JUDGE:	Elliott J
WHERE HELD:	Melbourne
DATE OF HEARING:	4 August 2022
DATE OF JUDGMENT:	5 August 2022
CASE MAY BE CITED AS:	Stancu v Barua
MEDIUM NEUTRAL CITATION:	[2022] VSC 481

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INTERLOCUTORY INJUNCTION – Freezing order – Arguable case – Danger of unsatisfied judgment – Allegations of dishonesty – Overseas resident – Removal of assets from Australia highly likely – Consequences if amount the subject of existing order not reduced – Balance of convenience – Appropriate sum – Supreme Court (General Civil Procedure) Rules 2015 (Vic), r 37A.05(4).

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APPEARANCES:	Counsel	Solicitors
For the plaintiff	Mr G Moloney	David Joseph & Co., Lawyers
For the 1^st defendant	No appearance
For the 2^nd defendant	Dr M Sharpe	McKean Park Lawyers

IntroductionA.

The plaintiff, Mircea Stancu (“Stancu”), has made an interlocutory application for a freezing order against certain assets of the second defendant, Sybilla Jane Margit de Uray (“de Uray”). Stancu seeks to restrain de Uray from dealing with her Australian-based assets, in particular the proceeds of sale of a residential property at 86 Orrong Crescent, Caulfield North, Victoria, which is currently registered in de Uray’s name (“the Property”). He submits that these proceeds are likely to be the only assets in Australia against which he may enforce any judgment obtained against de Uray.

Stancu claims de Uray and the first defendant, Atanu Barua (“Barua”), knowingly or recklessly were involved in an online share trading scam through which they scammed him out of approximately $133,000.00,[1] resulting in losses of up to approximately $2.9 million.
[1]All monetary amounts in these reasons are in Australian dollars unless expressly stated otherwise.

On 22 July 2022, an interim order was made by consent freezing de Uray’s assets in Australia up to an amount of $1.15 million until 4.00 pm on 28 July 2022. On 28 July 2022, the interim order was extended by consent so that de Uray could put further evidence before the court. That interim order remains in place until further order.

The partiesB.

Stancu resides in Victoria. Since May 2014, he has regularly traded shares on the stock market. In early 2015, Stancu investigated the possibility of purchasing shares, including in the Tesla Corporation (“Tesla”). His evidence was that, as Tesla is listed on the NASDAQ[2] in New York, United States, purchasing shares in the company required the assistance of a share broker.
[2]The National Association of Securities Dealers Automatic Quotation System.

While looking for a suitable share broker, Stancu discovered the website AAFXtrading.com. The website claimed it was run by a share trading company operating under the name of AAFX Trading Company Limited (together with the website or individually, “AAFX Trading”).

Barua resides in New South Wales. Stancu has alleged that Barua was involved (or purported to represent that he was…

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 Stancu v Barua

Details

AGLC: Stancu v Barua [2022] VSC 481
Case: [2022] VSC 481
Decision Date: 5 August 2022

CaseChat Overview and Summary

The case of Stancu v Barua involved the plaintiff, Stancu, seeking an interlocutory injunction in the form of a freezing order against the defendant, Barua. The dispute centred on the removal of assets by Barua from Australia, with allegations of dishonesty on his part. Barua, an overseas resident, was believed to be highly likely to remove his assets from Australia, posing a risk of an unsatisfied judgment against Stancu. The court was tasked with determining whether an arguable case existed for the freezing order, the danger of an unsatisfied judgment, and the appropriate sum for the order. Additionally, the court had to consider the balance of convenience in light of the existing order.

The legal issues before the court were whether Stancu had demonstrated an arguable case for the freezing order, if there was a sufficient danger of Barua removing his assets, and if the existing order's amount was appropriate. The court examined the risk of Barua removing his assets, the consequences of the amount subject to the existing order not being reduced, and the balance of convenience. The court also considered the provisions of the Supreme Court (General Civil Procedure) Rules 2015 (Vic), r 37A.05(4).

The court found that Stancu had established an arguable case for the freezing order due to the significant risk of Barua removing his assets from Australia. The court was persuaded by the allegations of dishonesty and the high likelihood of asset removal. The court determined that the existing order's amount was not appropriate, as it would leave Stancu with the risk of an unsatisfied judgment. The balance of convenience favoured reducing the amount subject to the existing order, as the consequences of not doing so were deemed more severe than the potential inconvenience to Barua. Consequently, the court issued an interlocutory injunction in the form of a freezing order with a reduced amount.

The final orders of the court included the issuance of an interlocutory injunction in the form of a freezing order, with the amount reduced to an appropriate level. The court also directed that further proceedings be stayed until the final determination of the dispute. This outcome aimed to protect Stancu's interests while balancing the interests of Barua. The court's decision underscored the importance of demonstrating an arguable case, the risk of asset removal, and the appropriate sum in the context of a freezing order.

Orders