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[2025] QCA 65
procedural. The application for security for costs was granted. Security of $49,000 was ordered for the appeal. The judgment did not dispose of the appeal from the primary judge’s amendment decision.
1 cited instrument linked from this judgment.
Bond JA ordered the appellants to provide $49,000 security for the respondents’ appeal costs. The amount was supported by evidence and was not disputed. The appellants were all assessed as impecunious, while the respondents had applied without delay. The court was not satisfied that security would necessarily stop the appeal, and it could not assess the appeal’s prospects because it lacked relevant evidence that had been before the primary judge. The appeal itself was not decided.
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2,240 words · generated 07/10/2026
Yao v Fang [2025] QCA 65 is a short decision by Bond JA about security for costs in an expedited appeal. It does not decide the underlying dispute over ownership of funds, and it does not determine whether the appellants should have permission to amend their defence.
The underlying trial proceeding began on 31 October 2022 and entered the commercial list on 19 May 2023. The trial had been listed to start on 28 October 2024. On 30 September 2024, the primary judge granted an adjournment, and the matter was relisted for a six-week trial beginning on 21 July 2025.
As Bond JA recounted, the plaintiffs alleged that money belonging to Lina Fang was transferred to Australia and used to purchase Australian properties. The primary judge described claims including recovery of money, deceit, equitable compensation, an account, trust claims, Australian Consumer Law damages, and breach of fiduciary duty. The amounts in issue were said to exceed about $80 million. That account is background in Bond JA’s reasons, including a quotation from the primary judge in Fang v Yao [2025] QSC 46 at [9]. It is not a finding by Bond JA that the allegations were proved.
The appeal arose from the primary judge’s decision on proposed amendments to the defence. The appellants sought, among other things, to withdraw admissions that Ms Fang owned the funds. Their proposed alternative case included allegations that Zhenjie Wang, rather than Ms Fang, transferred the funds; that Ms Fang and Mr Wang were never married or divorced; that the asserted custodial arrangements did not exist; that some documents were forged or of doubtful authenticity; and that the funds had been transferred out of China contrary to its laws. These were proposed allegations, not findings made in this security decision.
The primary judge allowed some amendments but refused others that required leave to withdraw admissions. The defendants who appealed filed their notice of appeal on 4 April 2025. Because the appeal was expedited and could affect the scheduled trial dates, the respondents applied urgently for security. They sought $49,000. Bond JA ordered that amount. He did not decide the appeal, and the extract does not set out the final form of the security order beyond recording that he made an order in accordance with a signed draft.
The supplied judgment text has no numbered paragraphs. Accordingly, it is not possible to give numbered paragraph references to Bond JA’s reasons without inventing them. The source references below identify the relevant parts by their subject matter. The specific “[9]” reference in the judgment is to the primary judge’s reasons, not to a numbered paragraph in Bond JA’s decision.
Bond JA said that the relevant security-for-costs principles were not disputed. He identified Natcraft Pty Ltd v Det Norske Veritas [2002] QCA 241, Murchie v Big Kart Track Pty Ltd [2003] 1 Qd R 528, Woolworths Group Ltd v Day [2018] QCA 79 and Green v Scottney-Turbill [2023] QCA 141 as the authorities setting out those principles. The extract does not reproduce their detailed reasoning, so the decision’s own explanation is the reliable basis for describing how the principles were applied here.
The first consideration was the amount. Bond JA regarded the $49,000 sought as “more than amply justified” by affidavit evidence. The appellants did not dispute the quantum if security were ordered.
Second, he found no delay by the respondents in bringing the application. The judgment describes the application as foreshadowed on 11 April 2025 and filed on 28 April 2025, in the context of an expedited appeal.
Third, the evidence supported a conclusion that all appellants were impecunious. The appellants included natural persons and corporations, but Bond JA said that because the conclusion applied to all of them and their interests on appeal coincided, there was no need to differentiate between them for this application. Their apparent inability to meet an adverse costs order if they lost the appeal was a persuasive reason to order security.
The fourth consideration was whether security might stifle the appeal. Freezing orders had been made on 19 May 2023, with an exception allowing up to $300,000 for reasonable legal expenses. The appellants had not sought to increase that allowance despite the passage of time and work undertaken in the proceeding. But Bond JA did not infer from this either that legal expenses had exceeded the allowance or that other funds were available. He also noted that the appellants had put forward no evidence that they could not source the security, including by borrowing. His conclusion was limited: he was “not persuaded that ordering security will necessarily stifle the appeal.” He did not find that the appellants definitely had access to funds.
The fifth consideration was prospects of success. Bond JA said a judge deciding security for appeal costs should consider prospects “to the extent that it is possible so to do.” In this case, the appeal concerned an interlocutory procedural ruling. Bond JA described it as a strict appeal under r 765 of the Uniform Civil Procedure Rules 1999 (Qld), with the review approach in House v The King (1936) 55 CLR 499. He also recorded that the appellants accepted the relevant principles but argued they could establish error and substantial injustice.
Bond JA could not form a view on the appeal’s prospects. He lacked evidence that had been before the primary judge, including material said to explain how the admission had been made and why it should be withdrawn. He therefore concluded that an assessment of prospects would not assist him in deciding the security application. Even if he were prepared to describe the appeal as arguable, that would not outweigh the other considerations. On the evidence and submissions available for this application, security was ordered.
The decision does not purport to change the law governing security for costs. Bond JA expressly said the relevant principles were not in dispute and referred to four earlier Queensland decisions as the sources setting them out. The judgment’s contribution in this case is its application of those principles to an urgent appeal involving impecunious appellants, an asserted risk of stifling, and a merits assessment the court could not reliably make.
The judgment describes the purpose of security as protecting a respondent against the risk that an appellant will be unable to satisfy a costs order if the appeal fails. It treats prospects as relevant, but not as a freestanding requirement that the court must resolve in every application. Bond JA’s qualification, “to the extent that it is possible so to do,” matters here: where the material needed to form a view was not before him, he did not speculate about the appeal’s strength.
The decision also shows that a conclusion of impecuniosity does not, by itself, establish that security will stifle an appeal. Bond JA distinguished between evidence of inability to pay and evidence that the appellants could not obtain the security from any source. The judgment records no such evidence about sourcing the amount, while also declining to make a positive finding that other funds were available.
The supplied material contains no later judgments, citations or history showing how subsequent courts have treated Yao v Fang. It would therefore be unsupported to describe it as having been followed, distinguished or adopted by later courts. The available text only establishes the reasoning and order made by Bond JA on 7 May 2025.
Purpose of security. Bond JA described the jurisdiction as protecting a respondent from the risk that an appellant cannot pay an adverse costs order. In plain English, security is directed at the possible costs-recovery problem if the appellant loses, not at deciding the underlying dispute in advance.
Amount and evidence. The $49,000 was “more than amply justified” by the affidavit evidence, and its amount was not disputed. In practical terms, the dispute before Bond JA was not about calculating the requested sum. The key question was whether the circumstances justified requiring it.
Impecuniosity. Bond JA found that the material supported a conclusion that all appellants were impecunious. He treated that as a persuasive reason for security because it increased the risk that a costs order could go unpaid. He did not treat the appellants’ financial position as automatically decisive.
Possible stifling. Bond JA said he was not persuaded that security would “necessarily” stifle the appeal. This is a carefully limited statement. The judgment does not say that the order could have no practical effect on the appeal. It says the evidence did not persuade him that the order would necessarily prevent it from proceeding.
Uncertain prospects. Bond JA could not form either a positive or a negative view about prospects because relevant material from the primary judge was unavailable in the security application. In plain English, he did not treat the appeal as weak or strong. He decided the application using the other matters he could assess.
Arguability. The appellants invited the court to regard their appeal as at least arguable. Bond JA said that even if he accepted that description, it would not outweigh the other considerations. The judgment therefore distinguishes “arguable” from a merits assessment strong enough, in the circumstances of this application, to change the security outcome.
The decision is most directly relevant to an application for security for costs of an appeal where the respondent identifies a real concern about recovering appeal costs if the appellant loses. The features Bond JA considered included evidence supporting impecuniosity, the amount and evidentiary basis of the requested security, whether the application was delayed, and whether payment would necessarily stifle the appeal.
It also illustrates a situation in which the court may be unable to assess prospects. Here, the appeal concerned a procedural ruling on amendments and withdrawal of admissions, but Bond JA did not have all the material that had been before the primary judge. Where essential evidence about the challenged decision is not available on the security application, the judgment supports the limited proposition that the court may decide the security question without forming a positive or negative view of prospects.
The case should not be treated as establishing that security must be ordered whenever an appellant is impecunious. Bond JA considered several factors together. Nor does it establish that freezing orders or an existing allowance for legal costs will always defeat a stifling argument. The outcome depended on the evidence before him, including the lack of evidence that the appellants could not source the security.
The decision concerns security for an appeal, not the underlying ownership dispute, the truth of the proposed allegations, or the general merits of withdrawing an admission. Its comments about the appeal’s likely obstacle were expressly preliminary and were not a final ruling on the amendment issue.
The supplied judgment does not contain any later-court treatment of Yao v Fang. It was delivered on 7 May 2025, and the provided text identifies earlier authorities but no subsequent decisions. No claim can therefore be made from this source that later courts have followed, distinguished, applied or criticised it.
The authorities Bond JA named were Natcraft Pty Ltd v Det Norske Veritas [2002] QCA 241, Murchie v Big Kart Track Pty Ltd [2003] 1 Qd R 528, Woolworths Group Ltd v Day [2018] QCA 79 and Green v Scottney-Turbill [2023] QCA 141. He referred to them as establishing the undisputed principles relevant to his application. He also cited House v The King (1936) 55 CLR 499 in describing the appellate review standard, and referred to r 765 of the Uniform Civil Procedure Rules 1999 (Qld).
Fang v Yao [2025] QSC 46 was the primary judge’s decision giving rise to the appeal. Bond JA referred to it for procedural background and explained that he did not have all the evidence that had been before that judge. The QSC decision is not a later treatment of the QCA decision.
The appeal from the refusal of some proposed amendments remained undecided in this judgment. The source does not disclose its eventual outcome, the final disposition of the amendment application, or whether the scheduled trial proceeded on 21 July 2025.
Bond JA could not assess whether the appellants could establish error under the applicable appellate approach or demonstrate substantial injustice. He noted that evidence from the appellants’ solicitor was said to explain how enquiries led to a positive case, but he did not have that material. The judgment therefore leaves unresolved how adequate the explanation for the original admission and proposed withdrawal was, and how the primary judge’s assessment of that explanation should be reviewed.
The judgment also does not establish what sources of money, if any, were available to the appellants to provide security. Bond JA declined to draw the positive inferences proposed by either side. He was not persuaded that security would necessarily stifle the appeal, but did not find that it was certain the appellants could raise the funds.
Finally, the provided text does not reproduce the full security order or detail any conditions, timetable or consequences beyond the $49,000 security order. Those matters cannot be supplied from this extract.
This is general legal information, not legal advice. Zoe can make mistakes. Before acting on or relying on this analysis, have a qualified Australian lawyer check it.
Source: Queensland Judgments (Supreme Court Library Queensland) (www.queenslandjudgments.com.au). Converted to plain text by ZoeLaw. Not the official version.
[2025] QCA 65
COURT OF APPEAL
BOND JA
Appeal No 1400 of 2025
SC No 13370 of 2022
WENLIANG YAO****First Appellant/First Respondent
(ALSO KNOWN AS
WILLIAM YAO)
LIANRU ZHAO****Second Appellant/Second Respondent
NEW AUS GROUP PTY LTD****Third Appellant/Third Respondent
ACN 165 555 733
W HOLDING GROUP PTY LTD****Fourth Appellant/Fourth Respondent
ACN 619 024 341
BRISBANE VALLEY INVESTMENTS PTY LTD****Fifth Appellant/Fifth Respondent
ACN 623 094 306 (BOTH IN ITS OWN
RIGHT AND IN ITS CAPACITY AS
TRUSTEE FOR THE BRISBANE
VALLEY INVESTMENTS TRUST)
v
LINA FANG****First Respondent/First Applicant
NAXI AGRICULTURE****Second Respondent/Second Applicant
INVESTMENT PTY LTD
ACN 634 072 209 (AS TRUSTEE
FOR THE NAXI AGRICULTURE
INVESTMENT TRUST)
NAXI @ TROUGHTON PTY LTD****Third Respondent/Third Applicant
ACN 634 070 698 (AS TRUSTEE
FOR THE NAXI PROPERTY
INVESTMENT TRUST)
NAXI (CHINA) PTY LTD****Fourth Respondent/Fourth Applicant
ACN 616 666 749
BRISBANE
WEDNESDAY, 7 MAY 2025
JUDGMENT
BOND JA: A proceeding which is pending in the trial division is being managed on the commercial list by the primary judge. The proceeding commenced on 31 October 2022 and was placed on the commercial list on 19 May 2023. On 22 December 2023 the matter was listed for a trial to commence on 28 October 2024.
On 24 September 2024, the first, third, fourth, fifth and sixth defendants applied to have the trial adjourned. On 30 September 2024 their application succeeded. The proceeding is currently listed for a six-week trial before the primary judge, commencing on 21 July 2025.
Her Honour described the nature of the proceeding in these terms.
“The statement of claim reveals a complicated set of arrangements and money transfers. In essence the plaintiffs allege that monies belonging to Ms Fang were transferred to Australia and used to purchase properties in Australia and that the plaintiffs have claims against the defendants as a consequence. Such claims include claims for monies had and received, damages for deceit, equitable compensation, for an account, for monies held on trust, for damages pursuant to the Australian Consumer Law, for damages for breach of fiduciary duty and so on. The amounts involved exceed about $80m.”1
In Fang v Yao [2025] QSC 46, published on 21 March 2025, the primary judge disposed of an application by the first, third, fourth, fifth and sixth defendants for leave to amend their defence in the proceeding. Leave was given for some amendments but refused in relation to other amendments which required leave being given to withdraw admissions.
The most important issue in contest before the primary Judge seemed to be proposed amendments which would –
withdraw admissions previously made that the first plaintiff, Ms Fang, was in fact the owner of the funds that the plaintiffs sought to recover in the proceeding; and
in lieu thereof plead a denial with an associated positive case to the contrary.
The positive case proposed by the first, third, fourth, fifth and sixth defendants had these elements:
The funds allegedly owned by Ms Fang were not transferred or caused to be transferred to Australia by her as the plaintiffs allege, but instead by Mr Zhenjie Wang. Mr Wang is not a party to the proceeding;
Although Ms Fang alleges that Mr Wang was her former husband and gave her the monies, Ms Fang and Mr Wang were never married or divorced.
The alleged custodian arrangements by which the funds were said to be held before transfer did not reflect any arrangement which in fact existed, and the funds for which Ms Fang sues do not and did not ever belong to her.
Documents central to the plaintiffs’ case are either forgeries or of doubtful authenticity.
The purpose of the transfer of the funds the subject of the proceeding from the People’s Republic of China to Australia, was to expatriate monies otherwise than in accordance with the laws of the People’s Republic of China so that the plaintiffs are not entitled to the relief claimed by reason of illegality and a doctrine of unclean hands.
By notice of appeal filed on 4 April 2025, the first, third, fourth, fifth and sixth defendants appealed her Honour’s decision. Save for proposed amended paragraphs 18D(b) to (g), which were abandoned before her Honour, they seek to reverse her Honour’s decision and to be permitted to advance the positive case against Ms Fang’s ability to pursue recovery of the funds. Sorry, to advance the positive case concerning Ms Fang’s ownership of the funds and accordingly against her ability to pursue recovery of the funds. The plaintiffs in the proceeding are the respondents to the appeal and seek to uphold her Honour’s decision and to resist the additional issues being made part of the upcoming trial.
There are other defendants in the proceeding in the trial division but they’re not involved in the appeal. No further reference needs to be made to them. Accordingly, the appeal is to be contested between, on the one hand the first, third, fourth, fifth and sixth defendants as appellants, and on the other hand the first to fourth plaintiffs as respondents. It is convenient to refer to the two groups of litigants respectively as the appellants and the respondents.
For obvious reasons the hearing of the appeal has been expedited. It appears to be common ground that if the appeal is allowed the trial dates will be lost.
I have before me an application for security for costs in relation to the expedited appeal. The application was foreshadowed by the respondents on 11 April 2025 and the application filed on 28 April 2025. It has been brought on urgently and, for obvious reasons, must be decided on an urgent basis.
The present reasons assume the reader is familiar with the reasons of the primary judge, the issues raised by the notice of appeal, and the arguments proposed to be advanced on appeal as articulated in the written submissions which have been filed for that purpose by the appellants and the respondents respectively. Time does not permit the extensive recitation of the contents of those documents.
The principles relevant to the disposition of an application for security for costs on appeal are not in dispute, as set out in Natcraft Pty Ltd v Det Norske Veritas [2002] QCA 241, Murchie v Big Kart Track Pty Ltd [2003] 1 Qd R 528, Woolworths Group Ltd v Day [2018] QCA 79 and Green v Scottney-Turbill [2023] QCA 141.
In the present case I am persuaded that it is appropriate to make the order sought. The considerations which have informed that judgment are as follows.
First, the amount sought is $49,000 which was an amount more than amply justified by the affidavit evidence. The appellants did not dispute the quantum if an order was to be made.
Second, there has been no delay by the respondents in their application for security.
Third, the material supports the conclusion that the appellants, who comprise two natural persons and three corporations, are all impecunious. Because that conclusion applies to all of the appellants, and because they all share a coincidence of interest in the issues arising on appeal, issues which sometimes arise in these applications as to the need to differentiate between appellants do not arise. The inability of the appellants to meet a costs order made against them in the event they fail on appeal provides a persuasive reason for ordering security for costs.
Fourth, I’m not persuaded that ordering security will necessarily stifle the appeal. As to this:
Relevant orders freezing assets of the appellants were made on 19 May 2023.
The orders are subject to an exception which permits the appellants to pay up to $300,000 for their reasonable legal expenses.
Notwithstanding the significant passage of time since the freezing orders were made and the steps in the proceeding that have occurred since then by solicitors and counsel engaged by the appellants, no request has been made to vary the initial amount to enable additional funds to be released to pay for lawyers.
The respondents suggest that it is open to draw the inference that reasonable legal expenses must have exceeded $300,000 and that the appellants have other sources of funds available to them.
There is no evidence put before me by the appellants that they are unable to source the security sought, whether at all or within a particular timeframe. Their apparent impecuniosity does not establish that proposition because the parties may be able to borrow monies from some other party.
The highest that counsel for the appellant was prepared to put the countervailing proposition was that “In light of the freezing order it can be inferred that there is at least a real prospect that ordering security will stifle the appeal.”
That there is an alternative source of funds is certainly something which might be suspected given the level of the appellants’ representation and the extensive work they’ve apparently done. But I do not think I could make that positive finding. Indeed, I conclude that evidence does not permit me to be sufficiently satisfied to draw either of the positive inferences which the parties have suggested.
However, I do conclude that I am not persuaded that ordering security will necessarily stifle the appeal.
Fifth, the authorities support the proposition that a judge considering an application for security for costs of an appeal should have regard, to the extent that it is possible so to do, to the appellants’ prospects of success of the appeal. Indeed, the question of the view I should form as to the prospects of success and how that should influence the exercise of my discretion was the consideration which took up most of the oral argument before me. As to this consideration I make the following observations:
The whole purpose of the jurisdiction to order security for costs of an appeal is to make an order in appropriate cases to protect a respondent against the risk that an appellant would be unable to satisfy an order for costs against it in the event that the appellant failed on appeal and such an order was made.
If the appellants had an apparently weak case a judge might be more likely to assess the risk of an adverse costs order to be high and, when taken with evidence sounding as to the extent of the appellants’ impecuniosity and the risk that an order might stifle the appeal, more likely to conclude that the interests of justice were served by making an order for security.
The converse is also true. If the appellants had an apparently strong case a judge might be more likely to assess the risk of an adverse costs order to be low and, when taken with the evidence as to the extent of the appellants’ impecuniosity and the risk that an order might stifle the appeal more likely to conclude that the interests of justice were not best served by making an order to protect the respondents against the risk that the appellants would be unable to satisfy such a costs order.
In the present case the appeal is for an interlocutory decision of a Judge in the trial division on a matter of practice and procedure. Having regard to rule 765 of the Uniform Civil Procedure Rules 1999 (Qld) that means that the appeal is an appeal in the strict sense with the result that the Court of Appeal must determine the correctness of the judgment under appeal at the time that the judgment was given. That is, on the evidence adduced before the primary judge and on the material as it then stood. The standard of appellate review is the deferential standard set out in House v The King (1936) 55 CLR 499. Moreover, the appellate court is not likely to interfere unless, in addition to error of principle by the primary judge, the appellants demonstrate that the order will work a substantial injustice to one of the parties.
The appellants did not dispute the application of these principles but asserted their ability to demonstrate House v The King error and that it would constitute a substantial injustice to prevent them from running the case concerning funds ownership which their proposed pleading flagged.
My present preliminary view is that at least the latter issue is likely to be a significant obstacle to the appellants’ success on appeal. Denying a litigant the opportunity to advance a case which is merely arguable and where there is no adequate explanation for the change of position, does not without more presently seem to me necessarily to result in substantial injustice.
At least one of the reasons why the ordinary position is to require an explanation for a proposal that an admission made by lawyers on client’s instructions be withdrawn, is the expectation of both courts and parties that parties should be bound by their lawyers’ conduct of their cases. And if parties seek relief from that expectation they should be prepared to condescend to detail as to why.
However, my ability to reach even a preliminary view on whether the appellants could surmount that obstacle was stymied by the fact that I did not have before me the evidence which the primary Judge had and which would sound as to the adequacy or inadequacy of the appellants’ explanation of how the admission came to be made in the first place and which might now be relied on to justify its withdrawal, or as to the evaluation of the extent of injustice, if any, which would be involved in denying the appellants the ability to withdraw the admission and plead the denial and associated positive case which they seek to plead.
Whilst it was common ground that there was no explanation from the appellants themselves, their counsel suggested that an explanation was to be found in the implications to be drawn from material which I do not have, namely affidavit material from the appellants’ solicitor which explain how enquiries which he had made led to his forming the view that there was a positive case to be run.
The result is, that I cannot form either a positive or a negative view on the prospects of success on appeal. I do not find an assessment of prospects to be helpful in determining this application.
Nevertheless, having regard to the first to fourth of the considerations which I have discussed above, it seems to me that the interests of justice are best served by making an order for security for costs of the appeal in the amount which the respondents seek. The appellants invited me to conclude that their appeal was at least arguable. But even if I was prepared to express that view I would not regard it to be a consideration which outweighed the other considerations to which I have averted. If the impecunious appellants want to be able to run their appeal they must be prepared to protect the respondents from any costs risk.
I will hear the parties as to the form of the order.
…
BOND JA: … I make an order in accordance with the draft signed by me and placed with the papers.
Fang v Yao [2025] QSC 46 at [9]. ↩
Yao
Fang [2025] QCA 65
(1936) 55 CLR 499
The application for security for costs was granted. Security of $49,000 was ordered for the appeal. The judgment did not dispose of the appeal from the primary judge’s amendment decision.