Tsiang & Wu and ors
[2018] FamCA 1057
•11 December 2018
FAMILY COURT OF AUSTRALIA
Tsiang & Wu and ors
[2018] FamCA 1057
FAMILY LAW – PROPERTY – Where the husband seeks injunctive orders against the wife in relation to property taken by her in Consent Orders – Where the husband fails to establish an evidentiary basis for those injunctive orders – where the husband seeks injunctive orders against the second and third Respondents – where no evidence has been adduced in support of this application – where service has not been effected upon the third Respondent – Substituted Service of the third Respondent ordered.
Family Law Act 1975 (Cth), s 37A(1), 79A
Family Law Rules 2004 r. 1.14 , 7.18
Waugh and Waugh (2000) FLC 93-052
APPLICANT:
Mr Tsiang
1ST RESPONDENT:
Ms Wu
2ND RESPONDENT:
Mr Wu
3RD RESPONDENT:
Mr Cao
FILE NUMBER:
SYC
1529
of
2016
DATE DELIVERED:
11 December 2018
PLACE DELIVERED:
Sydney
PLACE HEARD:
Sydney
JUDGMENT OF:
Stevenson J
HEARING DATE:
26 November 2018
REPRESENTATION
COUNSEL FOR THE APPLICANT:
Mr Richardson SC
SOLICITOR FOR THE APPLICANT:
Mills Oakley Lawyers
COUNSEL FOR THE 1ST RESPONDENT:
Mr Kearney SC
SOLICiTOR FOR THE 1ST RESPONDENT:
Somerville Legal
COUNSEL FOR THE 2ND RESPONDENT:
Mr Schonell SC
SOLICITOR FOR THE 2ND RESPONDENT:
Juris Cor Legal
3rd RESPONDENT:
Third respondent not served
Orders
(1) Pursuant to Rule 7.18 of the Family Law Rules 2004 (Cth), personal service of the Further Amended Initiating Application of the husband filed on 16 August 2018 ("the Application") upon the third Respondent is dispensed with.
(2) Substituted service of the Application and the affidavits of Mr Tsiang affirmed on 8 August 2018 and 23 November 2018 will be effected upon the third Respondent by the following means:
2.1 by post to:
2.1.1 B Street, City C, China
2.1.2 C/o- Mr D, attorney at law of E Legal, F Street, City C, China.
(3) Paragraphs 2, 3 and 4 of the Application in a Case filed by the husband on 24 August 2018 are dismissed.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Tsiang & Wu and Ors has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).Family Court of Australia at Sydney
FILE NUMBER: SYC 1529 of 2016
Mr Tsiang
Applicant
And
Ms Wu
1st Respondent
And
Mr Wu
2nd Respondent
And
Mr Cao
3rd Respondent
REASONS FOR JUDGMENT
The proceedings
1. Mr Tsiang and Ms Wu are parties to proceedings in relation to parenting orders for their daughter X, born in 2005, and financial issues. The second and third Respondents, Mr Wu and Mr Cao, respectively are the father and uncle of the wife.
2. On 24 August 2018 the husband filed an Application in a Case, by which he sought the following orders:
1. That leave be granted to the Applicant to amend the Applicant's Initiating Application to seek Orders in relation to property matters.
2. That pending determination of the substantive Orders sought by the Applicant as against the Respondents as to financial matters arising in relation to [G Partnership] (Chinese Registration no. …) "substantive proceedings"), the First Respondent be restrained from dealing with or further encumbering the following properties:-
a. [H Street, Suburb J] in the State of New South Wales … being all of the land in (sic) comprised in Folio Identifier …;
b. [K Street, Suburb L] in the State of New South Wales … being all of the land comprised in Folio Identifier …;
c. [M Street, Suburb N] in the State of New South Wales … being all of the land comprised in Folio Identifier …;
d. [O Street, Suburb P] in the State of New South Wales … being all of the land comprised in Folio Identifier ….
3. That the Applicant be permitted to lodge a Request at
NSW Land Registry Services in respect of each [of] the properties identified in Order 1 hereof pending a determination of the substantive proceedings on a final basis.4. That the Second and Third Respondents be and are hereby restrained from:
a. Disposing of, or encumbering, their interests in [Q Partnership] (Chinese Registration no. …) (Formerly [G Partnership], Chinese Registration no. …) ("the partnership"); and
b. Causing or permitting the partnership to dispose of any asset of the partnership, other than in the ordinary course of business.
5. That pursuant to Rule 7.18 of the Family Law Rules 2004 (Cth), personal service of this Initiating Application filed by the Applicant upon the Third Respondent be dispensed with.
6. That substituted service of this Initiating Application be ordered and that such service be effected by sending a copy of this Initiating Application and the Affidavit of [Mr Tsiang] sworn 8 August 2018 to the Third Respondent by means of the following:-
a. By post to:
i. [B Street, City C], China;
ii. c/o- [Mr D], attorney at law of [E Legal], [F Street, City C], China;
7. That the First Respondent pay the Applicant's costs of this Application on an indemnity basis.
3. The wife filed a Response to Application in a Case on 14 November 2018, by which she sought the following orders:
Pending further order:
1. That paragraph 1 to 14 (financial) of Further Amended Initiating Application (Family Law) filed 16 August 2018 be dismissed summarily insofar as such application concerns the respondent wife.
2. That the application in paragraph 1 herein be listed for a separate hearing.
3. That the respondent wife be excused from filing a Financial Statement pending determination of each of:
3.1. Paragraph 1 above; and
3.2. Paragraphs 1 to 7 inclusive (financial) of the Further Amended Initiating Application (Family Law) filed 16 August 2018.
4. That the husband pay the wife's costs of and incidental to the above applications on indemnity basis.
4. The second Respondent sought orders as follows:
1. That such of the orders sought in the Application in a Case against the Second Respondent be dismissed.
2. That the applicant pay the second Respondent's costs on an indemnity basis."
Service has not been effected upon the third Respondent.
Background
5. The husband and the wife, who are aged 47 and 87 respectively, married in 2000 and separated on 18 October 2015. The parties were divorced by an Order made in March 2017.
6. On 23 March 2016 the husband and the wife entered into consent orders in relation to parenting of their daughter and settlement of property. For present purposes, order 18 is relevant and provides as follows:
18. That in relation to [the BB] companies:
18.1 The Wife forthwith transfer to the Husband all of her interest in the [BB] companies and resign from any office that she holds in [the BB] companies;
18.2 That the Husband indemnify the Wife and keep her indemnified against all liability of the Wife arising as a consequence of the holding by her of any interest in the [BB] companies or the holding by her of any office in the [BB] companies excluding liability for personal income tax;
and for the purpose of this Order:
18.3 The Wife agrees to surrender any and all interest she may have in the [BB] companies and upon entering these Orders the Husband shall be absolutely entitled to the whole interest in the [BB] companies;
18.4 The Husband shall forthwith indemnify the Wife and keep the Wife forever indemnified with respect to any or all liability of the Wife arising with respect to the [BB] companies;
18.5 It is noted that in the event of the Husband requiring the Wife's consent to sell any or all of the [BB] companies the Wife will execute all such documents as may be necessary to give effect to such transaction and for the Husband to retain the entirety of the net proceeds of sale of the [BB] companies.
7. The phrase "[BB Companies]" is defined in notation A.35 to the consent orders as follows:
A.35 "[BB companies]" means the company [BB] Co. Ltd and includes the following companies:
A.35.1 [R] Co. Ltd;
A.35.2 [U] Co. Ltd;
A.35.3 [S] Co. Ltd;
A.35.4 [T] Co. Ltd;
A.35.5 [G] partnership;
A.35.6 [V] partnership;
A.35.7 [W] Ltd partnership.
8. In essence, the consent orders provided that the husband take certain business interests and real estate in China and that the wife receive assets located in Australia. These Australian assets included four parcels of real estate in Sydney.
9. The parties attributed a value of $8.8 million to the assets in China which were to be taken by the husband in the consent orders. Overall, these orders were stated to put in place a division of the parties' net assets as to $17,934,731 to the husband and $20,900,034 to the wife.
10. The husband now contends that shares in entities A.35.6 and A.35.7 were held by persons other than himself and the wife but, nevertheless, the parties to the marriage were the beneficial owners. The husband's Further Amended Initiating Application filed on 16 August 2018 sought orders in the alternative for:
• a review of the Registrar's exercise of power pursuant to section 37A(10) of the Family Law Act1975 (Cth);
• leave to review the decision out of time, pursuant to Rule 1.14 of the Family Law Rules; and
• consent orders set aside pursuant to section 79A of the Family Law Act.
11. The husband contended that Order 18 is "wholly inefficacious" and has not brought about a transfer of entity A.35 to him.
12. It seems that the wife's father Mr Wu commenced proceedings in China, by which he sought orders to set aside the transfer of certain shares held by entities referred to in note A.35 to the consent orders. Mr Wu deposed that he was successful in these proceedings both at first instance and on appeal.
13. The husband submitted an undertaking in the following terms:
I undertake to the Court:
to pay damages to the Respondents and submit to the Court's Orders to pay compensation in respect of injunctive relief if granted by the Court in accordance with my Application in a Case filed 16 August 2018.
Consideration
The husband's application for injunctive relief
14. The wife and the second Respondent submitted that the husband failed to establish a ground or evidentiary basis for injunctive orders against the wife in relation to the four parcels of real estate in Sydney. I accept the submission on behalf of the wife, to the effect that the husband failed to identify the risk to the husband and what steps are necessary to address that risk.
15. I accept the submission on behalf of the wife, to the effect that the only evidence pertinent to risk which the husband adduced was an alleged statement made by the parties' ten year old daughter. The husband deposed as follows:
22. I am gravely concerned that [Ms Wu] will dispose of assets in order to continue to defeat my claim for property settlement. On about 5 August 2018 [X] said to me in words to the effect of:
"Mum is going to sell [Suburb J], it is too far away from [Suburb Z] and [Suburb Y]."
16. The wife denied that she made any such statement. She deposed as follows:
50. In relation to paragraph 22 of [Mr Tsiang’s] Affidavit, I have not told [X] that I was going to sell the [Suburb J] property. I have no present intention of selling any of the properties in my name.
17. On behalf of the husband, it was submitted that he can establish a prima facie case in terms of the relief sought in his Further Amended Application. It was submitted further that the husband has been the victim of "sharp practice to deprive him" at the hands of the wife and her relatives, which enhances the risk to him.
18. I accept that the husband may be able to establish a prima facie case for relief as sought in his Further Amended Initiating Application. As noted the wife intends to seek summary dismissal of aspects of that Application and that issue, inter alia, will be explored at such a hearing.
19. It may be true that the husband has been the victim of "sharp practice" but, in my view, such a determination cannot be made at this stage of the proceedings. That contention may also be explored on the hearing of the wife's application for summary dismissal.
20. In Waugh and Waugh (2000) FLC 93-052 the Full Court (Lindenmeyer, Coleman and Brown JJ) said:
46. While his Honour certainly seems to have considered issues of balance of convenience and hardship between the parties, it seems to us, with respect, that he did not give consideration to the fundamental question whether there was any evidence of any intention by the husband to dispose of any assets pursuant to any scheme to defeat the judgment which the wife might obtain in a substantive proceedings, or whether he merely wished to continue to trade, as he always had done prior to and since the separation of the parties.
21. Their Honours said further:
52. Had there been some clear evidence given by the wife (even if denied by the husband) of some disposition of property by the husband, or other conduct by him from which an inference might reasonably be drawn that he had embarked, or was about to embark, upon a course of action which was designed to or, irrespective of design, would be likely to defeat any anticipated order in the substantive proceedings in the wife's favour, then perhaps we might be persuaded to uphold his Honour's orders notwithstanding his failure to identify the factual basis (whether attested to by the wife or inferred by his Honour), upon which he proceeded in so doing ...
22. In my view, the husband failed to adduce any proper evidence of an intention by the wife to dispose of assets. He relied on a disputed hearsay statement of a ten year old child and his alleged "fears" of what the wife may elect to do with her assets. I am not prepared to grant an injunction in these circumstances.
23. The husband adduced no evidence in support of his application for injunctive orders against the second and third Respondents. As noted, service has not been effected upon the third Respondent. In these circumstances, I am not prepared to make orders in accordance with paragraph 4 of the husband's Application in a Case.
Substituted service upon Mr Cao
24. Senior counsel for the husband submitted that this order is necessary because there has been no result after that matter has been in the hands of a Registrar for approximately three months. No submission was put on behalf of the wife in opposition to this proposed order.
Balance of relief sought by the husband and the wife
25. No submissions were put in support of the remaining relief sought by either the husband or the wife. They are at liberty to pursue these matters if they so wish, for example, it is open to the wife to seek a hearing of an application for summary dismissal of specified paragraphs in the husband's Further Amended Initiating Application.
I certify that the preceding twenty-five (25) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Stevenson delivered on 11 December 2018.
Associate:
Date: 11 December 2018
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