Bankside barristers Dr Simon Foote KC, Andrew Grant, and employed barrister Daisy Archibald, have represented both parties in the recent Court of Appeal case, HUA WU also known as DANNY WU v JINXING LIU.
In early 2022 Wu launched a case in the High Court concerning funds he allegedly misappropriated from his former employer, Timber King, and a separate $1.2 million paid to Mr Liu under an agreement procured by threats to report the alleged misappropriation to the Police and immigration authorities.
In October 2024 the High Court dismissed Wu’s claim, ruling in favour of Liu, represented by Andrew Grant and Daisy Archibald. The Court concluded that Mr Wu had indeed been blackmailed by Mr Liu and his son Jackie and had paid the $1.2m under duress. However, the Judge further held that Mr Wu had affirmed the contract under which the payment was made because he failed to take steps to repudiate it for over 3 years after the payment and before filing the High Court proceedings. Accordingly the agreement remained valid and Mr Wu could not recover the payment made under it.
In his appeal, Mr Wu, now represented by Dr Simon Foote KC, advanced a different argument. He contended that the agreement under which the payments were made constituted an illegal contract under subpart 5 of the Contract and Commercial Law Act 2017 (CCLA), with the result that the agreement was void and the issue of affirmation did not arise. In the alternative, Mr Wu submitted that the High Court erred in finding that he had affirmed the contract.
“The case involved arguments concerning the legality of contracts to procure forbearance from reporting alleged criminal behaviour to authorities, blackmail, the amendment of pleadings on appeal, and the little used exception to limitation periods contained in section 50 of the Limitation Act 2010,” says Dr Simon Foote KC. “There is also an interesting discussion about affirmation by silence in duress cases.”
On the primary illegality argument, the Court found:
“We have little hesitation in finding that the true agreement was an illegal agreement. As the Judge noted, blackmail is a criminal offence. It is prohibited by section 237 of the Crimes Act 1961. On that basis alone this was plainly an illegal contract. Further, the threat Mr Liu made was to report Mr Wu to the authorities given Mr Wu had [allegedly] stolen from his employer, which was a promise not to report an alleged crime to the authorities. This involves the additional dimension of an agreement to prevent the investigation and prosecution of crimes. As Elias CJ summarised in Osborne… "It has long been held that private bargains to avoid prosecution through payment or provision of other benefit unlawful.””
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