• Lawyers in Sydney
• Lawyers in Melbourne
• Lawyers in Brisbane
• Lawyers in Perth
• Family lawyers
• Employment lawyers
• Criminal lawyers
• Wills and estates lawyers
• Find a lawyer

Category: Consequential orders

Parties: Jianping Qiu (First Plaintiff)
Jingjing Lin (Second Plaintiff)
Yuchen Chen (First Defendant)
Jarrah Capital 2005 Loan Pty Ltd (Second Defendant)
Michael Hai Tao Pan (Third Defendant)

Representation: Counsel:
D Cook SC with J Foley (Plaintiffs)
E Finnane (First Defendant)
N Li (Second and Third Defendants)
Solicitors:
AHD Lawyers (Plaintiffs)
EXC Law (First Defendant)
Northan Legal (Second and Third Defendants)

File Number(s): 2024/00241565

Publication restriction: Nil

JUDGMENT

1. On 30 July 2026, I delivered reasons for judgment in this matter: Jianping Qiu v Yuchen Chen (No 2) [2026] NSWSC 899 (Primary Judgment).

2. In the Primary Judgment, I found that each of the First to Third Defendants engaged in misleading conduct in contravention of s 12DA(1) of the Australian Securities and Investments Commission Act 2001 (Cth) (ASIC Act), and that, as a result, the Plaintiffs suffered, between them, loss and damage in the amount of $1m.

3. I also found that the Second Defendant (Jarrah Capital) was liable for breach of trust and for breach of its duties as trustee, and that the Third Defendant (Mr Pan) knowingly assisted in those breaches of duty (Primary Judgment at [328], [338]).

4. At the time of delivering the Primary Judgment, I made orders for the parties to confer on interest and costs, and to serve submissions on any issue which remained in dispute, and also for the parties to exchange submissions on the issue of apportionment, as between the Defendants, of the loss and damage suffered by their respective contraventions of s 12DA of the ASIC Act.

5. The parties have conferred and agreed that the amount of pre-judgment interest up to the date of delivery of the Primary Judgment was $112,212.33, with interest accruing thereafter at a daily rate of $114.38. It follows that, as at the date of these reasons for judgment, the total interest figure is $115,529.35, and the total apportionable loss, including pre-judgment interest, is $1,115,529.35.

6. It should be noted that the parties’ submissions proceeded on the basis that – even though there were two separate amounts of $500,000 invested, with one being invested in the name of the First Plaintiff (Mr Qiu) and the other in the name of his wife, the Second Plaintiff (Ms Lin) – there should be a single judgment sum awarded in favour of the Plaintiffs, with interest calculated on the total sum of $1m. I will also proceed on this basis.

7. There remain two questions for determination:

8. first, the manner in which the Plaintiffs’ loss should be apportioned between the Defendants; and

9. secondly, whether the Defendants should be jointly and severally liable for the Plaintiffs’ costs, or whether the liability for costs should also be apportioned between them.

Apportionment

8. It is common ground that the Plaintiffs’ claims against each of the Defendants for the loss suffered by their respective contraventions of s 12DA(1) of the ASIC Act are apportionable claims.

9. Section 12GR(1) of the ASIC Act provides as follows (emphasis added):

(1) In any proceedings involving an apportionable claim:

(a) the liability of a defendant who is a concurrent wrongdoer in relation to that claim is limited to an amount reflecting that proportion of the damage or loss claimed that the court considers just having regard to the extent of the defendant’s responsibility for the damage or loss; and

(b) the court may give judgment against the defendant for not more than that amount.

10. A “concurrent wrongdoer” is “a person who is one of 2 or more persons whose acts or omissions (or act or omission) caused, independently of each other or jointly, the damage or loss that is the subject of the claim”: s 12GP(3).

11. Section 12GR(1) directs attention at the extent of each concurrent wrongdoer’s “responsibility” for the plaintiff’s damage or loss. The determinants of “responsibility” are blameworthiness and causal potency: Reinhold v New South Wales Lotteries Corporation (No 2) (2008) 82 NSWLR 762; [2008] NSWSC 187 at [50] (Barrett J).

12. In Podrebersek v Australian Iron and Steel Pty Ltd (1985) 59 ALJR 492 at 493-494; [1985] HCA 34, the High Court (Gibbs CJ, Mason J, Wilson J, Brennan J and Deane J) said that:

“A finding on a question of apportionment is a finding upon a ‘question, not of principle or of positive findings of fact or law, but of proportion, of balance and relative emphasis, and of weighing different considerations. It involves an individual choice or discretion, as to which there may well be differences of opinion by different minds’: British Fame (Owners) v Macgregor (Owners) [1943] AC 197 at 201…

The making of an apportionment as between a plaintiff and a defendant of their respective shares in the responsibility for the damage involves a comparison both of culpability, ie of the degree of departure from the standard of care of the reasonable man (Pennington v Norris (1956) 96 CLR 10 at 16) and of the relative importance of the acts of the parties in causing the damage: Stapley v Gypsum Mines Ltd [1953] AC 663 at 682; Smith v McIntyre [1958] Tas SR 36 at 42–49 and Broadhurst v Millman [1976] VR 208 at 219, and cases there cited. It is the whole conduct of each negligent party in relation to the circumstances of the accident which must be subjected to comparative examination. The significance of the various elements involved in such an examination will vary from case to case; for example, the circumstances of some cases may be such that a comparison of the relative importance of the acts of the parties in causing the damage will be of little, if any, importance.”

13. In Vinidex v Theiss [2000] NSWCA 67 at [29], Rolfe AJA (with whom Sheller and Fitzgerald JJA agreed) made the following observations:

“… the Court must have regard to what is just and equitable and, in doing so, it must make a comparison of the culpability and of the acts of the parties causing damage and, thus, to the relative blameworthiness and the relevant causal potency of the negligence of each party, and to the whole conduct of each negligent party in relation to the circumstances of the accident by way of comparative examination …”

14. It is also relevant to take into account if either concurrent wrongdoer has obtained some benefit or profit from those actions on its part which caused the plaintiff’s loss: Reinhold at [61]; Stav Investments Pty Ltd v Taylor; LK Group Investments Pty Ltd v Taylor [2022] NSWSC 208 at [548] (Ward CJ in Eq, as her Honour then was).

Apportionment as between Jarrah Capital and Mr Pan?

15. A preliminary issue is whether loss can be apportioned as between Jarrah Capital and Mr Pan, in circumstances where Jarrah Capital contravened s 12DA by reason of the conduct of Mr Pan, who was its sole director, and by reason of the conduct of an employee (Mr Damon Yu), which was undertaken at the direction of Mr Pan (Primary Judgment at [207]-[221]).

16. The Plaintiffs submitted that there should be no apportionment as between Mr Pan and Jarrah Capital, having regard to the decision of the Court of Appeal in Tomasetti v Brailey [2012] NSWCA 399 and the decision of the Full Court of the Federal Court in Robinson v 470 St Kilda Road Pty Ltd (2018) 263 FCR 572; [2018] FCAFC 84.

17. In Tomasetti, an issue arose as to whether, pursuant to s 35(1) of the Civil Liability Act 2002 (NSW) (which is in relevantly the same terms as s 12GR(1) of the ASIC Act), loss should be apportioned as between an individual (Mr Brailey) and a corporation (TJC), in circumstances where Mr Brailey “was, in effect, [TJC]”, with “their acts and mind being the same”, such that “the acts and omissions of Mr Brailey in advising the appellants were the corporate acts of TJC” (at [154]). Macfarlan JA (with whom McColl and Campbell JJA agreed) rejected the contention that loss should be apportioned between Mr Brailey and TJC, stating as follows (at [154]):

“I find nothing in the terms of s 35(1) that requires responsibility for a loss to be apportioned between concurrent wrongdoers of this type so that the total of the percentages for which they are liable is 100 per cent. The section simply limits the liability of the defendant to the proportion of the loss that the Court considers just having regard to the defendant’s responsibility for the damage or loss. Here Mr Brailey and TJC were each fully responsible for the losses and it is just that each be liable for 100 per cent of the losses.”

18. In Robinson, the Full Court considered an issue of apportionment arising under s 87CD of the Competition and Consumer Act 2010 (Cth) (which is also in relevantly the same terms as s 12GR(1) of the ASIC Act). The misleading conduct in that case was the making of a false statutory declaration by Mr Robinson, in support of a payment claim by a corporation (Reed) of which Mr Robinson was the chief operating officer. Again, the issue which arose was whether there should be apportionment between Mr Robinson and Reed, in circumstances where Mr Robinson was “the directing mind and will” of Reed, such that Mr Robinson and Reed bore “joint and direct liability” for the misleading statutory declaration (at [34]).

19. McKerracher and Markovic JJ (with whom Rangiah J agreed on this issue) observed (at [51]) that in such circumstances:

20. “it cannot be said that the acts are independent because there is a single act carried out by the person which is also the act of the company”;

21. “it cannot be said that the acts ‘jointly’ caused the damage or loss. There is no capacity for joint conduct because there is only a single act, which makes it artificial to say that there are two acts of persons, one of the company and one of the director”; and

22. “there cannot be any concurrent wrongdoing within the definition of s 87CB(3) of the TPA or in any common use of the expression ‘concurrent wrongdoer’”.

23. Their Honours said (at [53]-[54], emphasis in original) that:

“The reason why s 87CB(3) of the CCA could not apply may be put another way. The provision requires that the concurrent wrongdoer be a person who is one of two or more persons whose individual acts or omissions would, independently of each other, have caused the damage or loss. In the present instance, there is no independent act at all of Reed which could fall for consideration. While the company would have been 100% liable if sued for the acts of Mr Robinson, the acts were not acts which were independent of the acts of Mr Robinson. To the contrary, they were directly dependent upon his conduct in that they are regarded at law as one and the same act.

As a consequence, it would be impossible to form any view that Reed, by virtue of conduct of some other employee or officer, should contribute any percentage, let alone 50% by way of apportionment. The very concept of apportionment requires an assessment of the degree of wrongdoing of the contributory wrongdoer. There is no evidence of any wrongdoing on the part of Reed, but for the actions of Mr Robinson himself.”

21. The Plaintiffs acknowledged that in DSHE Holdings Ltd (Receivers and Managers) (in liq*) v Potts; HSBC Bank Ltd v Abboud; Potts v National Australia Bank Ltd* (2022) 163 ACSR 23; [2022] NSWCA 165 at [439]-[440], the Court of Appeal (Leeming and Kirk JJA, and Basten AJA) expressed some doubt about the construction of the proportionate liability provisions which was adopted in Tomasetti and Robinson. However, those observations were obiter in circumstances where the appellant (who was a director of the relevant company, DSH) “accepted that he had to establish some act attributable to DSH, other than his own acts vicariously attributable to DSH, in order to establish that DSH was a concurrent wrongdoer” (at [442]).

22. In the present case, Mr Pan was at all material times a director and the Chief Executive Officer of Jarrah Capital (Primary Judgment at [3]). Jarrah Capital provided an Information Memorandum in respect of the Jarrah Capital Trust (Jarrah Capital IM) to Mr Chen at Mr Pan’s direction (Primary Judgment at [208]). The knowledge of Mr Pan was the knowledge of Jarrah Capital (Primary Judgment at [241]-[242]), [246]). The liability of Jarrah Capital for contravention of s 12DA of the ASIC Act arises from the acts or omissions of Mr Pan (Primary Judgment at [207]-[220]).

23. In those circumstances, and having regard to the decisions in Tomasetti and Robinson, I reject the contention of Mr Pan and Jarrah Capital that loss can be apportioned as between them. That is either because they are not, as between themselves, “concurrent wrongdoers” (Robinson at [51], [53]) or because it is “just” not to apportion responsibility as between them (Tomasetti at [154]).

Apportionment as between Mr Chen and Jarrah Capital / Mr Pan?

24. It remains necessary to consider the question of apportionment as between, on the one hand, the First Defendant (Mr Chen) and, on the other, Jarrah Capital and Mr Pan.

25. The parties adopted the following positions on this issue:

26. the Plaintiffs submitted that 15% of their loss should be apportioned to Mr Chen, and 85% to Jarrah Capital and Mr Pan;

27. Mr Chen submitted that 5% of the loss should be apportioned to himself, and 95% to Jarrah Capital and Mr Pan; and

28. Jarrah Capital and Mr Pan submitted that 80% of the loss should be apportioned to Mr Chen, with the remaining 20% to themselves.

29. As set out above, in order to determine the extent of the responsibility of the various Defendants for the Plaintiffs’ loss or damage, it is necessary to undertake a comparison both of culpability and of causal potency: Vinidex at [29].

Culpability

27. I have found that Mr Chen contravened s 12DA(1) of the ASIC Act by making misleading statements about the Jarrah Capital Trust (Oral Representations) to the Plaintiffs and by providing the Jarrah Capital IM to the Plaintiffs, which contained misleading statements (IM Representations).

28. I have found that Jarrah Capital and Mr Pan contravened s 12DA(1) of the ASIC Act by providing the Jarrah Capital IM to Mr Chen, knowing and intending that this document would be forwarded to potential investors.

29. Mr Chen was not a sophisticated investor and did not have any training or experience in relation to dealing in financial products (Primary Judgment at [193]).

30. Mr Pan approached Mr Chen about the Jarrah Capital Trust in circumstances where Mr Pan was seeking out new investors, because one of the original investors had requested that Jarrah Capital redeem his units in the Trust and Jarrah Capital did not have the funds available to do so (Primary Judgment at [35]-[36]). Mr Pan was aware that Mr Chen was a former real estate agent who was working as a tennis coach and who had, through tennis, a number of wealthy friends (Primary Judgment at [38]-[39]). Mr Pan offered Mr Chen a financial reward if he was successful in finding investors for the Jarrah Capital Trust (Primary Judgment at [40]).

31. Before Mr Chen met with the Plaintiffs to discuss the Jarrah Capital Trust, Mr Pan told Mr Chen that the Cobbitty Property (being the security property described in the Jarrah Capital IM) had been sold, and told him that there was a “retention amount” associated with the sale contract which provided a form of “security” (Primary Judgment at [195]-[197]). However, Mr Chen did not have any understanding as to either the nature of the arrangement that was in place or how this arrangement provided security for the Jarrah Capital Trust (Primary Judgment at [198]-[202]). He believed the investment was safe because it was promoted by Mr Pan (Primary Judgment at [199]-[201]).

32. When Mr Chen made the misleading Oral Representations to the Plaintiffs – namely, that Jarrah Capital was taking a registered mortgage over a large parcel of land near the proposed Western Sydney Airport and that an investment in the Jarrah Capital Trust was a safe and secured investment – he was not aware that those representations were false, and was not reckless or careless as to whether they were false or not (Primary Judgment at [203]).

33. Similarly, it was not established that, when Mr Chen provided the Jarrah Capital IM to the Plaintiffs, he understood what was stated in that document regarding the nature of an investment in the Jarrah Capital Trust and the nature of the security for such an investment, or understood the information which Mr Pan conveyed to him regarding the changes to the investment and the security since the issue of the Jarrah Capital IM, let alone was aware that this information meant that the IM Representations were false (Primary Judgment at [238]-[239]).

34. In contrast, Jarrah Capital and Mr Pan were aware of the contents of the Jarrah Capital IM, were aware that it conveyed the IM Representations, and were aware that those representations were false.

35. Mr Pan had created the Jarrah Capital IM, based on the Ausvogar IM, and signed the Letter to Unit Holders as Chief Executive Officer of Jarrah Capital (Primary Judgment at [16], [18]). When preparing the Jarrah Capital IM, Mr Pan deliberately removed references to a “second” or “second ranking” mortgage which were contained in corresponding passages of the Ausvogar IM, in the knowledge that this meant that the Jarrah Capital IM gave incomplete and inaccurate information to investors regarding the security for their investment (Primary Judgment at [141]).

36. Mr Pan and Jarrah Capital knew that the Jarrah Capital IM made statements about an investment in the Jarrah Capital Trust and the security for such an investment which were false and misleading (Primary Judgment at [242]-[243]), and that this document was “completely false as at June 2022” (Primary Judgment at [244]).

37. Despite knowing that this was the case, and despite knowing and intending that Mr Chen would forward the document to potential investors, Jarrah Capital provided the Jarrah Capital IM to Mr Chen, at Mr Pan’s direction, without placing any restriction on its use, without identifying to potential investors that the information in the Jarrah Capital IM was outdated, without providing any warning to potential investors that the Jarrah Capital IM could not be relied upon as providing an accurate description of an investment in the Jarra Capital Trust, and without providing any update to potential investors on the developments since the issue of the Jarrah Capital IM (Primary Judgment at [219]-[220]). Mr Pan was knowingly involved in this misleading conduct (Primary Judgment at [224]).

38. While Mr Pan provided an oral update to Mr Chen regarding the sale of the Cobbitty Property and regarding the “retention amount” which was said to provide a form of “security” for the investment, this explanation appears to have been limited in its extent, and Mr Pan did not provide Mr Chen with any documents about those matters (either for the benefit of Mr Chen or potential investors) (Primary Judgment at [211]-[218]).

39. I acknowledge that Mr Chen received a financial benefit in return for the investment by the Plaintiffs in the Jarrah Capital Trust, but this was fairly limited in extent (Primary Judgment at [40]). Further, I do not consider that this is a matter which can be relied on by Jarrah Capital and Mr Pan to increase the extent of Mr Chen’s culpability, and decrease the level of their own culpability, given that Jarrah Capital and Mr Pan offered this incentive to Mr Chen as an inducement to finding new investors among his wealthy friends (such as the Plaintiffs).

40. Having regard to those matters, I have determined that Jarrah Capital and Mr Pan have a significantly greater level of culpability than Mr Chen.

Causal potency

41. A comparison of causal potency is not a mathematical exercise: James Hardie & Co Pty Ltd v Roberts (1999) 47 NSWLR 425; [1999] NSWCA 314 at [92] (Sheller JA, with whom Spigelman CJ, Stein and Giles JJA agreed). Instead, the inquiry turns primarily on the “relative importance of the acts of the parties in causing the damage”: Podrebersek at 494.

42. Prior to investing in the Jarrah Capital Trust, Mr Qiu told Mr Chen that he wanted to see “any documents about the investment”. That was because he would not have made a decision to invest based only on Mr Chen’s description of the investment at a social tennis gathering (Primary Judgment at [258(1)]).

43. Mr Pan and Jarrah Capital were responsible for the content of the Jarrah Capital IM.

44. On reading the Jarrah Capital IM, Mr Qiu paid particular attention to statements in that document regarding the nature of an investment in the Jarrah Capital Trust and the security for the investment (Primary Judgment at [267]). He relied on those statements in making the decision to invest in the Jarrah Capital Trust (Primary Judgment at [275]). That was the case both in relation to the first investment, which was made in the name of Ms Lin, and the subsequent investment, which was made in Mr Qiu’s own name (Primary Judgment at [284]).

45. While the Oral Representations by Mr Chen continued to have causative effect, Mr Qiu would not have relied on those representations unless the content of the Jarrah Capital IM was consistent with, and confirmed, those representations (Primary Judgment at [267], [280]-[281]).

46. Having regard to those matters, I have determined that the misleading conduct of Jarrah Capital and Mr Pan (in creating a misleading document and in providing the document to Mr Chen for the purpose of being forwarded to investors) had greater causal potency than the misleading conduct of Mr Chen (in forwarding the document to the Plaintiffs and making statements consistent with its content).

Conclusion on apportionment

47. For those reasons, I have determined that the Plaintiffs’ loss should be apportioned:

48. to Mr Chen, as to 20%; and

49. to Jarrah Capital and Mr Pan, jointly and severally, as to 80%.

Costs

48. The Plaintiffs sought orders that the Defendants pay their costs of the proceeding, on the ordinary basis.

49. Jarrah and Mr Pan did not, in their submissions, seek any different or other form of costs order.

50. However, Mr Chen submitted that whilst unsuccessful parties are ordinarily jointly and severally liable for costs, apportionment of costs is within the Court’s discretion, and “apportionment based on the quantum recovered against each party would be appropriate where the facts allow and would be rational, albeit imprecise”.

51. As a general rule, where a plaintiff succeeds against multiple defendants, those defendants are jointly and severally liable for the plaintiff’s costs. The rationale is that the successful party is prima facie entitled to its costs of the action, and should not lose that entitlement if one of the parties against whom costs orders are made cannot, or will not, meet its share of the costs burden: Perigo v Workers Compensation Nominal Insurer (No 3) [2013] NSWSC 6 at [3]-[5] (McCallum J) and the cases there cited.

52. In seeking an apportionment of costs, Mr Chen relied on Morris v Riverwild Management Pty Ltd [2009] VSC 439 and Ezy-Fit Engineering Group Pty Ltd v Microm Nominees Pty Ltd (No 4) [2025] FCA 411.

53. In Morris at [13], Pagone J observed that:

“The discretionary nature of costs orders may permit a less rigorous apportionment of costs as between different parties than might be required when determining the apportionment of liability to reflect fault or causation. The apportionment of costs between parties should bear some relationship to the part played by the parties in the overall proceeding however imprecise that relationship must be in any given case. A measure based upon the number of parties (with appropriate adjustments where two or more parties should be considered as in effect one) may be inexact but is rational. Similarly, a measure that apportions the costs against the quantum recovered from each contributor to the overall settlement proceeds (if the costs component can be excised from the settlement figures) would also be appropriate where the facts allow and would also be rational, albeit imprecise.”

54. In Ezy-Fit, Banks-Smith J (at [36]) said that the Court “is not obliged to make joint and several costs orders” and that the “discretionary nature of costs orders permits the apportioning of costs between parties” (citing the passage from Morris set out above).

55. Importantly, her Honour continued as follows (at [38]):

“That is not to say that there should be an apportionment of costs whenever liability for damages is apportioned. Depending on the circumstances, joint and several orders as to costs may be appropriate. Tsu v Nemeth [2012] NSWCA 29 provides an example where despite apportionment of liability for damages in accordance with a statutory scheme, joint and several costs order were made having regard to the fact that liability of the defendants depended upon a common substratum of facts: at [54]-[56],[69] (Handley AJA, Beazley and Whealy JJA agreeing).”

56. In Tsu v Nemeth [2012] NSWCA 29 at [54]-[56], Handley AJA observed that, while proportionate liability legislation “deprived a plaintiff of the common law right to a joint and several judgment against all concurrent tortfeasors”, it remained the case that “damages still had to be proved against all defendants, and plaintiffs had to establish the responsibility of each”. This, in turn, “required proof of the causative potency and culpability of each [defendant] in relation to the causative potency and culpability of the others”. It followed that “[t]he whole of the plaintiffs’ costs were therefore incurred in proving the case against each of the defendants”, and consequently there was “substantial justice in joint and several costs orders”.

57. Those observations are equally applicable here. This is not a case where the claims against individual defendants involved distinct legal or factual issues, but rather where the claims arose from a common substratum of facts. In order to establish the claims against Mr Chen, the Plaintiffs had to establish many of the same matters that arose in the claims against Jarrah Capital and Mr Pan, such as the presence of misleading statements in the Jarrah Capital IM, the Plaintiffs’ reliance on those misleading statements in deciding to invest in the Jarrah Capital Trust, and the loss and damage suffered by the Plaintiffs as a result of their investment in the Jarrah Capital Trust.

58. Although the claim regarding breach of the trustee’s duties was made only against Jarrah Capital and Mr Pan, Mr Chen was “centrally involved” in the relevant events (see Primary Judgment at [95]-[97], [268]).

59. For those reasons, I have determined that the Defendants should be jointly and severally liable for the Plaintiffs’ costs of the proceeding.

orders

60. For the reasons set out above, I make the following orders:

61. Judgment in favour of the Plaintiffs against the First Defendant in the amount of $223,105.87.

62. Judgment in favour of the Plaintiffs against the Second and Third Defendants in the amount of $892,423.48.

63. The Defendants pay the Plaintiffs’ costs of the proceeding, as agreed or assessed.

**********