For those following the Façade Designs International v Yuanda saga, an update:
- FDI, having issued proceedings against Yuanda, has been ordered to provide security for costs, on the basis that there are credible grounds that it may not be able to pay the costs of Yuanda if ordered to do so. The initial tranche of security – to close of pleadings – is $200,000.
- More unusual was the application that FDI’s solicitors Piper Alderman be restrained from acting for FDI unless and until an adequate information barrier (Chinese wall) be put in place. This issue arose because it emerged that Piper Alderman partner Daniel Fitzpatrick, who had conduct of the case, had previously acted for Yuanda on a number of occasions when employed by Gadens. Following what Justice Delany described as “gradual movement on the part of Piper Alderman” over some months the requirements of a proper Chinese wall were eventually put in place, such that Piper Alderman were permitted to continue with a fresh team (not including Mr Fitzpatrick), but a costs order was made against Piper Alderman and FDI was made in respect of the application.
The security for costs order was made on the basis of the inference that FDI’s refusal to disclose its full financial position was motivated by a wish not to reveal liabilities, as to do so would likely confirm impecuniosity. This approach is sometimes characterised as the rule in Browne v Dunn. Justice Delany referred to the much more recent decision, just a few days earlier, in Wu v Bi.
I was instructed by Yuanda as leading counsel on both limbs of this, and so Continue reading