By a summons filed on 24 December 2020, the plaintiff, Bank of China Limited, sought the following relief against the defendant, Ying Chen:
"1 Judgement for the Plaintiff in the sum of RMB ¥17,990,172.26, or the equivalent in Australian dollars, being the recognition and enforcement of a judgment of the People's Court of District Jimo, Qingdao Shi, Shandong Province, China in proceedings (2019) Lu 0282 Civil Trial No 4209.
2 Judgement for the Plaintiff in the sum of RMB ¥22,372,474.11, or the equivalent in Australian dollars, being the recognition and enforcement of a judgment of the People's Court of District Jimo, Qingdao Shi, Shandong Province, China in proceedings (2019) Lu 0282 Civil Trial No 4210.
3 Interest.
4 Costs.
5 Such further or other orders as to the Court seem fit."
That matter was heard before me on 25 August 2022 and, at the end of the hearing, I made the following orders and directions, and reserved my reasons:
"The Court orders:
1. Judgment for the Plaintiff in the sum of RMB21,691,810.90 in respect of the Civil Mediation Judgment of the People's Court of Jimo District, Qingdao City, Shandong Province, People's Republic of China in proceedings (2019) Lu 0282, Civil Trial No. 4209.
2. Judgment for the Plaintiff in the sum of RMB27,307,302.39 in respect of the Civil Mediation Judgment of the People's Court of Jimo District, Qingdao City, Shandong Province, People's Republic of China in proceedings (2019) Lu 0282, Civil Trial No. 4210.
3. The Defendant is to pay the Plaintiff's costs of the proceedings.
4. If the Defendant wishes to apply to set aside orders 1, 2, or 3 under Rule 36.16(2)(b) of the Uniform Civil Procedure Rules 2005 (NSW) the Defendant is to file and serve a notice of motion seeking that relief and any supporting evidence on or before 15 September 2022.
The Court directs:
5. The Plaintiff to serve by email and post on the Defendant a copy of these orders on or before 29 August 2022."
My reasons for making those orders are as set out below.
The summons was served on the defendant, Ms Chen, in China on 7 January 2021. On 21 April 2021, Ms Chen challenged the service of the summons by filing a notice of motion seeking to set aside the plaintiff's summons on the basis that the summons had not been duly served on the defendant in China because leave to serve the summons out of the jurisdiction had not been obtained as required by r 11.5 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR). In response, the plaintiff contended that, by operation of r 11.4 and Sch 6(m) of the UCPR leave was not required because the originating process "sought to recognise or enforce any judgment" and the "judgments" of the People's Court referred to in prayers 1 and 2 of the summons were "judgments" for the purposes of Sch 6(m).
The plaintiff's notice of motion was heard by Harrison AsJ on 18 February 2022. On 7 June 2022, her Honour handed down her judgment, Bank of China Limited v Chen [2022] NSWSC 749, and made the following orders:
"(1) The defendants notice of motion filed 21 April 2021 be dismissed.
(2) The defendant's application for variation of the previous cost order of Registrar K Jones dated 19 October 2021 is refused.
(3) The plaintiff is to file and serve an affidavit deposing the current amount of the judgment debt by 20 June 2022.
(4) The defendant is to pay the plaintiff's costs."
Her Honour's judgment recorded that the parties' submissions were not limited to the question of whether the "judgments" of the People's Court referred to in prayers 1 and 2 were "judgments" within the meaning of Sch 6(m) to the UCPR but also included submissions concerning the enforcement at common law of this type of judgment.
Harrision AsJ made findings as to how the "judgments" of the People's Court referred to in prayers 1 and 2 came about and concluded that they were "judgments" within Sch 6(m). In addition, her Honour dealt with the issue of enforcement, relevantly holding as follows (referring to the applicable authorities, affidavit evidence and experts' reports which she accepted):
"8. The principles for enforcement of a Chinese judgment in Australia are settled. In Bao v Qu; Tian (No 2) [2020] NSWSC 588 ("Bao"), Rothman J summarised those principles at [23]-[29]:
'[23] Foreign judgments may be enforced in Australia either at common law or pursuant to the statutory regime under the Foreign Judgments Act 1991 (Cth).
[24] The statutory regime applies where a country has been designated as a jurisdiction of substantial reciprocity under the Regulations. The People's Republic of China has not been so designated: see the Foreign Judgments Regulations 1992 (Cth), sch 1.
[25] Thus, the judgments of Chinese courts are not enforceable in Australia through statutory means. However, decisions of Chinese courts may be enforceable in Australia under the common law procedure for the enforcement of foreign judgments.
[26] At common law, a foreign judgment is prima facie capable of recognition and enforcement if the following requirements have been met:
(1) the foreign court must have exercised jurisdiction of the requisite type over the defendant (also known as jurisdiction "in the international sense");
(2) the judgment must be final and conclusive;
(3) there must be identity of parties between the judgment debtors and the defendants in any enforcement action; and
(4) the judgment must be for a fixed, liquidated sum.
See Benefit Strategies Group v Prider (2005) 91 SASR 544; [2005] SASC 194 per Bleby J at [18]; Schnabel v Yung Lui [2002] NSWSC 15 per Bergin J at [75]; RDCW Diamonds Pty Ltd v Da Gloria [2006] NSWSC 450 per Rothman J at [28]-[32]; M Davies et al, Nygh's Conflict of Laws in Australia (LexisNexis, 10th ed, 2020) at [40.2].
…
[29] The onus rests on the party seeking to enforce the foreign judgment to establish these four requirements: Carl Zeiss Stiftung v Rayner & Keele Ltd [1967] 1 AC 853, Schnabel at [74]-[76]. Once they are established, however, the judgment is prima facie enforceable as a valid obligation: Stern v National Australia Bank; National Australia Bank Ltd v Pollack [1999] FCA 1421 at [133] (Tamberlin J); Suzhou Haishun Investment Management Co. Ltd v Yue'e Zhao & Ors [2019] VSC 110 at [92]."
…
Jurisdiction in the international Sense
86. The basic principle in relation to this criterion is that the foreign court must have jurisdiction over the defendant. The defendant's authorised legal representative appeared before the People's Court on her behalf: Huang Aff 11.12.20 at [5]-[7]. The parties agreed to mediation: Huang Aff 11.12.20 at [7]-[8]. The representatives of the plaintiff and the defendant agreed that the defendant should pay the plaintiff RMB ¥ 17,990,172.26 in relation to Proceedings 4209, and RMB ¥ 22,372,474.11 in relation to Proceedings 4210, and this agreement was recorded in the transcript: Huang Aff 11.12.20 at [11]. The parties' representatives then signed the transcript and the Documents were issued by the People's Court: Huang Aff 11.12.20 at [12]-[13]. I am satisfied jurisdiction in the international sense is established.
Final and conclusive
87. In order for the second criterion to be made out, the foreign court's judgment must be final in the sense that it puts an end to the proceedings and is treated as res judicata by the courts of the country in which it is made: Bao at [28]. The Mr Cao confirms this in Cao Report 19.2.21 at [1] and [3.5]-[3.8] and Mr Cao's translation is confirmed in Xue Aff 26.2.21. Assoc. Prof. Huang reports an MTS establishes res judicata: Huang Report 1.10.21 at [23]-[28]. Prof. Lin reports that an MTS is binding once signed by both parties or their representatives: Lin Report 21.1.21 at [10], [37] and [39]. I am satisfied the MTS' are final and conclusive.
Identity of Parties
88. The defendant's name, date of birth and Chinese citizen ID card number appear on the Documents. These are the same as those in Annexure "A" of Zhang Aff 8.6.21. I am satisfied the defendant is relevantly identified.
Judgment for a fixed liquidated sum
89. The Documents give a fixed amount for principal and interest being RMB ¥ 17,990,172.26 in Proceedings 4209 and RMB ¥ 22,372,474.11 in Proceedings 4210. I am satisfied the judgments are for a fixed liquidated sum.
90. The Bao principles have, in my opinion, been met on the evidence presented.
…
107. The judgments in Proceedings 4209 and 4210 embodied in the Documents are enforceable. The plaintiff is to file and serve an affidavit by 20 June 2022 as to the correct amount of the judgment debt."
The references to "the Documents" and an "MTS" were explained in the judgment.
1. As to "the Documents", since a central issue in dispute before her Honour was whether the two "judgments" of the People's Court referred to in the summons were "judgments" within the meaning of Sch 6(m) of the UCPR, they were referred to in her Honour's judgment by the neutral term "the Documents": Harrison AsJ's judgment at [4]; and
2. "MTS" referred to a type of outcome in a Chinese Court described as "民事调解书", whose pronunciation can be represented using the Latin alphabet as "Minshi Tiaojie Shu", and which was abbreviated to "MTS": Harrison AsJ's judgment at [31].
The People's Court outcomes sought to be enforced in the present case were 民事调解书, which has been translated in various ways, as illustrated by her Honour at [31] and [32]. Accepting Harrision AsJ's unchallenged and very helpful findings and analysis, I have referred to the 民事调解书 in this case as "civil mediation judgments" and accepted that they are "judgments" within the meaning of Sch 6(m) to the UCPR.
In addition, I understood her Honour's finding at [88] to the effect that the defendant's name and ID card number were the same in relation to both the civil mediation judgments and in relation to the present proceedings meant that the parties to the judgments and the parties to these proceedings were identical. This followed from the fact that there was no dispute as to the identity of the Bank of China Limited, which was the judgment creditor in respect of the two civil mediation judgments as well as being the plaintiff in the present proceedings.
I noted that there had been no appeal from Harrison AsJ's judgment, which took effect as a judgment of the Supreme Court by virtue of s 118(4) of the Supreme Court Act 1970 (NSW). Further and in any event, even if it were necessary for me to reach any conclusions in relation to the enforceability of the civil mediation judgments, based on the evidence before me I was satisfied that the same conclusion should be reached that the civil mediation judgments in proceedings (2019) Lu 0282, Civil Trial No. 4209 and (2019) Lu 0282, Civil Trial No. 4210 were enforceable by this Court under the principles stated in Bao v Qu; Tian (No 2) [2020] NSWSC 588 for the reasons her Honour gave, which I respectfully adopted.
Apart from the fact that the defendant did not appear at the hearing of the summons, I could discern no reason of public policy which might amount to basis for not recognising and enforcing the civil mediation judgments of the People's Court in this case.
As noted above, the orders made by Harrison AsJ on 7 June 2022 included order (3) requiring the Bank of China to file and serve an affidavit deposing to the current amount of the judgment debts by 20 June 2022. This was done since quantification of the amount outstanding under the civil mediation judgments was the only outstanding issue and in order to permit consideration of whether final relief should be granted, as sought in the summons, on an expeditious and properly informed basis.
An affidavit affirmed on 20 June 2022 by Junxian Huang dealing with the then current amount of the judgment debts (including interest) was filed on 23 June 2022.
On 30 June 2022, the proceedings were before the Registrar and Dr Townsend appeared for the plaintiff and Mr Chan appeared for the defendant. On that occasion, no point was apparently taken that Junxian Huang's affidavit of 20 June 2022 was filed and served late, and the summons was set down for final hearing on 25 August 2022. Directions were also made for the filing and serving of written submissions by the parties during August 2022.
On 5 July 2022, the defendant's solicitors filed a notice of intention to file and serve a notice of ceasing to act.
On 3 August 2022, the foreshadowed notice of ceasing to act by the solicitors for the defendant was filed and, as required, that notice gave the last known business or residential address, email address and telephone number for the defendant, Ying Chen.
On 12 August 2022, Xiaoyu (Franky) Sun one of the solicitors for the plaintiff sent emails to the defendant's last known email address attaching a copy of the plaintiff's written submissions dated 12 August 2022 and noting that the proceedings were listed for hearing on 25 August 2022 at 10:00. There was nothing to indicate that these emails were not delivered to the defendant's email address.
The evidence of Tong Qiu, a lawyer with Beijing DHH (Qingdao) Law Firm, was that he was instructed by the plaintiff's solicitors to serve on the defendant the correspondence between the plaintiff's solicitor and the defendant on 12 August regarding the hearing on 25 August 2022 and the plaintiff's written submissions of 12 August 2022.
Tong Qiu gave evidence of two unsuccessful attempts to serve those documents on the defendant, although contact was made with her by telephone on a number of occasions. Eventually, on 19 August 2022 a female was observed to collect the correspondence and written submissions left for the defendant in the lobby of the building the defendant occupied. On that day, Tong Qiu also sent copies of those documents and a letter explaining what had occurred in relation to the documents left in the lobby to the defendant by express post to the address nominated in the notice of ceasing to act. I accepted Tong Qiu's evidence.
On 22 August 2022, Franky Sun received an email from the defendant in response to the emails of 12 August 2022 which stated (in translation):
"I have ceased to retain my previous lawyer and am looking for a new lawyer.
I am not able to prepare for the next hearing nor attend it. Please explain to the Court and arrange for adjournment.
Thanks!"
On 22 August 2022, Franky Sun responded to the defendant's email in the following terms:
"Thank you for your email of 22 August 2022.
The Plaintiff does not consent to an adjournment of the hearing date of 25 August 2022. We put you on notice that Plaintiff will proceed to judgment against you on that date, whether or not you choose to appear before the Court."
On 24 August 2022 at 15:48, Franky Sun sent to the defendant an email attaching copies of: the affidavit of Xiaoyu Sun affirmed 23 August 2022; the affidavit of Tong Qiu affirmed 24 August 2022; and, the affidavit of Junxian Huang affirmed 24 August 2022. The first two of those affidavits dealt with service of the documentation referred to above and the third affidavit updated the amount outstanding under the civil mediation judgments as at 24 August 2022.
On 24 August 2022 at 19:50, the defendant replied in Mandarin to the email of Franky Sun sent earlier that day. This email was translated into English by Ms June Liu, a partner in the firm of solicitors retained by the plaintiff. Ms Liu's native language is Mandarin and she speaks and writes English consistent with her practising as a solicitor in New South Wales. Her translation of Ms Chen's email was:
"I cannot accept this approach! Due to the COVID-19 restrictions in China, all parties cannot have normal and smooth communication, also myself and my acting lawyer are not present. What's the meaning of such hearing?"
Based on the evidence of Junxian Huang, which I accepted, I was satisfied that each of the civil mediation judgments provided that interest was to be calculated in accordance with the terms of the underlying loan agreements, which were somewhat complex. As a result, the quantum of outstanding interest from time to time was calculated by the Bank of China's internal computer system, which was programmed to make the calculations in accordance with the relevant loan agreements. In some cases, the loan was denominated in a currency other than Renminbi yuan and a conversion into that currency was required.
I was informed that the calculation of the total amount outstanding under each of the civil mediation judgments took into account sums already recovered by the plaintiff in satisfaction of those judgments including interest.
In all the circumstances, I was satisfied that as at 24 August 2022 the amounts outstanding were as follows:
1. RMB ¥21,691,810.90 in respect of the civil mediation judgment in proceedings No. 4209; and
2. RMB ¥27,307,302.39 in respect of the civil mediation judgment in proceedings No. 4210.
As noted above, I was also satisfied that both of these judgments were enforceable by this Court and, in the circumstances of the present case, I considered that orders should be made accordingly.
Since the plaintiff was entirely successful, it was in my view appropriate that costs should follow the event.
In order, however, to take into account that Ms Chen was not represented at the hearing before me and in order to ensure that she was given an opportunity to challenge any orders made disposing of the summons, if she wished to do so, I included in the orders and directions:
1. an order that, if the defendant wished to apply to set aside the orders enforcing the civil mediation judgments and the costs order, because she was not present for the hearing or when the orders were made, she should file and serve a notice of motion seeking such relief and any supporting evidence within approximately 3 weeks; and
2. a direction that the plaintiff serve by email and post on Ms Chen a copy of the orders.
Finally, I note that, in the form of orders and directions made on 25 August 2022, the appropriate symbol (¥) to denote that the currency was Renminbi (RMB) yuan was inadvertently not included. Accordingly, under the slip rule, r 36.17 of the UCPR, the orders made on 25 August 2022 are corrected by the insertion of "¥" in orders (1) and (2) so that the orders and directions read as follows:
The Court orders:
1. Judgment for the Plaintiff in the sum of RMB ¥21,691,810.90 in respect of the Civil Mediation Judgment of the People's Court of Jimo District, Qingdao City, Shandong Province, People's Republic of China in proceedings (2019) Lu 0282, Civil Trial No. 4209.
2. Judgment for the Plaintiff in the sum of RMB ¥27,307,302.39 in respect of the Civil Mediation Judgment of the People's Court of Jimo District, Qingdao City, Shandong Province, People's Republic of China in proceedings (2019) Lu 0282, Civil Trial No. 4210.
3. The Defendant is to pay the Plaintiff's costs of the proceedings.
4. If the Defendant wishes to apply to set aside orders 1, 2, or 3 under Rule 36.16(2)(b) of the Uniform Civil Procedure Rules 2005 (NSW) the Defendant is to file and serve a notice of motion seeking that relief and any supporting evidence on or before 15 September 2022.
The Court directs:
1. The Plaintiff to serve by email and post on the Defendant a copy of these orders on or before 29 August 2022.
[3]
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Decision last updated: 01 September 2022