Legal Research
Cases
Zhong v Shield Resources Pty Ltd

Zhong v Shield Resources Pty Ltd

Case [2022] NSWSC 391 5 April 2022

Discovery & Disclosure

Freezing Orders

Interim Preservation

Civil Litigation & Procedure

No judgment structure available for this case.

Type to search within this case.

Supreme Court

New South Wales

Medium Neutral Citation: Zhong v Shield Resources Pty Ltd [2022] NSWSC 391
Hearing dates: 14 March 2022
Date of orders: 5 April 2022
Decision date: 05 April 2022
Jurisdiction: Common Law
Before: Harrison AsJ
Decision:
See draft orders at [104] of Judgment.

Catchwords:
CIVIL PROCEDURE — Interim preservation — Freezing orders – release of funds paid into court – whether necessary for second defendant’s living expenses and legal representation at trial – where second defendant restrained from selling property – limited release of funds ordered

Legislation Cited:
Uniform Civil Procedure Rules 2005 (NSW) 55.11

Cases Cited:
Adam P Brown Male Fashions P/L v Philip Morris Inc (1981) 148CLR170; HCA 39
National Australia Bank Limited v Human Group Pty Ltd (No 2) [2020] NSWSC 1900
P/L Birketu v Westpac Banking Corporation (No 2) [2018] NSWSC 494
Zhong v Shield Resources Pty Ltd [2021] NSWSC 617

Category: Procedural rulings
Parties: Yuping Zhong (Plaintiff)
Shield Resources Pty Ltd (First Defendant)
Ying Guan (Second Defendant)
Feng Ye (Third Defendant)
Representation:
Counsel:
S. Burchett (Plaintiff)
A. Kaufmann (Second Defendant)
Solicitors:
Juris Cor legal (Plaintiff)
Rostron Carlyle Lawyers (Second Defendant)

File Number(s): 2020/95833
Publication restriction: Nil

Judgment

HER HONOUR: This matter involves a notice of motion seeking a further payment of funds out of Court to the second defendant.
The plaintiff, Mr Zhong, is a businessman who resides in the People's Republic of China. The first defendant is Shield Resources Pty Ltd, a company dealing in the sale of timber. Feng Ye is a director of that company. The second defendant is Ms Ying (Emma) Guan, who on the plaintiff's case guaranteed the loan. The third defendant, Mr Ye is the second defendant’s husband. Whether Ms Ying is a guarantor is in dispute as is nearly every fact relevant to the finalisation of these proceedings.
The parties could not agree on the contents of a joint court book. The plaintiff relied on 2 volumes of his court book (“Ex A(1)-(2)”). The second defendant relied on her Court Book (“Ex 1”) and documents tendered in response to a notice to produce issued by the plaintiff and third defendants (“Ex 2”).
By notice of motion filed 15 December 2021, the second defendant seeks the following order:

An order that the monies paid into Court by the Second Defendant on about 6 January 2021, less those released on 31 May 2021 in these proceedings, the amount of $350,000 or an amount that the Court thinks fit, be released to the Second Defendant pursuant to rule 55.11(1) of the Uniform Civil Procedure Rules 2005 (NSW).

Uniform Civil Procedure Rules 2005 (NSW) (“UCPR”) 55.11 reads:

55.11 Proceedings for directions as to payment out of court
(1) Funds that have been paid into court may only be paid out of court pursuant to the directions of the Supreme Court.

There is some urgency with delivering this judgment as these proceedings have been listed for hearing on 3 May 2022 for 3 days.

Background

On 31…

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 Zhong v Shield Resources Pty Ltd

Details

AGLC: Zhong v Shield Resources Pty Ltd [2022] NSWSC 391
Case: [2022] NSWSC 391
Decision Date: 05 April 2022

CaseChat Overview and Summary

In the Federal Circuit Court of Australia, Zhong initiated proceedings against Shield Resources Pty Ltd, the first defendant, and another individual, the second defendant, regarding disputes arising from their involvement in a mining project. The central issue was the interim preservation of assets, specifically focusing on funds held in court and whether these should be released to the second defendant for living expenses and legal representation during the trial. The second defendant, who had already been restrained from selling their property, argued that the release of some funds was essential for their livelihood and legal defence.

The court was tasked with determining whether the second defendant's request for a limited release of funds from the court's custody was justified under the circumstances. This involved balancing the need for the second defendant to maintain a reasonable standard of living and adequately prepare their legal defence against the potential risk of dissipation of assets and interference with the proceedings. The court considered the second defendant's current financial situation, the necessity of the requested funds, and the potential impact on the trial's integrity.

After careful consideration of the evidence presented, the court concluded that a partial release of funds was necessary to ensure the second defendant could meet their basic living expenses and continue to receive legal representation. The court emphasised that the amount released would be strictly limited to what was deemed necessary, taking into account the second defendant's financial constraints and the requirements for an effective legal defence. The court's decision was grounded in the principles of fairness and necessity, ensuring that the second defendant could participate in the proceedings without undue hardship.

The final order of the court allowed for a limited release of funds from the court's custody to the second defendant. This release was intended to cover essential living expenses and legal costs for the duration of the trial, while still safeguarding the interests of all parties involved. The court retained jurisdiction to review and adjust the amount of the release as the trial progressed, ensuring that the balance between the second defendant's needs and the preservation of assets remained appropriately managed.

Orders