Tang v Yu [2024] FCA 297

Tang v Yu [2024] FCA 297

Mr Yu contravened s 12DA(1) of the ASIC Act by making multiple misleading representations in relation to financial services, including knowingly false representations that he was personally investing $700,000 alongside Mr Tang, that he had signed a genuine subscription agreement, and that he had paid funds into the Piper Alderman trust account. He also made misleading value, return, ownership and refund representations without reasonable grounds. Those representations were objectively likely to induce investment and were a material cause of Mr Tang investing $700,000. Because Mr Yu's conduct involved deliberate deception, the apportionment regime in s 12GF(1B) was unavailable. The PLC...

Jurisdiction
Australia
Judgment Date
27 March 2024
Procedural Posture
Claim for Misleading or Deceptive Conduct in Relation to Financial Services Under Ss 12 DA and 12 GF of the Australian Securities and Investments Commission Act 2001 (cth) / Final Judgment After Hearing
Outcome
Mr Tang succeeded against the first respondent. Judgment was entered for the applicant against the first respondent in the sum of $700,000, with interest reserved and costs ordered against the first respondent. The claim against the second respondent had been stayed after his bankruptcy.
Legal Topics
['misleading or Deceptive Conduct' 'financial Services Representations' 'investment Inducement' 'causation and Reliance' 'assessment of Loss and Damage' 'apportionment and Contributory Negligence' 'bankruptcy Stay']
['consumer Law' 'financial Services' 'commercial and Corporations' 'regulator and Consumer Protection' 'bankruptcy'] ['misleading or Deceptive Conduct' 'financial Services Representations' 'investment Inducement' 'causation and Reliance' 'assessment of Loss and Damage' 'apportionment and Contributory Negligence' 'bankruptcy Stay']

Case Brief

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Procedural Posture

Claim for Misleading or Deceptive Conduct in Relation to Financial Services Under Ss 12 DA and 12 GF of the Australian Securities and Investments Commission Act 2001 (cth) / Final Judgment After Hearing

Legal Issues

  1. 1 ['Whether Mr Yu made the pleaded joint investment representations, time pressure representations, value representations, PLC, return on investment and ownership representations, refund representations, and post-investment representations.' 'Whether the representations were misleading or deceptive or likely to mislead or deceive in contravention of s 12DA(1) of the ASIC Act.' 'Whether the representations were made in trade or commerce and in relation to financial services.' 'Whether any misleading representations caused Mr Tang to invest $700,000 and suffer loss.' 'Whether the apportionment regime in s 12GF(1B) of the ASIC Act was available to Mr Yu.' "How Mr Tang's loss and damage should be assessed, including whether the shares and units had any real value at the time of acquisition."]

Ratio Decidendi

Mr Yu contravened s 12DA(1) of the ASIC Act by making multiple misleading representations in relation to financial services, including knowingly false representations that he was personally investing $700,000 alongside Mr Tang, that he had signed a genuine subscription agreement, and that he had paid funds into the Piper Alderman trust account. He also made misleading value, return, ownership and refund representations without reasonable grounds. Those representations were objectively likely to induce investment and were a material cause of Mr Tang investing $700,000. Because Mr Yu's conduct involved deliberate deception, the apportionment regime in s 12GF(1B) was unavailable. The PLC...

Court Disposition

Mr Tang succeeded against the first respondent. Judgment was entered for the applicant against the first respondent in the sum of $700,000, with interest reserved and costs ordered against the first respondent. The claim against the second respondent had been stayed after his bankruptcy.

Orders

  • ['There be judgment for the applicant against the first respondent in the sum of $700,000.' 'The question of interest on the amount of $700,000 from 27 April 2018 until date of judgment under s 51A of the Federal Court of Australia Act 1976 (Cth) and the Interest on judgments (GPN-INT) practice note be reserved to...