Linjing Fang v Xiaodan Sun & Ors [2014] NSWSC 713

Linjing Fang v Xiaodan Sun & Ors [2014] NSWSC 713

The first defendant knew, before the plaintiff sent money, that the restaurant purchase price was $450,000, not $750,000, and that Mrs Park was not contributing $300,000, yet she allowed the plaintiff to invest on the contrary understanding. The plaintiff relied on those representations and would not have entered the transaction had she known the truth, and the money she paid was lost. The first defendant also undertook to act as the plaintiff's representative in Australia and owed fiduciary duties in administering the funds; by applying the funds to a $450,000 purchase wholly funded by the plaintiff and to later business expenses on the false premise of the original transaction, she...

Jurisdiction
Australia
Judgment Date
10 June 2014
Procedural Posture
Equity Division Principal Judgment Concerning Misleading and Deceptive Conduct and Breach of Fiduciary Duty / Judgment After Hearing; Remaining Contest Between the Plaintiff and the First Defendant, With Questions of Interest, Costs and an Alleged $50,000 Advance Reserved
Outcome
Judgment for the plaintiff against the first defendant in the sum of $654,850 exclusive of interest; misleading and deceptive conduct and breach of fiduciary duty established; further issues reserved.
Legal Topics
['misleading and Deceptive Conduct' 'fiduciary Duty' 'business Investment' 'reliance' 'loss and Damage' 'equitable Compensation' 'interest on Misapplied Funds']
['trade Practices' 'equity'] ['misleading and Deceptive Conduct' 'fiduciary Duty' 'business Investment' 'reliance' 'loss and Damage' 'equitable Compensation' 'interest on Misapplied Funds']

Case Brief

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Procedural Posture

Equity Division Principal Judgment Concerning Misleading and Deceptive Conduct and Breach of Fiduciary Duty / Judgment After Hearing; Remaining Contest Between the Plaintiff and the First Defendant, With Questions of Interest, Costs and an Alleged $50,000 Advance Reserved

Legal Issues

  1. 1 ['Whether the first defendant engaged in misleading and deceptive conduct by representing that the Zozo Korean Restaurant was being purchased for $750,000 and that the second defendant would contribute $300,000 when the first defendant knew the purchase price was $450,000 and that the plaintiff was funding it alone.' "Whether the plaintiff relied on the first defendant's representations and suffered loss as a result." "Whether the first defendant owed the plaintiff fiduciary duties as the plaintiff's representative in Australia in relation to the investment funds." "Whether the first defendant breached fiduciary duty by applying the plaintiff's funds to transactions not authorised by the plaintiff."]

Ratio Decidendi

The first defendant knew, before the plaintiff sent money, that the restaurant purchase price was $450,000, not $750,000, and that Mrs Park was not contributing $300,000, yet she allowed the plaintiff to invest on the contrary understanding. The plaintiff relied on those representations and would not have entered the transaction had she known the truth, and the money she paid was lost. The first defendant also undertook to act as the plaintiff's representative in Australia and owed fiduciary duties in administering the funds; by applying the funds to a $450,000 purchase wholly funded by the plaintiff and to later business expenses on the false premise of the original transaction, she...

Court Disposition

Judgment for the plaintiff against the first defendant in the sum of $654,850 exclusive of interest; misleading and deceptive conduct and breach of fiduciary duty established; further issues reserved.

Orders

  • ['Judgment for the plaintiff against the first defendant in the sum of $654,850 exclusive of interest.' "Reserve for further consideration the questions of the plaintiffs' alleged $50,000 advance in November 2010, of what interest is payable by the first defendant to the plaintiff on the judgment sum in order (1),...