Liu v Xiao - [2018] NSWSC 1401

Supreme Court

New South Wales

Medium Neutral Citation: Liu v Xiao [2018] NSWSC 1401
Hearing dates: 7 September 2018
Decision date: 07 September 2018
Jurisdiction: Common Law
Before: R A Hulme J
Decision:
The plaintiff’s application for a freezing order is refused. The plaintiff is to pay the defendant’s costs of the application.

Catchwords: CIVIL PROCEDURE – interim preservation – freezing orders – requirements to be met before order made – where both parties Chinese nationals – where plaintiff allegedly gave defendant money for share in Chinatown restaurant businesses – where plaintiff alleges she received no share in restaurant businesses – good arguable case established on limited evidence – whether a risk of assets being placed out of reach of plaintiff – where last payment made almost a year ago – no evidence funds have since been dissipated or removed – application refused
Category: Principal judgment
Parties: Qiujiao Liu (Plaintiff)
Yuqing Xiao (Defendant)
Representation:
Counsel:
Mr J McGrath SC with Mr J Lee (Plaintiff)
Mr H El-Hage (Defendant)
Solicitors:
Shen’s Lawyers
Avantro

File Number(s): 2018/265627

Judgment

HIS HONOUR: This is an application for a freezing order.
The plaintiff filed a statement of claim on 29 August 2018 by which she seeks judgment in the amount of $1,555,623.77 plus interest. She claims, in short, the amount represents monies given by her to the defendant between January 2017 and 5 October 2017.
The plaintiff and the defendant are both Chinese nationals. They met in Sydney in the context of their sons both attending the same high school.
The plaintiff asserts in an affidavit affirmed by her on 5 September 2018 that there were a number of conversations between her and the defendant in which they agreed that they, with others, would establish a restaurant business or businesses in Sydney. They would be the major shareholders. Pursuant to such agreements, which were never reduced to writing as I understand it, the plaintiff made the various payments to the defendant.
According to Ms Liu’s affidavit, the defendant and her son are now shareholders in two companies that operate restaurants in Chinatown. The plaintiff says that she has not received any interest in such businesses or the companies that operate them.
The plaintiff filed a notice of motion yesterday upon which I made the orders sought: short service and an urgent hearing date. Today I have heard the substantive application for the freezing order. Mr McGrath SC with Mr Lee have appeared for the plaintiff and Mr El-Hage has appeared for the defendant. It was apparent that Mr El-Hage was somewhat hamstrung by the fact that his client is presently in China and so I accept that his ability to marshal evidence to meet this application at short notice was an impediment for him.
The principles relating to an application of this type were usefully set out in written submissions by senior and junior counsel for the plaintiff:

“The Court’s jurisdiction to grant a freezing order is contained within UCPR 25.14, as well as its…

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.

Continue reading Liu v Xiao

Details

AGLC: Liu v Xiao [2018] NSWSC 1401
Case: [2018] NSWSC 1401
Decision Date: 07 September 2018

CaseChat Overview and Summary

The case of Liu v Xiao involves a dispute between two Chinese nationals, where the plaintiff seeks interim preservation orders to prevent the dissipation of assets. The matter was heard in the Supreme Court of Queensland. The plaintiff, Liu, alleges that she paid the defendant, Xiao, money for a share in several Chinatown restaurant businesses. Liu claims she received no share in the businesses and seeks to prevent Xiao from disposing of the funds or the businesses until the matter is resolved.

The court was required to determine whether the plaintiff had established a good arguable case on the limited evidence presented and whether there was a real risk that the defendant would dissipate or remove the assets from the jurisdiction. The court considered the timing of the last payment, which was made almost a year ago, and the lack of evidence that the funds had been dissipated or removed since that time. The plaintiff argued that the risk of dissipation remained due to the length of time elapsed since the last payment and the nature of the businesses involved.

The court found that while the plaintiff had established a good arguable case, there was insufficient evidence to demonstrate a real risk of dissipation or removal of the assets. The absence of evidence regarding the current whereabouts of the funds or any actions by the defendant to dissipate the assets weighed against making the orders. Consequently, the application for interim preservation orders was refused. The court did not make any orders in relation to the application.

Orders