plaintiff. Dismissed the second defendant's notice of motion for transfer to the Family Court; ordered the second defendant to pay the plaintiffs' costs of the motion; otherwise no order as to costs; directed...
Key principles
The Supreme Court should refuse transfer under s 5(1)(b) of the Jurisdiction of Courts (Cross-vesting) Act 1987 (NSW) where, having regard to the interests of justice, the...
Where the creditor's claim is a straightforward claim to a quantifiable debt under written loan agreements supported by contemporaneous business records, and there is no...
A party who is not a necessary party to a money claim, and who has been joined only to be given notice, is not necessarily prejudiced by the refusal to transfer where that party...
Issues before the court
Whether the Supreme Court should transfer the money claims by the father and brother-in-law to the Family Court under s 5(1)(b) of the Jurisdiction...
Whether the Family Court has accrued jurisdiction such that transfer might be appropriate.
Whether the wife's forensic position and potential prejudice supports transfer to the Family Court.
Plain English Summary
The wife sought to transfer two separate money claims brought in the NSW Supreme Court by her husband’s father and brother-in-law to the Family Court. The claims were for sums advanced under written loan agreements, supported by bank records. Adamson J refused transfer: the loan claims were narrow, documented, and appropriately determined in the Supreme Court; there was no convincing evidence the agreements were sham; the Family Court's involvement was not necessary and transfer would not be in the interests of justice. The wife was ordered to pay the plaintiffs’ costs of the transfer application and given time to decide whether to remain a party.
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Whether the plaintiffs should be required to be joined to the Family Court proceedings rather than litigate their discrete contractual claims in the...
Cited legislation
3 cited instruments linked from this judgment.
Deep Dive
1,984 words · generated 23/07/2026
What happened
This is a cross-vesting / transfer decision. The wife (second defendant) had earlier commenced Family Court proceedings against the husband seeking matrimonial property division (Initiating Application filed 23 May 2019). Separately, two family members of the husband commenced money claims in the NSW Supreme Court: the father sued for $2.5 million advanced under a written loan agreement for the purchase of a Lindfield property (Contract of Loan Guarantee dated 16 May 2016), and the brother-in-law sued for an amount arising from a ¥25 million advance (oral agreement reduced to writing 11–12 February 2019). Those Supreme Court matters were commenced on 10 January 2020 (Introduction [1]–[3]; Facts).
The wife applied in the Supreme Court (notice of motion filed 7 February 2020) to transfer both Supreme Court proceedings to the Family Court under s 5 of the Jurisdiction of Courts (Cross-vesting) Act 1987 (NSW), relying on overlap with the matrimonial property dispute and the Family Court's powers to deal with third parties in certain circumstances (Introduction [3]; Facts). The plaintiffs opposed transfer. The husband neither opposed nor consented.
Adamson J heard the application on 4 May 2020 and delivered judgment on 6 May 2020. The judge refused the wife's application for transfer, ordered the wife to pay the plaintiffs' costs of the notice of motion, and made directions in respect of the continuation of the Supreme Court proceedings (Orders 1–7).
Why the court decided this way
Statutory test and approach
The transfer power is statutory. Section 5(1) of the Cross-vesting Act directs the Supreme Court to transfer if, inter alia, having regard to certain matters (including the interests of justice), it is more appropriate that the Federal Court or Family Court determine the relevant proceeding (Consideration [1]). The parties agreed that the primary focus would be the interests of justice limb of s 5(1)(b)(ii)(C) (Consideration [1]–[2]).
The “natural forum” and interests of justice
The Court applied the established approach to determine the natural forum for the “relevant proceeding” by assessing where, objectively, the dispute should be resolved having regard to judicial advantages and disadvantages: see BHP Billiton Ltd v Schultz (noted and summarised at Consideration [3]) and Valceski (discussed at Consideration [7]–[8]).
Evidentiary character of the plaintiffs’ claims
The plaintiffs’ claims are discrete contractual debt claims founded on written loan agreements and contemporaneous bank transfers (Contract of Loan Guarantee, loan advances listed in Facts). The father’s written agreement expressly included a charging clause and was signed; the brother-in-law’s agreement was reduced to writing and supported by transfer documents (Facts, summary of loan advances). Adamson J emphasised that the loans pre-dated the final separation and that there was contemporaneous documentary evidence of the advances (Consideration [4]).
Sham allegation and accrued jurisdiction
The Family Court might have accrued jurisdiction in certain circumstances (Fencott v Muller), but the judge accepted that the only realistic route to Family Court jurisdiction over these claims was if there was a bona fide allegation that the loan agreements were shams (Consideration [2], [5]). The wife had advanced the suggestion of sham only as a “mere possibility” and there was no real evidentiary foundation to upgrade that to a pleadingable case (Consideration [5]).
Forensic prejudice and practicalities
The wife argued forensic disadvantage if the Supreme Court retained the claims: in the Family Court the husband would bear onus of proving debts if he asserted them; in the Supreme Court the plaintiffs would have to prove them. Adamson J found this submission unpersuasive because the agreements were in writing and contemporaneously supported by bank records; the prima facie case was already evident (Consideration [6]). Further, the Supreme Court proceedings were narrow in ambit and likely to be determined much sooner than the family proceedings in the Family Court, the latter of which was expected to require much more time to list for final hearing (Facts [2] and [3] consistent with solicitor affidavits on listing delays).
Relationship to Valceski
Valceski was a case where the Equity suit touched directly upon the matrimonial property pool and the Family Court was the natural forum. Adamson J distinguished Valceski on the ground that, in contrast, the plaintiffs here seek only quantification of discrete debts and not a share of the matrimonial property by contribution; their interests in the Lindfield property derive only from the charging clauses in the loans (Consideration [7]–[8]). Accordingly, the practical overlap which drove transfer in Valceski was absent here.
Conclusion
Weighing the documentary strength of the plaintiffs’ cases, the lack of real evidence of sham, the narrow scope of the Supreme Court claims, and the comparative expedition of a Supreme Court hearing, Adamson J concluded that the interests of justice favoured retention in the Supreme Court and refused transfer. The wife was ordered to pay costs of the notice of motion (Orders; Costs).
Before and after state of the law
Before: The established principles governing cross-vesting and transfer were already set out in authoritative authorities. The High Court’s guidance (notably in BHP Billiton and Fencott) and NSW Supreme Court exposition (Valceski) on the “natural forum” and interests of justice have been applied in many transfer applications.
This decision: Xue v Xue restates and applies those principles to a fact pattern where family members bring discrete contractual debt claims against a spouse in the Supreme Court while matrimonial proceedings proceed in the Family Court. Adamson J emphasised that transfer is not automatic where third-party creditors have claims that could affect the matrimonial asset pool. The existence of written loan documents and contemporaneous evidence, and an absence of credible sham allegations, materially weigh against transfer where the plaintiffs seek only judgment for debt and interest.
After: The case reinforces that (a) documented, pre-separation loan claims that seek only quantification of debt ordinarily sit comfortably within the Supreme Court’s natural jurisdiction, (b) speculative or merely possible allegations of sham will not, without more, justify treating the Family Court as the appropriate forum, and (c) practical considerations such as expedition and the narrow ambit of claims are weighty in s 5(1)(b)(ii)(C) assessments.
Key passages with plain-English translation
Passage: The Court reproduced s 5(1) and proceeded to decide transfer by reference to the interests of justice (Consideration [1]).
Plain English: The judge said he must decide if it would be fair and sensible to move the case to the Family Court, looking at where justice and convenience point.
Passage: “The loan agreements pre-dated the separation and were supported by signed documents and contemporaneous business records evidencing the transfers.” (Consideration [4])
Plain English: The loans were made before the marriage broke down, and there are signed contracts and bank records showing the money moved, so there is solid documentary evidence of the debts.
Passage: “Although Mr Connor raised the possibility that the agreements were shams, there is no evidence to suggest that they were.” (Consideration [5])
Plain English: The wife suggested the loans might have been fake, but there is no real proof of that, only speculation.
Passage: “The proceedings in this Court have a narrow ambit. There is a real prospect that they can be determined before the end of the year...” (Consideration [7])
Plain English: The Supreme Court claims are limited in scope and can probably be heard quickly; by contrast the Family Court litigation could take years.
Passage: Distinguishing Valceski, the judge noted that in Valceski the equity claim directly impacted the matrimonial pool; here the plaintiffs only seek debt judgments and are not claiming a contribution-based share of the property (Consideration [7]–[8]).
Plain English: In Valceski the outside parties' claims were so bound up with dividing the family property that the Family Court had to handle them; that is not the situation here.
What fact patterns trigger this precedent
This decision will be particularly relevant when:
Third-party creditors who are family members or associates commence standalone contractual or debt recovery proceedings in a superior court while matrimonial property proceedings are on foot in the Family Court, and the third-party claims are founded on written loan documents and contemporaneous financial transfers.
The loan agreements pre-date separation and are supported by documentary evidence such that the creditor’s case is prima facie strong.
The person seeking transfer cannot show more than a speculative possibility that the agreements were shams, or cannot identify a substantive overlap that would require the Family Court to resolve the contractual questions as part of the matrimonial pool assessment.
The creditor seeks only judgment for a defined sum plus interest rather than an equitable claim to a share of property by contribution.
There are strong practical reasons (expedition, narrow ambit) favouring the superior court retaining the discrete debt claims.
Conversely, this precedent will be of limited weight where the third-party claim is directly intertwined with the parties' matrimonial property pool and equitable claims to property by contribution, or where there is real evidential foundation for alleging that the relevant transactions were shams.
How later courts have treated it
At the date of this decision, Adamson J applied established High Court and NSW Supreme Court authorities (Fencott, BHP Billiton, Valceski) and distinguished Valceski on its facts. Courts deciding transfer applications should treat Xue v Xue as an example applying the natural forum and interests of justice analysis where:
documentary contractual evidence is strong and the dispute is narrow, and
the Family Court’s accrued jurisdiction is merely arguable without firm evidence of sham or of necessary overlap with matrimonial property division.
Practitioners should cite Xue v Xue where they wish to show that a Supreme Court is the natural forum for discrete debt claims despite concurrent family proceedings.
(Note: This section records the practical import of Adamson J’s reasoning; subsequent cases applying or distinguishing Xue v Xue should be checked for the most current treatment.)
Still-open questions
Threshold for alleging “sham”: Adamson J treated the wife’s contention that the agreements might be shams as a “mere possibility” and insufficient to justify transfer. There remains practical uncertainty as to the degree of evidential particularity (affidavit material, contemporaneous documents, suspicious conduct) required to convert a mere suspicion into a claim that properly anchors accrued Family Court jurisdiction and thereby supports transfer.
Scope of Family Court accrued jurisdiction: Xue v Xue recognises the arguability of accrued jurisdiction (Fencott) but does not exhaustively define the situations where discrete contractual claims become so entwined with the matrimonial pool that the Family Court becomes the natural forum. Middle cases where contractual claims have some but not decisive impact on the matrimonial pool will remain fact-sensitive.
Joinder and anti-suit remedies: The judge observed that the Family Court could, in appropriate circumstances, restrain prosecution of external proceedings by means such as anti-suit injunctions or by joinder orders. The contours of when and how the Family Court should exercise such powers against third-party creditors remain to be further refined in subsequent decisions.
Practical management of cross-jurisdictional evidence: Many of these matters involve Chinese documentation and transactions. Questions about the weight to be attached to foreign corporate records, translations, authenticity challenges, and the evidentiary process in the Family Court versus the Supreme Court are potential sources of dispute in future cases.
Strategic naming of non-necessary parties: The plaintiffs named the wife only to give her notice and to preserve her ability to seek transfer. The strategic effects of this practice, on issue estoppel, pleading strategies, and on costs, raise procedural questions about the proper handling of nominal joinder of family members in third-party claims.
In practice, solicitors and counsel should closely evaluate: (a) documentary strength of creditors’ claims, (b) whether there is a real prospect of establishing sham or other equitable defences, (c) likely expedition of the competing courts, and (d) whether the relief sought is discrete (judgment for debt) or part of a larger claim to property, before bringing or opposing a transfer application.
Catchwords
[2004] HCA 61
Fencott v Muller (1983) 152 CLR 570[1983] HCA 12
Murray Morgan Investments v Capma Pty Ltd [2016] NSWSC 264
Raftland Pty Ltd v Federal Commissioner of Taxation (2008) 238 CLR 516[2008] HCA 21
Rippon v Chilcotin Pty Ltd (2001) 53 NSWLR 198[2001] NSWCA 142
Snook v London and West Riding Investments Ltd [1967] 2 QB 786
Valceski v Valceski (2007) 70 NSWLR 36
Judgment (9 paragraphs)
[1]
Solicitors:
WB Legal Pty Ltd (Plaintiff in both matters)
Apex Lawyers Pty Ltd (First Defendant)
Yau & Wang Lawyers (Second Defendant)
File Number(s): 2020/8992; 2020/9036
[2]
Introduction
By initiating application filed on 23 May 2019, Haiying Lu (the wife) commenced proceedings in the Family Court of Australia against Keguang Xue (the husband) seeking orders which included orders for the division of the matrimonial property. By reason of the issues for determination, it is convenient to refer to the parties by their relationships with each other rather than by name.
On 10 January 2020, Shuqiang Xue (the father) commenced proceedings 2020/9036 in this Court against the husband and the wife, claiming judgment on the basis of $2.5 million said to have been advanced to the husband for the purchase of property at Lindfield which was intended to be the matrimonial home of the husband and the wife (the father's proceedings). On the same day, Xiongbin Xue (the brother-in-law) commenced proceedings 2020/8992 in this Court against the husband and the wife claiming monies said to be owed under a loan contract with the husband for an advance of $5.2 million to be invested in a start-up company in China (the brother-in-law's proceedings).
By notice of motion filed on 7 February 2020 in each proceeding, the wife sought an order for the transfer of the father's proceedings and the brother-in-law's proceedings to the Family Court pursuant to s 5(1)(b) of the Jurisdiction of Courts (Cross-vesting) Act 1987 (NSW) (the Act). The order sought was opposed by the father and the brother-in-law (the plaintiffs), for whom Mr Lawrance appeared. The husband, for whom Ms Chen appeared, neither consented to nor opposed the orders sought on the motion.
It was agreed, at least between the plaintiffs and the wife, that the wife was not required to put on her defence to the plaintiffs' statements of claim until her motion for transfer had been determined. Neither the husband nor the wife has put on a defence to the statement of claim.
It was accepted by the plaintiffs that the wife was not a necessary party to the proceedings in this Court. Mr Lawrance informed me that she had been named as second defendant in order to give her notice of the proceedings and the opportunity to apply to transfer them if she was so advised. He confirmed that the plaintiffs were content to file a notice of discontinuance in respect of the wife, in the event that she no longer wished to be a party to these proceedings after the determination of the present notice of motion.
[3]
Facts
It is convenient to summarise the facts, in so far as they are revealed by the evidence. The summary is based on the present state of the evidence and is not intended to amount to final findings of fact.
The husband and wife were both born in 1982. The husband was engaged in business activities in China before he married the wife. According to his affidavit of 16 March 2020 (which was tendered by the wife in support of her notice of motion for transfer), his activities were as follows:
"Business and Investment activities between 2006 and 2013
52. In 2006, I formed a real estate company with my brother in law, Ben. We established Fujian Hengshun Investment Co., Ltd. in May 2006.
53. My father and Ben helped with providing the initial finance of RMB 10,000,000 Yuan.
54. With the help of my father I invested RMB 1,470,000 Yuan. I held 49% equity. The company was mainly engaged in investing in other companies. It invested in Maanshan Kangjia Real Estate Development Co., Ltd. In May 2006, which in turn invested in Wuhu Huicheng Real Estate Corporation in Dec. 2006.
55. Since its incorporation until 2008, Maanshan Kangjia Real Estate Development Co., Ltd had developed both projects Kangjia Garden and Kangjia Landscape City. Kangjia Landscape City covers area for 120000 square meters from 2006 to 2008, total sales income was about RMB 400,000,000 Yuan, enterprise income tax paid was RMB 13,000,000 Yuan.
56. I held 11% equity of Maanshan Kangjia Real Estate Development Co., Ltd. Through Fujian Hengshun Investment Co., Ltd. (Fujian Hengshun Investment Co., Ltd. held 22% equity of Maanshan Kangjia Real Estate Development Co., Ltd., I held 49% equity of Fujian Hengshun Investment Co., Ltd.).
57. From November 2006 until the end of 2013, Wuhu Huicheng Real Estate Corporation developed Huicheng Mingju. The total sales income was about RMB 1,100,000,000 Yuan from 2009 to 2013, and enterprise income tax paid was over RMB 40,000,000 Yuan.
58. I held 3.4% equity of Wuhu Huicheng Real Estate Corporation through Maanshan Kangjia Real Estate Development Co., Ltd. (Maanshan Kangjia Real Estate Development Co., Ltd. held 30% equity of Wuhu Huicheng Real Estate Corporation, Fujian Hengshun Investment Co., Ltd. held 22% equity of Maanshan Kangjia Real Estate Development Co., Ltd., I held 49% equity of Fujian Hengshun Investment Co., Ltd.).
59. In July 2008, I became involved with Fujian Laibao Construction Engineering Co., Ltd as the Project Manager. I managed projects with value of RMB 280,000,000 Yuan, including Huicheng Shandong Phase 1 Section 1 project started in May 2009 and Huicheng Shangdong Phase 1 Section 2 started in September 2009 .
60. In 2013, I became the Vice General Manager of Maanshan Xiushan Real Estate Development Co., Ltd.
61. My financial and business success started and continued with my parents' financial and non-financial backing and support."
[4]
The husband has paid interest of $720,000 on 18 July 2018 (being interest for the first two years) and $100,000 on 9 May 2019, being interest for a further 3.33 months. Otherwise, the husband has made no payments.
On or about 24 July 2016, the husband and the wife arrived in Australia with their two sons.
In December 2016 the husband committed an offence of domestic violence against the wife as a result of which he was sentenced to a term of imprisonment of 10 months, 2 months of which were required to be served in custody. Upon his release, he lived separately from the wife as a consequence of an Apprehended Violence Order (AVO). He returned to China in November 2017 to look for business opportunities there. He continued to provide financial support to his family in Australia.
The AVO expired in December 2018, at which point, the wife travelled with their two sons to China to be reunited with the husband. On 1 February 2019, the family returned to Australia from China.
By oral loan agreement made on 9 February 2019, which was reduced to writing on 11 February 2019, the brother-in-law agreed to advance to the husband ¥25 million for a term of 10 months commencing on 11 February 2019 and ending on 10 December 2019 at an interest rate of 1.5% per month. It was a term of the agreement that the funds would be deposited into an account in the name of the husband at a nominated account at the China Merchants Bank. The husband agreed to charge all of his assets as security for the loan.
On 11 February 2019 and 12 February 2019, Ruihua Sun advanced the total sum of ¥25 million (in two amounts of ¥10 million and ¥15 million respectively) to the husband, pursuant to a loan agreement between him and the brother-in-law for that sum.
According to documents filed by the wife in the Family Court proceedings, the husband and the wife finally separated on 1 April 2019. As referred to above, there had been earlier periods of separation.
On 17 May 2019, the husband left Australia to return to China to look for business opportunities as he had been unemployed in Australia.
As referred to above, on 23 May 2019, the wife commenced the Family Court proceedings. The final order sought was that the net matrimonial pool be distributed between the parties in the proportion of 65% to 35% in her favour. She sought injunctive relief on an ex parte basis, which included the following order:
"7 In respect of the amount of $5 million being the complying investment funds forming part of the requirements for the visa held by the parties, that the wife be granted leave to serve a copy of the restraining orders on:
a. The Department of Home Affairs of 26 Lee Street, Sydney NSW 2000;
b. Citigroup Pty Limited ("Citibank"); and
c. Any other persons or entities where the complying investment funds for the visa are held or deposited."
[5]
Consideration
Section 5(1) of the Act provides:
"5 Transfer of proceedings
(1) Where:
(a) a proceeding (in this subsection referred to as the relevant proceeding) is pending in the Supreme Court, and
(b) it appears to the Supreme Court that:
…
(ii) having regard to:
(A) whether, in the opinion of the Supreme Court, apart from any law of the Commonwealth or another State relating to cross-vesting of jurisdiction and apart from any accrued jurisdiction of the Federal Court or the Family Court, the relevant proceeding or a substantial part of the relevant proceeding would have been incapable of being instituted in the Supreme Court and capable of being instituted in the Federal Court or the Family Court,
(B) the extent to which, in the opinion of the Supreme Court, the matters for determination in the relevant proceeding are matters arising under or involving questions as to the application, interpretation or validity of a law of the Commonwealth and not within the jurisdiction of the Supreme Court apart from this Act and any law of the Commonwealth or another State relating to cross-vesting of jurisdiction, and
(C) the interests of justice,
it is more appropriate that the relevant proceeding be determined by the Federal Court or the Family Court, as the case may be,
…
the Supreme Court shall transfer the relevant proceeding to the Federal Court or the Family Court, as the case may be."
It was common ground that the proceedings in this Court would not have been incapable of being instituted in this Court but for any cross-vesting law. It was also common ground that the proceedings in this Court would not have been capable of being instituted in the Family Court but for any cross-vesting law or the Family Court's accrued jurisdiction. It was also common ground that the proceedings in this Court do not give rise to any question relating to Commonwealth law. The parties accepted that the motion ought be determined by reference to the interests of justice in s 5(1)(b)(ii)(C) of the Act.
It was accepted on behalf of the husband on the basis of Fencott v Muller (1983) 152 CLR 570 at 608 (Mason, Murphy, Brennan and Deane JJ); [1983] HCA 12 that it was arguable that these proceedings would fall within the accrued jurisdiction of the Family Court. However, Mr Lawrance submitted that the only way the Family Court would actually have jurisdiction would be if there were a genuine allegation that the loans were sham transactions. Given Mr Lawrance's acceptance that it is arguable that the Family Court would have accrued jurisdiction over the matters the subject of the proceedings in this Court, it is common ground that I have power to transfer the proceedings to that Court under s 5(1)(b) of the Act.
[6]
Costs
Mr Connor and Mr Lawrance agreed, relevantly, that there was no reason for departing from the general rule that costs ought follow the event: Uniform Civil Procedure Rules 2005 (NSW), r 42.1. Ms Chen submitted that no order for costs should be made against the husband because he did not play an active role in the hearing of the motion. Mr Connor and Mr Lawrance accepted that no order for costs ought be made against the husband.
[7]
Further directions
As referred to above, no defences have been filed and the question whether the wife wishes to remain a party to the proceedings is still an open one. In these circumstances, I propose to make directions to address these two matters.
[8]
Orders
For the reasons given above, I make the following orders in proceedings 2020/8992 and 2020/9036:
1. Dismiss the second defendant's notice of motion filed on 7 February 2020 for transfer of the proceedings to the Family Court.
2. Order the second defendant to pay the plaintiff's costs of the notice of motion.
3. Otherwise make no order as to costs.
4. Direct the second defendant, on or before 20 May 2020, to inform the other parties whether she wishes to remain a party to the proceedings or wishes the proceedings against her to be discontinued.
5. Direct the defendants, or defendant, as the case may be, to file and serve a defence on or before 27 May 2020.
6. List the matter before me for directions at 9.15am on 29 May 2020.
7. Grant liberty to the parties to apply to re-list the matter on 3 days' notice to my Associate.
[9]
Amendments
08 May 2020 -
[48] - "2010" substituted for "2020"
DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.
Decision last updated: 08 May 2020
Dismissed the second defendant's notice of motion for transfer to the Family Court; ordered the second defendant to pay the plaintiffs' costs of the motion; otherwise no order as to costs; directed the wife to confirm whether she will remain a party by 20 May 2020; directed defendants to file defences by 27 May 2020; listed matter for directions on 29 May 2020; liberty to re-list on 3 days' notice (Orders 1–7).
In the affidavit, the husband also deposed to his property interests and funds in China as follows:
"Properties and funds in China
62. I currently have two properties in my name in China.
63. In 2005 with the assistance of my father, a property was purchased in my name at Unit 1001, Changlebei Road, Siji Area Building 8. ("First property") The total purchase price was about 600,000 Yuan . The deposit was 30% which was paid by my father. The remaining was mortgaged to the bank. In 2011, my father provided me with funds to pay off the entire mortgage.
64. In 2012 another property was purchased in my name at Unit 2204, Building 1, Provincial Pingdong Community Restructuring Project, No .25 Hualing Rd, Gulou District, Fuzhou City and Parking # 195 ("Second property"). This property was purchased for about 2 .6million Yuan. This property was purchased in cash and the entire funds came from my father's bank account.
65. In 2015, I borrowed about 1.3million Yuan against the First property. I used these funds to transfer to Australia under the Complying Investment Scheme as part of the $5million investment requirement. To the best of my knowledge this loan agreement was also signed by Haiying.
66. In 2015, I also purchased another property at D Area, Building 5, Unit 2604 ("Third property"). This property was purchased for about 6 million Yuan, which is about $1.2m. The Deposit was about 1.8million Yuan . The funds for the deposit came from my father and my sister. The remaining amount was mortgaged to the bank for 4.19 million Yuan.
67. In March 2016, I sold the Second property for 3.2million Yuan. I used the proceeds in the following manner:
67.1. Paid the mortgage on Unit 1001 with interest;
67.2. Used the remaining to pay back my sister and my father for the funds that I had received from them."
The husband and the wife were married on 17 June 2004. They have two sons, born in 2005 and 2012 respectively.
On 23 January 2016, the husband and the wife arrived in Australia on a temporary Business Skills Innovation and Investment Visa (subclass 188). The husband was the primary visa applicant.
On 23 March 2015 the husband provided a statement of his assets and liabilities to the Department of Immigration for the purposes of establishing that he qualified for a visa. The statement showed that he had assets to the value of $5,527,978.06 which comprised cash on deposit in China and real estate in China and that he had no liabilities.
The husband set out the circumstances which led to the loan from his father the subject of the proceedings in this Court in his affidavit of 16 March 2020 as follows:
"Primula Street, Lindfield NSW ('Lindfield Property')
82. In about March 2016, with the assistance of my brother in law, Ben and a friend Biyun Xue and upon attending several house inspections, I finally found the property at 14 Primula Street, Lindfield NSW (Lindfield Property).
83. As my funds were used to meet the requirement for the $5 million complying investment for the subclass 188 visa application, I had to ask for financial help from my father to buy the Lindfield Property.
84. My father agreed to lend me the money but he wanted me to sign a formal loan agreement. In or around early May 2016, and while I was in China, my father handed over the loan agreement to me and stated to me words to the following effect: "You are going to be living in Australia, so both of you should sign this loan agreement."
85. I showed the agreement to Haiyin and asked her to sign it. Haiyin and I had discussions with words of the following effect:
Me: "I have found this house in Lindfield, apparently a very good suburb in Sydney. It is quite close to schools as well, for [the sons]… But you know, most of my monies have been used for the visa. So we need to borrow money. The price is around $2.5m. My father has agreed to lend us money and he wants us to sign a formal loan agreement and mortgage the house to him as security."
Haiyin: "If you want to buy the house, you go buy it. You can sign the loan agreement with your father but I won't sign it. I will not be liable for anything."
Me: "Well, if you don't want to be a liable party and I have to borrow all the purchase monies from my father, I will put the house in my name only."
86. I then signed the loan agreement with my father, and on or about 29 May 2016, I returned to Australia to deal with the settlement of the purchase and the renovation of the property.
87. On or about 10 June 2016, after having found the contractors to do the renovation work at Lindfield property, I returned to China to continue to make work arrangements and to look for and buy furniture for our new home.
…"
By agreement entitled "Contract of Loan Guarantee" dated 16 May 2016 the father agreed to lend to the husband the total sum of $2.5 million for the purchase of a property at Lindfield (the Lindfield property). The loan was for a term of 48 months commencing on 16 May 2016 and ending on 15 May 2020. The interest rate of the loan was 1.2% per month. There was provision in the written agreement for the wife to guarantee the loan but, as she did not sign the agreement, she is neither a party, nor bound by it. Clause 3 of the Contract of Loan Guarantee, the charging clause, relevantly provided:
"Party B agrees to hand over all assets and operating revenues under its name to Party A so Party A could have them at its disposal (including purchased property in Sydney [the Lindfield property] …"
The Contract of Loan Guarantee was signed by the husband and the father. According to the evidence, including business records, which was tendered on the notice of motion, the father advanced the following amounts to the husband pursuant to the agreement:
Date of advance Amount of advance
13 May 2016 $700,350
13 May 2016 $653,060
13 May 2016 $646,590
19 May 2016 $500,000
Total $2,500,000
The next Court date listed on the Initiating Application was 25 June 2019. The rules of the Family Court required the husband to file a Response to the Initiating Application by 18 June 2019, being a date at least 7 days before the next Court date.
On 3 July 2019, Rees J of the Family Court made ex parte orders restraining the husband from withdrawing or reducing the $5 million which formed the requirement for the husband and wife's visa application and restraining him from withdrawing any funds from any bank account held in his name or in the name of an associated company or trust. The husband was unaware of the proceeding until he was served with the orders made on 3 July 2019.
Directions were made by Rees J on 10 July 2019 for the filing of an affidavit by the husband.
On 2 August 2019, the husband filed his Response to Initiating Application in the Family Court. Also on that day, Rees J made orders by consent, which included a direction that the parties disclose their financial circumstances both in Australia and China.
On 29 August 2019 the brother-in-law lodged a caveat on the title of the Lindfield property, based on an interest in the land said to arise from the loan agreement made in February 2019. The basis for the caveat was the charging clause in the loan agreement.
On 9 September 2019, the father lodged a caveat on the title of the Lindfield property, based on an interest in the land said to arise from the loan agreement made on 16 May 2016. The basis for the caveat was the charging clause in the loan agreement. On 23 September 2019 further directions were made by consent for the filing of documents "by way of financial disclosure".
On 24 September 2019 the husband filed a Financial Statement in the Family Court proceedings in which he said that he owed the father $3.12 million for the purchase of the Lindfield property and he owed the brother-in-law $5.9 million for an investment in a Chinese start-up company. He also said that he owed Ling Xue (the sister) and Xiuling Chen, the father's sister (the aunt) ¥8.238 million. His Financial Statement sets out total assets of $10,463,200.35 and total liabilities of $12,797,516.37, of which the combined total of the monies said to be owing to the plaintiffs is $8,983,583.33 plus ongoing interest.
Further consent directions were made by Rees J on 13 November 2019.
As the husband did not repay the brother-in-law by the due date of 10 December 2019, the brother-in-law was unable to repay Mr Sun. On 9 March 2020, Mr Sun sent a letter of demand to the brother-in-law demanding repayment of ¥25 million together with interest of ¥4.875 million.
On 20 November 2019, the wife filed an Application in a Case in the Family Court proceedings seeking an order that the brother-in-law, the father and the sister be joined as parties to the proceedings.
By letter dated 3 December 2019, the wife's solicitors sought particulars of the husband's Financial Statement, including of the loans the subject of the proceedings in this Court. I was informed that the particulars have not yet been answered.
On 5 December 2019 the wife filed an Amended Initiating Application in the Family Court proceedings. The named respondents were the husband, the father, the brother-in-law and the sister. The orders sought included an order that the sister transfer to the husband the sum of $1.1 million and that the brother-in-law and the father remove their caveats from the title of the Lindfield property.
On 10 January 2020, the husband filed a Response to an Application in a Case in which he sought orders which included the dismissal of the wife's Application in a Case (which sought joinder of the brother-in-law, the father and the sister).
On 6 February 2020, the wife filed an Application in a Case in which she sought an anti-suit injunction preventing the respondents (the husband, the father, the brother-in-law and the sister) from commencing or taking any step in proceedings to which the wife was a party, pending determination of the Family Court proceedings. She also sought an order pursuant to s 114 of the Family Law Act 1975 (Cth) restraining the plaintiffs and the sister from prosecuting or commencing any proceedings before this Court.
On 9 March 2020, the wife filed an Amended Application in a Case. She continued to press for the injunctive relief contained in the Application in a Case referred to above. Also on 9 March 2020, the wife filed a financial statement in which she assessed the total value of her assets to be $2,000 and the total amount of her liabilities to be $60,000.
On 16 March 2020, the husband filed a Response to an Application in a Case. The orders he sought included an order that the Family Court proceedings be stayed pending the disposal of the proceedings in the Supreme Court.
On 16 March 2020, the husband made the affidavit in the Family Court proceedings referred to above. Of the involvement of his family in his financial dealings he said:
"Allegations of funds withdrawn and my dealings with my family members
77. [The wife] alleges that I have transferred substantial amounts to my family members. I say that my bank statements for at least the last 5 years will show that funds have always been transferred to or received from my family members. This has always been how we have been working as a family together. We loan to each other and we pay back the loans. We also enter business or investment ventures together and we transfer funds to each other.
…"
Of his failure to make repayments on the loans from his father or brother-in-law, the husband deposed at [186]:
"As I have not been able to make any loan repayments since the funds have been frozen [by the orders made by Rees J on 3 July 2019], the interest has been accumulating on the principal."
On 18 March 2020, the plaintiffs and the sister sought dismissal of the application to join them as parties.
In the meantime, as referred to above, the plaintiffs commenced these proceedings in this Court. The wife was named as a party in order to give her notice although it is accepted that she is not a necessary party to the proceedings, as she was not a party to the loan agreement with either plaintiff. Mr Lawrance indicated that, if she wishes to be removed as a party, the plaintiffs would be content to file a notice of discontinuance in respect of her. If the wife remains a party, she would be subject to issue estoppels and would be prevented from re-litigating in the Family Court an issue decided against her in this Court (Rippon v Chilcotin Pty Ltd (2001) 53 NSWLR 198; [2001] NSWCA 142). If she chooses no longer to be a party, no issue estoppel could arise against her. In that latter event, she will not be prejudiced because she will not be bound by a judgment in this Court against the husband. However, the plaintiffs will, if they obtain judgments, obtain valuable rights, including to have the quantum of the debt fixed and his liability determined as well as the right to commence bankruptcy proceedings against the husband on the basis of the judgments.
On 20 March 2020, an interim hearing took place in the Family Court before Deputy Chief Justice McClelland. The Amended Application was stood over generally with liberty granted to apply. No request has yet been made to relist the application.
On 4 February 2020 the wife swore an affidavit in support of her notice of motion in this Court, parts of which were tendered by the plaintiffs. Of present relevance, she deposed:
"15 In the Family Court Proceedings, one of the main issues in dispute is the value of the asset pool. Prior to my commencing the Family Court Proceedings, I had no knowledge of any of the debts set out in the Financial Statement. I was not aware that the First Defendant was involved in a 'Chinese start-up company' nor that [the] Plaintiff had provided funds in connection with this.
16 I am aware that the First Defendant, the Plaintiff, and the First Defendant's father, Mr Shuqiang Xue, are shareholders and directors in various real estate development, investment and money lending companies in China.
17 If the Family Court finds that the First Defendant indeed owes the various debts as alleged in the Financial Statement, the value of the entire asset pool in Australia would be depleted. The Family Court Proceedings will necessary involve a detailed investigation into questions such as:
a. Whether there were transfer of funds between the Plaintiff and the First Defendant;
b. If so, what was the purpose of the transfer of funds?
c. Whether a loan agreement existed and if so, what were the terms?
18 Since the beginning of the marriage, I have been financially dependent on the First Defendant. Since the birth of our second child, I have stopped working. I am currently residing in the Former Matrimonial Home and am financially supported by spousal maintenance payments from the First Defendant, as ordered by the Family Court. I do not have the financial resources to adequately defend these proceedings as well as to prosecute the Family Court Proceedings."
It would appear, on the basis of this evidence, that the wife was unaware of the loan agreements or the transfers from the plaintiffs to the husband and does not accept that they were arms-length transactions. I note that in a letter dated 23 January 2020, which foreshadowed the notice of motion for transfer, the wife's solicitors said to the husband's solicitors:
"… the alleged lenders identified in the Statements of Claim, and in the Husband's financial statement, are all members of the Husband's family. They are also co-directors and co-shareholders with the Husband in various real estate money lending and investment companies in China. The Wife will assert in the Family Court Proceedings that if there were transfer of funds between the alleged lenders and the Husband, the funds were for other purposes, and were no loans by the alleged lenders."
However it does not appear that the wife presently has any basis to allege that they were shams. Mr Connor, who appeared for the wife, accepted, at the hearing of the notice of motion, that he could not put the hypothesis that the agreements were shams as any higher than a "mere possibility".
The wife swore a further affidavit in support of her notice of motion on 21 April 2020. She deposed, in [4]:
"… I have located a document which appears to suggest that on or around 30 September 2014, the First Defendant had transferred 98% of the company known as Fujian Ming Ding Investment company to his father, Shuqiang Xue, for RMB 29,400,000. I understand that the sum is equivalent to approximately AUD $6,000,000. Annexed and marked "A" is a copy of the document written in Chinese."
In response to that affidavit, Ms Gong, in an affidavit affirmed on 27 April 2020, deposed that she was instructed that the father had not seen the document referred to in [4] of the wife's affidavit and had not signed it.
Mr Matulich, the solicitor acting for the wife in the Family Court proceedings, has deposed in an affidavit filed in that court that it will be at least 12 months before the matter will be listed for call-over for a hearing date to be fixed and that it will be at least another 12 months before a hearing date is fixed "at best". Ms Gong, the solicitor for the plaintiffs, deposed that it was likely that the hearing in this Court would take a day and obtain a hearing date this year.
The principles are well established. It was accepted that the relevant proceedings for the purposes of s 5(1) of the Act are the proceedings in this Court. In determining where the interests of justice lie, the Court is to consider and identify the "natural" forum for the "relevant proceeding". Brereton J, summarising the principles established in BHP Billiton Ltd v Schultz (2004) 221 CLR 400; [2004] HCA 61, described the natural forum as the forum "in which, objectively judged it might be expected that the dispute would fall to be resolved, with its concomitant judicial advantages and disadvantages for each party, whatever they may be": Valceski v Valceski (2007) 70 NSWLR 36; [2007] NSWSC 440 (Valceski) at [69].
On the face of it the money claims in this Court fall within this Court's usual jurisdiction. The wife, though not a party to either of the loan agreements, is a party to the proceedings only because of the plaintiffs' concern to alert her to the proceedings. Both of the loans were entered into before the final separation of the husband and the wife. The loan from the father to the husband was entered into in order to provide the funds for the purchase of the Lindfield property in which the husband and wife were to live when they took up residence in Sydney. There is documentary evidence to establish the advance of the funds by the father and the brother-in-law. It would appear, in any event, that the husband accepts that he is bound by the loan agreements, since he included the liabilities in his Financial Statement and has made payments pursuant to them. The payments only ceased by reason of the injunction granted by the Family Court on the wife's application.
Although Mr Connor raised the possibility that the agreements were shams, there is no evidence to suggest that they were. Further, in order to make the allegation, it would be necessary for the wife to have a basis for alleging that none of the parties to the loan agreements, the husband, the father and the brother-in-law intended the agreements to operate according to their terms: Snook v London and West Riding Investments Ltd [1967] 2 QB 786 at 802 (Diplock LJ), cited with approval in Raftland Pty Ltd v Federal Commissioner of Taxation (2008) 238 CLR 516; [2008] HCA 21 at [115] and [120] (Kirby J). Nor is there any basis to suppose (notwithstanding Mr Connor's submission) that the proceedings in this Court are an abuse of process.
Mr Connor submitted that the wife would be forensically disadvantaged if the proceedings in this Court were not transferred to the Family Court. He contended that in this Court the plaintiffs would be required to prove the loan agreements and that the husband did not dispute those loan agreements. Thus the loan agreements could be established in this Court without contest. However, if the matter were determined in the Family Court, the husband would bear the onus of establishing his debts, which (on his case) included the amounts owing under the loan agreements. I do not consider this to be a particularly relevant matter since the loan agreements were in writing and the transfers made under them are supported by contemporaneous business records showing bank transfers. Thus whether they have to be proved in this Court by the plaintiffs or the husband in the Family Court, the prima facie evidence of the agreements and their performance has already been adduced in this motion.
The present case is to be distinguished from a case such as Valceski, where Brereton J found that the Family Court was the natural forum of proceedings commenced in the Equity Division. In that case, Bobby and Mick (his father) purchased a property as joint tenants in 1982. Both names were on the title because the bank refused to lend the money for its purchase to Bobby alone but Bobby repaid the loan on the property. Bobby married Betty in 1992. Throughout their marriage, they lived on a house on the property and paid all expenses associated with the property. In 2004 the parties (Bobby, Betty and Mick) entered into a deed whereby Mick agreed to transfer his interest in the property to Bobby and Betty agreed to acknowledge that Mick would still have a beneficial interest in the property in accordance with the contributions he had made to it. In 2006 Bobby and Betty separated. On 4 April 2006 Betty commenced proceedings in the Family Court. She claimed that the property constituted part of the matrimonial estate. On 5 December 2006 Mick and Angelina (his wife) commenced proceedings in the Equity Division. On 13 February 2017, Betty filed a notice of motion in this Court seeking transfer of the proceedings to the Family Court.
Brereton J analysed the effect of the Equity Division proceedings at [26] as follows:
"If Mick and Angelina succeed, then the probable outcome would be that Bobby's legal interest will be reduced from 100 per cent to 50 per cent, and Mick will resume a 50 per cent legal and beneficial interest in the property (in which Angelina may have some beneficial interest). If they fail and the deed stands, then Bobby's 100 per cent legal interest will stand, but his equitable interest may be limited to a proportion reflecting his contributions vis-à-vis those of Mick (and Angelina) - although, if the statutory declaration is accepted as accurate, there may be no outstanding equitable interest in Mick, and Bobby may be the only person beneficially interested. Accordingly, the outcome of the equity suit will directly impact on the quantum of Bobby's estate."
At [27], his Honour summarised the three-stage approach applied in Family Court proceedings for the division of property: first, the pool of property of the parties to the marriage needs to be identified and valued; secondly, their respective financial and non-financial contributions to the property and to the welfare of the family are to be assessed; and, thirdly, the appropriate adjustment is to be made to reflect the means and needs of the parties to the marriage. His Honour found, at [76], that the issues in the Equity suit were a subset of those in the Family Court proceedings and that Mick and Angelina were already parties to the Family Court proceedings. He concluded that the present was a case in which "exactly the same issue will be litigated by two local courts" ([76]) but that only the Family Court could resolve the whole controversy between the parties. His Honour concluded at [78]:
"Accordingly, while the matrimonial dispute is a more extensive one, which will cover considerably more ground, than the dispute in the equity suit - including children's matters, and property in addition to McArthur Parade - so that, unless the exceptional course of determining a separate question were adopted in the Family Court, Mick and Angelina would be involved in a much larger piece of litigation than would be the case if the equity suit were to remain in this court, nonetheless the natural forum for the equity suit in the present context is the Family Court, because:
• the factual context of both proceedings significantly overlaps: there would be much duplication of evidence, and some of issues for determination, which would be avoided by both proceedings being determined by the one court;
• for practical purposes, only the Family Court can resolve the whole controversy: the s 78 application will remain part of the matrimonial proceedings and will be litigated in the Family Court, whether or not the equity suit is transferred to the Family Court; this Court cannot compel the parties to litigate the matrimonial proceeding here, and no party has proposed that the matrimonial proceeding be transferred to it; whereas it would be open to the Family Court to ensure that all issues were litigated in that Court, by restraining the prosecution of the equity proceedings in this Court;
• the equity suit arises in the context of the breakdown of the marriage of Bobby and Betty: the occasion for the dispute which underlies the equity suit appears to have been the breakdown of that marriage, which triggered the matrimonial proceedings. Where strangers to a marriage use the occasion of its demise to assert a right against the property of one or other (or both) of the spouses, they cannot reasonably complain if they become entwined in the matrimonial dispute."
His Honour, at [85] reiterated the last dot point in the following passage:
"Third parties - especially associates, such as parents or children or private companies, of one or other of the spouses - who use the occasion of the demise of a marriage to assert a right against the property of one or other (or both) of them, cannot reasonably complain if their claim is treated as part of the larger matrimonial dispute in the context of which it arises."
Mr Connor submitted that Valceski was on all fours with the present case. He relied on the circumstance that the determination of whether the plaintiffs were the husband's creditors and had an interest in his property (as a result of the charging clauses in the loan agreements) had a substantial effect on the identification of the net matrimonial assets available for distribution in the Family Court proceedings. Mr Connor submitted that the plaintiffs would be made parties to the Family Court proceedings because of the caveats on the Lindfield property and also their involvement in the husband's business dealings. He relied on the Family Court's undoubted power to make orders against persons who were not parties to the marriage and referred to various provisions, including ss 90AE and 106B of the Family Law Act. He submitted that this Court did not have jurisdiction to hear the whole of the claim but that the Family Court did have such jurisdiction and that it was appropriate that all matters in issue between all parties to both proceedings ought be determined in one proceeding.
I am persuaded by Mr Lawrance that Valceski can be distinguished on several grounds. Whereas Brereton J considered the Family Court to be the natural forum for matters in issue in the Equity suit, I consider this Court to be the natural forum for the plaintiffs' money claims. The loan agreements pre-dated the separation and were supported by signed documents and contemporaneous business records evidencing the transfers. What is in issue in the Family Court is the division of the assets of the parties, having regard to their respective contributions, whereas the only matter in issue (which might not be an issue at all) in the proceedings in this Court is the quantum of the amount owing under the loan agreements. It is also of significance that, unlike the claim in Valceski, the father does not claim a percentage share of the value of the Lindfield property by reason of the contribution made by his loan to the husband for its purchase. All that the father claims in these proceedings is judgment for the amount outstanding under the loan agreement together with interest. While this amount is said to be secured by reason of the charging clause in the loan agreement, his interest, if any, in the Lindfield property is to be measured by the amount outstanding under the loan agreement. Similarly, the brother-in-law's interest, if any, in the Lindfield property, arises only by reason of the charging clause in the loan agreement and not by reason of an equity arising from his contribution.
There would be no prejudice to the wife in allowing the Supreme Court proceedings to proceed to judgment since she could cease to be a party and would, in that event, not be bound by any issue estoppel. Although it is difficult to discern that there is any basis for considering that either or both of the loan agreements was a sham, if the wife has a proper basis to put the legitimacy of the loan agreements in issue in these proceedings and pleads that allegation in her defence to the plaintiff's statement of claim, this would plainly be a matter that could be taken into account in the Family Court in determining her application for an anti-suit injunction preventing the parties from participating in the proceedings in this Court pending determination of the Family Court proceedings. But for such an allegation, it is difficult to see on what basis the Family Court would grant an anti-suit injunction.
I am not persuaded that there is any basis to suggest that either of the plaintiffs has sought to use the occasion of the demise of the marriage between the husband and wife to assert his rights under the loan agreement. The proceedings in this Court were commenced because the husband breached the loan agreements by reason of the injunctions restraining him from withdrawing money from accounts to which he would otherwise have had access to make repayments. The relief sought in the two statements of claim is limited to a judgment sum and interest. Although Mr Lawrance accepted that a judgment in this Court would have the effect of quantifying, as between the plaintiffs and the husband, the caveated interest, no declaration that the plaintiffs have an interest in the Lindfield property is sought in the proceedings in this Court.
It cannot be said that the issue in the proceedings in this Court will be the same as any issue in the Family Court proceedings. Indeed, there is no basis for suggesting that there is any issue between the husband and the plaintiffs as to his indebtedness under the loan agreements or the quantum of that indebtedness since he has declared the loans in his Financial Statement filed in the Family Court. There is no basis in the evidence before me to support Mr Connor's insinuation that the absence of dispute is collusive and amounts to an in-house family arrangement to remove matrimonial assets from the pool available for division between the parties to the marriage. Indeed, as referred to above, I understood him ultimately to accept that the prospect that the agreements were a sham was no more than a possibility at this stage. The wife's evidence before me goes no higher than to depose that she was unaware of the loans.
Even if the plaintiffs are required to give evidence in the Family Court proceedings, it does not follow that they ought be made parties. It is not to the point that the plaintiffs might have engaged in business relationships with the husband in the past. If that were sufficient to make a person a party in Family Court proceedings, it would be necessary for a party's business partners to be joined in such proceedings, which could not be the case. The liabilities of the husband under the loan agreement are a discrete matter of a kind usually determined in this Court: see, for example, Aspinall v Aqua Sports Pty Ltd [2018] NSWSC 706. Even if the plaintiffs, as seems inevitable, are made parties to the Family Court on the basis that the wife seeks a withdrawal of the caveats they have each lodged against the Lindfield property, this is a discrete issue, which could be dealt with by the Family Court in an efficient way and would not require the plaintiffs to be present throughout the whole of the Family Court proceedings: Murray Morgan Investments v Capma Pty Ltd [2016] NSWSC 264 at [17] (Hidden J).
The proceedings in this Court have a narrow ambit. There is a real prospect that they can be determined before the end of the year, particularly if the wife chooses not to be a party or does not raise an allegation that either agreement is a sham. The determination of the Family Court proceedings is still years away. Mr Sun, from whom part of the loan monies were borrowed, has already demanded repayment. I am not persuaded that there is any justification for visiting the ambit of the Family Court proceedings on the plaintiffs whose only interest is in obtaining a judgment against the husband under the loan agreements for monies which he would appear to admit he owes them. The interests of justice are that the proceedings remain in this Court which is the natural forum.