Wan, W.W.Y.L v McDonald, D.R

[1991] FCA 85

JUDGMENT No. 85_./...?.! ,..-..

IN THE FEDERAL COURT OF AUSTRALIA	)	No. QG 3 of 1990
QUEENSLAND DISTRICT REGISTRY	)
GENERAL DIVISION	)

BETWEEN r WENDY WAL YIANG LEUNG WAN

Applicant

AND :  DONALD ROBERT McDONALD

First Respondent

AND :  RONALD MURRAY McDONALD

Second Respondent

18 MAR 1991 AND : DOTWELL INVESTmNTS PTY. LTD.

FEDERAL CWRT OF

CRINUPAL Third Respondent

MINUTES OF ORDER

JUDGE MAKING ORDER:	PINCUS J.
DATE OF ORDER:	12 MARCH 1991
WHERE MADE:	BRISBANE
THE COURT ORDERS THAT:

1.   The application to amend the defence of the first respondent be refused.

2.    The application to amend the defence of the second and third respondents be refused.

when he is satisfied that it is ready for trial.

3.    The trial be on affidavit as to all issues.

4.    The applicant's af fidavits be filed and served on or before 9 April 1991.

5.   The respondents' affidavits be filed and served on or before 7 May 1991.

6.    There be no affidavits in reply.

7.    Either side may ask leave to adduce oral evidence.

8.   The matter be set down for trial by the Registrar

9.   The respondents pay the applicant's costs of and incidential to the applications for leave to amend, to be taxed.

10.  The costs of and incidental to today's hearing otherwise be costs in the proceedings.

THE COURT DIRECTS THAT:

1.    In support of the application for leave to appeal, both counsel for the respondents produce written submissions to be filed and served on or before 19 March 1991.

2.   Any response to the written submissions by the applicant's counsel be filed and served on or before

26 March 1991.

m:  Settlement and entry of orders is dealt with in
Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA	1	No. QG 3 of 1990
QUEENSLAND DISTRICT REGISTRY	)
GENERAL DIVISION	)

BETWEEN: WENDY WAI YIANG LEUNG WAN

Applicant

AND: DONALD ROBERT McDONALD

First Respondent

AND: RONALD MURRAY McDONALD

Second Respondent

AND: DOTWELL INVESTMENTS PTY. LTD.

Third Respondent

CORAM: PINCUS J.

PLACE: BRISBANE

m: 12 MARCH 1991

EX TEMPORE REASONS FOR JUDGMENT

In this matter the respondents applied this morning
to amend their defences and I adjourned to consider the

proposed amendments. The statement of claim alleges that the

Migration Programme and that in consequence she paid money to	applicant was misled by the respondents as to the Business
one or more of them and executed an agreement to purchase property and have a house built. There is also a claim in negligence. The pleading asserts that there was a breach of the contract relating to the house and that the applicant terminated the contract and demanded her money back. The statement of claim contains other allegations which do not require analysis.
The first respondent now wishes to amend, rather late, to set up two extra defences. It seems clear that if there were an amendment discovery would have to be recommenced. The first allegation which the first respondent now wishes to make is that the agreement referred to in the statement of claim was "obtained", to use the word in the defence, to defraud the government of Hong Kong as to income derived and was a means of getting money on which tax had not been paid out of Hong Kong. I assume "obtained" means "executed" or "made". The second allegation is that the money which the applicant paid under the agreement was unlawfully lent to the applicant.
The second point seems to me to have no substance, but the first requires consideration. Assuming that it was shown, after analysis of dealings in Hong Kong, that the proper tax had not been paid on the money the applicant used, would that deprive the applicant of the right to get back what she paid under the agreement mentioned in the statement of
Australian tax there could be no serious argument that a claim? Even if the money were earned here and subject to breach of the Australian tax laws would taint it so that once invested it could never be recovered. But what the proposed amendment says, in effect, is that the purpose of executing the agreement was to defraud the government of Hong Kong.
I cannot readily understand how that government could be defrauded by mere execution of the agreement. Perhaps the proposed defence is that the Hong Kong government will not be able to recover some tax due it, in consequence of payment of money under the agreement. This assumes that income tax attaches to particular money, in specie, whereas it merely creates a liability.
The affidavit filed in support of the application to amend explains the reason why the application is made now. It says that discovery has shown that the applicant knew she did not comply with the guidelines for immigration under the relevant programme because she was not using her own money, but that of her employer, that she had a small taxable income, and, lastly, that while she had funds in her name "there were large transactions which raised the possibility that the BMP guidelines were breached. There were no documents discovered which revealed how the applicant would lawfully obtain these
funds. "
The affidavit appears to foreshadow a different case any document has been obtained which would provide a proper from that sought to be pleaded. There is no suggestion that
foundation of the serious allegation that there was an intention to defraud the Hong Kong authorities. The affidavit says the applicant had only a small income and suggests that the respondents would like to probe the question of how she got her money. Even though the case has been in progress for quite some time, I would be inclined to allow an amendment if the papers discovered had disclosed facts supporting the
proposed amendment, but in the circumstances I have mentioned I do not propose to allow the first respondent to amend. The impression created by the papers is that the intention is to conduct a roving inquiry into the source of the applicant's funds, to see if Hong Kong tax was paid on them, and I won't allow that.
The other application to amend, by the second and third respondents, says that money paid by the applicant was the property of another person and that the applicant was not really worth enough to comply with the requirements of the Business Migration Programme.
I cannot easily understand how this could constitute a defence. It is not part of the applicant's case that she could comply with the programme; if it were established that she had no chance of complying, but she was nevertheless misled, then her cause of action would still be made out. She does not claim damages for loss of a chance of migration. Mr.
goes to causation, and I notice that paragraph 4 A ( i ) raises Redmond said, as I understood him, that the proposed amendment
that point. But proving the applicant's disentitlement under the programme would not avoid the respondent's liability, if it were otherwise shown to exist.
As to paragraph 4 8 and 4C of the proposed amendment of the second and third respondents, no doubt the quantum of damages is in issue. I do not, however, see the point of
allowing a specific plea of failure to mitigate unless it were based on some precisely stated allegation of fact, and here it isn't.
The applications to amend will both therefore be The other matter which was discussed this morning is the mode of trial. What I have in mind is to require that either statements or affidavits be delivered in advance of the trial. I have taken into account the submission made by Mr. Redmond that it's undesirable that in matters of credit affidavits be used, but my experience has been that if the respondent (or in the case of an af fidavit by the respondent, the applicant) thinks that the party making the affidavit is unable to reproduce what the affidavit says orally, then the course usually adopted, and effectively adopted, is to ask it to be given again, orally. It can be disadvantageous to the party making the affidavit if, he having produced an affidavit
refused.
which can't be sworn up to orally, the cross-examiner simply says, "Well, tell me the conversation now, without benefit of
that piece of paper". I have never understood the objection which Mr. Redmond has made, for that reason; that is, I can't understand why people are concerned about the deponent resting upon the affidavit, when he or she can easily be forced not to rest upon it, by simply being asked in the box what was said.
Therefore, I propose to order statements or affidavits. My own preference is for affidavits. If nobody wants to cross-examine - and it does sometimes happen - then the affidavit can be used and there's no need to call the witness. I'll order that the trial be on affidavit as to all issues; that the applicant's affidavits be filed and served on or before 9 April; that the respondents' affidavits be filed and served on or before 7 May. I order that there be no affidavits in reply and that either side may ask leave to adduce oral evidence.
In support of the application for leave to appeal, both counsel for the respondents seek to put in a written submission, and I will allow that. I direct that it be filed and served on or before 19 March and I direct that any response to it by the applicant's counsel be filed and served on or before 26 March. When I've received and considered those written submissions I will determine the applications for leave to appeal which have been made by these respondents.
In addition to the orders I have made, I'll order that the matter be set down for trial by the Registrar when he's satisfied that it's ready for trial.
I order that the respondents pay the applicant's costs of and incidental to the applications for leave to amend, to be taxed. I order that the costs of today otherwise be costs in the proceedings.

I certify that the six

preceding pages are a true copy of the reasons for judgment herein of his Honour Mr. Justice Pincus.

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