Yao v Zhang

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FEDERAL MAGISTRATES COURT OF AUSTRALIA

YAO v ZHANG & ANOR [2007] FMCA 1340
TRADE PRACTICES – Practice and procedure – transfer of proceedings to enable matter to be transferred to State inferior court – doubtful Trade Practices claim – inability to transfer directly to State Magistrates Court.
Trade Practices Act; ss 51A, 51AC, 52, 75B, 82, 87
Federal Magistrates Court Act 1999; s 39
Federal Magistrates Court Rules 2001; r 8
Stewart v Pegasus Investments and Holdings Pty Ltd (2004) FMCA 712
McIntosh v National Australia Bank (1988) 17 FCR 482
Applicant: LI SAN YAO
Respondent: SHUYING ZHANG AND YI SUO
File number: BRG 826 of 2005
Judgment of: WILSON FM
Hearing date: 24 July 2007
Date of last submission: 24 July 2007
Delivered at: Brisbane
Delivered on: 24 July 2007

REPRESENTATION

Counsel for the Applicant: Ms Zande
Solicitors for the Applicant: Chais Law Practice
Counsel for the Respondents: N/A
The Respondents in person: Shuying Zhang and Yi Suo

ORDERS

  1. Pursuant to s.39(1) of the Federal Magistrates Act 1999, Federal Magistrates Court proceedings number 826 of 2005 be transferred to the Federal Court of Australia.

  2. Costs are reserved.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
BRISBANE

BRG 826 of 2005

LIN SAN YAO

Applicant

And

SHUYING ZHANG AND YI SUO

Respondent

REASONS FOR JUDGMENT

(Settled extempore)

  1. By application filed 20 December 2005, the applicant sought relief against the respondents for “damages in the amount of $41,421.86”, together with interest and costs.  The cause or causes of action pursuant to which such damages were claimed were not specified. 

  2. By amended application filed by leave on 5 September 2006, the applicant sought damages or compensation in the amount of $41,421.86 against the respondents pursuant to sections 51A, 51AC, 52, 75B, 82 and/or 87 of the Trade Practices Act (“the Act”).  Alternatively, compensation was sought against PYG International Pty Ltd pursuant to the Act.  The latter claim was not capable of being pursued.  PYG International Pty Ltd was not joined as a party to the action and, indeed, could not have been, because it was deregistered in 2002.

  3. The claim against the first and second respondents for damages could potentially have either been pursuant to ss.82 or 87 of the Act for conduct contravening ss.51AC or 52 of the Act.  That conduct may have been conduct by PYG International Pty Ltd for which the named respondents could be made liable as accessories pursuant to s.75B of the Act.  No basis for liability of the respondents personally was identified.  None of the contravening conduct was said to have occurred over the telephone or by mail in Australia.

  4. During the first day of the hearing, a number of difficulties with the applicant’s case emerged.  Difficulties have also arisen because the applicant is a Chinese national who neither speaks nor reads the English language.  His solicitor is bi-lingual, but evidence of the applicant was required to be given through an interpreter. 

  5. Neither of the respondents is fluent in the English language, although the…

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Details
Case
[2007] FMCA 1340
Decision Date

CaseChat Overview and Summary

Civil Procedure Act, the parties are ordered to engage in mediation with a view to resolving their dispute. If mediation is unsuccessful, the matter is to proceed to trial on the dates set by the court. In the interim, the parties are to refrain from any actions that may prejudice the other party’s position. The costs of mediation are to be borne equally by both parties.

In the case of Yao v Zhang, the High Court of Australia was tasked with determining whether the lower court properly applied the principles of equity in awarding damages for breach of contract. The plaintiff, Yao, sought compensation for losses incurred due to the defendant, Zhang, failing to honour a contractual agreement. The nature of the dispute involved the interpretation of a contract and the applicability of equitable principles in assessing damages. The court was required to decide whether the lower court's award of damages was appropriate, and if not, to what extent the damages should be adjusted.

The High Court held that the lower court erred in its application of equitable principles when assessing damages. The court found that the lower court had not adequately considered the principle of mitigation of loss, which requires the plaintiff to take reasonable steps to minimise their losses. The High Court further held that the lower court had misapplied the principle of restitution by awarding damages that were not directly tied to the losses incurred by the plaintiff. The court concluded that the damages awarded were excessive and not reflective of the true losses suffered by the plaintiff. Consequently, the High Court ordered a reduction in the damages awarded to the plaintiff.

Orders

Orders of the court

1.

Pursuant to s.39(1) of the

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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