Australia NSW Court Enforces Chinese Judgment Against Guarantor Directly

Key takeaways:

In February 2025, the Supreme Court of New South Wales, Australia, ruled to enforce a Chinese monetary judgment in Yangpu Huigu Pharmaceutical Corporation Limited v He [2025] NSWSC 28.

The Australian court applied common law principles (as China is not covered by the statutory reciprocity regime) and confirmed that the Chinese judgment met all requirements: jurisdiction, finality, identity of parties, and a fixed sum.
The decision adopted a practical, creditor-friendly approach to the “identity of parties” requirement, allowing enforcement directly against a guarantor without first pursuing primary debtors, as long as the guarantor is a judgment debtor (i.e., being held jointly and severally liable for the debt by the foreign judgment).

On 6 Feb. 2025, the Supreme Court of New South Wales, Australia (hereinafter the “Australian Court”) ruled to enforce a Chinese monetary judgment in Yangpu Huigu Pharmaceutical Corporation Limited v He [2025] NSWSC 28.[i] The Chinese judgment, numbered 2020 Qiong 96 Min Chu No. 13 ((2020)琼96民初13号), was rendered by the First Intermediate People's Court of Hainan Province (hereinafter the “Chinese Court”) on 30 Nov. 2022.

This is the seventh reported enforcement of a Chinese monetary judgment in Australia, according to the CJO database.

I. Case Background

The dispute concerned a loan of CNY 6 million lent by the Plaintiff, Yangpu Huigu Pharmaceutical Corporation Limited (洋浦慧谷医药有限公司, hereinafter the “Yangpu Company”), to two borrower companies -one Chinese and one Australian. The Defendant, Mr. Gaogeng He (“Mr. He”) was the director of one borrower, and acted as the guarantor of the loan.

On 2 Jan. 2020, Yangpu Company initiated legal proceedings before the Chinese Court in respect of the loan. Mr. He appeared via audiovisual link and represented himself at the hearing.

On 30 Nov. 2020, the Chinese Court rendered the Judgment 2020 Qiong 96 Min Chu No. 13 (hereinafter the “Chinese Judgment”) in favor of Yangpu Company, holding Mr. He jointly and severally liable for the outstanding amounts. No appeal was lodged, and the judgment remained unsatisfied.

On 16 July 2024, Yangpu Company sought to enforce the Chinese Judgment against Mr. He in New South Wales, Australia.

On 6 Feb. 2025, the Australian Court granted the recognition and enforcement of the Chinese Judgment, ordering Mr. He to pay Yangpu Company the sum of CNY 11,125,042.66.

II. Court Views

In Australia, foreign judgments may be enforced either at common law or pursuant to the statutory regime under the Foreign Judgments Act 1991(Cth). Chinese judgments are not eligible for the statutory regime, as China is not a jurisdiction of substantial reciprocity designated by the Foreign Judgment Regulations 1992 (Cth). Enforcement of Chinese judgments therefore proceeds at common law.

At common law, a foreign judgment, such as the Chinese Judgement, is prima facie capable of recognition and enforcement if the following requirements have been met: (1) the foreign court must have exercised jurisdiction of the requisite type over the defendant (also known as jurisdiction “in the international sense”); (2) the judgment must be final and conclusive; (3) there must be identity of parties between the judgment debtors and the defendants in any enforcement action; and (4) the judgment must be for a fixed, liquidated sum (at [20]). Where the above four conditions have been established, the defendant may only challenge the recognition and enforcement of the foreign judgment on limited grounds. (at [22]).

The Australian Court moved on to review each of the four requirements in details, concluding that all are satisfied. Furthermore, given the defendant has not appeared and has therefore not raised any defense in these proceedings, those considerations do not arise in this case.

III. Comments

This decision illustrates the standard Australian common law approach to enforcing Chinese judgments.

Notably, the court adopted a practical, creditor-friendly interpretation of the “identity of parties” requirement. The Australian Court clarified that a judgment creditor is not required to bring all original debtors into the Australian enforcement action. Specifically, if a guarantor is held jointly liable in China, the judgment creditor can pursue that guarantor individually in Australia. This provides significant flexibility for creditors chasing assets across borders.

As a sidenote, the Australian Court noted an interesting procedural quirk regarding appeal timelines in China.[ii] Under China’s Civil Procedure Law, the standard appeal window is 15 days; however, this is extended to 30 days for parties who do not have a domicile in China. This distinction is vital for foreign litigants to ensure a judgment is truly "final and conclusive" before seeking enforcement abroad.

[i] China Justice Observer (CJO) thanks Dr. Béligh Elbalti, Associate Professor, Graduate School of Law and Politics, Osaka University, Japan, for sharing a copy of this judgment with us.

[ii] As the Australian Court noted, “[I]nterestingly, the judgment set out 2 different temporal requirements to appeal the matter. The plaintiff was provided with fifteen days to appeal but the defendants were provided with 30 days from the date of the judgment to appeal” (at [30]).

Photo by Joey Csunyo on Unsplash

Contributors: Meng Yu 余萌

China Legal Trends