Huo v Super Shepherd Pty Ltd

Category: Procedural rulings

Parties: Jingmin Huo (Plaintiff)
Super Shepherd Pty Ltd (First Defendant)
Chun Ting Lee (Second Defendant)
Tony Truong (Third Defendant)

Representation: Counsel:
A Rizk (Plaintiff)
A E Hopkins (Second Defendant)
Solicitors:
KAS Lawyers (Plaintiff)
Bailey Law (Second Defendant)

File Number(s): 2024/00368523

Publication restriction: No

JUDGMENT – EX TEMPORE

1. Before the Court for determination is a Notice of Motion filed on 3 November 2025 by the second defendant seeking an order under s 67 of the Civil Procedure Act 2005 (NSW) staying, according to the Motion, the judgment given and entered on 25 August 2025 and any execution of the same, pending an appeal. Stays should in general terms be sought in relation to orders not judgments.

2. In support of the application, the applicant read the affidavit of the second defendant, Chun Ting Lee, dated 3 November 2025.

Background

3. In substance, the background facts are as follows:

(a) A stay is sought, pending an appeal to the Court of Appeal, from orders made by Gibson DCJ on 25 August 2025: see Huo v Super Shepherd Pty Ltd & Others [2025] NSWDC 345; (b) A final hearing date for the appeal has been fixed for 9 February 2026 which is a relatively short time away. A short delay in hearing and determining the appeal only is likely, therefore; (c) Interlocutory orders for the conduct of the appeal have been made in the Court of Appeal; (d) A Notice of Appeal for the appeal and a red book have been filed; (e) The transcript has been obtained in relation to the hearing at first instance; (f) The amount in issue is a large amount; (g) There is no evidence before the Court that the first defendant can pay the judgment amount. The first defendant had judgment entered against it previously; (h) There is no evidence that the second defendant can pay the judgment amount. In relation to that matter, the second defendant gives evidence as to his income and assets which I accept, as there is nothing to the contrary before me as to that; (i) The evidence indicates that the estimated costs of the appeal would be between $50,000 and $60,000. There is no evidence about how the second defendant will meet those costs. I can only assume that they will be met either from his income or from some third party source not indicated; (j) The applicant has taken proceedings to protect his position in the Federal Circuit and Family Court of Australia (Div. 2) as to his potential bankruptcy; (k) The applicant, as I indicated, has limited resources and cannot offer on the evidence any security. (l) The refusal to grant a stay may lead to the applicant's bankruptcy notice being determined which may, subject to a matter I will later refer to, make the appeal nugatory; (m) Steps seem to have been taken to prosecute the appeal with due dispatch.

4. The Court has been assisted by both written submissions and vigorous oral submissions from counsel for both parties.

Principles Applicable

5. The parties have referred to the classic decision on stays of Alexander v Cambridge Credit Corporation Limited (1985) 2 NSWLR 685.

6. There have been numerous decisions of the Court of Appeal, both last year and this year, in relation to the principles applicable.

7. In Michael Hill Jeweller (Australia) Pty Ltd v Gispac Pty Ltd [2024] NSWCA 128, Payne JA set out the principles to be applied at paragraphs five to nine of his Honour's judgment. I will spend a little bit of time on this decision as it forms the foundation for later decisions of the Court. In essence, his Honour held as follows at [5]-[11]:

(a) The principles governing the grant of a stay pending an appeal are well settled; (b) The party applying for a stay must show, first, that the appeal raises serious issues for determination by the appellate court; and (c) Secondly, that there is a real risk that the appellant will suffer prejudice or damage if the stay is not granted; (d) If an appellant prevails on those two questions, the onus being on the appellant, then the Court is to consider the balance of convenience and the competing rights of the parties; (e) One factor which is relevant is whether the Notice of Appeal takes a carefully considered and focused approach setting out in some detail the reasoning in support of the appeal.

8. Exceptional or special circumstances are not required for a stay.

9. In ACN 627 087 030 Pty Limited v Po**che [2025] NSWCA 66, Kirk JA considered a stay in the context of an appeal and quoted with approval the decision of the Court of Appeal in Kalifair Pty Ltd v Digi-Tech (Australia) Ltd (2002) 55 NSWLR 737 at [18]. The principles there stated are similar to the ones I have previously set out from Payne JA. The requirement that there be a “real risk” that the appellant will suffer prejudice or damage will be satisfied if the appeal would be rendered abortive or nugatory unless a stay is granted. Then the Court looks at the balance of convenience issue. As Kirk JA indicated in paragraph 11, the starting point is that the respondent is entitled to the fruits of its judgment.

10. In Nyangbul v State of New South Wales [2025] NSWCA 119, Griffiths AJA stated the principles applicable and adopted the comments of Payne JA in the Michael Hill case at paragraphs 17-20. His Honour also referred to Dogra v Dogra (No. 3) [2024] NSWCA 2018 at [19] where it was held that the general principles stated by Payne JA in the Michael Hill Jeweller case did not preclude the potential relevance of other matters in considering whether or not to grant a stay pending an appeal. At paragraph 19 his Honour emphasised the factor I have mentioned above, that there is no requirement for the applicant to demonstrate that there are special circumstances which justify a stay. At paragraph 20, Griffiths AJA indicated that the Court was not required to conduct a detailed assessment of the grounds of the appeal for the purpose of a stay but needs to be satisfied that one or more serious questions are raised by the appeal.

11. In the decision of Rahman v Rahman [2025] NSWCA 126, Adamson JA again adopted the principles stated by Payne JA in the Michael Hill Jeweller case.

12. As I indicated, the Court has been assisted by detailed submissions for both parties. The Court has also had the advantage of reading the decision of Gibson DCJ and also the earlier decision of Cole DCJ against the first defendant in the proceedings, being Huo v Super Shepherd Pty Ltd [2025] NSWDC 286.

Consideration

13. It appears from the judgment of Gibson DCJ that the second defendant was self-represented at the hearing before her. He had previously had solicitors acting for him some time earlier. He sought a vacation of the hearing date at the time of the hearing which her Honour rejected. Reasons were given in her Honour's judgment in relation to that issue.

14. Thus, the second defendant had to conduct the case as a litigant in person. The second defendant's occupation is registered architect, and Gibson DCJ makes some comment at the time that as an architect the second defendant appeared to be an intelligent and educated person: at [51].

15. The Notice of Appeal is part of the exhibit to Mr Chun Ting Lee's affidavit. In the Notice of Appeal there are extensive grounds of appeal. In my view, this is not like an appeal where there are general grounds of appeal, for example that a decision is against the evidence or that the Court should have preferred one series of witnesses over another.

16. Mr Rizk in his written submissions makes extensive reference to the grounds of appeal. This Court should not and will not undertake an analysis of the grounds such as to effectively form a view as to whether grounds are more likely to succeed or not. The second defendant, as I indicated, was self-represented and that placed difficulties in the path of the second defendant at the trial. The grounds of appeal are numerous and complex. I only have to find that a ground of appeal is arguable, although the strength of the grounds for appeal are relevant.

17. One matter which concerns me is the conduct of the hearing where the second defendant was acting for himself. That comment should not be construed as any suggestion that Gibson DCJ acted inappropriately or in breach of the rules of natural justice. However, I am concerned in relation to the desire by the second defendant to cross-examine the witnesses. Mr Rizk referred me to p 46 of the exhibit (p 24 of the transcript) and in particular the defendant wishing to cross-examine the factual witnesses. There also is an issue about cross-examination of the expert witnesses. Her Honour indicated that the witnesses were not there and that Mandarin interpreters would be required for those witnesses. Her Honour rejected the application. It seems to me that it is possible to argue that her Honour should have adjourned the proceedings to permit the cross‑examination.

18. The issue relates to what occurred in the interaction between the various witnesses in the case. I do not think that that is a strong ground of appeal but I think that it is not so weak that I would exclude it as being a proper matter to be argued before the Court of Appeal.

19. A number of the other grounds raise issues both as to quantum and as to liability. Having reviewed the judgment, I am not satisfied in relation to the issue concerning the ground of appeal as to the distinction said to be inappropriately drawn by Gibson DCJ between the second defendant and the first defendant. I need not go into that in any more detail.

20. Turning back therefore to the principles to be applied, as I indicated, the applicant/appellant bears the onus of establishing first, that the appeal raises serious issues for determination by the appellate court, and secondly, that there is a real risk that the appellant will suffer prejudice or damage if the stay is not granted. In relation to the first of those requirements, I am satisfied that at least one of the appeal grounds is arguable, albeit on its face it does not appear to be a strong ground of appeal. That, in my view, means that the first issue should be determined in favour of the applicant.

21. The second issue is whether there is a real risk that the appellant will suffer prejudice or damage if the stay is not granted. I will come back to an issue relating to offered undertakings shortly. However, what is clear from the evidence is that there are proceedings in the Federal Circuit and Family Court of Australia (Div. 2) relating to bankruptcy issues and, in my view, there is a real risk that the appellant will suffer prejudice or damage in those proceedings if the stay is not granted.

22. The Court then proceeds to look at the balance of convenience and the competing rights of the parties: see Pamplin v Irwin [2024] NSWCA 112 at [11] per Leeming JA as followed by Payne JA in Michael Hill Jeweller at [5].

23. One starts with the proposition that generally a person is entitled to the fruits of their victory. The factors which in my view are relevant in comparing the competing rights of the parties are the right to enjoy the fruits of victory against the interests of the appellant/second defendant to have the opportunity of an appeal and not to have that appeal be rendered nugatory by action taken in the interim. The balance of convenience must take into account that the hearing is not that far away, being in February of next year, and that the preparation for the appeal is, on the evidence, well advanced. On one level there are a number of factors on the balance of convenience which clearly favour a stay. These include that the second defendant is of limited means, there is a threat of a bankruptcy order against him, there is no significant prejudice to the plaintiff indicated other than an indicated problem with the date when an act of bankruptcy is said to have taken effect, the appeal date has been set and is only a short time away, the Notice of Appeal has been filed and steps have been taken to advance the matter.

24. It is argued by Mr Rizk on behalf of the plaintiff/respondent to the application that in any case an order for security should be made. In my view, no order for security should be made if there is not a stay. Secondly, even if a stay was to be ordered, on the basis of the evidence before me in the affidavit of the second defendant, in my view, an order for security would be inappropriate because it would stultify the appeal (there being no clear evidence of means to pay the amount). The fact that the costs of the appeal are greater than the second defendant's resources is a factor but there is no evidence before me how the costs are being paid and it may be that some arrangement has been made. I cannot advance the matter any further. In my view, no security should be ordered in either scenario against the applicant.

25. Mr Rizk has offered to give undertakings to the Court on behalf of his client. Those undertakings are an undertaking not to file any creditor's petition seeking a sequestration order or to take any steps to execute on the orders made by Gibson DCJ on 25 August 2025 pending the hearing of the appeal.

26. Mr Rizk submits that these undertakings are acceptable and should be taken by the Court as adequate protection for the plaintiff and that would not stop the plaintiff continuing, if he so chooses, to defend proceedings for setting aside of the bankruptcy notice. It is submitted that on a balance of convenience basis that such undertakings, properly taken into account, protect the position of the second defendant and properly take into account the position of the plaintiff.

27. Mr Hopkins, who appears on the application for the second defendant, submits that to accept such undertakings would effectively result in further litigation in the Federal Circuit and Family Court of Australia on the bankruptcy issue, thus resulting in further costs to all of the parties where what should simply be granted is the stay. He further submits that it is unnecessary in all the circumstances for the second defendant to give any usual undertaking to prosecute the appeal with due dispatch because that is effectively evidenced by what steps have been already taken by him in any case in relation to the matter.

28. The Court therefore has before it two alternative approaches to the appeal. It seems that the plaintiff accepts that the appeal should be run and has a date but wants to protect his position in relation to the bankruptcy. The second defendant submits that this just adds another level of complexity and encouragement of further litigation and that a simple stay should be ordered.

29. In my view, it is a closely balanced situation. The appeal is to be heard only a relatively short period away. It is not as if the appeal is to be heard several months in the future. I understand the desire of the plaintiff to protect its position as to the bankruptcy notice, however, in my view, taking into account all the circumstances of the case, the balance of convenience just favours the second defendant. In taking into account the proper approach which the Court should take, I have carefully considered the undertakings proposed. However, in my view, it is in the interests of justice to limit wherever possible further litigation and the unnecessary expenditure of further costs pending the outcome of the appeal.

30. It is important that the second defendant is diligent and proactive in relation to the prosecution of the appeal. In my view, leave should be granted to the plaintiff to bring the matter back before the Court if there is a fundamental issue relating to that.

31. The following orders are made:

In relation to the Notice of Motion filed on 3 November 2025:

1. Pursuant to s.67 of the Civil Procedure Act 2005 (NSW), the orders made by Gibson DCJ on 25 August 2025 are stayed, including any execution pursuant to those orders, until the determination of the appeal in proceedings number 2025/364401 in the Court of Appeal of the New South Wales Supreme Court (“Appeal Proceedings”).
2. The costs of the Notice of Motion are to be costs in the Appeal Proceedings.
3. Liberty to apply on one business day’s notice.

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