Zao and Gong

[2018] FamCA 379

FAMILY COURT OF AUSTRALIA

ZAO & GONG [2018] FamCA 379

FAMILY LAW – INJUNCTIONS – Mareva – Ex parte application to restrain the Respondent from accessing a sum of $5,000,000 invested on behalf of the parties pursuant to their Australian visa requirements.

APPLICANT: Mr Zao

RESPONDENT: Ms Gong

FILE NUMBER: SYC 2998 of 2018

DATE DELIVERED: 18 May 2018

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Carew J

HEARING DATE: 18 May 2018

REPRESENTATION

COUNSEL FOR THE APPLICANT: Ms Coulton

SOLICITOR FOR THE APPLICANT: Sunfield Chambers Solicitors & Associates

COUNSEL FOR THE RESPONDENT: Application made on an ex parte basis

Orders

1. Upon the undertaking of the Applicant to pay any damages assessed as suffered by the Respondent as a result of this injunction, the Respondent wife be restrained and an injunction hereby issues restraining her form withdrawing any part of the $5,000,000 invested relating to the complying investment funds for the Applicant husband’s and Respondent wife’s subclass 188 (significant visa stream) visa application, including any funds deposited in an account held by B Limited, ACN …;  the trustee of B Ltd, ABN …;  C Limited, ACN …, ABN …;  the D Corporation and by any other entity or person.

2. In respect of the $5,000,000 complying investment funds for the visa, the Applicant husband is granted leave to serve a copy of the restraining order on (a) the Department of Home Affairs, formerly known as the Department of Immigration and Border Protection, at 26 Lee Street, Sydney, New South Wales 2000;  (b) B Limited and the trustee of B Fund, ABN …, at …;  (c) C Limited, ACN …, ABN …, at …;  (d) D Corporation at …;  and (e) any other persons or entities where the complying investment funds for the visa are held or deposited.

3. The Applicant is to forthwith serve upon the Respondent a copy of his initiating application filed 14 May 2018, his affidavit in support also filed on that date and his financial statement, together with a transcript of today’s proceedings.

4. Costs of this application will be reserved.

Note: The form of the order is subject to the entry of the order in the Court’s records.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Zao & Gong has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 2998 of 2018

Mr Zao

Applicant

And

Ms Gong

Respondent

EX TEMPORE REASONS FOR JUDGMENT

1. This is an application for an ex parte Mareva injunction restraining the Respondent from accessing a sum of $5,000,000 invested on behalf of the parties pursuant to their Australian visa requirements.

background

1. The Applicant and Respondent are citizens of the Republic of China. The Applicant is present in Australia, having arrived in Australia on 11 May 2018, and the application was filed on 14 May 2018. His application for final orders seeks a property settlement order under s 79 of the Family Law Act 1975 (Cth) (“the Act”) for the payment to him of $2,500,000. In the interim, he seeks injunctions against the respondent by way of an ex parte order today.

2. On 9 December 2014, the Applicant and Respondent were granted an investor visa, a condition of which required them to invest in authorised investments in Australia the sum of $5,000,000. The visa allows the Applicant and Respondent to travel to and from Australia at any time during the term of the visa.  It expires on 9 December 2018.  It is the Applicant’s understanding that the investor visa permits the Applicant and Respondent to apply for permanent residency, provided that they have complied with the visa requirements throughout the term of the visa.

3. The Applicant contends that both he and the Respondent contributed to the $5,000,000 investment sum, although the Respondent is the primary Applicant on the investor visa.  The Applicant also believes that if any part of the $5,000,000 is withdrawn from investment in Australia, it will be a breach of the conditions of the visa.  The Applicant contends that it was his and the Respondent’s intention to apply for permanent residency in Australia and for them and their families to spend two or three months per year living in Australia.  That remains the Applicant’s intention.

4. The Applicant and Respondent are again estranged, having married for the first time in 2012 and divorced on 10 December 2015, and remarried in early 2016 and separated for the final time in July 2016.  There are no children of the marriage.  The Applicant contends that the Respondent has been controlling and abusive during the marriage.  That is the reason, he says, for the first divorce.  The Respondent’s application for divorce in China in more recent times was refused by the Court.

5. The Applicant did not sign the paperwork for the visa and is concerned that the Respondent may withdraw funds without consultation with him.  On 30 April 2018, the Applicant and Respondent engaged in a telephone conversation as set out in paragraph 55 of his affidavit, which was filed on 14 May 2018.  During that conversation, the Respondent refused to provide any information to the Applicant about the $5,000,000 investment, insisting that it was hers and had nothing to do with the Applicant.

6. The Respondent mentioned that she had been in Australia in April 2018.  The Applicant contends that the Respondent was very emotional during the telephone call, and he is concerned that the Respondent will remove the $5,000,000 or part thereof.  And in those circumstances, not only will it be removed from Australia and possibly invested in the names of third parties, which has been the practice of the Respondent in the past, but it will also cause them to be in breach of their Australian visa.

7. The parties entered into a financial agreement during their marriage which provides, among other things, that the Applicant and Respondent are to divide assets acquired by them during the marriage in accordance with their respective contributions, and the Applicant claims to have made significant contributions, both financial, non-financial and as homemaker.

Applicable legal principles. 

1. Where a party is present in Australia at the time of filing an application, the Court has power to deal with the application made by the Applicant under s 39(4) of the Act. That section provides that proceedings of a kind referred to in the definition of ‘matrimonial cause’ in s 4(1) of the Act, other than proceedings for a divorce or proceedings referred to in paragraph (f) of that definition, may be instituted under the Act if, in the case of proceedings between parties to a marriage, either party to the marriage is present in Australia at the relevant date.

2. Section 39(4A) of the Act defines ‘relevant date’ in relation to proceedings as meaning, if the application instituting the proceedings is filed in the Court, the date on which the application is filed. In this case, the Applicant deposes to having been present in Australia on the date of filing, indeed, that he arrived in Australia on 11 May 2018. He is present in Court.

3. The power to grant injunctions can be found in s 114 of the Act, which relevantly provides:

   (1)In proceedings of the kind referred to in paragraph (e) of the definition of ‘matrimonial cause’ in subsection 4(1), the Court may make such order or grant such injunction as it considers proper with respect to the matter to which the proceedings relate, including:

   …

   (e) an injunction in relation to the property of a party to the marriage.

   …

   (3)A Court exercising jurisdiction under this Act in proceedings other than proceedings to which subsection (1) applies may grant an injunction by interlocutory order or otherwise in any case in which it appears to the Court to be just and convenient to do so and either unconditionally or upon such terms and conditions as the Court considers appropriate.

4. Section 4(1) of the Act defines ‘matrimonial cause’ to mean, in subsection (ca), proceedings between the parties to a marriage with respect to the property of the parties to the marriage or either of them, being proceedings arising out of the marital relationship and in subsection (e) proceedings between the parties to a marriage for an order or injunction in circumstances arising out of the marital relationship.

5. Prior to granting an injunction, the following matters need to be considered:

   (a) whether there is a serious issue to be tried;

   (b) the balance of convenience;

   (c) whether there is an objective risk of disposal of assets if the injunction is not granted; and

   (d) if it is considered appropriate to issue injunctions, the Court should to the minimum extent required.

6. An applicant seeking an ex parte application must be able to satisfy the Court about a number of matters as provided in r 5.12 of the Family Law Rules 2004 (“the Rules”) and I have considered those matters that are relevant in that rule. Rule 14.05 of the Rules provides that the Court may grant a Mareva injunction in certain circumstances, which I have also considered.

7. If a prima facie claim exists and damages would not be an adequate remedy, the Court may grant an injunction where the balance of convenience favours it. 

application of legal principles

1. In this case, the Applicant seeks a property settlement order of $2,500,000 on the basis of his financial, non-financial and homemaker contributions to the marriage. 

2. On the face of it, he does have a claim, although I make no comment about the quantum of that claim. There is a serious issue to be tried.

3. The hardship to the Applicant if I do not grant the injunction appears to be twofold.  Firstly, that the money will leave Australia and possibly be invested in the names of third parties as the Applicant allegedly has done in the past.  And secondly, he may lose the opportunity to apply for a permanent residency visa, as removing the money will be in breach of their current investor visa.

4. It is difficult to see any hardship to the Respondent at this point, as she does not currently have the use of the money, having invested it in December 2014 as a condition of her visa.  Any injunction imposed will be for a short time.

5. It is alleged that the actions of the Respondent in the past of overriding the Applicant’s requests and her alleged dismissal of his entitlement to any of the investment fund, and in those circumstances it is proper, in my view, to grant the injunction as sought. 

6. The nature of the conversation that took place between the Applicant and Respondent and her history of ignoring any requests made by the Applicant satisfy me that this is an appropriate matter to deal with on an ex parte basis, particularly in circumstances where I propose to return the matter to court next Wednesday. 

7. The injunction will be subject to an undertaking as to damages as offered by the Applicant. 

8. The matter will be adjourned for further hearing to 9.30 on Wednesday, 23 May 2018.

I certify that the preceding twenty-three (23) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Carew delivered on 18 May 2018.

Associate: 

Date:  29 May 2018