HIS HONOUR: Yuan Qi and Yu Wang were married on 5 June 2010 and separated on 28 August 2015. Yuan Qi commenced proceedings in the Family Court of Australia on 29 September 2015. A significant aspect of the dispute in that Court appears likely to involve the parties' respective but competing claims to the income and assets of Groupage Pty Ltd, in which company Yuan Qi and Yu Wang are equal shareholders. Yu Wang is the sole director. That company commenced business in about July 2014 printing and selling mobile phone and tablet accessories sourced primarily from China.
Groupage Pty Ltd commenced proceedings against Yuan Qi in the District Court of New South Wales by statement of claim filed on 16 June 2016. That document is unfortunately drafted and on one view fails to plead a cause of action known to the law. It could be that a common money count and a claim in detinue are to be found lurking somewhere within its many paragraphs but that assumption may on one view be unduly generous to the draftsman. It is at least reasonably apparent that Groupage Pty Ltd contends that Yuan Qi somehow unlawfully obtained or retained possession of a motor vehicle and some printers and that she also transferred $119,045 out of the company's trading accounts to herself without authorization. The statement of claim also alleges that Yuan Qi is liable to the company in a wholly unspecified way for $200,000 in lost income and $20,000 for loss in the value of the company's stock.
In these circumstances Yuan Qi has commenced the present proceedings by summons filed on 18 July 2016 seeking the following relief:
1. An order pursuant to s 8 of the Jurisdiction of Courts (Cross Vesting) Act 1987 that the District Court proceedings 2016/183139 be removed to the Common Law Division of this Court.
2. An order pursuant to s 5(1)(b) of the Act that the District Court proceedings, when removed into this Court, be transferred to the Family Court of Australia.
In Valceski v Valceski [2007] NSWSC 440; (2007) 70 NSWLR 36, Brereton J said this at [69], [74] and [85]:
"[69] That leaves to the third factor, the interests of justice. The question is simply whether, assuming that the jurisdiction of the transferor court has been regularly invoked, it is in the interests of justice that the proceedings be heard and determined in the transferee court, there being a statutory obligation to transfer the proceedings to that court whenever it appears to be in the interests of justice to do so - for which purpose it is both necessary and sufficient that the transferee court be the 'more appropriate' forum [BHP Billiton Ltd v Schultz (2004) 221 CLR 400, 421 [14], 434-5 [63]]. In identifying the 'more appropriate forum', relevant considerations include the cost and efficiency of proceedings in the respective jurisdictions, and the 'connecting factors' described by Lord Goff in Spiliada Maritime Corporation v Cansulex Ltd [1987] AC 460, 478 - including matters of convenience and expense such as availability of witnesses, the places where the parties respectively reside or carry on business, and the law governing the relevant transaction [BHP v Schultz, 422 [18]]. Consideration of relevant connecting factors may identify a 'natural forum' [BHP v Schultz, 423 [19]; cf British American Tobacco Australia Ltd v Gordon [2007] NSWSC 230, [44]]. As Schultz makes clear, the interests of justice concern those of both parties, and rather than the selection of the most advantageous, or least disadvantageous, forum for one of them, the 'interests of justice' are to be judged by more objective factors, such as facilitate identification of the 'natural forum', in which objectively judged it might be expected that the dispute would fall to be resolved, with its concomitant juridical advantages and disadvantages for each party, whatever they may be [cf British American Tobacco v Gordon, [47]].
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[74] Nor is the expected time to hearing a factor that favours retaining the equity suit in this court in this case, though it may be influential in some. There is evidence that, if transferred to the Family Court, the consolidated proceedings are not likely to be allocated a hearing date before about November 2007. If I could be confident that the equity suit could be heard and determined before then, without disrupting the preparation and progress of the matrimonial proceedings, then there might be more to be said in favour of determining them in this Court, although considerations of duplication would still point in the other direction. But the equity suit is unlikely to be heard in this court significantly before November 2007, and if the Family Court did not restrain their prosecution, it would probably adjourn the matrimonial proceedings until after their determination, further delaying the ultimate resolution of issues in the matrimonial proceedings…
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[85] In my opinion, justice can best be done by the one court resolving the whole justiciable controversy, in order to avoid both duplication and inconsistency. In the present context, the Family Court is the more appropriate court for that purpose, because the larger controversy, of which the smaller forms part, is a matter properly and primarily in the jurisdiction of the Family Court. It follows that the proceedings must be transferred to the Family Court. If as a matter of principle the effect of this decision is that third parties who, in the context of a marriage breakdown, assert rights against matrimonial property, should join in existing matrimonial proceedings rather than commence separate litigation, then the beneficial result is that all issues are litigated only once and only in one court, the risks and costs of duplication and inconsistency are avoided, and forum-shopping and collateral litigation is discouraged…"
In the present case there is a significant degree of similarity between, and overlap in, the factual background to the separate proceedings. The Family Court for all practical purposes is best placed to resolve the entire controversy. The occasion for the dispute that underlies the District Court proceedings appears clearly to be the breakdown of the marriage. The prospect that conflicting or different outcomes or results in two different courts might arise favours the transfer of the proceedings to the Family Court. There is what must amount to an almost certain prospect that costs will be unnecessarily incurred and duplicated if the orders are not made.
The material before me suggests that some of the issues in the Family Court will involve consideration of whether Yu Wang has transferred assets from the matrimonial asset pool overseas and whether he now owns assets purchased overseas using funds taken from that pool. It will also be a significant issue in the Family Court to assess the value of the matrimonial assets and the business operated by Yu Wang through Groupage Pty Ltd. The income, assets and liabilities of Groupage Pty Ltd will be intimately concerned with that inquiry.
It has been submitted on behalf of Groupage Pty Ltd and Yu Wang that the separate and independent corporate identity of the plaintiff in the District Court makes the present application untenable or at least inappropriate. In my view, that submission seeks improperly to elevate form over substance. In effect, the claims made by the company and Yu Wang mirror the claims made by Yuan Qi against her husband in the Family Court. Yu Wang and Groupage Pty Ltd allege that Yuan Qi took property and money from the company and that she is liable for the costs of replacement and the return of the money. The evidence relating to these claims by Yu Wang has already been filed in the Family Court. Indeed, the Family Court has made interim orders dealing with the financial relationship between the parties in that Court, including access to funds and the operation of bank accounts.
In my opinion it is in the interests of justice to make the orders sought. Accordingly I order as follows:
1. Order pursuant to s 8 of the Jurisdiction of Courts (Cross Vesting) Act 1987 that District Court proceedings 2016/183139 between Groupage Pty Ltd as plaintiff and Yuan Qi as defendant be removed to the Common Law Division of this Court.
2. Order pursuant to s 5(1)(b) of the Jurisdiction of Courts (Cross Vesting) Act 1987 that District Court proceedings 2016/183139 between Groupage Pty Ltd as plaintiff and Yuan Qi as defendant, when removed into this Court, be transferred to the Family Court of Australia.
3. Order that the costs of this application be paid by Groupage Pty Ltd.
[2]
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Decision last updated: 22 August 2024