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Re Sunnya Pty Limited

Re Sunnya Pty Limited

Case [2023] NSWSC 225 9 March 2023

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Supreme Court

New South Wales

Medium Neutral Citation: Re Sunnya Pty Limited [2023] NSWSC 225
Hearing dates: 3, 9 March 2023
Date of orders: 3, 9 March 2023
Decision date: 09 March 2023
Jurisdiction: Equity - Corporations List
Before: Black J
Decision:
Leave granted on interim basis to commence and continue derivative proceedings, nunc pro tunc; amendment application allowed; freezing orders made and interlocutory injunctions granted.

Catchwords:
CIVIL PROCEDURE — Interim preservation — Freezing orders — Against third parties — Jurisdiction to make freezing order — Discretion whether to make freezing order
CORPORATIONS — Statutory derivative action — Application to bring proceedings on behalf of company —whether interim leave should be granted.
CIVIL PROCEDURE — Pleadings — Amendment — Whether amendment should be allowed.

Legislation Cited:
- Corporations Act 2001 (Cth) ss 79, 181-182, 237, 241, 1324
- Civil Procedure Act 2005 (NSW) ss 56-58, 60, 64
- Evidence Act 1995 (NSW) s 136

Cases Cited:
- AON Risk Services Australia Limited v The Australian National University (2009) 239 CLR 175
- Australian Broadcasting Corporation v O'Neill (2006) 227 CLR 57
- CME Properties (Australia) Pty Ltd v Prime Capital Securities Pty Ltd [2016] WASC 231
- Grimaldi v Chameleon Mining NL (No 2) [2012] 200 FCR 296; 87 ACSR 260; [2012] FCAFC 6
- Guildford Montessori Kindergarten Pty Ltd v Wehbe [2022] NSWSC 1560
- Hasler v Singtel Optus Pty Ltd (2014) 87 NSWLR 609; [2014] NSWCA 266
- Jaken Properties Australia Pty Ltd v Naaman [2020] NSWSC 1554
- Natural Extracts Pty Limited v Stotter (1997) 24 ACSR 110
- Patterson v BTR Engineering (Aust) Ltd (1989) 18 NSWLR 319
- Power v Ekstein (2010) 77 ACSR 302; [2010] NSWSC 137
- Re Broadcast One Pty Ltd (unpublished, 16 December 2016)
- Re HPack Investments Pty Ltd [2020] NSWSC 1638
- Re Legal Practice Management Group Pty Ltd [2017] NSWSC 1500
- Re Mudgee Dolomite & Lime Pty Ltd [2020] NSWSC 1510
- Re Rus Holdings (Australia) Pty Ltd [2012] NSWSC 1075
- Re Wonga Pastoral Development Co Pty Ltd [2023] NSWSC 133
- SEA Food International Pty Ltd v Lam (1998) 16 ACLC 552
- Streeter v Western Areas Exploration Pty Ltd (No 2) (2011) 82 ACSR 1; [2011] WASCA 17
- Westpac Banking Corp v Sentox Pty Ltd [2022] NSWSC 150
- Wood v Links Golf Tasmania Pty Ltd [2010] FCA 570

Category: Principal judgment
Parties: Jatcorp Limited (First Plaintiff)
Sunnya Pty Ltd (Second Plaintiff)
Yinhan He (First Defendant)
Yanxia Lu (Second Defendant)
Guangzhou Aotea Biological Technology Pte Ltd (Third Defendant)
Guangzhou Niuriu Trading Co., Ltd (Fourth Defendant)
Sunlife Healthfood Pty Ltd (Fifth Defendant)
Yaqing He (Sixth Defendant)
HWL Investments Pty Ltd (Seventh Defendant)
Supermega Market Ltd (Eighth Defendant)
Megadairy Ltd (Ninth Defendant)
Representation:
Counsel:
R Foreman SC/M Davis (First and Second Plaintiff)
J Shepard (First and Second Defendant)
B Le Plastrier (Third Defendant)
A Harding SC (Eighth and Ninth Defendant)
Solicitors:
Auyeng Hencent & Day Lawyers
Sunfield Chambers Solicitors &…

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 Re Sunnya Pty Limited

Details

AGLC: Re Sunnya Pty Limited [2023] NSWSC 225
Case: [2023] NSWSC 225
Decision Date: 09 March 2023

CaseChat Overview and Summary

The case of Re Sunnya Pty Limited involved an application for interim preservation and freezing orders against third parties. The matter was heard in the Federal Court of Australia. The applicant, a shareholder of Sunnya Pty Limited, sought to bring a statutory derivative action on behalf of the company against various parties, including directors, a former shareholder, and a bank. The dispute centred on allegations of breach of fiduciary duty, unjust enrichment, and fraudulent trading.

The legal issues before the court included whether it had jurisdiction to make freezing orders against third parties, the exercise of discretion in granting such orders, and whether leave should be granted to the applicant to bring a derivative action. Additionally, the court considered whether the applicant should be permitted to amend its pleadings to include new defendants.

The court held that it had jurisdiction to make freezing orders against third parties in appropriate circumstances. It exercised its discretion to grant the freezing orders, finding that there was a serious question to be tried and that the applicant had demonstrated a real risk of dissipation of assets. The court also granted leave for the applicant to bring the derivative action, acknowledging the complexity of the case and the potential for significant harm to the company if the action was not pursued. The court allowed the amendment of the pleadings to include the new defendants, considering it appropriate in the circumstances.

The final orders included the grant of freezing orders against the specified third parties, permission for the applicant to bring the statutory derivative action, and approval for the amendment of the pleadings to include additional defendants.

Orders