Qui v Chen

Qui commenced proceedings against Chen in the Federal Circuit Court of Australia seeking an interim preservation of Chen’s assets. Qui argued that there was a prima facie or good arguable case that Chen had assets in Australia that were connected to an alleged international fraud. Qui further argued that Chen was at risk of dissipating those assets, and therefore sought freezing orders to preserve the assets until the matter was determined. Chen opposed the application, submitting that there was no substantial risk of dissipation of his assets, and that the application should be dismissed. The court was required to determine whether Qui had established a prima facie or good arguable case, and whether there was a substantial risk that Chen would dissipate his assets.

The court found that Qui had established a prima facie or good arguable case, however it was not satisfied that there was a substantially significant risk of dissipation of Chen’s assets. The court noted that the evidence was not sufficient to establish a real risk that Chen would dissipate his assets, and dismissed the application for freezing orders. The court held that there was no question of principle that required the orders to be made, and that the application was not in the interests of justice.

Chen was awarded his costs of the application on an indemnity basis. The court further noted that the application had caused Chen to incur unnecessary expense, and that there was no reasonable prospect of success. The court dismissed the application for freezing orders, and ordered that Chen recover his costs from Qui on an indemnity basis.