LAI YIM BING v. CHAN YAU MAN

BETWEEN:-

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JUDGMENT

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1. On the 19th December 1979 the plaintiff issued a writ against the defendant claiming the sum of $99,000.00 being the balance of a loan due by the defendant under a Chinese memorandum dated the 26th December 1973. The amount of the loan was $100,000.00 and the defendant agreed to make repayment at the rate of a monthly sum of not less than $1,000.00 commencing on the lst January 1974. The first monthly payment due in January 1974 was in fact paid leaving the balance.

2. According to the affirmation of service the defendant was served personally with the writ on the 21st December 1979. No appearance was entered and judgment was obtained by the plaintiff in default on the 22nd January 1980 for the sum claimed together with interest and fixed costs.

3. Attempts were subsequently made by the plaintiff to levy execution in respect of the judgment, but they proved to be unsuccessful.

4. No further steps were apparently taken until the plaintiff issued a summons on the 3rd July 1984 for the examination of the defendant under Order 49B of the Rules of the Supreme Court and an order to this effect was made on the 18th July 1984.

5. The defendant issued a summons on the 6th February 1985 by which inter alia he sought orders that the judgment obtained against him be set aside and that he be given unconditional leave to defend the proceedings. The orders sought in that summons were refused by Master O'Donnell on the 26th February 1985 and they are to-day the subject matter of the defendant's appeal. A further summons was issued by the defendant on the 19th February 1985 whereby an order was sought that the plaintiff produce for inspection the Chinese memorandum dated the 26th December 1973, but this application was also refused by Master O'Donnell. The plaintiff, in fact, has at all times according to the evidence, refused to produce this document despite requests made by the defendant.

6. The defendant was examined as to his means by Master O'Donnell on the 26th February 1985 and was ordered to pay the judgment debt and costs by monthly instalments of $500.00. The plaintiff appeals against this order.

7. The defendant has filed three affirmations in support of his appeal, two of which were before Master. The third affirmation entitled the second supplemental affirmation was filed on the 12th March 1985. In his first affirmation, the defendant says that he was not aware that judgment had been obtained against him until he received an order to attend before one of the Masters on the 20th September 1984 in respect of an earlier hearing relative to the examination under Order 49B. He also denies that he has ever been indebted to the plaintiff for the amount claimed.

8. He sets out details of his relationship with the plaintiff to the effect that he cohabited with her from about August or September 1973. As a result of their relationship the plaintiff gave birth to a daughter in 1974 or 1975. During the period of cohabitation, the defendant gave money to the plaintiff for the support of the daughter and for general family expenses. He states that in 1978 or 1979 he and the plaintiff separated, but that he continued to pay maintenance for the child at the rate of $500.00 per month.

9. He claims that in about 1978 or 1979, the plaintiff asked him how to write a memorandum evidencing a loan as the plaintiff informed him that she wished to lend money to some of her fellow employees. He says that he wrote out in his own hand in Chinese several simple draft sample memoranda, one of which he signed his name as the borrower. However, he says that it never occurred to him that this particular memorandum or any of the other samples would be used by the plaintiff to form evidence for a loan and that it was not his intention that the sample memorandum should have this effect. It is further alleged that there was no consideration for the loan.

10. In his first supplemental affirmation, the defendant said that he did not remember how the writ was served but referred to certain documents that he handed to a solicitor's clerk at the time. Thereafter he took no further action until he was served with the order dated the 18th July 1984 relating to the examination under Order 49B. After he attended before one of the Masters in chambers on the 20th September 1984, the defendant made an application for legal aid which was refused. His appeal from that refusal was also unsuccessful.

11. The only evidence filed on behalf of the plaintiff was an affirmation by Mr. Hui Kai who says that he witnessed the defendant's signature to the memorandum on the 26th December 1973.

12. In his second supplemental affirmation, the defendant denies that Mr. Hui witnessed this memorandum, and in fact says that he did not know Mr. Hui in December 1973, but only came to know him in February 1974. In this affirmation, reference is made to a report made by the plaintiff to the police which alleged that she had been raped by the defendant. The police investigation revealed that there was no substance to the allegation. In paragraph 5 of the affirmation, the defendant expands on the borrowing notes to which I have referred and sets out details of one sample which he now claims he was able to remember which reads as follows:-

"I, Chau Yau Man and Lai Yim Bing are going to have a marriage ceremony in Macau, and borrow $100,000.00 from friends and relatives, covenanting to repay $1,000.00 a month. For fear that oral words are not sufficient, this is made as proof.".

He says that he placed an earlier date on the document because of instinctive cautiousness for the plaintiff was a dance hostess and she had already made one false accuation against him.

13. Some of the evidence revealed in this affirmation is not very satisfactory. Nevertheless, on the evidence presented by the defendant there is an arguable defence to be tried. Accordingly, I shall allow the defendant's appeal against the order made by Master O'Donnell, but upon condition that the costs thrown away will be paid by the defendant in any event which will be taxed and paid forthwith. Subject to compliance with that condition the judgment obtained by the plaintiff will be set aside and the defendant is granted unconditional leave to defend. The appeal by the plaintiff has no longer any relevance. The costs of the appeal will be in the cause. There will be the usual taxation of the plaintiff's costs in accordance with the Legal Aid (Scale of Fees) Regulations.