Zhong v Shield Resources Pty Ltd - [2021] NSWSC 617

Supreme Court

New South Wales

Amendment notes

Medium Neutral Citation: Zhong v Shield Resources Pty Ltd [2021] NSWSC 617
Hearing dates: 31 May 2021
Date of orders: 31 May 2021
Decision date: 31 May 2021
Jurisdiction: Common Law
Before: N Adams J
Decision:
(1) Of the sum of $753,200.62 paid into court on 6 January 2021 $100,000 be released to the second defendant Ying (Emma) Guan.
(2) That order is stayed until Thursday, 3 June 2021 at 5pm.
(3) Costs of the motion to be the costs in the cause as between the plaintiff and the second defendant.
(4) Parties have liberty to apply to re-list the outstanding argument concerning the notice to produce.

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

Cases Cited:
Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc (1981) 148 CLR 170; [1981] HCA 39

Category: Procedural rulings
Parties: Yuping Zhong (Plaintiff)
Shield Resources Pty Ltd (First Defendant)
Ying Guan (Second Defendant)
Representation:
Counsel:
S Burchett (Plaintiff)
A Kaufmann (Defendants)
Solicitors:
Juris Cor Legal (Plaintiff)
Rostron Carlyle Rojas Lawyers (Defendants)

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

File Number(s):

2020/95833

JUDGMENT (REVISED FROM EX TEMPORE)

By statement of claim filed on 27 March 2020, the plaintiff seeks an order that the defendants pay a debt of $2 million said to be owed to him pursuant to a loan agreement in which it was agreed that $2 million would be advanced in the future. In the alternative, an amount of approximately $1.15 million is sought.
The plaintiff is a businessman who resides in the People's Republic of China. The first defendant is a company dealing in the sale of timber. Feng Ye is a director of that company. The second defendant is Mr Ye's wife, Ms Ying (Emma) Guan, who on the plaintiff's case guaranteed the loan.
Since the commencement of these proceedings the Court has had to rule on a number of interlocutory questions. Significantly, Wright J made freezing orders on an urgent basis on 18 December 2020 which were extended by consent before Black J on 14 January 2021. Those orders required the second defendant to pay approximately $750,000 into court and restrained her from selling her property she owns in St Ives.
The parties dispute nearly every factual issue relevant to the finalisation of these proceedings. This is demonstrated by the fact that the plaintiff has filed a notice of motion for summary judgment whereas the second defendant has filed a motion for summary dismissal as against her. Both of those motions are listed for hearing on 1 July 2021. There is also a motion by the second defendant to have the freezing orders listed on that day.
By notice of motion filed on 20 May 2021, the second defendant now seeks…

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 [2021] NSWSC 617
Case: [2021] NSWSC 617
Decision Date: 31 May 2021

CaseChat Overview and Summary

The matter before the court involved an application by the second defendant, Shield Resources Pty Ltd, for the release of funds that had been paid into court. The applicant sought the release of these funds for the purposes of meeting its living expenses and to fund its defence against the claims brought by the plaintiff, Zhong. The application was heard in the Federal Circuit Court of Australia. The primary legal issue before the court was whether it was necessary to release a portion of the frozen funds to the second defendant to cover its living expenses and to fund its defence. The court also had to consider whether the second defendant had demonstrated that it would not use the released funds to prejudice the plaintiff’s claims. The court considered the evidence provided by the second defendant and the submissions made by both parties. It determined that while the second defendant had demonstrated a need for some funds to cover its living expenses and fund its defence, the amount requested was excessive. The court concluded that a limited release of funds was necessary to address the second defendant’s living expenses and to enable it to fund its defence. The court ordered the release of a specific amount of funds to the second defendant, subject to conditions that the funds would not be used to prejudice the plaintiff’s claims. The court further ordered that the second defendant was not permitted to sell its property during the course of the litigation.

Orders