Supreme Court New South Wales Medium Neutral Citation: Yue Family Investment Pty Ltd atf Yue Family Investment Trust v Yin [2023] NSWSC 641 Hearing dates: 16 – 18 May 2023 Decision date: 15 June 2023 Jurisdiction: Equity - Real Property List Before: Peden J Decision: Plaintiff's Statement of Claim is dismissed with costs: see [120] Catchwords: CONTRACTS — Formation — Contracts requiring written evidence — Contracts for sale of land or interest in land — Contract for the sale of rural land in Queensland — Where evidence of contract included receipt indicating deposit and signature — Whether deposit actually paid — Whether contract actually signed by purchaser — Where evidence does not demonstrate contract in existence CONTRACTS — Formation — Intention to create legal relations — Requirement that parties have the requisite intention to be bound — Whether parties intended to be bound at the time of signing the contract — Whether subsequent conduct of parties is admissible of such intention — Where vendor in any event had no intention to enter legal relations CONTRACTS — Discharge by abandonment — Where date of settlement in dispute — Where passage of time provided evidence of abandonment — Where contract therefore abandoned before purchaser's demand for settlement CONTRACTS — Remedies — Specific performance — Whether the purchaser is ready, willing and able to perform — Where there was some evidence of third party financiers — Where evidence of financing did not demonstrate purchaser ready, willing and able EQUITY — Defences — Unclean hands and laches — Whether specific performance should be refused — Where no evidence of prejudice to vendor or third parties — Where the relevant impropriety was the purchaser's failure to obtain approval from the Foreign Investment Review Board — Where no evidence of whether approval was required Legislation Cited: Duties Act 2001 (Qld) ss 455, 491, ch 4 Foreign Acquisitions and Takeovers Regulation 2015 (Cth) reg 52 Foreign Investments and Takeovers Act 1975 (Cth) ss 43, 52 Cases Cited: Carantinos v Magafas [2008] NSWCA 304 Coulls v Bagot's Executor & Trustee Company Ltd (1967) 119 CLR 460 Darzi Group Pty Ltd v Nolde Pty Ltd (2019) 100 NSWLR 394 Dougan v Ley (1946) 71 CLR 142 Jeans v Cleary [2006] NSWSC 647 R v Doney [2001] NSWCCA 463 Rocky Point Holdings Pty Ltd v TEB Enterprises Pty Ltd [2023] QSC 20 Stellar Vision Operations Pty Ltd v Hills Health Solutions Pty Ltd [2023] NSWCA 102 Sze Tu v Lowe (2014) 89 NSWLR 317 Twigg v Twigg [2022] NSWCA 68 Woolworths Group Ltd v Gazcorp Pty Ltd [2022] NSWCA 19 Texts Cited: G J Tolhurst and E Peden, Furmston and Tolhurst on Contract Formation: Law and Practice (3rd ed, 2023, Oxford University Press) Category: Principal judgment Parties: Yue Family Investment Pty Ltd ATF Yue Family Investment Trust (Plaintiff) Kehui Yin (Defendant) Representation: Counsel: L Shipway and M Harker (17 – 18 May 2023) (Plaintiff) M Castle and J M McEnaney (Defendant) Solicitors: Revolance Legal (Plaintiff) Gells Lawyers (Defendant) File Number(s): 2021/305004-1 Publication restriction: Nil JUDGMENT 1. This is a case about a disputed contract for the sale of land in Queensland and whether it ought to be specifically performed. 2. The plaintiff purchaser, Yue Family Investment Pty Ltd, claims that the defendant vendor, Kehui (Lily) Yin, is bound to sell the land by reason of a written contract dated 1 May 2017. 3. The purported contract was signed by Ms Yin's daughter, Ruochen (Kate) Jiang, as her power of attorney. 4. Mr Tao (Vincent) Li signed for the plaintiff. He was the plaintiff's sole director at the time but has since become bankrupt and can no longer perform the role of a director. 5. Ms Yin denies the contract is binding on her for various reasons, and otherwise says that the plaintiff is not entitled to an order for specific performance. Background 1. In about 2012, Ms Jiang and Mr Li met and discussed various business ideas. One idea was to set up an educational college for international students in Sydney. For that purpose, Mr Li formed a company, Vin International Pty Ltd (Vin International), and funded the school. By 2016, Ms Jiang became a director and CEO of Vin International. 2. In about 2014 or 2015, Ms Jiang told Mr Li about Ms Yin's property in Queensland, referred to by the parties as the "farm". Ms Yin had purchased the farm in 2012 for $675,000. That same year Ms Jiang and her former husband set up a company, with a view to producing sea cucumbers at the farm for export to China. That business idea never eventuated, and the farm was leased to a tenant, who used it as a seafood hatchery. 3. In 2015, Ms Yin returned to China to care for her elderly mother-in-law, and continued to spend most of her time in China until about 2018. From time to time, she returned to Australia briefly. In August 2015, Ms Yin appointed Ms Jiang her power of attorney, which was registered, and enabled Ms Jiang to enter transactions on Ms Yin's behalf, including the sale of land. 4. By the end of 2015, while they were working together, Ms Jiang had lent Mr Li $159,700, provided by way of various payments of $1,000 up to $10,000. Mr Li denied he had received such money, but was ordered to repay Ms Jiang, following a dispute in this Court determined by Williams J late last year: Yin v Li; Li v Jiang [2022] NSWSC 1512. In those proceedings, Mr Li was also ordered to repay Ms Yin a loan of $95,000 which she had provided to him in about February 2016, which he had also denied. After that judgment was given against Mr Li, he entered into voluntary bankruptcy and his mother, Mrs Yueying Liu, became the sole director of the plaintiff. 5. In 2016, Mr Li had attracted an investor for Vin International. Mr Yunxiang Cao invested approximated $500,000 and became the majority shareholder and a director of Vin International. 6. Mr Li expressed some interest in finding investors to purchase the farm, however, at no time did he have the financial resources to purchase it himself. At his request, Ms Jiang approached Ms Yin about a possible sale. Ms Yin indicated she would be prepared to sell the farm for an appropriate price. 7. In March 2016, Mr Li incorporated the plaintiff company, and was its sole director, secretary and shareholder. 8. The plaintiff alleges that Ms Yin ought be compelled to complete the sale of the farm to it, relying primarily on two documents: 1. A "receipt" allegedly signed by Ms Jiang on 21 April 2016 acknowledging Mr Li provided to her a $260,000 deposit towards the purchase of the farm (the Receipt); and 2. A contract for the sale of land allegedly signed by Ms Jiang as Ms Yin's power of attorney dated 1 May 2017 (the Contract). 1. On 27 October 2021, the plaintiff commenced proceedings seeking specific performance of the Contract. 2. The main issues in the case are whether the 2016 receipt and 2017 contract are genuine and bind Ms Yin. If they are found binding, then there are remaining issues of whether it is appropriate to order specific performance in all the circumstances. Receipt of "deposit" 1. Mr Li relies on a hand-written receipt that was said to have been signed by Ms Jiang in these terms: I have received $260,000 AU from Tao Li on 31/04/2016 for the deposit of 91 shore rd east Urangan QLD 4655. [signature] Ruochen Jiang 21/04/2016 1. Mr Li's evidence was that before April 2016 he had provided Ms Jiang with between $275,000 - $300,000 in cash for her own personal reasons and she had orally agreed that $260,000 could be used as "deposit" for the farm. 2. Ms Jiang denies she signed the Receipt, having no positive recollection of having done so. However, she also says that if she did sign it, despite her lack of memory about it, then it was solely for the purpose of providing a document for Mr Li to encourage investors to purchase the farm. 3. Ms Jiang's evidence was that Mr Li had sought such "receipts" from her earlier. On 22 January 2015, an email was sent from Mr Li's email address to Ms Jiang with a subject line of "receipt of rural" and attached a "template" receipt. Ms Jiang's evidence was that Mr Li asked Ms Jiang to complete the receipt by inserting details of Ms Yin's farm, so that Mr Li could use it for: the pre-valuation of the property so that the investor can get a loan from the bank. If the investor obtains pre-approval for a loan it is highly possible the investor will purchase this property. If not, he will not bother with the deal. 1. On 23 January 2015, Ms Jiang emailed back a completed receipt in the following terms (formatting as per the original): To whom it may concern, This is Kehui Yin, 61 The Tronagte Granville, owner of 91 shore rd east Urangan. I am acting on behalf of me and YY Investment Unit Trust in regards to the property purchase matter . the property address is 91 shore rd east urangan. I confirm 10% deposit ($200,000) has been paid by YY Investment Unit Trust and received by myself . the funds is deposited in my account. Signature: Name: Date: 1. Mr Li denied he ever sent the email, denied he asked Ms Jiang to complete the receipt and send it back, and denied he received it. 2. Counsel for the plaintiff, Mr Shipway, appropriately conceded that Mr Li was a combative and argumentative witness. He submitted: Now, true it is, that Mr Li, who's an important witness for my case, in some ways, was, on occasion, argumentative and combative, I couldn't be heard to say otherwise. Now, in my submission, there's a couple of things that needs to be said about that. First, as your Honour knows, this is a second chapter, as it were, in a series of legal proceedings between the parties and Mr Li was cross examined in those earlier proceedings and so, there can be no doubt that I think your Honour will have perceived that Mr Li perceives these proceedings as an adversarial setting and perhaps his demeanour in that context is explained, in part, by that. Now, your Honour might say, well, that's partly of Mr Li's own making. That is, that there were findings about his credit made by her Honour, Justice Williams, that were not positive, if I can put it that way, but the fact remains that Mr Li is seeking to put forward his version of events in a context in which he understands that those events are heavily contested. Now, the second point to make in that regard is that, on some occasions, I think it's fair that the reason for the combativeness or confusion was due to the inherent difficulties with translation and sometimes there were confusions in translation, particularly of technical or legal terms. … gauging demeanour and/or arriving at judgments as to credibility is inherently problematic and so we'd urge on your Honour to look at the documents to provide the reliable foundation, where they're available. 1. It was submitted that, by reason of these explanations, Mr Li's evidence ought be accepted. I have not made any determination of credit based on demeanour alone, or without regard to the documentary evidence. However, I do not accept Mr Li's evidence for the following reasons: 1. Mr Li denied that he sent and received the emails in 2015, which were the "template" receipts. However, there was no evidence that anyone else used his email. Those emails are consistent with Ms Jiang's evidence that Mr Li wanted documents to show investors to raise money to purchase the farm, and consistent with the Receipt being purely for the same purpose and not as an accurate record of the payment of actual money. 2. There was no evidence that Ms Yin had agreed that Ms Jiang could accept money on her behalf towards a deposit for the farm. I consider that unlikely where there was no agreement as to price and further there is no reference on the Receipt to Ms Jiang signing as Ms Yin's power of attorney. Ms Yin was not asked whether she agreed to the terms of the Receipt. 3. Mr Li claimed he had given Ms Jiang cash that he had withdrawn from his "savings" in China through a remittance service in World Square and a "lady by the name of Amanda … from the north-east part of China". However, he could not recall the name of the service provider. He had no receipt for any withdrawals and his evidence was that he was never provided with any, which I find incredible. He did not produce any records that demonstrated the depletion of his "savings" in China. 4. Despite deposing to having obtained "some" of the cash to give to Ms Jiang from his mother, Yueying Liu, and investors, Mr Li did not provide a single email or document to support that assertion or the quantum of those sums. Yueying Liu did not give any evidence in the case. 5. He was unable to give even a rough estimate of the number of tranches of cash he had allegedly given Ms Jiang, nor the estimated size of each tranche. 6. He kept no record whatsoever of any amount of money he had given to Ms Jiang. 7. At the time he claimed to have given Ms Jiang $260,000 for her own personal needs, he in fact owed her $159,700. Mr Li did not suggest that there was any discussion of any possible set-off, probably because he denied owing Ms Jiang any money. However, that tells against him having lent Ms Jiang any money also. 8. There is no evidence that Mr Li gave Ms Jiang $260,000 "on 21/04/2016" as stated in the handwritten document. His evidence was instead that it was over some time, and therefore the document is inaccurate. 9. As outlined further below, the Contract relied upon by the plaintiff specifies a deposit of $150,000, not $260,000, and does not indicate that either sum had already been paid as at the date of the Contract in 2017. 10. In 2016, Mr Li's instructions to his solicitor, Ms Di (Shelley) Sun, were that a draft contract for the sale of the farm was needed to assist in obtaining finance for the purchase. Those instructions are consistent with the Receipt being prepared for the same purpose. 1. I prefer the evidence of Ms Jiang, who denied she had written or signed the Receipt and had no positive recollection of doing so. There was no expert handwriting evidence to assist in determining whether the handwriting and signature belonged to Ms Jiang. While Ms Sun's evidence was that Ms Jiang signed the Receipt in her presence, she has not signed the Receipt as a witness, nor given evidence that she witnessed Mr Li give Ms Jiang $260,000. She further has no file notes recording the meeting, nor invoices or correspondence confirming that Ms Jiang signed the Receipt in her office. She did state that she sent a photo of the Receipt to Mr Li after Ms Jiang signed it, however, that photo was not in evidence. While Ms Sun held the Receipt at her office, she does not appear to have produced it to Mr Li and Ms Jiang at any meeting concerning the Contract. 2. On the balance of probabilities, I am not satisfied that Ms Jiang signed the Receipt. 3. However, if I ought to have found that Ms Jiang did sign the Receipt, I am not persuaded that it was a true reflection of either receipt of money, or an agreement to accept money for the purpose of the purchase of the farm. Instead, I consider that the Receipt was similar to the emailed receipts in 2015; Mr Li wanted documents to show investors and Ms Jiang provided them. Ms Yin's counsel, Ms Castle, accepted that it was unwise to have done so. However, I do not accept that the receipts ought therefore be accepted as accurate as representations of what actually occurred. 4. My conclusion that Mr Li had not provided Ms Jiang with $260,000 means that even if the Contract is binding, the plaintiff has never paid any deposit, which is relevant to the question of whether specific performance ought to be ordered and is considered below. Written contract 1. In early 2016, Mr Li's solicitor, Ms Sun, contacted Ms Christine Zhou, a Queensland solicitor, and asked her for a quote for preparing a contract for the sale of the farm. This was despite the fact that she was only acting for the plaintiff or Mr Li and not Ms Yin. At no time did she hold instructions from Ms Yin. 2. Ms Zhou advised that a bespoke contract would be necessary for the sale of a farm (with "a pond"), but that if the purpose of the document was merely to provide a draft contract to a lender to assist Mr Li with raising finance, then a standard Queensland residential contract could be used and Ms Zhou would only charge $330. 3. In November 2016, Ms Jiang approached Ms Zhou and instructed her to prepare a contract for sale of the farm, which was provided to Ms Sun. It included a typed settlement date of 30 days and a typed purchase price of $650,000, but a blank deposit. Mr Li requested an extension of the settlement to six months, to which Ms Yin agreed, and on 21 November 2016 Ms Zhou provided an updated version to Ms Sun, but still with the deposit blank. Deposit sum 1. The signed Contract has written in hand next to deposit "$150,000". The handwriting is that of Ms Sun. 2. On 1 December 2016, Ms Jiang sent Ms Zhou an email stating that she had received a deposit of $150,000. Thereafter, Ms Zhou never heard from Ms Sun. Ms Zhou's evidence was that usual Queensland conveyancing practice was that a buyer would sign a contract and send it to the vendor's solicitor, so that the vendor could then decide whether to sign the contract or not. 3. Ms Jiang's evidence was that Mr Li told her he had paid a deposit of $150,000 and showed her his phone and what appeared to be a bank receipt for that amount. However, she never in fact received $150,000. The plaintiff does not assert that it paid a deposit of $150,000 or any money after the date of the Receipt. I accept that Ms Jiang in December 2016 sent an email to Ms Zhou confirming that a deposit of $150,000 had been received. I accept that she trusted that Mr Li had paid the deposit as he represented it to her, and further that Mr Li asked her to send the confirmation to Ms Zhou so that it could be "process[ed] … faster". I do not accept that the plaintiff ever paid any money towards the purchase of the farm. 4. Mr Li alleges that on 1 May 2017 he went with Ms Jiang to Ms Sun's solicitor's office, where they signed two copies of the Contract, a waiver of cooling off period and a transfer, and that these documents were witnessed by Ms Sun (1 May Meeting). Mr Li's evidence differs from that of Ms Sun and Ms Jiang in material respects. 5. Mr Li gives no evidence of Ms Sun filling in the deposit sum in front of him; his evidence is that Ms Sun "explained … some key terms of the contract, including contract price, deposit and settlement date". 6. Ms Sun's evidence is that she had a conversation with Ms Jiang and Mr Li as follows: Sun: Is the amount of deposit $150,000? I recall Kate writing and signing a receipt in my presence that you paid to Kate $260,000 last time as deposit? Vincent: Yes, please just leave it as $150,000. For financial reasons. Sun: Kate, do you agree with that? Kate: Yes. 1. Ms Sun did not explain what she meant by saying Mr Li paid Ms Jiang $260,000 "last time as deposit" (emphasis added). However, it suggests that she did not consider the $260,000 sum remained a deposit. Neither does she explain why she mentioned a deposit of $150,000, when that sum had not been referred to in earlier conversation. 2. While Ms Jiang appears to have accepted that $150,000 would be an appropriate deposit, I do not consider that Ms Sun or Mr Li's evidence demonstrates that the deposit amount was inserted in front of Ms Jiang and on balance I find it was inserted on only Mr Li's instructions to Ms Sun without Ms Jiang's input. 3. I note for completeness that the plaintiff appropriately conceded that it could not succeed on its rectification case, which sought to have the deposit on the Contract amended to $260,000. The abandonment of that issue amounted to an acceptance that at the time of the execution of the Contract there was no continuing common intention of the parties that the deposit should be recorded as $260,000. In my view, such a want of intention also supports the conclusion that Mr Li had never provided $260,000 to Ms Jiang by way of a deposit for the farm. Such a payment was not recorded at the time of the Contract either on the Contract or separately, for example, in a document detailing the sum that would be required to be paid on completion. One or two contracts signed? 1. Ms Sun's evidence was that "a contract" (singular) was signed by Mr Li and Ms Jiang, and witnessed by her, not two copies as Mr Li suggested. When Ms Sun transferred her file to the plaintiff's lawyers acting in the litigation, she provided a single "original contract" and an additional signing page. However, when her firm was subpoenaed to produce "all documents, including the file … relating to the purchase" of the farm, no copy of the additional signing page was produced. The failure to produce the additional signing page was never explained by Ms Sun. 2. There are further peculiar features of the evidence. From a visual observation of the original Contract that was kept by Ms Sun until this litigation, it appears that the same pen colour was used for all the signatures. However, on the additional signing page, what is said to be Ms Jiang's signature is in a different pen colour to that of Ms Sun and Mr Li. Ms Sun did not provide any evidence about the additional signing page. No one provided any explanation for the apparent use of different pens. On a visual inspection of all the documents, the signatures alleged to be those of Ms Jiang on the various documents do not appear identical. The Court can, as a tribunal of fact, make its own comparison of handwriting: Jeans v Cleary [2006] NSWSC 647 at [157] (Johnson J) citing R v Doney [2001] NSWCCA 463 at [59]-[64] (Ipp AJA, Barr and Hidden JJ). 3. Further, while Ms Sun's evidence was that in 2016 she witnessed the signatures and discussed the terms of the Contract with Mr Li and Ms Jiang, she had no documentary evidence to support the fact of, or contents of, such a meeting. For example, there was no file note, diary entry, time entry, invoice or letter of advice about such a meeting. Ms Sun did not take any steps ordinarily expected when a contract for sale of land has been formed. There was also no letter confirming exchange had taken place, or explaining the stamp duty and settlement amount payable on the purchase, and Ms Sun did not provide the Contract to Ms Zhou who would have been involved in the settlement process. Mr Li expected Ms Zhou to be involved, as his evidence was that Ms Jiang told him "I do not think Shelly can handle Queensland properties". 4. When, later in 2017, Ms Yin's lawyers challenged the alleged "exchange" of the Contract, asking where it had been signed and who had witnessed it, Ms Sun did not respond stating she had been present, but instead refused to engage with the questions. Her response seems unusual, when the request from a professional colleague was otherwise polite and reasonable. Ms Sun accepted that it would have been easy to write back and provide answers to questions. 5. In 2016 and 2017, Ms Sun was a very junior solicitor who had only been admitted to practice on 27 May 2016. She also provided no convincing explanation as to why she could recall alleged conversations during the meeting with Ms Jiang and Mr Li some five years before the preparation of her affidavit without the aid of any file notes, when she was responsible for 30-40 matters at that time. She did not identify any particular features of the meeting that stood out to her that had sustained her clear memory. She did make the assertion "I recall both Mr Li and Ms Jiang had been long time work colleagues with good working relationship" without explaining her reasons. I consider that while Ms Sun was not dishonest, her account of a meeting with Mr Li and Ms Jiang is unreliable, particularly in circumstances where there is no objective evidence corroborating her evidence and Ms Jiang denies attending any meeting as alleged. On balance I find that Mr Li gave Ms Sun instructions and provided her with documents allegedly signed by Ms Jiang. Settlement date 1. On the basis that the Contract is binding, there is a dispute as to the settlement "term". There is no dispute that Ms Zhou first sent a draft contract to Ms Sun with a 30-day settlement period, and then sent a second draft with six month settlement period. However, the Contract relied upon by the plaintiff has been further altered by Ms Sun; she crossed out "6" and handwrote "18" and initialled the change. Neither Mr Li nor Ms Jiang initialled the change. 2. Mr Li's evidence was not only did Ms Jiang agree to an 18 month settlement, but that she agreed orally that settlement could be delayed until such a time that the plaintiff had finance and was ready. 3. I do not accept that Ms Jiang agreed to the oral "extension" suggested by Mr Li. It is highly improbable Ms Yin and Ms Jiang would have agreed to provide Mr Li with complete control over the timing of any sale, with a fixed price of $650,000. There was no evidence that Ms Yin was under financial pressure and needed to sell the farm, or that she had otherwise sought to sell it; Mr Li was the moving party on the purchase. 4. I also do not accept Mr Li's evidence of Ms Jiang agreeing to an extension to 18 months where Ms Jiang denied such an agreement, and the plaintiff has not produced cogent evidence of the change on the Contract. Ms Sun's evidence was that she "wasn't aware" that Ms Jiang never agreed to the 18 month settlement date. I am not persuaded that Ms Sun informed Ms Jiang of her handwritten change and that Ms Jiang agreed to it. 5. Therefore, if the Contract is binding, I consider the settlement period was six months, which would have required settlement in November 2017. The first time the plaintiff demanded settlement was in March 2021. Conclusion 1. It is difficult in the circumstances to determine what exactly occurred between the parties in relation to the Contract at the 1 May Meeting, and to determine whether the signatures are those of Ms Jiang or not. Ms Jiang did concede that while she had no positive recollection of signing the Contract, she may have done so, if it was among papers that Mr Li gave her to sign in her role as CEO of the school. She was certain that she did not attend Ms Sun's office and, while not conclusive, she had no diary entry to suggest she attended. The plaintiff did not provide any evidence of how such a meeting with Ms Sun was organised, for example, by email or SMS, and as noted above Ms Sun had no documentary records that would be expected of a solicitor, had such a meeting occurred. Mr Li could not remember the time of the meeting and from where he travelled to the meeting; only that he attended the meeting with Ms Jiang. 2. The plaintiff bears the onus of proving the validity of the Contract. On the balance of probabilities, I am not persuaded that Ms Jiang signed the Contract. I do not accept Mr Li's evidence, and while I do not consider Ms Sun was dishonest, I am not persuaded that her evidence of Ms Jiang attending a meeting on 1 May 2017 and signing the Contract is reliable. Accordingly, the specific performance will not be ordered in the plaintiff's favour, nor damages or relief against forfeiture in the alternative. Did the parties intend to be bound by the signed Contract? 1. If, contrary to the conclusions reached, Ms Jiang did in fact sign the Contract, I nevertheless do not consider that Ms Yin is bound by that Contract for the following reasons. 2. Recently, in Stellar Vision Operations Pty Ltd v Hills Health Solutions Pty Ltd [2023] NSWCA 102 at [64], the Court of Appeal stated the familiar test of the requirement that parties have the requisite intention to be bound (citations omitted): Whether parties intend to create binding legal relations is ascertained objectively, that is, by determining whether a reasonable person in the position of the parties would have taken them to have intended to contract. The presence (or absence) of that intention is fact-based, to be found in all the circumstances, including by drawing inferences from their words and their conduct in making their agreement. In ascertaining their intention, whether from a series of communications or from a single document, regard can be had to the commercial circumstances in which the parties exchanged their communications and to the subject matter of the supposed contract… 1. Subsequent conduct of parties may be admissible on the question of whether the parties intended to be bound to a written contract. In Darzi Group Pty Ltd v Nolde Pty Ltd (2019) 100 NSWLR 394 at 429, Emmett AJA (with whom Bathurst CJ agreed) stated: … where there is a dispute as to the facts known to the parties at the time of the alleged contract, their actions after that time may throw light on what was known to them at the relevant time. The purpose of considering evidence of subsequent conduct or actions, however, is to determine what actually happened or was known prior to the time of the making of the contract. For example, where one party alleges an intention to be legally bound by written documents and the other party disputes the legally binding nature of the material, one factor for determining whether the parties objectively intended to be bound is whether the writing covers everything that the parties, acting reasonably, would intend to be regulated by their agreement. Thus, their actions subsequent to the writing may disclose that there were matters that had not been attended to that, objectively considered, the parties must be taken to have intended to be covered. Where the writing does not cover such matters, there would be good ground for concluding that, objectively considered, the writing was not intended to create a legally binding obligation. 1. Further, as explained in G J Tolhurst and E Peden, Furmston and Tolhurst on Contract Formation: Law and Practice (3rd ed, 2023, Oxford University Press) at [1.14]: … a party will be estopped from giving evidence as to their own state of mind in order to resile from a contract. For example, assume the situation is that A makes an offer to B which is accepted by B in circumstances where a reasonable person in the position of A would construe B's statement as an acceptance. It is not possible for A to seek to resile from the contract by attempting to lead evidence that he or she did not subjectively believe B was accepting. A has acted in a way that a reasonable person 'B' would interpret as suggesting an intention to contract and is estopped from resiling from that position, unless A can prove that B did not rely or could have relied on the representation implied from A's conduct because B knew that, in fact, A did not intend to contract. 1. While often a signed contract will provide conclusive objective evidence that the parties intended to be bound, I do not consider that at the time of signing the Contract, Ms Jiang and Mr Li intended to be bound by that document for the following reasons. 2. The only circumstances in which Ms Zhou advised a standard form residential contract for sale of land was appropriate was if the document was to be used merely to assist the purchaser obtain finance. Otherwise, Ms Zhou advised that a bespoke contract would be required. There is no evidence from Ms Zhou, Ms Yin or Ms Jiang that the Contract was intended for purposes other than for Mr Li to obtain finance. Ms Sun understood that Ms Zhou was being asked to prepare a contract for finance purposes, and only later was told by Mr Li that the position had changed. Ms Jiang never provided such instructions to Ms Sun. 3. Ms Yin's evidence was that she understood that Mr Li would procure new investors to purchase the farm. For that reason, she provided him with documentation relevant to the farm, such as rates notices. She also provided him with information about a proposed new lease, and even asked the tenant to liaise with Mr Li about its terms. Ms Yin's evidence, which I accept, was that she did so because the investors would be bound by the lease and therefore ought to be involved in its negotiation. However, Ms Yin's evidence was that Mr Li never "did anything" and she finalised the lease between herself and the tenant. 4. There is no evidence of conduct by the plaintiff that demonstrates that it considered itself bound by the Contract after May 2017. For example, no deposit was paid at the time of alleged formation or any time thereafter. No stamp duty was paid on time for the purchase, even though it was due and payable within 30 days of formation. No correspondence was exchanged with Ms Yin about the Contract until 2021, after Ms Yin had commenced her proceedings against Mr Li for the repayment of the loan she gave him. 5. Based on all the evidence, I do not consider that Mr Li intended the Contract to bind Ms Yin, and Ms Jiang and Ms Yin had no intention to be bound; at its highest the contract was "subject to finance", and that finance was not obtained either within the settlement period or within a reasonable time. Is the Contract admissible? 1. At the hearing, Ms Yin raised that the Contract was inadmissible as evidence because stamp duty had not been paid in accordance with the Duties Act 2001 (Qld). 2. An instrument is properly stamped where relevantly it is stamped under ss 455(1)(c) and 455(2) which provides for registered self-assessors to stamp and endorse the instrument: see Duties Act 2001 (Qld) s 491(1). 3. The plaintiff accepted that this matter needed to be rectified and the Contract was at first admitted, subject to an undertaking that the plainitff's solicitor, as a self-assessor, would stamp a copy of the Contract, and subject to the Court being satisfied that there had been compliance with the stamping requirements. 4. The plaintiff first sought to demonstrate that the requisite duty had been paid through an affidavit of Ms Sisi (Stella) Song, the plaintiff's solicitor, whose firm is a registered duty self-assessor of the Queensland Revenue Office. However, the actual requirements of stamping the Contract had not been satisfied, and the plaintiff later sought to tender a version of the Contract with such stamping. 5. The defendant maintained the submission that the Court could not be satisfied that the Contract was adequately stamped because Ms Yueying Liu has a 50% share in the plaintiff and is an overseas resident, and for that reason a higher rate of duty known as Additional Foreign Acquirer Duty was payable by the plaintiff: see Duties Act 2001 (Qld), ch 4. 6. Ms Song conceded in cross-examination that she did not seek any advice or refer to any case law in deciding what duty to pay on the Contract; she relied on her experience and believed the assessment was to be carried out at the time of entry into the Contract when Mr Li held 100% of the shares in the plaintiff, rather than at the time of payment of duty and therefore the additional duty was not payable. She also gave evidence that her understanding was that because the plaintiff was a family trust, the Additional Foreign Acquirer Duty was not payable; she was informed by the plaintiff that the beneficiary of the trust was not a foreign person. However, the trust deed, which created a discretionary trust, was not in evidence. 7. The plaintiff submits that it is not necessary for the Court to determine whether the correct duty has been paid, when instead the Court can order that: … the plaintiff submit the contract to the Commissioner of State Revenue (Queensland) for the assessment of Additional Foreign Acquirer Duty, and to thereafter cause any such duty to be paid in the amount assessed. see 640 The Esplanade Pty Ltd v Splash Bay Pty Ltd (No 2) [2017] FCA 89, at [117] (Markovic J) 1. Ms Yin did not make any submission against this approach being taken. Were it appropriate, contrary to my conclusions, to order specific performance, then the plaintiff ought to be ordered to submit the contract to the Queensland Commissioner of State Revenue to ensure compliance with the Duties Act: see eg Rocky Point Holdings Pty Ltd v TEB Enterprises Pty Ltd [2023] QSC 20 at [40] (Davis J). Did the parties abandon the Contract? 1. Ms Yin submitted that, if the Contract was binding, it had been abandoned by the parties. I consider the issue of abandonment on the basis that a contract was in fact binding on Ms Yin. 2. In Woolworths Group Ltd v Gazcorp Pty Ltd [2022] NSWCA 19, Bell P (as the Chief Justice then was, with whom Meagher JA agreed) summarised the relevant principles of abandonment at [91]-[96]: 91. As outlined in Ryder v Frohlich [2004] NSWCA 472 at [135] (Ryder), where it is plain from the conduct of parties to a contract that neither intends that the contract should be further performed, the parties will be regarded as having so conducted themselves as to abandon or abrogate the contract. In DTR Nominees Pty Ltd v Mona Homes Pty Ltd (1978) 138 CLR 423 at 434; [1978] HCA 12 (DTR Nominees), Stephen, Mason and Jacobs JJ observed that: "the contract in the present case was still on foot on and after 25th July 1974. Neither party had effectively rescinded. But there can be no doubt that by 5th December 1974, when these proceedings were commenced, neither party, whatever may have been their reasons, regarded the contract as being still on foot. Neither party intended that the contract should be further performed. In these circumstances the parties must be regarded as having so conducted themselves as to abandon or abrogate the contract. The position is similar to that with which Isaacs J. dealt in Summers v The Commonwealth. The plaintiff did not succeed in his action for damages for breach of contract, but on the other hand the defendant had not rescinded. Time passed during which neither party took any steps to perform the contract. It was held that the parties had so conducted themselves as mutually to abandon or abrogate the contract". (footnote omitted) 92. In Paal Wilson & Co AS v Blumenthal [1983] 1 AC 854 at 914, Lord Brandon described abandonment as follows: "Where A seeks to prove that he and B have abandoned a contract in this way, there are two ways in which A can put his case. The first way is by showing that the conduct of each party, as evinced to the other party and acted on by him, leads necessarily to the inference of an implied agreement between them to abandon the contract. The second method is by showing that the conduct of B, as evinced towards A, has been such as to lead A reasonably to believe that B has abandoned the contract, even though it has not in fact been B's intention to do so, and that A has significantly altered his position in reliance on that belief. The first method involves actual abandonment by both A and B. The second method involves the creation by B of a situation in which he is estopped from asserting, as against A, that he, B, has not abandoned the contract". (citation omitted) 93. As Leeming JA (with whom Bathurst CJ and White JA agreed) pointed out in Técnicas Reunidas SA v Andrew [2018] NSWCA 192 at [51], although it is common to refer to "abandonment" as a distinct doctrine, the preferable view is that the contract has been discharged by inferred agreement. His Honour relied on the following statement by Dixon CJ and Fullagar J in Fitzgerald v Masters at 432: "There can be no doubt that, where what has been called an 'inordinate' length of time has been allowed to elapse, during which neither party has attempted to perform, or called upon the other to perform, a contract made between them, it may be inferred that the contract has been abandoned … What is really inferred in such a case is that the contract has been discharged by agreement, each party being entitled to assume from a long-continued ignoring of the contract on both sides that (in the words of Rowlatt J) 'the matter is off altogether'." 94. As McColl JA stated in Ryder at [137]: "The underlying premise of the abandonment cases is that a period of time elapses during which neither party to the contract manifests any intention to perform the contract, leading to the inference that the contract has been abandoned. It is clear that the question whether an 'inordinate length of time has been allowed to elapse' is relative. In DTR Nominees Pty Limited v Mona Homes Pty Limited the High Court was prepared to infer abandonment after a period of less than five months had elapsed during which neither party took any steps to perform the contract. In Fitzgerald v Masters it was held that a contract for the sale of land had not been abandoned even though proceedings for its specific performance were not commenced until 26 years after its execution." … 95. Whether there is abandonment or abrogation of a contract is a matter of fact to be inferred from an objective assessment of the conduct of the parties … In Jafari v 23 Developments Pty Ltd [2019] VSCA 201 at [192], the Victorian Court of Appeal held that: "While commonly inferred by the lapse of an inordinate period of inactivity as between the parties, this is not always necessarily so. The doctrine rests on the objective intention of the parties to abandon or abrogate the contract, ascertained from their conduct and the surrounding circumstances. Accordingly, abandonment can be inferred where parties have either agreed or sought to agree on an entirely new bargain which constitutes a fundamental departure from their original bargain." (footnote omitted) 96. In Fazio v Fazio [2012] WASCA 72 at [74], Murphy JA noted that the abandonment of a contract, in the sense of the mutual release of future obligations, does not depend upon the subjective intention of the parties. Rather, it depends upon whether their conduct (both acts and omissions), viewed objectively, manifests an intention to discharge the contract. … 1. Ms Yin relied upon the passing of time as objectively demonstrating an agreement to abandon the Contract, rather than having relied to her detriment upon a representation by the plaintiff not to complete the Contract. 2. The plaintiff submits that no abandonment ought be found because: 1. Ms Yin could have terminated the Contract for the plaintiff's failure to perform, as time was expressly of the essence in the Contract; 2. Ms Yin's solicitor "had apparently acknowledged that the contract had been entered into"; and 3. after November 2017, Ms Yin had not sought to agitate for a resolution as to whether the Contract had been properly executed or not. 1. While not entirely clear, it seems the plaintiff submits that Mr Li did not abandon the Contract, because Mr Li subjectively believed that "Ms Jiang would agree, as she had previously indicated, to extend the settlement date upon my request". Further it was explained that from November 2017 until March 2021 when the plaintiff commenced proceedings, Mr Li was busy with other matters, including his divorce and the ill health and death of various family members. However, there is no evidence, other than his bare assertion, that he communicated these matters to Ms Yin or Ms Jiang. 2. The plaintiff further submits that "the only conduct of the plaintiff that would properly entitle the defendant to assume that the Contract had been abandoned would be a categorical indication by the plaintiff that it no longer considered the Contract to be on foot". 3. I do not accept the plaintiff's submissions for the following reasons. 4. First, I do not accept Mr Li's evidence that Ms Jiang agreed that the plaintiff could settle the Contract whenever it notified her it was ready and after the settlement date in the Contract, which I have found was a term of six months and therefore November 2017. While Ms Yin did not formally notify the plaintiff that she was terminating the Contract for a failure to comply with the settlement date, that is not a pre-requisite to finding the parties abandoned the Contract. Ms Yin did not consider the Contract was binding and therefore she was unlikely to have terminated a non-binding contract. 5. Secondly, Mr Li's subjective understanding or intentions are irrelevant to the question of whether it ought to be inferred that the parties abandoned the Contract. It is only objective evidence that can be considered. 6. Thirdly, I do not accept that Ms Yin's solicitor effectively "acknowledged" that the Contract had been properly formed. Read as a whole, the correspondence from Ms Yin's solicitor was seeking information from the plaintiff's solicitor concerning the alleged execution of the Contract. The plaintiff's solicitor refused to provide any details and instead informed Ms Yin's solicitor that they "are instructed not to further accommodate any request for information on this matter until… [Ms Yin's solicitor] advise us of [Ms Yin's] legal position". That final email from Ms Sun did not indicate that the plaintiff intended to perform the Contract in November 2017, or even November 2018 or any time thereafter. 7. Fourthly, I consider the fact that neither party raised the existence of the Contract in the context of the other disputes between Ms Jiang and Ms Yin and Mr Li is compelling and gives rise to an inference that the parties effectively had agreed to abandon the Contract. This is particularly so in circumstances where the plaintiff: 1. failed to pay any deposit; 2. failed to pay stamp duty as required at any time prior to the hearing; 3. failed to provide Ms Yin's solicitor Ms Zhou with a copy of the Contract so that conveyancing steps could be taken as necessary; and 4. failed to obtain definite finance at any time. 1. Fifthly, the plaintiff made no submissions, but relied in evidence on an agreement it had made with a Chinese company in 2019, allegedly to upgrade the facilities at the farm and engage in a joint venture to export produce to China. The alleged "Mariculture Cooperation Agreement" in evidence provided that the plaintiff was to "provide the site, premises, facilities and equipment to Party B , from 31 October 2019 to 1 November 2024". Party B was defined as Beijing Huiwei Zongheng Technology Co Ltd (BHZTCL). However, in 2019 the plaintiff did not have any finance available and had not even contacted Ms Yin to complete the Contract, so there was no way that the plaintiff could perform its obligations under that agreement with BHZTCL, if it was valid and enforceable. 2. It was not explained why that agreement was only attached to Mr Li's second affidavit of 20 September 2022, instead of his earlier affidavit of 3 May 2022, if the agreement had been created in October 2019. 3. Further, a "purchase confirmation form" from Baotou Guangquan Industrial Co Ltd listing equipment Mr Li claimed had been purchased by BHZTCL cannot be accepted to demonstrate that representation. There is no evidence from BHZTCL to state that the listed equipment was in fact purchased or that it was intended to be used at the farm rather than somewhere else. 4. There is no evidence that BHZTCL has sued the plaintiff for non-performance of the agreement, or that the plaintiff is liable to pay BHZTCL any compensation or damages. 5. Ms Yin relied upon evidence from a Chinese company that carried out a company search of BHZTCL, which showed that Mr Li's mother Yueying Liu was the "supervisor" or director of that company, and that it was created shortly before the alleged joint venture agreement. The plaintiff did not provide any evidence rebutting that report and Yueying Liu did not give evidence either. Mr Li tried to deflect questions about that company by denying his mother was involved and suggesting that the reports did not come from a government agency. I do not accept his evidence. 6. I do not accept that the plaintiff has proved that the agreement with BHZTCL is binding, that the parties to that agreement are performing it, or that the plaintiff will suffer any loss by reason of the alleged agreement with BHZTCL, should specific performance not be ordered. 7. Had it been necessary I would have found that the parties abandoned the Contract prior to March 2021. Ought specific performance be ordered? 1. If there was in fact a valid and binding contract, I note the principles concerning specific performance are well known and need not be set out in detail. There was no dispute that damages would be an inadequate remedy here, because the transaction involved property, which is a category of contracts for which specific performance is uncontroversial: Coulls v Bagot's Executor & Trustee Company Ltd (1967) 119 CLR 460 at 503 (Windeyer J); Dougan v Ley (1946) 71 CLR 142. The remedy is discretionary and subject to equitable defences which are detailed below. 2. The defendant principally resists specific performance on the basis that the plaintiff is not ready, willing and able to perform its obligations under the contract. The defendant also submitted that specific performance should be refused because of laches and unclean hands. Is the plaintiff ready, willing and able? 1. An issue that consumed some time at the hearing was whether the plaintiff could demonstrate it had the finance to complete the Contract, should specific performance be ordered. The Equity One "offer" 1. In its first tranche of evidence, the plaintiff relied upon an offer for finance apparently made by a lender called Equity One Mortgage Fund Ltd (Equity One). 2. In its opening written submissions, the plaintiff appeared to accept that the evidence was insufficient, and instead it would seek to provide updated evidence of the plaintiff's ability to complete the purchase. No submissions were made in closing about the Equity One letter demonstrating the plaintiff's ability to complete. However, for completeness I consider the issues around that offer letter, as the parties engaged at the hearing on the issue. 3. Mr Tyers' evidence was that Equity One operates by providing quotes to brokers or responding to a client's formal request for offer. Such a request involves an application form completed by the client, broker or both. The application is then submitted to Equity One. 4. The authenticity of the Equity One offer was questionable in a number of respects. Mr Michael Tyers, the general manager of Equity One, gave evidence that he did not consider the offer had originated from him, and he was responsible for approving almost all offers that left the company. Mr Tyers also conducted a search of documents relating to the plaintiff as a borrower and Mr Li as a guarantor and could not locate any records indicating they were clients of Equity One, or there had been any correspondence with either of them. 5. While cross-examination of him may have been intended to elicit evidence that Mr Tyers could not be absolutely confident that the letter had not originated from his company, because he had not approved every single letter of offer, I consider that on the balance of probabilities the letter did not come from Equity One, including for the following reasons. 6. Mr Li was not able to give any persuasive evidence of from where the offer letter originated. He said it was provided to him by WeChat by a person called "Coco", who was a mortgage broker, but he could not provide a surname. He could not produce any evidence of those WeChat communications because he had since upgraded his phone. 7. There are other peculiar features of the letter: 1. The email address on the offer letter is "eric.chanchan905@gmail.com", not a Coco. Mr Li's evidence was that he did not know who Eric was. There is no evidence of who "Eric" is. I note that Mr Tyers' email address ends with a company specific domain of "equity-one.com" rather than a "gmail" address. 2. The letter is not signed by an individual and instead there is an illegible signature above "Equity-One Mortgage Fund Limited", despite the final paragraph of the letter inviting "dear Client" to "contact me on 0497 555 000" (emphasis added). There is no evidence of whose phone number that was. 1. Even if it could be concluded that the offer letter was genuine, it was said to be open for five days, and could be accepted "by returning a signed copy of this letter to us, together with the commitment fee". Mr Li's evidence was he believed the offer had already been approved, but he conceded the offer was never accepted. While Mr Li had applied his signature using his mobile phone under the words "signed by guarantor", the conditional payment part of the document had not been completed and he did not give evidence that he had paid the commitment fee. In any event, as Mr Li is now bankrupt, it could not be expected that a lender would accept Mr Li as a guarantor. Therefore, that offer does not demonstrate that the plaintiff had funding to complete the purchase. "Funding" through Cisic Global Pty Ltd 1. On Sunday 14 May 2023, two days before the hearing commenced, the plaintiff served an affidavit of Dongmei Wang, the director of Cisic Global Pty Ltd, described to be by way of "update" on the plaintiff's ability to complete the purchase. 2. Cisic Global is the trustee of the "Tiana Trust", so-named after Mr Li's six-year-old daughter. Ms Wang is the only director of Cisic Global. However, the ASIC record states she became the director in December 2020. Ms Wang's evidence was that date was included on the ASIC record because "the accountant" for the company, whom she refused to name and whose identity was described as a "company secret" when questioned, had lodged a form to backdate her appointment date as a director to 2020, despite her evidence being that she had only become a director in 2023. Ms Wang therefore did not consider the ASIC record was "false", because ASIC had accepted the accountant's form and registered it. 3. Ms Wang also gave evidence that the company's registered address belongs to a woman called "Nicki", whose surname she did not know, and who has nothing to do with the company other than being a friend of Ms Yueying Liu. Ms Yin sought to obtain documents from the company by subpoena, which was complicated by the fact that Ms Wang, the director, had no connection to the registered address. 4. ASIC company extracts in evidence also showed that Cisic Global was renamed from Vin Global Pty Ltd in 31 January 2023 when the only director was Ms Wang. Ms Wang offered the following explanation for the name change: Q. Why did you change the name to Cisic Global on 31 January 2023? A. INTERPRETER: The reason is that Ms Liu Yueyang want to divide her share of property from her son and she wanted to give her property to the granddaughter. That's why we changed the name and addback at ASIC. That's why we also changed the company's name from Vin to Cisic Global. 1. These aspects of Ms Wang's evidence were troubling. She was also reluctant to give evidence and the plaintiff was required to subpoena her to attend Court to do so. 2. Her evidence was that Cisic Global was "prepared to pay up to $650,000 to fund the settlement" of a purchase of the farm from the plaintiff. There are problems with this evidence which are outlined in turn. 3. First, the plaintiff is required to demonstrate that it is ready, willing and able to complete the purchase. It has no evidence that it is able to raise money for a settlement, and instead appears to be relying on the evidence of Ms Wang that Cisic Global will purchase the farm from the plaintiff. There is no evidence that will occur. For example, there is no evidence that Cisic Global has unconditional funding sufficient for the purchase price and stamp duty. 4. Ms Wang's evidence is that Cisic Global would fund the purchase from a loan from UC Loans. A conditional loan approval for "a residential property loan" was annexed to Ms Wang's affidavit. The security property was listed as "TBA". The loan was conditional on four matters. First, "subject to satisfactory valuation report… from our panel valuer, confirming the above value", which was listed as $1,500,000. There is no evidence of any valuation of the farm. Secondly, the loan was "subject to funder final approval's Terms & Conditions". The plaintiff submitted that "can be taken to be a standard reservation of rights so that a loan agreement does not come into effect without the full suite of terms being applicable". However, those terms are not in evidence. It does not appear that the plaintiff or Cisic Global sought those terms, and the Court cannot guess what they might include. Thirdly, the loan is conditioned on "satisfactory VOI [verification of identity]". It is not clear who must be identified for this purpose, and there is no evidence that such verification has taken place. The plaintiff makes no submission on this condition. Fourthly, the loan was conditioned on a "satisfactory employment check". The plaintiff makes no submission on this condition. However, it appears to contemplate that the lender wishes to be satisfied that the borrower has the capacity to repay the loan on its terms. There is no evidence that Cisic Global has any income or means to repay interest or capital on a loan. There is no evidence as to whether a lease over the farm would generate sufficient funds to repay the loan. Ms Wang also stated that Cisic Global had purchased a property in April 2023. In those circumstances, the conditional loan approval could have equally been provided for the purpose of another property. 5. Secondly, the draft sale of land contract has not been signed by the plaintiff to demonstrate it is willing to perform an on-sale to Cisic Global. Further, the draft contract provides for a 30 day settlement, which would not allow the plaintiff to settle its purchase in less than 30 days. There is further no evidence of how either the plaintiff will fund interest that may be payable by the plaintiff on the Contract, for the late settlement. Ms Yin submitted such interest is over $200,000. The plaintiff did not provide any submission in response to that matter, nor suggest that Cisic Global would fund that interest. 6. I do not accept that Cisic Global has demonstrated that it is ready, willing and able to complete a purchase from the plaintiff. It follows that the plaintiff has not demonstrated it is ready, willing and able to complete a purchase from Ms Yin. 7. In any event, I would not exercise my discretion to order specific performance in favour of the plaintiff, where Cisic Global is not a party to the proceedings, and cannot be compelled to purchase the farm from the plaintiff in order to allow the plaintiff to complete. Is FIRB approval necessary? 1. In closing oral submissions, the plaintiff indicated that it did not seek a finding as to whether the farm was appropriately classified as "residential" or "agricultural" for the purposes of the Foreign Investments and Takeovers Act 1975 (Cth) ss 43 and 52 (FIRB Act). Both parties accepted that where 50% or more of a corporation is owned by a foreign resident, then FIRB approval is required if the purchase price for the particular property is above the relevant threshold price. The threshold varies according to the type of property; the threshold is $0 for residential and $15 million for agricultural property: see Foreign Acquisitions and Takeovers Regulation 2015 (Cth) reg 52. As there is no clarity here as to the appropriate classification of the farm, I cannot be confident that FIRB approval is not required. No attempt has been made by the plaintiff to obtain a ruling as to whether FIRB approval is necessary, and, if it is, whether such approval would be granted. 2. I consider this is a further failure by the plaintiff to demonstrate it is ready, willing and able to perform the contract, but also a reason why specific performance ought not be granted. Laches and unclean hands 1. Ms Yin raised laches and the plaintiff's unclean hands as other reasons why specific performance ought to be refused, if all the other requirements were made out. 2. The plaintiff only made a brief submission in response to laches, namely, that Ms Yin led no evidence that specific performance would cause prejudice to a third party by reason of any delay by the plaintiff in enforcing its rights, and there are "explanations for the plaintiff's delay", which are "likely to turn on the same considerations as the question of abandonment". 3. The three elements of the defence of laches are knowledge of the wrong, delay and unconscionable prejudice to the opponent by the delay: Sze Tu v Lowe (2014) 89 NSWLR 317 at 391 (Gleeson JA, with whom Meagher and Barrett JJA agreed); see also Twigg v Twigg [2022] NSWCA 68 at [86] (Brereton JA, with whom Bell CJ and Payne JA agreed). 4. I do not consider that Ms Yin has made out laches. On the assumption that the May 2017 Contract was binding, the plaintiff knew that Ms Yin was taking no steps to perform it from November 2017 and did not commence proceedings until October 2021. While those facts may indicate the plaintiff's knowledge and delay, there was no evidence and no submission by Ms Yin that she has suffered prejudice. Her solicitor threatened in 2017 that she intended listing the farm for sale, however, she did not do so. Further, she did not seek to remove the plaintiff's caveat placed on the title to the farm on 8 April 2021. 5. Ms Yin's counsel made only a short submission that because of the plaintiff's unclean hands specific performance ought to be refused: …we say that given that the remedy is discretionary, there would be no hard and fast rule about what might weight into the balance in any particular case. It's for the Court to take all factors into account and the fact that the plaintiff has been cavalier about complying with the [Foreign Investment and Takeover] regulations of that is, the plaintiff now controlled by a foreign person has been cavalier about complying with legislation, would be another factor, not determinative, but another factor which would weigh in the balance. 1. I am not persuaded that the plaintiff would be prevented from obtaining an order for specific performance for the reason of unclean hands. The point was not fully developed in submissions and only stated broadly as requiring the Court to "take all factors into account". 2. The question is whether the impropriety advanced by the plaintiff has, firstly, "an immediate and necessary relation to the equity sued for": Carantinos v Magafas [2008] NSWCA 304 at [58]-[59] (Hodgson JA, with whom Campbell JA and Handley AJA agreed). The only impropriety explicitly advanced is the plaintiff's "cavalier" attitude to FIRB approval. 3. I was not asked to determine whether compliance with the FIRB Act was legally necessary. It therefore cannot be said the plaintiff was "cavalier" if there is nothing to suggest whether compliance with the FIRB Act was an obvious requirement or clearly applicable to the plaintiff in the circumstances. This is particularly where the application of the FIRB Act turns on questions of whether the property is classifiable as agricultural or residential. Further, Mr Li's evidence was that he did not have knowledge of the approval requirements and believed the plaintiff entity had been set up in accordance with Australian law. Further, it was not submitted that an order for specific performance could not have been conditioned on FIRB approval. I do not consider unclean hands would have disentitled the plaintiff from specific performance. Conclusion 1. For the reasons above it is appropriate to dismiss the plaintiff's claim with costs. Orders 1. The appropriate orders are: 1. The plaintiff's statement of claim is dismissed with costs. 2. Should any party seek an alternative costs order: 1. The parties are to attempt to resolve the issue and provide consent orders by email to the Associate to Peden J within seven days of this judgment. 2. Failing agreement, the party seeking an alternative costs order is to provide any evidence and submissions of not more than five pages by email to the Associate to Peden J within 10 days of this judgment, and the opposing party is to provide responsive evidence and submissions within 15 days of this judgment. 3. Any costs application will be determined on the papers if appropriate. ********** 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: 15 June 2023