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Ye v Zeng (No 5)

Ye v Zeng (No 5)

Case [2016] FCA 850 27 July 2016

Civil Litigation & Procedure

Arbitration

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FEDERAL COURT OF AUSTRALIA
Ye v Zeng (No 5) [2016] FCA 850

File number: NSD 1123 of 2015

Judge: ALLSOP CJ

Date of judgment: 27 July 2016

Catchwords: ARBITRATION – unsuccessful attempt to resist enforcement of foreign arbitration award by award debtor – indemnity costs application – whether circumstances of case justify the award of indemnity costs

Legislation: International Arbitration Act 1974 (Cth) ss 3, 8, 9

Cases cited:
A v R [2009] HKCFI 342

Exfin Shipping (India) Ltd Mumbai v Tolani Shipping Co Ltd Mumbai [2006] EWHC 1090 (Comm)

Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd [1988] FCA 364; 81 ALR 397

Gao Haiyan v Keeneye Holdings Ltd (No 2) [2012] 1 HKC 491

IMC Aviation Solutions Pty Ltd v Altain Khuder LLC [2011] VSCA 248; 38 VR 303

Ye v Zeng [2015] FCA 1192

Ye v Zeng (No 2) [2015] FCA 1243

Ye v Zeng (No 3) [2015] FCA 1279

Ye v Zeng (No 4) [2016] FCA 386

Allsop, JLB “Public Policy in the New York Convention and the Model Law”, Enforcement of International Arbitration Awards and Public Policy: Part III (Paper presented to the AMTAC and Holding Redlich Seminar, Sydney, 10 November 2014)

Dates of hearing: 28 October 2015, 2 November 2015, 13 November 2015, 17 November 2015, 15 April 2016, 18 May 2016

Registry: New South Wales

Division: General Division

National Practice Area: Commercial and Corporations

Sub-area: International Commercial Arbitration

Category: Catchwords

Number of paragraphs: 23

Counsel for the Applicant: Mr PE King

Solicitor for the Applicant: Zhang Shijing Lawyers

Counsel for the Respondents: Mr H Somerville (2 November 2015), Mr T Lynch (13 November 2015, 17 November 2015), Mr L Shipway (15 April 2016, 18 May 2016)

Solicitor for the Respondents: KL International Lawyers

ORDERS

NSD 1123 of 2015

BETWEEN:
JOHNSON YE

Applicant

AND:
ZENG RONGHUO ALSO KNOWN AS ANDREW TSANG

First Respondent

CHUNXIANG ZENG

Second Respondent

QINGLONG ZENG

Third Respondent

RONGXING ZENG
Fourth Respondent

FUJIAN XIANGRONG CONSTRUCTION GROUP CO LTD
Fifth Respondent

FUJIAN XIANGRONG DAQINSHAN TEA INDUSTRY DEVELOPMENT CO LTD
Sixth Respondent

JUDGE:

ALLSOP CJ

DATE OF ORDER:

27 JULY 2016

THE COURT ORDERS THAT:
1.Order 3, made on 15 April 2016, be varied by substituting the following order:
3.The respondents pay the costs of the applicant of the application, including the interlocutory applications:
(a) on a party/party basis up to 18 October 2015; and thereafter
(b) on an indemnity basis; but
(c) not including the respondents’ interlocutory application for an adjournment, granted on 17 November 2015, which should be paid on a party/party basis.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT
ALLSOP CJ:

The history of this matter has been set out in earlier judgments: Ye v Zeng [2015] FCA 1192; Ye v Zeng (No 2) [2015] FCA 1243; Ye v Zeng (No 3) [2015] FCA 1279; Ye v Zeng (No 4) [2016] FCA 386. It is necessary however,…

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 Ye v Zeng (No 5)

Details

AGLC: Ye v Zeng (No 5) [2016] FCA 850
Case: [2016] FCA 850
Decision Date: 27 July 2016

CaseChat Overview and Summary

In the Federal Court of Australia, Ye, the applicant, sought to enforce a foreign arbitration award against Zeng, the respondent, who had previously unsuccessfully attempted to resist the enforcement. The dispute centred on whether Zeng should be held liable for indemnity costs incurred by Ye due to Zeng's unsuccessful efforts to resist the enforcement of the arbitration award. Ye applied for indemnity costs following the dismissal of Zeng's application to set aside the original orders for enforcement.

The court needed to determine if the circumstances warranted the award of indemnity costs. This involved examining the nature and merits of Zeng's resistance to enforcement, the conduct of the parties, and whether Zeng's actions were vexatious, oppressive, or an abuse of process. The court had to balance the principles of fairness and deterrence with the rights of the parties involved.

The court held that the circumstances justified awarding indemnity costs to Ye. Zeng's attempts to resist enforcement were deemed to be without substantial merit, and the court found that Zeng's actions were vexatious and oppressive. Consequently, the court ordered Zeng to pay Ye's costs from the specified date, on an indemnity basis, except for the costs associated with Zeng's unsuccessful adjournment application, which were to be paid on a party/party basis. This decision underscored the importance of fair and reasonable conduct in legal proceedings and reinforced the potential consequences for parties who engage in frivolous litigation tactics.

Orders

Orders of the court

1. Order 3, made on 15 April 2016, be varied by substituting the following order:

3. The respondents pay the costs of the applicant of the application, including the interlocutory applications:

(a) on a party/party basis up to 18 October 2015; and thereafter

(b) on an indemnity basis; but

(c) not including the respondents’ interlocutory application for an adjournment, granted on 17 November 2015, which should be paid on a party/party basis.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

Citations

AGLC Citation

Ye v Zeng (No 5) [2016] FCA 850

Most Recent Citation

Winslow Constructors v Head, Transport for Victoria (Costs) [2021] VSC 74

Cases citing this decision · 5 of 5 shown

Winslow Constructors Pty Ltd v Head, Transport for Victoria (Costs)
[2021] VSC 74

…the International Arbitration Act may facilitate a finding that the applicant knew, or should have known, that the application was hopeless.[51] [50][2016] FCA 850, [23]. [51]As was observed in Colin Joss [2015] NSWSC 829, [11] (Hammerschlag J).…
Tianjin Jishengtai Investment Consulting Partnership Enterprise v Huang
[2020] FCA 767 Para 27

…The applicant seeks an order for indemnity costs relying on the observations in Ye v Zeng (No 5) [2016] FCA 850 ( Ye v Zeng (No 5) ). I am not satisfied that I should make an order for costs on an indemnity basis. As observed in Ye v Zeng (No 5) at [21]-[23], there is an important issue of principle involved whic…
Ye v Zeng (No 7)
[2018] FCA 1478 Para 1

…urt: Ye v Zeng [2015] FCA 1192; Ye v Zeng (No 2) [2015] FCA 1243; Ye v Zeng (No 3) [2015] FCA 1279; Ye v Zeng (No 4) [2016] FCA 386; Ye v Zeng (No 5) [2016] FCA 850 and Ye v Zeng (No 6) [2016] FCA 923.…
Sino Dragon Trading Ltd v Noble Resources International Pte Ltd (No 2)
[2016] FCA 1169 Para 1

…t the parties’ dispute has been resolved under contract with the arbitral award being the contractually provided for outcome ( Ye v Zeng (No 5) [2016] FCA 850 at [23] per Allsop CJ); and (d)in the context of (a) to (c), the public policy of discouraging article 34 challenges (and the mirror s 8 proceedings opposi…
Ye v Zeng (No 6)
[2016] FCA 923 Para 2

…Ye v Zeng [2015] FCA 1192; Ye v Zeng (No 2) [2015] FCA 1243; Ye v Zeng (No 3) [2015] FCA 1279; Ye v Zeng (No 4) [2016] FCA 386; and Ye v Zeng (No 5) [2016] FCA 850.…

View all 5 citing cases →

Cases cited in this decision · 11 of 11 shown

Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd
[1988] FCA 364 Para 18

…advised, should have known that there was no chance of resistance: Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd [1988] FCA 364; 81 ALR 397. Whilst an appeal was lodged in China, and one ground (that of a denial of procedural fairness) resonated in the text of the Act, no atte…
Ye v Zeng (No 4)
[2016] FCA 386 Para 1

…as been set out in earlier judgments: Ye v Zeng [2015] FCA 1192; Ye v Zeng (No 2) [2015] FCA 1243; Ye v Zeng (No 3) [2015] FCA 1279; Ye v Zeng (No 4) [2016] FCA 386. It is necessary however, to recount much of it to explain why the applicant should receive his costs on a full and complete indemnity basis. That co…
Ye v Zeng (No 3)
[2015] FCA 1279 Para 1

…The history of this matter has been set out in earlier judgments: Ye v Zeng [2015] FCA 1192; Ye v Zeng (No 2) [2015] FCA 1243; Ye v Zeng (No 3) [2015] FCA 1279; Ye v Zeng (No 4) [2016] FCA 386. It is necessary however, to recount much of it to explain why the applicant should receive his costs on a full and comple…
Ye v Zeng (No 2)
[2015] FCA 1243 Para 1

…The history of this matter has been set out in earlier judgments: Ye v Zeng [2015] FCA 1192; Ye v Zeng (No 2) [2015] FCA 1243; Ye v Zeng (No 3) [2015] FCA 1279; Ye v Zeng (No 4) [2016] FCA 386. It is necessary however, to recount much of it to explain why the applicant should receive his costs on a full and comple…
Ye v Zeng
[2015] FCA 1192 Para 1

…The history of this matter has been set out in earlier judgments: Ye v Zeng [2015] FCA 1192; Ye v Zeng (No 2) [2015] FCA 1243; Ye v Zeng (No 3) [2015] FCA 1279; Ye v Zeng (No 4) [2016] FCA 386. It is necessary however, to recount much of it to explain why the applicant should receive his costs on a full and comple…
IMC Aviation Solutions Pty Ltd v Altain Khuder LLC
[2011] VSCA 248 Para 22

…The Court of Appeal of Victoria in IMC Aviation Solutions Pty Ltd v Altain Khuder LLC [2011] VSCA 248; 38 VR 303 at [55], in the context of submissions and a view of the arbitration judge (Croft J) based on these cases, declined to distinguish proceedings for the enforcement of international arbitral awards from o…
Hazeldene's Chicken Farm Pty Ltd v Victorian Workcover Authority (No 2)
[2005] VSCA 298 Para 22

…Co v Cussons Pty Ltd [1993] FCA 536; (1993) 46 FCR 225, 233. See also, Hazeldene’s Chicken Farm Pty Ltd v Victorian WorkCover Authority (No 2) [2005] VSCA 298; (2005) 13 VR 435] Such a departure will only be countenanced in the presence of special circumstances.[ Australian Electoral Commission v Towney (No 2) (1…
Ugly Tribe Co Pty Ltd v Sikola
[2001] VSC 189 Para 22

…in Australia. However, as Harper J observed in Ugly Tribe Co Pty Ltd v Sikola, ‘[t]he categories of special circumstances are not closed’.[[2001] VSC 189, [8]]. [56] In Hong Kong, the decision of Reyes J in A v R has formed the basis for a number of decisions in which the failure to successfully resist the enfor…
Love, H. v Desmone (Des) Williams
[1994] FCA 984 Para 22

…3 VR 435] Such a departure will only be countenanced in the presence of special circumstances.[ Australian Electoral Commission v Towney (No 2) (1994) 54 FCR 383, 388] Unsuccessfully resisting enforcement of a foreign arbitral award is not an established category of special circumstances in Australia. However, as Ha…
Colgate-Palmolive Co v Cussons Pty ltd
[1993] FCA 801 Para 22

…Court ... departing from the usual course’ of awarding costs on a party and party basis.[ Colgate Palmolive Co v Cussons Pty Ltd [1993] FCA 536; (1993) 46 FCR 225, 233. See also, Hazeldene’s Chicken Farm Pty Ltd v Victorian WorkCover Authority (No 2) [2005] VSCA 298; (2005) 13 VR 435] Such a departure will only be…
Colgate-Palmolive Co v Cussons Pty Ltd
[1993] FCA 536 Para 22

…s to warrant the Court ... departing from the usual course’ of awarding costs on a party and party basis.[ Colgate Palmolive Co v Cussons Pty Ltd [1993] FCA 536; (1993) 46 FCR 225, 233. See also, Hazeldene’s Chicken Farm Pty Ltd v Victorian WorkCover Authority (No 2) [2005] VSCA 298; (2005) 13 VR 435] Such a depa…

Legislation cited in this decision · 2

International Arbitration Act 1974 (Cth)
3, 8, 9 4 mentions (from Para 1)
Federal Court Rules 2011 (Cth)
1 mention

File number:	NSD 1123 of 2015
Judge:	ALLSOP CJ
Date of judgment:	27 July 2016
Catchwords:	ARBITRATION – unsuccessful attempt to resist enforcement of foreign arbitration award by award debtor – indemnity costs application – whether circumstances of case justify the award of indemnity costs
Legislation:	International Arbitration Act 1974 (Cth) ss 3, 8, 9
Cases cited:	A v R [2009] HKCFI 342 Exfin Shipping (India) Ltd Mumbai v Tolani Shipping Co Ltd Mumbai [2006] EWHC 1090 (Comm) Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd [1988] FCA 364; 81 ALR 397 Gao Haiyan v Keeneye Holdings Ltd (No 2) [2012] 1 HKC 491 IMC Aviation Solutions Pty Ltd v Altain Khuder LLC [2011] VSCA 248; 38 VR 303 Ye v Zeng [2015] FCA 1192 Ye v Zeng (No 2) [2015] FCA 1243 Ye v Zeng (No 3) [2015] FCA 1279 Ye v Zeng (No 4) [2016] FCA 386 Allsop, JLB “Public Policy in the New York Convention and the Model Law”, Enforcement of International Arbitration Awards and Public Policy: Part III (Paper presented to the AMTAC and Holding Redlich Seminar, Sydney, 10 November 2014)
Dates of hearing:	28 October 2015, 2 November 2015, 13 November 2015, 17 November 2015, 15 April 2016, 18 May 2016
Registry:	New South Wales
Division:	General Division
National Practice Area:	Commercial and Corporations
Sub-area:	International Commercial Arbitration
Category:	Catchwords
Number of paragraphs:	23
Counsel for the Applicant:	Mr PE King
Solicitor for the Applicant:	Zhang Shijing Lawyers
Counsel for the Respondents:	Mr H Somerville (2 November 2015), Mr T Lynch (13 November 2015, 17 November 2015), Mr L Shipway (15 April 2016, 18 May 2016)
Solicitor for the Respondents:	KL International Lawyers