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Representation: Counsel:
P Flynn SC with H Zhu (Cross-Claimants)
D L Cook SC, G Ng SC and A Rizk (Cross-Defendants)
Solicitors:
Herbert Smith Freehills Kramer (Cross-Claimants)
Bartier Perry Lawyers (Cross-Defendants)

File Number(s): 2025/187897

Publication restriction: Nil

JUDGMENT

1. HIS HONOUR: These proceedings are listed for hearing before me commencing on 12 October 2026 with a current estimate of ten days. On 27 August 2026, his Honour Black J disqualified himself from hearing the matter on the application of one of the parties. His Honour had by then presided over approximately eight days of hearings in March and August 2026. On 31 August 2026, the Chief Judge in Equity allocated the matter to me for hearing. There is a contest between the parties about the approach I should adopt in doing so having regard to the history of the proceedings to date.

2. Section 89 of the Civil Procedure Act 2005 applies to the present circumstances and is in these terms:

89 Procedure on fresh trial

(1) If—

…

(c) a judicial officer before whom a trial of any proceedings has commenced has discharged himself or herself from the trial without having given judgment in the proceedings,

the court may give such directions as it thinks fit as to the evidence to be used in the fresh trial.

(2) In particular, the court may give either or both of the following directions—

(a) a direction that all or any part of the evidence given at the previous trial is to be taken to be evidence in the fresh trial without the need for the witnesses to be recalled,

(b) a direction that all or any of the witnesses are to be recalled for examination or cross-examination, or both, either generally or as to a particular question or questions in the proceedings.

(3) In subsection (1), a reference to a trial of proceedings includes a reference to a trial of one or more questions in the proceedings.

3. All of the parties’ affidavit evidence was read in the course of the proceedings before Black J. The parties accept that his Honour’s rulings on objections to those affidavits should stand. They also agree that the physical exhibits tendered before his Honour should remain in evidence as exhibits before me. The only issue about which there is significant disagreement is whether I should resume the hearing from where his Honour left off or alternatively commence it de novo and require that any witnesses who might already have given oral evidence before his Honour be recalled to be cross-examined from the beginning. Section 89 clearly anticipates either possibility or a combination of both.

Comment

4. I have taken some time to familiarise myself with what has occurred in the proceedings to date by reference to the transcript and the pleadings. Having done so, it is apparent that the cross-claims raise matters that are factually complex. For the purposes of deciding this application, I have been provided with competing submissions which, quite understandably, include limited but opposing suggestions concerning the merits. Having regard to the history of the matter, I do not propose to descend into an examination of these disputed facts in any detail lest it should appear that I might somehow have formed even a preliminary view about where the truth may lie. I frankly do not yet have a sufficient grasp of the facts to do so.

5. Accordingly, to the extent that I refer to the submissions of the parties on the question of what approach I should take to the hearing before me, I do not intend to adopt or embrace anything that the submissions contain that reflects a party’s particular opinion of how the case should be decided. However, the context in which I am asked to consider what course to take is very closely connected with two competing contentions. First, whether permitting the cross‑claimants’ witnesses, who have completed their oral evidence, to be cross‑examined again from the beginning would create a potential injustice for the cross-claimant. Secondly, whether refusing to do so creates a corresponding injustice for the cross-defendant. It is only in that context that I propose to make any reference to the parties’ limited submissions about the facts and not otherwise.

The cross-defendants’ submissions

6. Mr Cook of senior counsel for the cross-defendants described the proceedings as a contest between Mr Qiu, and his interests, and Mr Hu, and his interests. He provided the following summary of the facts of the case as understood by the cross-defendants.

7. Mr Qiu, Mr Zhang and Mr Hu formed a joint venture company whose name is an acronym of their surnames: QZH Australia Pty Ltd. QZH held the shares in two other land-owning companies, Green Estate Australia Pty Ltd and 624 Leakes Road Pty Ltd. The idea was that the joint venture would acquire agricultural land in Victoria and redevelop it into residential land.

8. Mr Qiu was expected to provide the initial funding. Mr Hu and Mr Zhang were then going to contribute additional capital with the result that Mr Qiu’s interest would be 40% and Mr Hu and Mr Zhang would each hold 30%. Ultimately, Mr Zhang was unable to provide his share of the funding. Mr Hu therefore funded Mr Zhang’s share, with the eventual result that Mr Zhang withdrew from the joint venture and Mr Hu’s holding increased to 60%.

9. With Mr Zhang unable to contribute and Mr Qiu’s fortunes declining, it became necessary for the joint venture to borrow further monies. Initially, third parties provided funding but then Mr Hu, through his company V2V Investment Pte Ltd, took over the debt, offering a better interest rate. However, in 2025, when V2V sought repayment of its loan of approximately $30 million, the current dispute emerged.

10. Some eight years after the event, Mr Qiu alleged for the first time that Mr Hu had misappropriated some $23,937,426.08 from Green Estate in the form of three cheques drawn on Green Estate’s bank account payable to Mr Hu’s companies, CXF Development Pty Ltd and CXH Development Pty Ltd, in September 2017, October 2017 and May 2018. An allegation that an additional sum had been misappropriated in August 2017 has since been abandoned. Each of the three cheques was signed by Mr Qiu’s representative and Mr Zhang’s representative. Mr Hu’s involvement was limited to providing verbal approval to the bank by telephone, in accordance with the bank’s requirements for cheques over $1 million.

11. The facts surrounding these cheques are largely common ground. Five source companies (four of which were in Hong Kong and one of which was in Singapore), paid monies to companies in Hong Kong that were part of the Boill Group of companies, owned by Mr Qiu. The Boill Group companies then remitted all of the funds to Green Estate. Immediately upon receipt of those funds, Green Estate paid the funds to Mr Hu’s companies, CXF and CXH.

12. Mr Qiu and his wife, Ms Jian Huang (not to be confused with Mr Shuying Huang), claimed that they had no knowledge at the time that Green Estate was paying these monies to Mr Hu’s companies and only discovered the payments in March 2025. Mr Qiu himself refused to be appointed formally as a director of Green Estate and insisted that his wife be a director. However, Mr Qiu gave an assurance to Mr Hu and Mr Zhang that, notwithstanding that his wife would be a director in his place, he would be the ultimate decision maker in respect of his interests in the joint venture.

13. On the basis of this allegation that Mr Hu had “stolen” $23,937,426.08 from Green Estate, Mr Qiu contended that his company, Oriental Management Pty Ltd, was no longer bound by the shareholding agreement entered into with Mr Hu under which Oriental Management had agreed that it was holding Mr Zhang’s relinquished 30% interest in the joint venture companies on trust for Mr Hu. Mr Qiu argued that he and his wife had been misled into believing that Mr Hu had contributed more money to the joint venture than he had because the misappropriated funds were actually contributions he, Mr Qiu, had made to the joint venture and for which he had not been given credit.

14. Mr Qiu originally alleged that Mr Hu stole $23,937,426.08 from Green Estate. He now contends that a lesser sum of $19,537,426.08 is in issue. Mr Qiu also alleged that the stolen money was his money which he contributed to Green Estate. The cross-defendants submit that both allegations are demonstrably false and that Mr Qiu’s allegations are implausible.

15. Mr Hu’s explanation is that when Mr Zhang could not repay him for his share of the contributions to the joint venture that Mr Hu had fronted, Mr Zhang offered to sell the Lonsdale commercial property to him on the basis of a set-off of his debt. However, after the contract had been entered into, Mr Hu discovered that the Lonsdale property had a significant mortgage over it. Mr Hu and his wife, Ms Yu (who plays a central role in the dispute), approached a lender, Mr Shuying Huang, to obtain finance to pay the mortgage out. Both Mr Hu and Ms Yu are Chinese residents. Ms Yu, who had known Mr Qiu for decades and had arranged finance for him and his companies, asked if Mr Qiu could help with transferring Mr Shuying Huang’s loan funds from overseas to Australia.

16. In August 2017, Ms Yu and Mr Qiu had two important telephone calls. During these calls, Mr Qiu proposed what has been referred to in these proceedings as the “Collect and Pay Arrangement”. Essentially, Mr Shuying Huang would cause the five source companies to pay money to Mr Qiu’s Boill Group companies in Hong Kong and then those companies would remit the funds to Green Estate, which would then transfer the funds to Mr Hu’s companies to buy the Lonsdale property. Mr Qiu explained that this methodology worked best because, he claimed, Hong Kong banks were more comfortable paying money to a company which was a related party of the accountholder (and through Mr Qiu’s involvement in the Boill Group and Green Estate, and Mr Hu’s connection with the CX companies and Green Estate, that connection existed). He also said that his recent experience showed that the transfers would go quicker if there was a loan agreement prepared with Green Estate borrowing the funds from the five source companies, which he would have prepared.

17. Mr Hu agreed with Mr Qiu’s proposal and signed the loan agreements, which Mr Qiu’s employees prepared, between Green Estate and the five source companies. It is Mr Hu’s case that the Loan Agreements were never intended to give rise to legal obligations and are essentially a sham that Mr Qiu suggested. Mr Qiu has maintained what Mr Cook has described as a position of strategic ambiguity as to whether he accepts that the loan agreements are shams: a finding that the loan agreements were not shams would preclude Mr Hu’s claim to the monies whereas such a finding would preclude Mr Qiu’s contention that the monies were his contributions to the joint venture and defeat his cross-claim to avoid the share holding agreement.

18. Mr Shuying Huang has been called by Mr Hu to give evidence that he lent Mr Hu the money through the five source companies. Ms Yu is being called by Mr Hu to give evidence of her telephone calls with Mr Qiu.

19. The cross-defendants maintain that my resolution of these highly contested and critically important factual issues means that cross-examination of the central players on both sides is extremely important and that it would be unjust to the cross-defendants if I were not to allow the cross-examination of the cross‑claimants witnesses to start afresh before me. They submitted that, from whatever perspective the matter is approached, the cross-examination of the key witnesses will play a pivotal role in deciding this case.

20. The cross-defendants submitted in the same context that I would be at a significant disadvantage in proceeding to decide this case by reference in part to the transcript of the earlier hearings. There are a number of contemporaneous documents that evidence the existence of the Collect and Pay Arrangements, including some that bear Mr Qiu’s signature and hand‑written comments. There are also audio recordings of Mr Qiu which are allegedly inconsistent with his evidence.

21. The cross-defendants submitted that it would create a significant burden for me to follow the cross-examination of Mr Qiu (and Ms Huang) in respect of those documents only by reference to the transcript. The documents are all in Mandarin and their translations are not entirely uncontentious.

22. The cross-defendants submitted that I should not be deprived of the advantage of observing first-hand Mr Qiu’s (and Ms Huang’s) attempts to explain the alleged inconsistencies in their evidence with contemporaneous documents and inherent probabilities. The evaluation of these explanations will be critical in determining whether their evidence can be accepted.

23. The cross-claimants’ submissions in any event concede that the demeanour of their witnesses was significant. They submit that “Ms Huang, in particular, found the experience distressing” and that Mr Qiu “did at times become exercised [sic] by the allegations put to him”. The cross-defendants submitted that the transcript fails to convey the full range of emotions displayed by the evidence of these two witnesses.

24. Finally, apart from being deprived of the opportunity to observe how these witnesses performed in the witness-box, it is submitted that I would be placed in the invidious position of making credibility findings about them in this case on the basis of transcript evidence on one side as opposed to live evidence from witnesses on the other side. The cross-defendants submitted that that would do a significant injustice to them.

The cross-claimants’ submissions

25. The cross-claimants submitted entirely uncontroversially that the overarching consideration should be doing justice between the parties by ensuring that the procedure for the resumed hearing results in a fair trial. The cross-claimants seek a direction under s 89(1) of the Civil Procedure Act of a kind referred to in s 89(2)(a) of the Act, for the following reasons.

26. The cross-claimants submitted that the trial should be resumed at the point at which it was paused and that evidence that has already been adduced should stand as evidence before me. There is precedent in this Court for such an approach. The already completed cross-examination should not be repeated.

27. At the point at which the trial was paused, the cross-claimants were ready to cross-examine the cross-defendants’ witnesses. The cross-claimants’ witnesses have already been extensively cross-examined. Ms Huang was cross-examined for three days in March and Mr Qiu was cross-examined for four days in August. They should not be recalled. That is said to be so for at least the following reasons.

28. First, it is unnecessary given the existence of the transcript. As the evidence was given through an interpreter, the reliability of demeanour-based assessments of credit is much reduced, as has been recognised in the authorities. The cross-defendants acknowledged in their submissions on their oral application for recusal that it might even be an “appropriate course” that the new judge proceed with all the evidence that had already been adduced. That acknowledgement was recorded in Black J’s disqualification judgment.

29. Secondly, it would impose an intolerable and unfair burden upon the witnesses to be cross-examined again. Ms Huang, in particular, found the experience distressing, including because issues of possible self-incrimination arose, and an appropriate warning was sought and given. While Mr Qiu did not experience the same level of distress, he did at times become exercised by the allegations being put to him, and was often visibly exhausted by the process of answering detailed questions using an interpreter. The cross-claimants submitted that the quality of their evidence is likely to be diminished, not improved, if these witnesses are to be cross-examined again.

30. Thirdly, the evidence of Ms Huang and Mr Qiu on any second occasion is likely to have been rendered less reliable by the following matters. Ms Huang has observed Mr Qiu being cross-examined. Both Ms Huang and Mr Qiu will have had entirely proper, detailed discussions with their legal advisers when it was thought that their cross-examination had concluded. Without intending to waive privilege, the cross-claimants submitted that I could take judicial notice of the fact that aspects of answers already given in cross-examination would have been discussed in that way.

31. Fourthly, cross-examining those witnesses again would cause further procedural complications, including issues such as whether the transcript of their original cross-examination would be available to be used as a prior inconsistent statement if the evidence given at the new hearing were different. There may also be difficulties if a witness answered a question by referring to an answer he or she had previously given. It would not be practical, particularly for witnesses giving evidence through interpreters, to act as though the earlier cross-examination had not occurred.

32. Fifthly, particularly because the evidence has been given through an interpreter, there is a risk that on the second occasion that questions and answers may be interpreted differently. In such a case there would be no way of knowing the extent to which that risk had been realised, and a lingering disquiet would remain. The use of the same interpreters would not eliminate this risk. This difficulty is exacerbated in the particular case of Mr Qiu, who the interpreter noted had a regional accent which occasionally made the task more difficult. There is also the risk that two differing transcripts might be created.

33. Sixthly, courts have traditionally recognised the unfairness created by subjecting witnesses to multiple cross-examinations, especially by different counsel. That unfairness would be greater in this case where counsel would be able to remedy any perceived defects or shortcomings in the original cross-examination. That is unfair to the witnesses and to the cross-claimants alike, because it gives one side a significant forensic advantage that is not available to the other. That is not conducive to a fair trial.

34. Seventhly, starting again would unnecessarily duplicate costs. Such an outcome would not be consistent with the guiding principles of ss 56-58 of the Civil Procedure Act.

35. Finally, none of the evidence already heard and transcribed is affected in any way by questions of apprehended bias that indirectly resulted in the present procedural contest.

Consideration

36. As I have already acknowledged, the fundamental principle that informs the present inquiry is the need to ensure that, whatever format is chosen for the further conduct of these proceedings, it is capable of producing a trial that is fair to both parties. A fair trial does not mean a perfect trial, assuming that there is such a thing, but one in which the respective advantages and disadvantages associated with either starting afresh or continuing where the trial left off do not avoidably favour one side over the other.

37. Both parties to this litigation are entitled to have it dealt with expeditiously without undue delay or expense. Understandably and not unreasonably, the cross-claimants maintain that a hearing de novo would effectively mean that the days taken up by the previous hearing would be completely wasted together with the associated costs. There is force in that contention. However, it is not without qualification.

38. To start with, and as I indicated during the hearing of the present application, it has long been my experience both as a judge of this Court and as a practising barrister, that cross-examination that for some reason has to be repeated, such as in a retrial caused by a hung jury in a criminal case or in circumstances calling for a second hearing following a successful appeal in a civil matter, almost always takes less time. Cross-examining counsel by then know what questions not to ask. Witnesses are for some reason less inclined to give long answers. Questions that are known to be objectionable can be avoided. Questions that were awkwardly framed the first time can be refined. I have also found that experienced cross-examiners seem to get to the point quicker and the process usually moves along more smoothly as a result. I would anticipate that this would happen in this case if the cross-claimants’ two witnesses were to be recalled.

39. This was also acknowledged by Mr Cook, if only to the extent that he anticipated his cross-examination, if given the opportunity to repeat it, would be considerably shorter. Something approaching seven days was taken up in the cross-examination of two witnesses in the earlier hearing. I would be very surprised if Mr Cook or anyone in his position would require as much time on a second occasion to cover the very same matters that he would need to explore again with Ms Huang and Mr Qiu.

40. The parties have also quite properly agreed that no time would be taken up with the need to make or deal with objections to affidavit evidence or with the tender of documents. The time required for me to hear the proceedings in either format will therefore be considerably reduced as a result.

41. Mr Cook has placed much emphasis upon what he insists is the need for me to see and hear Ms Huang and Mr Qiu in person as they give their evidence. He maintains that the transcript is a poor substitute for that advantage. While appreciating the wisdom of appellate decisions that downplay it, the issue for me to consider is not whether the asserted advantage is significant or insignificant so much as it is for me to avoid a situation where one party to this litigation is deprived of it when the other is not. Fairness compels the need for balance and equal treatment.

42. Mr Flynn has drawn attention to the fact that Ms Huang, at least, did not find the experience of cross-examination to be a pleasant one, to the point where Black J was moved by reason of his concern to inquire about her health. Mr Flynn understandably emphasised that witness distress should be avoided if at all possible. Mr Cook’s response is to say that there was to some extent a relationship between Ms Huang’s apparent distress and the importance of the questions she was being asked to answer. That remains to be seen.

43. The problems identified by Mr Flynn concerning the need to use an interpreter cannot easily be discounted. Verification of the accuracy of interpreted questions and answers is an unavoidable consequence of litigation in a multicultural society. It is by no means unique to these proceedings. As unsatisfactory as it may be, the court and the parties simply have to do the best that can be done. In my experience, the standard of interpreters in New South Wales is extremely high so that the problems Mr Flynn has referred to are to some extent more apparent than real. Once again, the issue affects both sides in equal measure.

44. The least important matter to be taken into account is my preference. As I have indicated, I have reviewed the transcript of the earlier proceedings to some extent. I have neither formed nor tried to form any view about the witnesses who have been cross-examined. However, based only upon my experience in this Court, I would feel distinctly more comfortable if I were able to compare in like fashion the witnesses called by both sides. There is an artificiality in forming an opinion about the truthfulness of any witness based solely upon a transcript of what they have said. Even the arguably minor matter of remembering what any witness looked like and putting a face to their words is helpful. Nor is the advantage only one way. No doubt Mr Flynn will want at some stage to assert that his witnesses should be believed. Recognising as I do that the importance of demeanour cannot and should not be exaggerated, even the limited assistance of demeanour is as important in attempting to recognise truth as it is in trying to detect lies.

45. Finally, I am not especially troubled by the likelihood that commencing afresh will be associated with any undue preoccupation with the previous, recorded answers of the witnesses. There are two sides to that equation in any event. Insisting that a witness be held to the minute details of a previous answer to establish some asserted inconsistency or recent invention is in my experience almost always an unproductive task and sometimes questionable advocacy. By the same token, witnesses who have had the experience of being cross‑examined before on the same subject matter might reasonably be expected to anticipate the questions they will be asked and prepare accordingly. The cross-defendants’ witnesses would not have a similar advantage if the trial were to start again. It is in any event worth bearing in mind that a witness who is telling the truth does not need to remember what they said before.

46. Doing the best I can, I consider that, with the exception of his Honour Black J’s evidentiary rulings and the reception of the physical exhibits tendered before him, this matter should proceed when it resumes on 12 October 2026 as a hearing de novo. It may also be advantageous if the matter were listed for directions in advance of the scheduled start date in order that any administrative loose ends could be attended to in a timely fashion.

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