Yuan v Huang (No 2)

1. [1]

   On 28 August 2023 I gave judgment on the plaintiff’s Notice of Motion for contempt in which I found that all the charges of contempt against the first defendant, Jun Yu Huang (Mr Huang) had been made out: Yuan v Huang [2023] NSWSC 1021 (Liability Judgment). I stood the matter over for the filing of further evidence and a further hearing on penalty which occurred on 4 December 2023. At the time of that hearing the contempts had not been purged. These are my reasons as to the appropriate penalty.

2. [2]

   In the Liability Judgment I found that the charges of contempt falling into two different categories had been proved beyond reasonable doubt. The first was that Mr Huang had breached order 6(a) of the freezing orders made against him on 4 June 2021 as a result of 26 payments by Mr Huang between 30 June 2021 and 26 October 2021 to seven entities that engaged in the business of gambling or which operate interactive platforms for such a purpose, in the total amount of $135,000, and a further 6 payments by Mr Huang to Cuihua Luo and Anni Zhu between 2 July and 21 July 2021, in the total amount of $38,900: Liability Judgment at [57].

3. [3]

   The second contempt was misleading the Court (Kunc J) on 30 June 2021 as to the assets he owned on that date by failing to disclose his account with the ANZ Bank which is the account he used for the transactions referred to in the previous paragraph: Liability Judgment at [73].

4. [4]

   At the penalty hearing, the plaintiff was represented by senior and junior counsel and Mr Huang was represented by his solicitor. The plaintiff relied on two affidavits of her solicitor, Athena Yu, affirmed on 26 October and 16 November 2023. Mr Huang relied on an affidavit affirmed by him on 21 November 2023, and after the hearing, with leave, he filed a further affidavit on 8 December 2023 addressing his current financial position. Mr Huang was also cross-examined at the penalty hearing.

5. [5]

   Part 55, r 13 of the Supreme Court Rules 1970 (NSW) (SCR) provides:

6. [6]

   As noted by Rees J in Seven Network (Operations) Ltd v Dowling (No 2) [2021] NSWSC 1106 at [6], the provisions of Pt 55 are only declaratory of the Court’s power to punish for contempt and alternatives to committal to a correctional centre or a fine may be fashioned by the Court in the exercise of its inherent jurisdiction. One such alternative is imposing an obligation of community service as a condition of suspending a term of imprisonment or the operation of a fine: Registrar of the Court of Appeal v Maniam (No 2) (1992) 26 NSWLR 309; Zhang v Shi (No 6) (2022) 67 VR 469; [2022] VSC 271; D Rolph, Contempt (Federation Press, 2023), p 810.

7. [7]

   The underlying rationale of sentencing for contempt (be it civil or criminal contempt) is that it is necessary to uphold and protect the effective administration of justice which it does by demonstrating that the Court’s orders will be enforced: Australian Meat Industry Employees’ Union v Mudginberri Station Pty Ltd (1986) 161 CLR 98 at 107; [1986] HCA 46. In setting the punishment for contempt it is necessary to bear in mind the purpose of punishing the contemnor, which is deterrence of the contemnor and others in the future from committing similar contempts and denouncing the conduct concerned in an emphatic way: Registrar of the Court of Appeal v Maniam (No 2) (1992) 26 NSWLR 309 at 314; NHB Enterprises Pty Ltd v Corry (No 8) [2022] NSWSC 97 at [26]­­–[27].

8. [8]

   The importance of this underlying rationale to the determination of the appropriate penalty for contempt was explained by the Full Court in Kazal v Thunder Studios Inc (California) (2017) 256 FCR 90; [2017] FCAFC 111 at [97]:

9. [9]

   The Crimes (Sentencing Procedure) Act 1999 (NSW) and the Crimes (Administration of Offences) Act 1999 (NSW) do not apply to punishments for civil contempts: Dowling v Prothonotary of Supreme Court of New South Wales (2018) 99 NSWLR 229; [2018] NSWCA 340 at [46], [57]–[58]; NHB Enterprises at [29].

10. [10]

    While the Court has power to sentence a person to a term of imprisonment for civil contempt, it is well established that this is a penalty of last resort. In relation to this, Bell P said the following in NHB Enterprises at [30]:

11. [11]

    In Australian Securities and Investments Commission v Matthews [2009] NSWSC 285 Barrett J set out at [27] the following matters as relevant to the determination of the appropriate penalty for civil contempt:

12. [12]

    This list was referred to with approval on appeal: Matthews v Australian Securities and Investments Commission [2009] NSWCA 155 at [129], [144]. In Kazal at [102] the Full Court described this as a useful, although not exhaustive, list of the relevant factors in assessing the appropriate penalty and added at [103]:

13. [13]

    In respect of factor (2) (culpability), the contemnor’s state of mind is a relevant matter as it may aggravate or mitigate the seriousness of the contempt. In Kazal the Full Court said:

14. [14]

    Contempt will be contumacious if it involves deliberate defiance, and in the context of a breach of the Court’s orders it is enough that there is deliberate conduct which is calculated to thwart the fundamental purpose of the Court’s orders: Witham v Holloway (1995) 183 CLR 525 at 530; [1995] HCA 3; Grocon v Construction, Forestry, Mining and Energy Union (No 2) [2014] VSC 134 at [102]–[114]; Brennock & Dixon v Norman [2021] NSWSC 1182 at [12]–[13]. However, it is open to the Court to punish contempt by imprisonment even if the contempt is not contumacious: BCEG International (Australia) Pty Ltd v Xiao (No 3) [2023] NSWSC 554 at [17]–[18].

15. [15]

    In respect of factor (6) (character and antecedents), when determining the penalty for contempt the relevant history of the offender includes other findings of contempt or convictions for offences similar to contempt. In Ferguson v Dallow (No 5) [2021] FCA 698, O’Callaghan J said the following about this at [20] (adopted by Rees J in Seven Network (Operations) Ltd v Dowling (No 2) [2021] NSWSC 1106 at [9]):

16. [16]

    In the first case referred to in the above passage, Australian Competition and Consumer Commission v Levi (No 3) [2008] FCA 1586, the defendant had breached a court order restraining him from selling businesses without providing the purchaser with certain information. In sentencing him to imprisonment, McKerracher J took into account his prior convictions for offences of dishonesty which involved conduct similar to the conduct giving rise to the contempt, although those offences were not for contempt. In reaching this conclusion, McKerracher J applied the following statement by Lord Lane CJ in R v Giscombe (1983) 79 Crim App R 79 at 84 (emphasis added):

17. [17]

    After setting out this passage from Giscombe, McKerracher J went on to say:

18. [18]

    It may be noted that McKerracher J accepted that a prior conviction may be taken into account if the conduct the subject of the prior offence is similar to the contempt for which the contemnor has been convicted, and it is not necessary that the offence itself is similar to that contempt.

Evidence at the penalty hearing

1. [19]

   It was clear from Mr Huang’s evidence in cross-examination at the penalty hearing that he knew in June 2021 that the effect of the freezing orders was that he could not deal with his assets up to $300,000 except for paying up to $1,000 a week for his ordinary living expenses and paying reasonable legal expenses (T35) and he knew at that time that he had no interest in his former wife’s property at Gordon and therefore it could not be taken into account (T29, 30 and 35).

2. [20]

   At the penalty hearing the plaintiff relied on evidence regarding the prior criminal convictions of Mr Huang, including three judgments of the Court of Criminal Appeal that concern Mr Huang being R v Huang [2002] NSWCCA 499 (Huang 1), R v Huang [2010] NSWCCA 68 (Huang 2) and Huang v R [2018] NSWCCA 57 (Huang 3). While the three decisions are not admissible to prove the existence of facts that were in issue in the proceedings for which they were rendered, it was submitted for the plaintiff that reference may be made to them to prove Mr Huang’s convictions and the terms of the sentences delivered by the Court of Criminal Appeal for the offences and that was the purpose for which they were relied on: Evidence Act 1995 (NSW) s 91(1) and 92(2).

3. [21]

   The plaintiff drew attention to the following aspects of these decisions. First, each of the charges or offences dealt with related to serious dishonest or fraudulent conduct, being an offence of receiving stolen property contrary to s 188 of the Crimes Act 1900 (NSW) (Huang 1), an offence of conspiracy to cheat and defraud (Huang 2), and offences of dealing in proceeds of crime under the Anti-Money Laundering and Counter Terrorism Financing Act 2006 (Cth) (Huang 3). Second, in each case Mr Huang was subject to a custodial sentence being a sentence of imprisonment for 5 years with a non-parole period of 3 years (Huang 1), a sentence of imprisonment for 2 years suspended on the condition that he enter into a good behaviour bond (Huang 2), and a sentence of imprisonment for 8 years with a non-parole period of 5 years which was reduced on appeal to 6 years and 3 months ending on 8 March 2022 with a non-parole period of 4 years 8 months ending on 8 August 2020 (Huang 3 at [90]–[91]). Mr Huang was released on parole at the time of the conduct which gave rise to the contempts in this case (which occurred in the period 30 June to 26 October 2021).

4. [22]

   Observations were made in the Court of Criminal Appeal in Huang 1 regarding Mr Huang’s gambling addiction when dealing with his sentencing appeal. In Huang 1, Howie J (Buddin J agreeing) said the following at [16]:

5. [23]

   The plaintiff also put into evidence records produced under subpoena by the Department of Communities and Justice (DCJ) which record that Mr Huang had undertaken a number of programs to treat his gambling addiction in 2005 while in custody following the conviction from which he unsuccessfully appealed in Huang 1. The documents produced by the DCJ also included the parole order issued on 27 July 2020, setting out the conditions attaching to his release on parole on 8 August 2020 pursuant to the sentence in Huang 3, as well as the case notes of Mr Huang’s parole officer. The parole conditions include relevantly:

6. [24]

   The case notes of Mr Huang’s parole officer record that:

7. [25]

   Mr Huang was taken to these case notes in cross-examination and it was put to him that he was gambling on 1 and 3 September 2021 and also on 1 October 2021 when he made various payments to gambling enterprises online as found in the Liability Judgment and that he lied to the parole officer when he said on 27 September 2021 that he was not “gambling online/offline”. He said he could not remember saying those words to the parole officer. Given the conditions of his parole prohibiting him from gambling, the history of the parole officer asking him about his gambling activities, and the impression I have formed of Mr Huang as a witness during his extensive cross-examination in these proceedings, I am satisfied beyond reasonable doubt that he did tell the parole officer on 27 September 2021 that he was not gambling online or offline, and that he lied in so doing.

8. [26]

   Mr Huang gave the following evidence in cross examination as to why he undertook the gambling activities in breach of the freezing orders (T36):

9. [27]

   Mr Huang attached to his affidavit of 21 November 2023 a report by a clinical psychologist, Mr Jing Wang. This was admitted without objection from the plaintiff. This report concludes that Mr Huang exhibits typical symptoms that are consistent with a diagnosis of a gambling disorder and includes the following:

10. [28]

    In relation to the first paragraph of this passage, Mr Huang said in cross-examination that he had told Mr Wang that he had attended counselling with Mission Australia, but said it was only on the telephone for a few hours which was not “treatment” (T20). This evidence is inconsistent with the documents produced by the DCJ which indicate that the gambling counselling he received extended beyond telephone consultations (see [23] and [24] above).

11. [29]

    The third paragraph of the passage quoted at [27] above records that Mr Huang expressed remorse for his actions. Mr Huang’s written submissions (but not his affidavit) also stated that Mr Huang felt remorseful that he had breached the freezing orders, and “deeply regrets” giving inaccurate responses to questions put to him by Kunc J on 30 June 2021. He was asked in cross-examination why he had expressed “remorse for his actions”, and he said that it was because he had a young son and wants to be a better person for his son and someone his son can be proud of (T21 and 22). When pressed during his cross-examination he gave an apology to the plaintiff and to the Court (T25 and 38) and did so again in re-examination by his legal representative. However, I do not regard these apologies as genuine. In the case of the apology to the plaintiff, it was expressed as an apology for misusing the $8,000 which was deposited to the ANZ account on 29 June 2021 and then qualified by an expression of bitterness towards the plaintiff for putting him to the trouble of the proceedings for the contempts and the legal costs he had incurred as a result (T22). In the case of the apology to the Court, it was very late and qualified by the evidence given earlier that what he was truly remorseful for was that he was not a better father for his son.

12. [30]

    Mr Huang’s personal circumstances are that he is 45 years of age, single, unemployed, and living in rented accommodation. He has a 3-year-old son and cares for him 4 days per week. His former de facto spouse, who lives 40 minutes from his home, cares for the child the other 3 days and is in paid employment. Mr Huang’s financial position is that he has no significant assets apart from a credit balance of $26,904 with NEDS, which operates an online gaming platform, and he owes debts, including to his solicitors, in excess of $151,000.

Submissions as to penalty

1. [31]

   Both parties approached the question of the appropriate penalty by reference to the nine factors stated by Barrett J in Matthews extracted above at [11].

2. [32]

   As to the seriousness of the contempt, the plaintiff submitted that the acts of contempt are serious as they involved undermining the Court’s orders and interference with the administration of justice. The freezing orders were intended to protect the position of the plaintiff with respect to any judgment that may be obtained by her against Mr Huang. His conduct undermined that protection after he had opposed the orders being made in the first place and his conduct constituted a direct attack on the authority of the Court. Mr Huang knew from the outset the substance of the freezing orders and possible consequences of breach (including imprisonment) having been informed of the potential consequences by Parker J on 10 June 2021: Liability Judgment at [12]. Mr Huang’s knowledge of the existence of the freezing orders was confirmed in his affidavit and oral evidence at the earlier hearing. The amounts expended by Mr Huang were significant having regard to their intrinsic amount, his financial circumstances, and the quantum of the plaintiff’s claim ($300,000). It is likely that the expenditure significantly prejudiced the plaintiff’s ability to recover her loss should she succeed against him. Further, his failure to disclose his ANZ account had significant consequences because it permitted him to breach the freezing orders in the manner that he did.

3. [33]

   As to Mr Huang’s culpability, the plaintiff submitted that Mr Huang deliberately and knowingly breached the freezing orders and misled the Court. In particular, it is apparent from the Liability Judgment at [62]–[63] that Mr Huang’s failure to disclose to Kunc J the true position of his assets on 30 June 2021 was calculated and deliberate. The breaches of the freezing orders were repeated and deliberate, in the sense that they were not a product of inadvertence, and the Court should find, having regard to its findings as to Mr Huang’s creditworthiness, that the breaches were not the product of any misunderstanding on his part.

4. [34]

   As to the reason or motive for the contempt, the plaintiff submitted that it should be inferred that Mr Huang’s motive for breaching the freezing orders was greed coupled with self-interest. This submission is supported by the evidence referred to in the next paragraph and the exchange in cross-examination set out at [26] above.

5. [35]

   As to whether Mr Huang received a benefit or gain from the contempt, the plaintiff submitted that by reason of his breaches of the freezing orders, Mr Huang misused a total amount of $173,900 of which $135,000 was spent on gambling, and it may be inferred that he would have obtained a significant benefit from his dissipation of that money. This is illustrated by the Ladbrokes records tendered at the hearing on liability, which disclosed that he earned $43,709 on 30 June 2021 from the $10,000 he had deposited into his account with that entity by that date. Accordingly, he derived a monetary benefit on 30 June 2021, the day he misled Kunc J as to the ANZ account, that was more than four times the amount of $10,000 he dissipated in breach of the freezing orders. The plaintiff also noted that Mr Huang has not offered to restore the total amount he dissipated but only the much lesser amount of $8,000 which was one of the deposits to the ANZ account on 29 June 2021.

6. [36]

   The plaintiff submitted that Mr Huang has not shown genuine contrition. He belatedly offered an apology to the Court in his evidence in re‑examination by his legal representative at the penalty hearing and did not show any genuine regret or remorse. His evidence at the hearing on liability was that he considered the freezing orders to be unjustified and a hindrance on his efforts at undertaking his gambling business (T99.29–34, 119.32–35, 122.1–4, 122.15–20, 122.40–42 and 123.12–15). He also sought to blame the plaintiff for freezing his gambling accounts, stopping him from making a living (T114.26–29) as well as causing him loss and suffering by doing so (T122.9–10, 123.14–15). He reiterated the same sentiments at the penalty hearing (T22.15–13).

7. [37]

   As to Mr Huang’s character and antecedents, the plaintiff relied on Huang 1, Huang 2 and Huang 3 and submitted that the Court should take into account Mr Huang’s antecedents on sentencing for two reasons: first, they evidence a history of engaging in deceptive or fraudulent conduct and second, the contempts he committed in this case occurred whilst he was released on parole for offences dealing with proceeds of crime and under the Anti-Money Laundering and Counter Terrorism Financing legislation, and in breach of the conditions of his parole.

8. [38]

   Insofar as the plaintiff relies on Mr Huang’s prior convictions as relevant, I am not satisfied that his prior convictions are sufficiently similar to the contempt or the conduct giving rise to it and, therefore, I have not taken into account the nature of those prior convictions for the purpose of determining the appropriate penalty in this case.

9. [39]

   As to the contemnor’s personal circumstances, the plaintiff notes two matters. First, Mr Huang does not have any assets of value and consequently is unlikely to satisfy any significant fine imposed by the Court which tends against the imposition of a fine upon him: NHB Enterprises at [84]; Sun v He (No 2) [2020] NSWSC 1298 at [78]–[109]; Kazal [2017] FCAFC 111 at [103]. Second, the plaintiff submitted that despite the limitation imposed by s 91 of the Evidence Act on the use that can be made of decisions of the Court of Criminal Appeal, this Court should treat Mr Huang’s gambling issue in the same manner as in Huang 1, by giving it little if any weight.

10. [40]

    The plaintiff also relied on the documents produced under subpoena by the DCJ referred to at [23]–[24] above which indicate that Mr Huang had undertaken gambling counselling between August 2020 and September 2020, there were follow ups regarding his gambling issue in September 2021, and that he lied to the parole officer when he “denied any gambling online/offline” on 27 September 2021. The plaintiff also pointed out that his use of the online platforms constituted a breach of his parole condition to not access any gambling services, including by telephone or by the internet.

11. [41]

    For these reasons, the plaintiff submitted that Mr Huang’s gambling issue does not warrant leniency or favourable treatment by this Court on sentencing for his contempt.

12. [42]

    As to the need for deterrence and for denunciation of the contemptuous conduct, the plaintiff submitted that both are significant factors in favour of a significant punishment in the present case. Deterrence of the contemnor is important in the present case because there is a risk that, absent a serious penalty, he may repeat his acts of contempt and insofar as deterrence of others is concerned, it was important to send a message to others that a breach of freezing orders is a very serious matter with very serious adverse consequences for those who do so: see Pisano v Dandris (No 4) [2015] NSWSC 1689 at [31]–[32]. The authority to enforce freezing orders made by the Court will be diminished if Mr Huang is not subject to a significant sanction for his disobedience.

13. [43]

    The plaintiff submitted that the appropriate penalty for the contempt was (a) imprisonment for 9 to 12 months or (b) a suspended sentence of indefinite imprisonment subject to him purging his contempt by paying the moneys he dissipated (in the sum of $173,900) into court within 28 days. In my view, it is evident from Mr Huang’s financial position that the second alternative will not be an effective punishment for his contempt (see [39] above).

14. [44]

    In support of the plaintiff’s proposed sentence of imprisonment the Court was referred to the table forming Annexure A to the decision of Zammit J in Moira Shire Council v Sidebottom Group Pty Ltd [2018] VSC 556 and to another table prepared by the plaintiff including 12 cases where punishments were imposed for contumacious contempt ranging from 40 hours of community service (Pisano v Dandris (No 4) [2015] NSWSC 1689) to imprisonment for 2 years and 3 months (Vaysman v Deckers Outdoor Corporation Inc (2014) 222 FCR 387; [2014] FCAFC 60). A significant number of cases where a sentence of imprisonment was imposed involved the breach of court orders including freezing orders, and in several of these cases sentences of 6 months or more were imposed: e.g. Huang v Liao [2022] NSWSC 526 (six months). I have taken these prior decisions into account. I recognise that while prior decisions provide a yardstick against which to examine a proposed sentence, the sentencing here requires an evaluative exercise which must be focused on the consideration of the particular circumstances of this case: Hili v The Queen (2010) 242 CLR 520; [2010] HCA 45 at [54].

(b) Mr Huang’s submissions

1. [45]

   Submissions were made for Mr Huang seeking to downplay the seriousness of the contempt for three reasons. First, it was said that while the breach of the freezing orders is a serious charge, it involved only $8,000 and not the amount of $173,900 calculated by the plaintiff. Second, it was acknowledged that while incorrect answers were provided to Kunc J on 30 June 2021, Mr Huang was genuinely concerned when providing those answers that if he disclosed his ANZ account it would be completely frozen as his other two bank accounts had been. Third, it was submitted that as the hearing of the substantive proceedings has not yet occurred, it is premature to conclude that Mr Huang’s contempt had significantly prejudiced the interests of the plaintiff. I note that the substantive proceedings are set down for hearing in June 2024.

2. [46]

   The submission that Mr Huang was seeking to avoid the ANZ account being frozen in the same way as the other two accounts, is a reference to an exchange Mr Huang had with Kunc J at the hearing on 30 June 2021:

3. [47]

   Following this exchange, Kunc J made orders which extended the freezing orders and included a direction that the plaintiff by her solicitors was “to liaise with the Commonwealth Bank and Bank of Queensland to facilitate the defendant having access to his bank accounts with those institutions in accordance with the freezing orders”. The evidence is that on the same day the plaintiff’s solicitor sent an email to each of those banks drawing their attention to the exceptions in order 10 of the freezing orders and noting that the exceptions include but are not limited to Mr Huang being allowed to withdraw money from his account to pay for ordinary living expenses and reasonable legal fees. Hence, the concern which Mr Huang raised with Kunc J was addressed and in any event does not explain his conduct, given that his intended use of the ANZ account went far beyond what order 10 permitted. Rather, the explanation for his answers to Kunc J is that he wanted to have the ability to use the money in the ANZ account free from the restraints in the freezing orders: see Liability Judgment at [64] and [72].

4. [48]

   As to Mr Huang’s culpability, it was submitted that the Court should take into account three mitigating factors: first, Mr Huang’s poor understanding of the English language, second his gambling disorder and third, that the inaccurate answers he gave to Kunc J on 30 June 2021 were driven by concern that the ANZ account would also be frozen (see above [46]–[47]) in circumstances where he had no legal representation and therefore no-one to protect him. The reference to his lack of legal representation at that time is to the refusal of his application for legal aid on 25 June 2021.

5. [49]

   As to the reason or motive for the contempt, it was submitted that Mr Huang had no motive to mislead the Court or to breach the freezing orders and reliance was placed on his gambling disorder diagnosis.

6. [50]

   As to whether Mr Huang has received or sought a benefit or gain from the contempt, it was submitted that he had received no significant benefit from the breach of the freezing orders, which was essentially a repeat of the submission that the total amount of the breach was only $8,000.

7. [51]

   As to whether there had been any expression of genuine contrition by Mr Huang, it was submitted that he felt very remorseful after being found guilty of contempt and had taken the active step of seeking help from a psychologist.

8. [52]

   As to the character and antecedents of Mr Huang, it was submitted that the three decisions of the Court of Criminal Appeal referred to above were not relevant to the present contempt proceedings.

9. [53]

   As to Mr Huang’s personal circumstances, it was submitted that the Court should take into account that he is unemployed, has no substantial personal assets or income, and has been diagnosed as having a gambling disorder for which he is undertaking a treatment plan for 12 months with his psychologist.

10. [54]

    As to deterrence and denunciation, it was submitted that as Mr Huang currently possesses no assets the likelihood of him breaching freezing orders in the future is nil. Further, he has communicated his remorse for breach of the freezing orders and has expressed a genuine intention that such breaches will not reoccur.

11. [55]

    It was submitted for Mr Huang that the appropriate penalty would be a suspended sentence of indefinite imprisonment subject to the condition that he attend a 12-month treatment plan for his gambling addictions and make monthly payments of $350 to the Court with the intention of paying into Court $8,000 over a period of 23 months.

Consideration

1. [56]

   For the following reasons I have concluded that the appropriate penalty for the contempts committed by Mr Huang is a period of imprisonment.

2. [57]

   As to the seriousness of the contempts, misleading a judge of the Court is a very serious matter, and its seriousness is compounded by the fact that Mr Huang’s intention in doing so was to enable him to evade the operation of the freezing orders made by the Court on 4 June 2021: see [47] above. In addition, Mr Huang undertook 32 transactions in breach of the freezing orders in pursuance, in part but not wholly, of his gambling activities. It is fundamental to the rule of law that litigants do not knowingly mislead the Court and that they should comply with orders of the Court. While it is not necessary for civil contempt to be contumacious in order for a sentence of imprisonment to be imposed, I find that the contempts here were contumacious. I am satisfied beyond reasonable doubt that Mr Huang deliberately lied to Kunc J on 30 June 2021 about his assets so that he could use the ANZ account to breach the freezing orders with knowledge of and in defiance of those freezing orders.

3. [58]

   I reject each of the submissions for Mr Huang referred to at [45] above as to the lack of seriousness of the contempts. As to the first, while Mr Huang’s initial deposit to the ANZ account on 29 June 2021 was only $8,000, he subsequently made withdrawals from it through the 32 transactions referred to at [2] above each of which was a breach of the freezing orders. The proper measure of the breach is therefore the total of the amounts withdrawn, and not the initial deposit. As to the second, while Mr Huang may have been concerned about the potential freezing of the ANZ account had he disclosed it, that is no excuse for failing to disclose it to Kunc J nor is it an explanation for that non-disclosure. He consciously withheld from Kunc J the existence of the ANZ account because he wanted the ability to use that account to make withdrawals which would not have been permitted under freezing orders: see [57] above. As to the third, this overlooks the importance of obeying orders of the Court and being truthful when responding to questions from a judge.

4. [59]

   I accept the plaintiff’s submissions that Mr Huang’s culpability is high, that his reason or motive for the contempts was personal gain, and that his belated expression of remorse should be given little weight. It was belated as it was made only when he was pressed in cross examination and then invited to make it in re-examination, and it was not genuine: see [29] above.

5. [60]

   Mr Huang put forward three mitigating factors referred to at [48] above. The first was said to be his poor understanding of the English language. While English is not his first language, I found in the Liability Judgment at [41] that he understood the substance of the freezing orders and the prohibition contained in orders 6, 7 and 10 and I am satisfied, based on his evidence in cross-examination at both hearings, that his understanding of the English language was sufficient to understand the substance of the freezing orders and the questions he was asked by Kunc J on 30 June 2021. The second was a concern that the ANZ account would also be completely frozen if he disclosed it to Kunc J. I have rejected that submission at [58] above. The third was his gambling addiction which is addressed below.

6. [61]

   The evidence regarding Mr Huang’s prior criminal convictions is relevant in assessing the significance of his gambling addiction as a mitigating factor. It appears that he has had a gambling addiction for approximately 20 years and has failed to genuinely participate in counselling and other treatment programs offered to him for that addiction. In particular, the documents produced under subpoena indicate that Mr Huang was required to undertake counselling for his gambling disorder as directed by parole officer as part of his parole conditions while he was on parole between 8 August 2020 and 8 March 2022 but his participation in that counselling program, according to him, was limited (T20). Further, he made a statement to his parole officer on 27 September 2021 that had not undertaken any gambling online or offline, which was untrue. I accept the plaintiff’s submission that these matters are relevant as they go to the weight to be placed on Mr Huang’s gambling addiction in sentencing.

7. [62]

   It was submitted for the plaintiff, and I accept, that the Court can have no confidence that Mr Huang will undertake the treatment plan for his gambling addiction recommended by the psychologist he recently retained. I give little weight to Mr Huang’s statement to the psychologist that he has “shown interest in receiving treatment for his gambling disorder” given: (a) what is said in Huang 1 set out above; (b) the fact that Mr Huang has been given numerous opportunities in the past to address his gambling addiction which he did not disclose to the psychologist, and which he has not taken up, and he showed no appreciation during cross-examination that these opportunities have been provided to him; and (c) that he lied to his parole officer on 27 September 2021 about his recent gambling activities which were in breach of his parole conditions. The Court can have no confidence that his statement that he will follow the proposed treatment plan is genuine.

8. [63]

   I note three further points about Mr Huang’s gambling addiction. First, it does not explain all the conduct which constitutes the contempt: $38,900 of the total amount of $173,900 withdrawn from the ANZ account was paid to individuals to whom Mr Huang says he owed money. Second, it is too simplistic an approach to say that Mr Huang’s gambling addiction motivated his other withdrawals from the ANZ account. The evidence he gave in cross-examination set out at [26] above indicates that the gambling activity was an attempt to generate income to pay his living expenses and to offer a settlement sum to the plaintiff. The proper characterisation of the conduct was to use funds in the ANZ account, knowing it was in breach of the freezing orders, for personal gain. Third, in any event to the extent that a gambling addiction does explain an offender’s conduct, it is not generally a mitigating factor on sentence: Johnston v R [2017] NSWCCA 53.

9. [64]

   As to Mr Huang’s character and antecedents, the relevant matters are the extent of his gambling addiction, and the fact that he lied to his parole officer about his gambling activities on 27 September 2021, both of which I have addressed above. I also take into account my assessment of Mr Huang as an unreliable witness in the evidence he gave at both hearings.

10. [65]

    In relation to Mr Huang’s personal circumstances, he is 45 years of age, single and his financial position is very poor. He has no significant assets and has significant liabilities, which makes a fine an inadequate penalty. I have taken into account the fact that he has a three-year-old child for whom he cares four days per week, as a factor reducing the sentence which would otherwise be imposed. However, it is not a factor which would justify a punishment other than imprisonment because there is nothing in the evidence to suggest that his former de facto spouse, who looks after their child for three days each week, cannot take responsibility for the care of the child during the period of Mr Huang’s imprisonment.

11. [66]

    As to the need for deterrence, I accept the plaintiff’s submission that there is a need for a term of imprisonment, rather than some other punishment, to effectively deter Mr Huang from further breaches of the freezing orders and for general deterrence.

12. [67]

    As to the need for denunciation of the contemptuous conduct, Mr Huang’s breaches of the freezing orders and his misleading statements to a judge of this Court designed to make those breaches possible, taken together, represent a very serious attack on the integrity of the Court and degradation of the proper administration of justice. This is a further reason why a term of imprisonment as punishment is necessary: cf Sun v He (No 2) at [105].

13. [68]

    I have taken into account that, in some circumstances, a breach of court orders has been punished by a suspended sentence on condition that the contemnor pay a fine or conduct a specified number of hours of community service: eg. Pisano v Dandris (No 4) [2015] NSWSC 1689 and Zhang v Shi (No 6) (2022) 67 VR 469; [2022] VSC 271. After careful consideration of all the circumstances, I have concluded that a fine or a period of community service would not be adequate punishment for the seriousness of the contempts committed by Mr Huang.

14. [69]

    In my view, taking into account all the relevant factors referred to at [11] above, the term of imprisonment to be served by Mr Huang should be an aggregate term of 6 months, reflecting in particular the very serious nature of the contempts, the need for a punishment which serves the purpose of providing a specific and general deterrent for such conduct and the need to denounce that conduct.

Plaintiff’s leave application

1. [70]

   On 17 November 2023, Robb J (as Equity Duty Judge) made an order requiring Mr Huang to file and serve an affidavit (Disclosure Affidavit) setting out the following information:

2. [71]

   On 22 November 2023, Mr Huang filed and served a Disclosure Affidavit which stated that the only name used by him to hold any assets or maintain any bank accounts was his given name, that his worldwide assets were nil and that the only bank accounts held by him under his given name were four accounts with Bank of Queensland, CBA, ANZ Bank and Bendigo Bank for which account numbers were provided.

3. [72]

   By notice of motion filed on 21 November 2023, the plaintiff seeks, relevantly, the following orders:

4. [73]

   In Universal Music Australia Pty Ltd v Sharman Licence Holdings (2005) 228 ALR 174; [2005] FCA 1587, Moore J noted that cross-examination on an asset disclosure affidavit will not usually be permitted and that it may be appropriate for the Court to order cross-examination of a deponent if he has disclosed assets in a piecemeal, late, untruthful, and manifestly incomplete manner. His Honour added at [28]:

5. [74]

   In the present case, there is evidence before the Court to indicate that Mr Huang has in the past operated under a number of aliases and that he may hold a significant asset under one of those aliases. The fact of Mr Huang’s aliases has only recently been discovered by the plaintiff. In all the circumstances it is appropriate, in my view, to grant the leave sought. I note that Mr Huang did not advance any submissions opposing the grant of leave.

Costs

1. [75]

   The plaintiff submitted that Mr Huang should be ordered to pay the plaintiff’s costs (for both the liability and penalty hearings) on an indemnity basis and that the costs be assessed forthwith. It was submitted that the factors warranting indemnity costs are as follows:

2. [76]

   While it is not uncommon for indemnity costs to be awarded in contempt proceedings, there is no established practice to that effect: GE Dal Pont, Law of Costs (5th Edition, Lexis Nexis, 2021). In my view, most of the matters relied on have already been taken into account in the assessment of the penalty, and to have regard to them again would conflate the question of the appropriate punishment for the contempt with the question of costs: cf NHB Enterprises at [99] and Huang v Liao at [62]. In relation to item (f) I do not regard the proceedings as significantly lengthened by the conduct of Mr Huang’s defence. I decline to order costs on the indemnity basis. However, it is appropriate that the plaintiff’s costs on the ordinary basis be assessed forthwith because the contempt application is a discrete part of the proceedings, and it will be some time before the substantive proceedings are determined.

Conclusion

1. [77]

   The Court will make the following orders:

   1. (1)

      Order pursuant to SCR Pt 55 r 13 that, in respect of all the contempts which the Court found on 28 August 2023 had been committed by him, the first defendant (Jun Yu Huang) be committed to a correctional centre for a term of 6 months, commencing from the date of his arrest.

   2. (2)

      Order that a warrant for the committal of Jun Yu Huang to a correctional centre for the said term be issued and executed forthwith.

   3. (3)

      Order the first defendant pay the plaintiff’s costs of the proceedings on the contempt motion on the ordinary basis, such costs to be assessed forthwith.

   4. (4)

      Grant the plaintiff leave to cross examine the first defendant on the Disclosure Affidavit (as that term is defined in the orders made by Robb J on 17 November 2023).

   5. (5)

      List the proceedings for further directions at 9.30am on 8 February 2024 before the Equity Registrar.