Zhu v Wang [2021] NSWCA 240

Zhu v Wang [2021] NSWCA 240

HQ Living repudiated the Management Agreement by terminating it peremptorily without the requisite notice, in circumstances where it was otherwise entitled to terminate by giving 28 days' notice due to De Rucci International's breach of the lease term regarding the number of bedding settings. The proper measure of damages was therefore one month's profit, not three months. Ms Zhu was personally liable for repayment of the $107,317.90 advanced as a loan for the bank guarantee, based on her written acknowledgment and the conduct of both parties. No overarching collateral agreement was established, and procedural fairness was not denied.

Parties
First Appellant: Lucy Zhu; Second Appellant: HQ Living Pty Ltd; Third Appellant: De Rucci Bundall Pty Ltd; Fourth Appellant: HQ Living (Moore Park) Pty Ltd; Fifth Appellant: HQ Bedding Pty Ltd; First Respondent: Bing Kun Wang; Second Respondent: De Rucci International Pty Ltd
Jurisdiction
Australia
Judgment Date
07 October 2021
Procedural Posture
Appeal / Court of Appeal Decision
Outcome
Appeal allowed in part
Legal Topics
Termination of Contracts, Repudiation, Procedure—joinder of Parties, Damages—assessment, Appeal Procedure
Contract Law Termination of Contracts Repudiation Procedure—joinder of Parties Damages—assessment Appeal Procedure

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Parties

Lucy Zhu

First Appellant

HQ Living Pty Ltd

Second Appellant

De Rucci Bundall Pty Ltd

Third Appellant

HQ Living (Moore Park) Pty Ltd

Fourth Appellant

HQ Bedding Pty Ltd

Fifth Appellant

Bing Kun Wang

First Respondent

De Rucci International Pty Ltd

Second Respondent

Procedural Posture

Appeal / Court of Appeal Decision

Legal Issues

  1. 1 Whether procedural fairness was denied to the appellants
  2. 2 Whether HQ Living repudiated the Management Agreement
  3. 3 Whether De Rucci International repudiated the Management Agreement

Ratio Decidendi

HQ Living repudiated the Management Agreement by terminating it peremptorily without the requisite notice, in circumstances where it was otherwise entitled to terminate by giving 28 days' notice due to De Rucci International's breach of the lease term regarding the number of bedding settings. The proper measure of damages was therefore one month's profit, not three months. Ms Zhu was personally liable for repayment of the $107,317.90 advanced as a loan for the bank guarantee, based on her written acknowledgment and the conduct of both parties. No overarching collateral agreement was established, and procedural fairness was not denied.

Court Disposition

Appeal allowed in part

Orders

  • Grant leave to the appellants to file a further amended notice of appeal in the form of the Revised Notice of Appeal within 7 days of reasons;
  • Set aside Order 6 (stay) made by Payne JA on 16 July 2021;