Yimiao Australia Pty Ltd v Star Mining Pty Ltd - [2022] VSC 701

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL COURT

S ECI 2022 03213

YIMIAO AUSTRALIA PTY LTD (ACN 657 775 758)	Plaintiff
v
STAR MINING PTY LTD (ACN 656 484 525) & ORS	Defendants

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JUDGE:	ATTIWILL J
WHERE HELD:	Melbourne
DATES OF HEARING:	14 and 15 September 2022, 27 October 2022 and 3 November 2022
DATE OF RULING:	15 November 2022
CASE MAY BE CITED AS:	Yimiao Australia Pty Ltd v Star Mining Pty Ltd & Ors
MEDIUM NEUTRAL CITATION:	[2022] VSC 701

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INJUNCTIONS – Interlocutory injunction – Application for interlocutory injunction for delivery up of cryptocurrency mining equipment – Whether serious question to be tried – Whether balance of convenience favours granting the interlocutory injunction – Where a defendant claims a registered security interest in the cryptocurrency mining equipment pursuant to the Personal Property Securities Act 2009 (Cth) – Where the plaintiff’s undertakings are inadequate to protect the defendant’s claimed security interest - Where the balance of convenience favours the refusal of the injunction – Application for interlocutory injunction refused.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Dr O Bigos KC with Mr P Annabell	Gilbert + Tobin
For the First Defendant	Mr P H Caillard	Maxim Legal
For the Third Defendant	Mr M A J McKillop	MinterEllison
For the Fourth Defendant	Mr L F White	Cathay Lawyers

HIS HONOUR:

INTRODUCTION

This is an application by the plaintiff (Yimiao) by summons filed 13 September 2022 (summons) for an interlocutory injunction for the delivery up by the third defendant (CIT) of cryptocurrency mining equipment. Yimiao seeks the delivery up of 810 items of ‘L7 Antminer’ cryptocurrency mining equipment (the Yimiao Identified Claimed Equipment) in a room (Mining Room) and a warehouse (Warehouse) at premises located at 159-171 Wellington Rd, Clayton (the Premises) and in two stacked shipping containers (the Container Rooms) at 175 Wellington Rd, Clayton (the Adjacent Premises). The Yimiao Identified Claimed Equipment has been identified during inspections of the Premises and the Container Rooms.

This proceeding concerns claims by Yimiao concerning a greater number of items of equipment, being 1,598 items of L7 Antminer cryptocurrency mining equipment (the Yimiao Total Claimed Equipment). The summons concerns only the Yimiao Identified Claimed Equipment as this is the equipment that has been identified during recent inspections of the Premises and the Container Rooms. The remainder has not been located.

By the summons, Yimiao sought the following order (based upon the undertakings set out in the order):

1.Until the hearing and determination of this proceeding or further order, the Third Defendant deliver up possession immediately to the Plaintiff of:
(a)the units of equipment described as L7 Antminer crypto-mining hardware bearing serial numbers set out in Annexure A to this summons, such that the units are made available to be collected by the Plaintiff and its contractors at the site at 159-171 Wellington Road, Clayton, Victoria during business…

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: [2022] VSC 701
Decision Date: 15 November 2022

CaseChat Overview and Summary

In the Federal Court of Australia, the case of Yimiao Australia Pty Ltd v Star Mining Pty Ltd involved a dispute over the ownership of cryptocurrency mining equipment. Yimiao Australia, the plaintiff, sought an interlocutory injunction for the delivery up of the mining equipment, claiming that it was wrongfully in the possession of Star Mining, the defendant. Star Mining asserted a registered security interest in the equipment under the Personal Property Securities Act 2009 (Cth), and argued against the grant of the interlocutory injunction.

The legal issues before the court centred on whether there was a serious question to be tried concerning the ownership of the cryptocurrency mining equipment, and whether the balance of convenience favoured granting the interlocutory injunction. The court had to consider the adequacy of the plaintiff’s undertakings to protect the defendant's claimed security interest and the overall balance of convenience. The primary consideration was whether the balance of convenience favoured either party, given the existence of the defendant's registered security interest.

The court found that while there was a serious question to be tried regarding ownership, the balance of convenience weighed against granting the interlocutory injunction. The court reasoned that the plaintiff’s undertakings were insufficient to adequately protect the defendant's claimed security interest, and that the overall balance of convenience favoured the refusal of the injunction. Consequently, the application for an interlocutory injunction was dismissed. No further orders were made regarding the final determination of the ownership dispute.

Orders