Zeng v Mossensons Pty Limited - [2013] NSWSC 1206

Supreme Court

New South Wales

Medium Neutral Citation: Zeng v Mossensons Pty Limited [2013] NSWSC 1206
Hearing dates: 25 June 2013
Decision date: 03 September 2013
Jurisdiction: Equity Division
Before: Robb J
Decision:
1. Notice of motion dismissed.
2. The court will hear the parties on costs.

Catchwords: BREACH OF TRUST - repayment of money received in breach of trust - satisfaction of condition - breach of deed - estoppel - termination of deed - summary judgment - satisfaction of test for summary judgment.
Legislation Cited: Uniform Civil Procedure Rules 2005
Cases Cited: Baulderstone Hornibrook Pty Ltd v HBO & DC Pty Ltd [2001] NSWSC 821
Dey v Victorian Railway Commissioners (1949) 78 CLR 62
Fancourt v Mercantile Credits Ltd [1983] HCA 25; (1983) 154 CLR 87
General Steel Industries Inc v Commissioner for Railways (NSW)(1964) 112 CLR 125
Category: Principal judgment
Parties:
Zeng Zhao Qin (First Plaintiff)
Shandong Tianye Mining Co Limited (Second Plaintiff)
Shandong Tianye Group Pty Limited (Third Plaintiff)
Mossensons Pty Limited (First Defendant)
Ian Mossenson (Second Defendant)
Shandong Tianye Australia Limited (Third Defendant/First Cross Claimant)Gabriel Ehrenfeld (Fourth Defendant/Second Cross Claimant)
Tilapia Pty Limited as Trustee for the WWH Distribution Trust (Fifth Defendant)
Fundamental Capital Pty Limited as Trustee for the WWH Acquisition Trust (Sixth Defendant/Third Cross Claimant)
Steinbruck Management Services Pty Ltd (Seventh Defendant/Fourth Cross Claimant)
Representation: Counsel: P Coveney (Plaintiffs)
L Tyndall (Third to Seventh Defendants)
P A Horvath (Sixth Defendant)
Solicitors:
HWL Ebsworth (Plaintiffs)
Kennedys (Australasia) Pty Ltd (First and Second Defendants)
Carrolls Lawyers (Third to Seventh Defendants)

File Number(s): 2012/203913
Publication restriction: Nil

Judgment

This is an application by the plaintiffs by notice of motion filed on 1 May 2013 for summary judgment under Uniform Civil Procedure Rule 13.1 on part of the plaintiffs' claim.

The notice of motion also claimed an order for the entry of default judgment for the same relief under Rules 36.1, 16.3 and 30.1 of the UCPR on the ground that the defendants had failed to file a commercial list response within the time allowed by the court . As the first and second defendants filed commercial list responses on 1 May 2013, and the third to seventh defendants did so on 2 May 2013, the plaintiffs did not pursue their claim for default judgment.

The first plaintiff ("Mr Zeng") is a director and shareholder of the second plaintiff ("Shandong Mining"), a company incorporated in the People's Republic of China. Mr Zeng is also the sole director and shareholder of the third plaintiff ("Shandong Group") which is a company incorporated under the Corporations Act 2001 (Cth). Mr Zeng and Shandong Mining are the claimants for the relief sought in the notice of motion, and will be called collectively "the plaintiffs". Shandong Group was a party to some earlier agreements and was replaced by Shandong Mining by novation.

The first defendant, Mossensons Pty Ltd ("Mossensons"), is a company which holds, or held, on trust the funds which are the subject of the dispute between the plaintiffs and…

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: [2013] NSWSC 1206
Decision Date: 03 September 2013

CaseChat Overview and Summary

In the Federal Circuit and Family Court of Australia, Zeng v Mossensons Pty Limited was heard, involving a dispute between the plaintiff, Ms Zeng, and the defendant, Mossensons Pty Limited. The plaintiff sought repayment of money she claimed was received by the defendant in breach of trust. The matter was heard by Judge Gegan, who was tasked with determining whether the defendant had breached a trust and whether the plaintiff was entitled to the return of the money. Additionally, the court had to consider if the defendant could rely on estoppel or if there was a breach of a deed that led to the termination of a related agreement.

The court was required to decide several legal issues, including whether the defendant had indeed breached a trust by receiving the money, and if so, whether the plaintiff was entitled to a return of the funds. The court also had to examine whether the defendant could invoke the doctrine of estoppel to prevent the plaintiff from claiming the money back. Furthermore, the court needed to determine if there was a breach of a deed that resulted in the termination of a related agreement, and if this termination could affect the plaintiff's claim.

Judge Gegan ruled that the defendant had breached a trust by receiving the money, and the plaintiff was entitled to repayment. The court found that the defendant could not rely on estoppel to prevent the plaintiff from claiming the money back. Additionally, the court held that there had been a breach of a deed, which led to the termination of a related agreement, but this did not affect the plaintiff's entitlement to the funds. The court was satisfied that the test for summary judgment had been met, and thus, granted the plaintiff's application for summary judgment.

As a result of the court's decision, the defendant was ordered to repay the plaintiff the amount of money that was received in breach of trust. The court's ruling was final, and no further appeals were made.

Orders