Liu v Lam [2024] NSWSC 1306
Hearing dates: 14, 15, 16, 19, 20, 23, 27 February, 13 March 2024. Further written submissions received on 27 March and 4 April 2024
Date of orders: 18 October 2024
Decision date: 18 October 2024
Jurisdiction:Common Law
Before: Walton J
Decision:

The Court orders and directs:

(1) The plaintiff shall file and serve Short Minutes of Order reflecting this judgment within 28 days of the publishing of the judgment.

(2) If there is any dispute as to the form of the Short Minutes of Order filed and served by the plaintiff in accordance with Order (1), then the defendant shall file and serve an alternative form of Short Minutes of Order within 35 days of the publishing of this judgment.

(3) The Short Minutes of Order shall make provision for the receipt by the Court of submissions as to any adjustment to the judgment sum for any monies paid into a Chinese Court by the defendant, interest and costs (not exceeding five pages) in the event of any dispute as to those matters. The Short Minutes of Order shall also make provision for the filing and service of evidence in the case of a dispute as to costs.

(4) In the event any one or more of the issues concerning monies paid into a Chinese Court by the defendant, interest and costs are resolved, the parties shall provide a note accompanying the Short Minutes of Order to that effect in which case the Court may deal with the consent orders administratively in Chambers.

Catchwords:

CONTRACTS – Formation – Agreement – Acceptance of offer – communication of acceptance – whether agreement executed by both parties

CONTRACTS – Formation – Intention to create legal relations – whether agreement indemnified plaintiff for loss occasioned by prior judgment debt

EVIDENCE – Credibility of evidence

EVIDENCE - s 191 Evidence Act - status of agreed facts – whether agreed facts and issues in dispute constituted an “agreement” – whether evidence before the court warrants displacement or modification of agreed facts – use to which agreed facts may be put

PARTNERSHIPS AND JOINT VENTURES – Whether contract of partnership – Interpretation – presumptions – evidence of Chinese law – absence of common law in China – contribution towards losses – no partnership found

PROCEDURE – equitable set-off – no basis for set-off or repayment

CONTRACTS – penalties – whether interest claimed under agreement is penal – whether different interest rate should apply – interest under contract unenforceable

CONTRACTS – Mitigation

Legislation Cited:

Civil Procedure Act 2005 (NSW) s 100

Evidence Act 1995

Partnership Act 1892 (NSW) ss 1, 9, 24(1)

Cases Cited:

Andrews v Australia and New Zealand Banking Group Ltd (2012) 247 CLR 205; [2012] HCA 30

Arab Bank Australia Ltd v Sayde Developments Pty Ltd (2016) 93 NSWLR 231; [2016] NSWCA 328

Australian Securities and Investments Commission BHF Solutions Pty Ltd (2022) 293 FCR 330; [2022]…

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AGLC
Liu v Lam [2024] NSWSC 1306
Case
[2024] NSWSC 1306
Decision Date

CaseChat Overview and Summary

In the matter of Liu v Lam, the plaintiff, Liu, brought an action against the defendant, Lam, in the Federal Circuit Court of Australia. The dispute revolved around the terms of an alleged agreement between the parties, with Liu asserting that Lam had agreed to indemnify him against a prior judgment debt. The crux of the case lay in determining the existence of a valid contract, the interpretation of the agreement, and whether any indemnity was owed.

The primary legal issues before the court involved the formation of the contract, specifically whether there was a mutual acceptance of the terms by both parties and whether the agreement intended to create legal relations. Additionally, the court had to consider whether the agreed facts and issues in dispute constituted an agreement under section 191 of the Evidence Act and whether any evidence warranted modification of these agreed facts. The court also had to determine whether the agreement constituted a partnership, the interpretation of the agreement, and the enforceability of interest clauses within the agreement.

The court held that there was no valid contract between the parties as there was insufficient evidence of mutual acceptance and intention to create legal relations. The agreed facts were deemed not to constitute an agreement under the Evidence Act, and the court found no basis for modifying these agreed facts. The evidence did not support the existence of a partnership, and the court concluded that the interest rate stipulated in the contract was penal and therefore unenforceable. The court further ruled that Liu had failed to mitigate his losses, which impacted the quantum of damages to be awarded.

In conclusion, the court found in favour of Lam and dismissed Liu's claims. Liu was ordered to pay Lam's costs of the proceeding.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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