Xie v Australian Shopping Town Development Pty Ltd - [2010] NSWSC 829

CITATION: Xie v Australian Shopping Town Development Pty Ltd [2010] NSWSC 829

HEARING DATE(S): 23 July 2010

JUDGMENT DATE :
12 August 2010

JURISDICTION: COMMON LAW

JUDGMENT OF: Davies J

DECISION: (1) The Defendants’ Notice of Motion filed 19 April 2010 is dismissed. (2) The Defendants are to pay the Plaintiffs’ costs.

CATCHWORDS: PROCEDURE - judgments and orders - default judgments - setting aside - failure to show any defence on the merits - failure to explain delay in filing a defence to the Statement of Claim for more than 5 months - failure to explain delay in filing Notice of Motion to ser aside judgment for more than 7 months - application dismissed.

LEGISLATION CITED: Corporations Act 2001 (Cth)

CATEGORY: Procedural and other rulings

CASES CITED: Evans v Bartlam [1937] AC 473 at 480
Magnate Projects Pty Limited v Youma Constructions (No 2) Pty Ltd [2005] NSWCA 331
North v Shierlaw (1897) 13 WN (NSW) 163
Term Sales Pty Limited v Joseph (1949) 67 WN (NSW) 44
Vacuum Oil Co Pty Ltd v Stockdale (1942) 42 SR (NSW) 239

PARTIES: Chuan-Liang Xie (First Plaintiff)
Xiaomin Song (Second Plaintiff)
Australian Shoppingtown Development (First Defendant)
Xiongying Li (Second Defendant)

FILE NUMBER(S): SC 2009/293656

COUNSEL: V Kerr (Plaintiffs)
Xiongying Li (Defendants)

SOLICITORS: Rutland's Law Firm (Plaintiffs)

- 1 -

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

DAVIES J

12 AUGUST 2010

2009/293656 XIE V AUSTRALIAN SHOPPINGTOWN DEVELOPMENT PTY LTD

JUDGMENT

1 The First Defendant, Australian Shoppingtown, borrowed money from the Plaintiffs pursuant to a Loan Agreement made on 5 November 2005. The Second Defendant (Xiaoying Li) guaranteed the repayment of the money.

2 At the time the loan was due to be repaid in November 2008 the terms of the arrangement were varied. However, the First Defendant did not adhere to the terms of the varied agreement leading to the issue of a Statement of Claim seeking judgment for the amount outstanding. Ultimately, Default Judgment was entered on 21 October 2009 against both Defendants. The Defendants now apply by Notice of Motion dated 19 April 2010 to set aside the Default Judgment.

The Loan Agreement

3 The Loan Agreement was entered into on 5 November 2005. The loan was in relation to a development that Australian Shoppingtown wanted to make in China. It provided for the Plaintiffs to lend Australian Shoppingtown $550,000. It was made clear that it was a loan and was not to be regarded as an investment in what Australian Shoppingtown intended to do with the money.

4 The term of the loan was for 3 years. Clause 6 provided that interest was payable at 20% for the 1^st year, at 30% for the 2^nd year and at 50% for the 3^rd year. That resulted in the interest over the 3-year period being equivalent to the principal. It was very high interest but was in fact the interest offered by the Defendants when they initially requested the loan from the Plaintiffs.

5…

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.

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Details

Case: [2010] NSWSC 829
Decision Date: 12 August 2010

CaseChat Overview and Summary

The case of Xie v Australian Shopping Town Development Pty Ltd involved a plaintiff who sought to have a default judgment set aside against them. The plaintiff had failed to respond to a Statement of Claim for over five months, resulting in a default judgment being entered against them. Subsequently, the plaintiff filed a Notice of Motion to set aside the judgment, which was also delayed by more than seven months. The court had to determine whether the plaintiff could successfully argue for the setting aside of the default judgment. The primary legal issue was whether the plaintiff had demonstrated a sufficient basis for setting aside the default judgment and whether the delay in filing the Notice of Motion could be justified.

The court examined the plaintiff's arguments for setting aside the default judgment, considering whether there was any defence on the merits. The plaintiff argued that they had a defence to the claim but did not provide any substantive evidence or explanation for their position. The court also assessed the plaintiff's explanation for the significant delay in filing the Notice of Motion, which was not adequately justified. Given the substantial delay and the lack of a viable defence, the court concluded that the plaintiff had not shown a valid reason for setting aside the default judgment. Consequently, the application to set aside the judgment was dismissed.

In dismissing the application, the court emphasised the importance of timely responses to legal proceedings and the necessity of providing a valid defence when seeking to set aside a default judgment. The court noted that the plaintiff had failed to demonstrate any reasonable justification for the delay in filing both the defence and the Notice of Motion. As a result, the plaintiff's application was unsuccessful, and the default judgment remained in place. The court's decision highlighted the consequences of failing to adhere to procedural timelines and the need for substantive arguments to support applications for relief in such matters.

Orders