KWAN SHUK CHING v. WAN MEI YAU

HCA 2765/2016

[2022] HKCFI 3781

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 2765 OF 2016

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JUDGMENT

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INTRODUCTION

1.  In the present case, Kwan Shuk Ching, the Plaintiff, claims against Wan Mei Yau, the executrix of the estate of Au Chi Cheung (the “Deceased”) and the registered owner of two landed properties, namely, (1) the property situate at Flat No.1115 on 10^th Floor of Block B, I-Feng Mansions, No.237A, To Kwa Wan Road, Kowloon (the “I-Feng Property”) and (2) the property situate at Unit B on 10^th Floor, Fook Shing Industrial Building, No.1A, Yuk Yat Street, Kowloon, Hong Kong together with Car Park No.2 on the Ground Floor (the “Fook Shing Property”), the full beneficial ownership of both I-Feng Property and Fook Shing Property on the basis of common intention constructive trust, part performance of an oral agreement and proprietary estoppel.

2.  The Plaintiff’s case is that in or about 1998, in anticipation of a divorce between her and Au Yeung Ming (“Yeung Ming”), one of the sons of the Deceased, the Deceased and the Plaintiff met for more than 10 times in Gold Gem Restaurant (“the Restaurant”) to discuss (1) whether the marriage between the Plaintiff and Yeung Ming could be saved, and (2) in the event the Plaintiff and Yeung Ming were to be divorced, how and in whose hands the Plaintiff’s children are to be placed and looked after. The Plaintiff pleads that after rounds of discussions and negotiations, in or about 1998, the Plaintiff and the Deceased entered into an oral agreement on the following terms (“the 1998 Oral Agreement”):

(1)  The Plaintiff would forgo her claims against Yeung Ming for any substantive ancillary relief but would only claim nominal periodical payments at the rate of HK$1 per annum for her maintenance.

(2)  The Plaintiff would bear the responsibility of looking after and taking good care of the Plaintiff’s children being the favoured grandchildren of the Deceased until they grow up.

(3)  The Plaintiff would not re-marry after her divorce with Yeung Ming.

(4)  In return, the Deceased would gift to the Plaintiff the two landed properties.

(5)  The Deceased would in in any event devise to the Plaintiff the two landed properties under his will to be executed. (See §§37-39 of the Statement of Claim).

3.  It is also the Plaintiff’s pleaded case that on or about 2 February 2001, on the 10^th day of the first lunar month in the year, the Deceased called a family meeting in Hong Kong and made various representations (the “2001 Representations”), namely:

(1)  The Deceased would gift to the Plaintiff the two landed properties.

(2)  The Deceased had already executed a will (the “2001 Will”) with a view to deal with the inheritance and distribution of his assets amongst his family members.

(3)  The Deceased had appointed Yeung Ming and Au Ching Ming Arthur (“Arthur”) a son of the Deceased and the Defendant as the joint executors of the 2001 Will.

(4)  Each child of the Deceased would be given HK$1,000,000 in cash.

(5)  Under the 2001 Will, amongst others, the Deceased had devised various landed properties to various members. (See §§46-47 of the Statement of Claim.)

4.  The Plaintiff pleads that she has dutifully performed her part of the 1998 Oral Agreement and as such a common intention constructive trust arises which vests her with full beneficial ownership of the two landed properties (see §§48-55 of the Statement of Claim). Alternatively, in reliance of the 2001 Representations and the 1998 Oral Agreement, she had incurred various expenses on the two landed properties. As such it would be unconscionable for the Deceased and hence the Defendant as the Deceased’s successor in title and the devisee of the landed properties to deny the Plaintiff’s beneficial entitlement to the two landed properties (see §§56-58 of the Statement of Claim.)

5.  The Defendant denies the existence of the 1998 Oral Agreement and the 2001 Representations. It is pleaded by the Defendant that after Yeung Ming moved to the USA, the Deceased permitted the Plaintiff to use and/or occupy the Fook Shing Property and the I-Feng Property as a bare licensee which is revocable at any time. To the best of the Defendant’s understanding, the Deceased was not inclined to revoke the licence before the children of the Plaintiff and Yeung Ming have grown up. As the youngest of the Plaintiff’s children, Ling Hon, was born in 1997, he would have turned 18 by 7 August 2015 and the bare licence would have expired by then. In any event, upon the death of the Deceased on 23 April 2011, the said bare licence was automatically revoked. (See §§14 and 19 of the Amended Defence and Counterclaim).

6.  Hence, the central dispute, as Mr Fan for the Plaintiff submitted, turns on the narrow issue of whether the 1998 Oral Agreement and/or the 2001 Representations existed or not. To this, there is no dispute that the Plaintiff carries the burden of proof.

AGREED FACTS

7.  The parties agree on the following undisputed facts:

(1)  Out of the relationship between the Deceased and Madam Au Ying, Madam Au gave birth to two sons, namely, (a) Yeung Ming and (b) Kit Ming. The Defendant does not admit the Deceased’s marital status to Madam Au. This relationship is currently subject to litigation in the Mainland to which this Court expresses no views as it is not relevant to the issues to be determined in the present proceedings.

(2)  In around 1962, the Deceased left Panyu for Hong Kong to look for business opportunities.

(3)  Since 1962, the Deceased developed a relationship with Madam Lau Wai Fong (“Madam Lau) who died on 25 April 2012. Madam Lau was also the Deceased’s trusted business partner.

(4)  The Deceased further developed a relationship with the Defendant in around 1963. Out of the relationship between the Deceased and the Defendant, the Defendant gave birth to (a) Arthur, (b) Yui Ming, (c) Hon Ming, (d) Yim Ling and (e) Tat Ming.

(5)  Arthur married Ho Ka Fung (“Ka Fung”) in 1999.

(6)  Hon Ming married Vannie Gao on 28 April 2000 but they divorced in the USA in about June or July 2018. They have two children, namely (a) Manna Au and Matthew Au.

(7)  In around 1982, the Deceased applied to the government authority for approval which allowed Yeung Ming to come to Hong Kong for family reunion.

(8)  Yeung Ming and the Plaintiff formally married on 17 August 1990. Out of the marriage between the Plaintiff and Yeung Ming, the Plaintiff gave birth to (a) Man Ni, (b) Ling Chun and (c) Ling Hon.

(9)  The Plaintiff and Yeung Ming divorced in Hong Kong on 17 May 1999.

(10)  The Deceased executed the Will on 27 July 2005 in Hong Kong (the “HK Will”).

(11)  On 23 April 2011, the Deceased died domiciled in Hong Kong.

(12)  Under the HK Will, Arthur is the sole executor of the estate of the Deceased.

(13)  The Deceased purchased the Fook Shing Property from Fook Luen Company Limited on 6 September 1974. Upon the Deceased’s death, the legal title of the Fook Shing Property vests in Arthur as the executor of the Will and the trustee of the Deceased’s estate.

(14)  On 3 June 2013, by the Fook Shing Assent, the Defendant becomes and is still the registered legal owner of the Fook Shing Property.

(15)  The Deceased purchased the I-Feng Property from Tse Yuk Ying on 8 December 1979. Upon the Deceased’s death, the legal title of I-Feng vests in Arthur as the executor of the Will and trustee of the Deceased’s estate.

(16)  On 3 June 2013, by the I-Feng Assent, the Defendant becomes and is still the registered legal owner of the I-Feng Property.

(17)  Yeung Ming entered into a deed to transfer a USA property (the “USA Property”) to the Plaintiff on 20 April 2005. The USA Property was purchased in the name of Yeung Ming but paid for by the Deceased. The Plaintiff subsequently transferred the USA property to Ling Chun and Man Ni by a deed dated 9 April 2015.

(18)  On 31 July 2015, the Defendant through her former solicitors demanded vacant possession of the said two landed properties.

(19)  On 10 May 2016, the Defendant commenced LDPE 518/2016 and LDPD 999/2016 against the Plaintiff, claiming orders for possession of the Fook Shing Property and the I-Feng Property.

(20)  On 25 October 2016, the Plaintiff issued the Writ of Summons for this action. LDPE 518/2016 and LDPD 999/2016 were discontinued on 27 November 2019.

APPROACH TO EVALUATION OF EVIDENCE

8.  This case turns essentially on the Court’s assessment of the credibility of the Plaintiff’s case. The Plaintiff mainly relies on her oral evidence. The fact that she physically occupied and is still occupying the two landed properties is both consistent with her version of facts and the Defendant’s version of a bare licence granted by the Deceased.

9.  Lord Bingham in his book The Business of Judging at pp 5 – 6 insightfully said:

“Let me then turn to the central questions. Faced with a conflict of evidence on an issue substantially effecting the outcome of an action, often knowing that a decision this way or that will have momentous consequences on the parties’ lives or fortune, how can and should the judge set about his task of resolving it? How is he to resolve which witness is honest and which dishonest, which reliable and which unreliable? How, as between competing experts in a field not his own, is a judge to determine where the truth lies? Is our existing way of resolving expert conflicts the best way? I shall begin by considering the resolution of issues of primary fact, the choice between first-hand eye-witnesses. Then I shall turn to expert evidence.

The normal first step in resolving issues of primary fact is, I feel sure, to add to what is common ground between the parties (which the pleadings in the action should have identified, but often do not) such facts as shown to be incontrovertible. In many cases, letter or minutes written well before there was any breath of dispute between the parties may throw a very clear light on their knowledge and intentions at a particular time ….

The most compendious statement known to me of the judicial process involved in assessing the credibility of an oral witness is to be found in the dissenting speech of Lord Pearce in the House of Lords in Onassis v Vergottis. In this he touches on so many of the matters which I wish to mention that I may perhaps be forgiven for citing the relevant passage in full:

‘Credibility’ involves wider problems than mere ‘demeanour’ which is mostly concerned with whether the witness appears to be telling the truth as he now believes it to be. Credibility covers the following problems. First, is the witness a truthful or untruthful person? Secondly, is he, though a truthful person, telling something less than the truth on this issue, or, though an untruthful person, telling the truth on this issue? Thirdly, though he is a truthful person telling the truth as he sees it, did he register the intentions of the conversation correctly and, if so, has his memory correctly retained them? Also, has his recollection even subsequently altered by unconscious bias or wishful thinking or by over-much discussion of it with others? Witnesses, especially those who are emotional, who think that they are morally in the right, tend very easily and unconsciously to conjure up a legal right that did not exist. It is a truism, often used in accident cases, that with every day that passes the memory becomes fainter and the imagination becomes more active. For that reason a witness, however honest, rarely persuades a Judge that his present recollection is preferable to that which was taken down in writing immediately after the accident occurred. Therefore, contemporary documents are always of the utmost importance. And lastly, although the honest witness believes he heard or saw this or that, is it so improbable that it is on balance more likely that he was mistaken? On this point it is essential that the balance of probability is put correctly into the scales in weighing the credibility of a witness. And motive is one aspect of probability. All these problems compendiously are entailed when a Judge assesses the credibility of a witness; they are all part of one judicial process. And in the process contemporary documents and admitted or incontrovertible facts and probabilities must play their proper part.

Every judge is familiar with cases in which the conflict between the accounts of different witnesses is so gross as to be inexplicable save on the basis that one or some of the witnesses are deliberately giving evidence which they know to be untrue. There are, no doubt, witnesses who follow the guidance of the Good Soldier Sveyk that ‘The main thing is always to say in court what isn’t true,’ as a matter of principle, but more often dishonest evidence is likely to be prompted by the hope of gain, the desire to avert blame or criticism, or misplaced loyalty to one or other of the parties. The main tests needed to determine whether a witness is lying or not are, I think, the following, although their relative importance will vary widely from case to case:

(1) the consistency of the witness’s evidence with what is agreed, or clearly shown by other evidence, to have occurred;

(2) the internal consistency of the witness’s evidence;

(3) onsistency with what the witness has said or deposed on other occasions;

(4) the credit of the witness in relation to matters not germane to the litigation;

(5) the demeanour of the witness.

The first three of these tests may in general be regarded as giving a useful pointer to where the truth lies. If a witness’s evidence conflicts with what is clearly shown to have occurred, or is internally self-contradictory, or conflicts with what the witness has previously said, it may usually be regarded as suspect. It may only be unreliable, and not dishonest, but the nature of the case may effectively rule out that possibility.” (Emphasis added).

10.  In Lee Fu Wing v Yan Paul Po Ting [2009] 5 HKLRD 513, Deputy High Court Judge Au (as he then was) at 524 helpfully set out the well-established approach as to assessment of witnesses:

(1)  whether the party’s case is inherently plausible or implausible;

(2)  whether the party’s case is, in a material way, contradicted by other evidence (documentary or otherwise) which is undisputed or indisputable;

(3)  where it is shown that a witness has been discredited over one or more matters to which he has given evidence using the above tests.  This is relevant to the assessment of his overall credibility; and

(4)  the demeanour of the witnesses.

11.  In Lam Rogerio Sou Fung v Tan Soon Gin George HCA2576/2005, unreported, 5 May 2011, Chu J at §§40-41 said:

“40. Mr Chain has referred me to what Lord Devlin said extra-judicially in The Judge (Oxford University Press, 1979) at p.63, where he endorsed the words of Mr Justice MacKenna in a paper entitled “Discretion” read at University College, Dublin on 21 January 1973 (printed in the Irish Jurist, vol.IX, new series, p.1) as follows:

“This is now I go about the business of finding facts. I start from the undisputed facts which both sides accept. I add to them such other facts as seem very likely to be true, as for example, those recorded in contemporary documents or spoken to by independent witness like the policeman giving evidence in a running down case about the marks on the road. I judge a witness to be unreliable if his evidence is, in any serious respect, inconsistent with these undisputed or indisputable facts, or of course if he contradicts himself on important points. I rely as little as possible on such deceptive matters as his demeanour. When I have done my best to separate the true from the false by these more or less objective tests, I say which story seems to me the more probable, the Plaintiff’s or the Defendant’s”

I respectfully agree.

41. I also agree what was said by Peter Smith J in EPI Environment Technologies Inc & Anor v Symphony Plastic Technologies plc & Anor [2005] 1 WLR 3456, 3470-3471 at para.74, that it is essential to have regard to the entirety of a witness’ evidence. As he observed, witnesses can make mistakes, but the mistakes do not necessarily affect other parts of their evidence. Likewise, witnesses can regularly lie. However, lies themselves do not mean necessarily that the entirety of that witness’ evidence is to be rejected. A witness may lie in a stupid attempt to bolster his case, but the actual case nevertheless remains good irrespective of the lie.”

12.  I find the above guidelines helpful and will apply the same in assessing the credibility of the parties’ diametrically different versions of events.

13.  In this case, I also bear in mind that the Deceased is not able to give any evidence to rebut the Plaintiff’s account of the 1998 Oral Agreement. (See Cheung Ping Sum v Wong Chi Hang [2019] HKCFI at §§5-6 per Deputy High Court Judge To.)

THE PLAINTIFF’S CASE

14.  Mr Fan for the Plaintiff submitted that the evidence as unfolded reveals that the Deceased had all along been stringing the Plaintiff all along. This is despite the fact that the Plaintiff gave evidence that the Deceased treated her very well. As such there were mutual trust between her and the Deceased. Her case is that when she and Yeung Ming divorced, the Deceased promised to gift the two landed properties to her, in order to prevent her from going after Yeung Ming for maintenance, and to make sure that she would take care of his grandchildren. Over the years, the Deceased had reiterated such promise, by the 2001 Representations, and when the 2004 tenancy agreement (“2004 Tenancy Agreement”) was signed, so that the Plaintiff would continue to abide by the terms of the 1998 Oral Agreement. The Deceased also continued to treat her as a member of the family, and treated her very well, so that she would let her guard off and trust him whole-heartedly. As a result, the Plaintiff being unsophisticated and naïve, believed in the Deceased’s promises. She did not claim maintenance from Yeung Ming and bore the sole responsibility of supporting her children financially, foregoing other opportunities in life.

15.  It is the Plaintiff’s case that the 1998 Oral Agreement was entered into between the Deceased and her, in the following circumstances:

(1)  In around 1997, her youngest son had just been born.

(2)  While the Plaintiff was in postpartum confinement, Yeung Ming had unilaterally withdrawn HK$200,000 from their joint account and also used all the proceeds from the sale of the Whampoa Garden property, i.e. around HK$5,000,000, to invest in the stock market, and lost all of the sale proceeds. It was a huge shock to her when she discovered such huge losses incurred by Yeung Ming.

(3)  In spite of the above, Yeung Ming further insisted on covering up for the investment loss of Hon Ming, who had himself lost HK$500,000, and said to the Deceased that he (Yeung Ming) was the one who lost the HK$500,000.

(4)  When she confronted Yeung Ming about the cover up, Yeung Ming told her that “兄弟如手足，妻子如衣服”. She then thought that Yeung Ming only cared about his brothers and had no regard for her and their children at all. Hence, she decided to divorce Yeung Ming and eventually filed a divorce petition in October 1998. In the divorce petition, she prayed for the custody of their children and ancillary relief.

16.  When disagreements between Yeung Ming and herself arose due to the former’s investment losses, the Deceased met with her a dozen times to dissuade her from divorcing Yeung Ming.  She did not ask for money from the Deceased, and instead opted for public assistance. After she filed the divorce petition, the Deceased changed to discussing with her how to deal with the children and their livelihoods. Although Yeung Ming did not have money at the time, she knew that the Deceased would step in to pay for ancillary relief for her and her children. In particular, the Deceased did not want any ugly divorce proceedings to play out between Yeung Ming and herself, and did not want her to claim against Yeung Ming for ancillary relief.

17.  Under such circumstances, she and the Deceased reached the 1998 Oral Agreement. She said that she did not ask the Deceased to assign the two landed properties to her immediately as she believed the Deceased was a person with moral integrity. In hindsight, she now believes that the Deceased had been stringing her along to prevent her from claiming against Yeung Ming for ancillary relief, and so that she expended her full time and effort to take care of her children.

18.  The fact that the divorce order provided that she would only receive nominal periodical payments at the rate of HK$1 per annum for her maintenance and for the 3 children makes it more probable than not that the 1998 Oral Agreement had been reached between her and the Deceased. But for the 1998 Oral Agreement, there is no reasonable explanation as to why she would have chosen to forgo her claims for ancillary relief against Yeung Ming, when she knew that the Deceased had deep pockets and would be aiding Yeung Ming in any potential maintenance payments.

19.  Further, given the undisputed facts that the Deceased had arranged many aspects of Yeung Ming’s life, for example, arranging Yeung Ming to come to Hong Kong, gifting Yeung Ming the USA Property, arranging for their children to live in the USA Property, arranging for Yeung Ming to be the director of Yuen Bong Trading Company Limited (“Yuen Bong”), it was inherently probable for the Deceased to enter into the 1998 Oral Agreement with her and intervened in their divorce proceedings to protect Yeung Ming from the ancillary relief proceedings , especially in light of Yeung Ming’s investment losses and Yeung Ming’s unilateral withdrawal of HK$200,000 from the joint account.

20.  In any event, as to the timing of when she acquired the beneficial ownership of the two landed properties, it is her case that under the 1998 Oral Agreement, she would be entitled to the beneficial ownership of the two landed properties upon entering into the 1998 Oral Agreement, and in any event upon the demise of the Deceased.

21.  In other words, the Deceased would be taken to be in breach of the 1998 Oral Agreement if he eventually failed to devise the two landed properties to her by his last valid will upon his death.

22.  Further, the 2001 Representations were made in the family meeting in 2001 (“the 2001 Family Meeting”) held on 2 February 2001, the Deceased’s birthday, in Star Court at noon.

23.  That the 2001 Representations were made in the 2001 Family Meeting is corroborated by Vannie Gao, an independent witness. Vannie Gao has nothing to gain from these proceedings, and no motive to lie. As far as the Defendant’s insinuation that Vannie Gao has come forward to testify that the 2001 Representations were made because of her alleged animosity towards Arthur due to an alleged loan of US$400,000 between Hon Ming and Arthur, Vannie Gao has indicated clearly in her testimony that her past divorce has nothing to do with the present proceedings, as they have been settled in 2017, and she has moved on.

24.  Further, it is also submitted that Vannie Gao has also indicated that she had made claims against the properties that Hon Ming was entitled to pursuant to the 2001 Representations (which she subsequently gave up in the settlement in 2017), further increasing the probability that the 2001 Representations were made.

25.  Moreover, the reason that she did not specifically make reference to the time and location of the 2001 Family Meeting, was because the Defendant had only substantially elaborated on the issue of the time and location of the 2001 Family Meeting in the last round of evidence, in which the Defendant had the last say to respond to Vannie Gao’s evidence which corroborated the 2001 Meeting.

26.  The challenge against the 2001 Family Meeting was only briefly mentioned in Arthur’s first witness statement at §65 and was characterized as a family gathering. She does not dispute that there was a family gathering at night, and therefore did not consider necessary to adduce evidence to deny the existence of and oppose what happened in the family gathering, and hence was not alerted to the challenge with regards to the time and location of the 2001 Family Meeting. In any event, the time and location of the 2001 Family Meeting is also corroborated by Vannie Gao’s testimony.

27.  With respect to the Defendant’s contention that it is inherently improbable for the 2001 Family Meeting to be held at noon as it was held on a Friday, her submissions is that it is reasonably probable for the family members to take time off for the 2001 Family Meeting, since the distribution of family assets was to be announced, and as admitted by Arthur, it was one of rare birthdays in which both he and Yeung Ming flew back from the USA to attend. Further, even Vannie Gao and Hon Ming, and Kit Ming and his wife came back from the PRC to attend the Deceased’s birthday. As mentioned by Vannie Gao, it was the first time she stepped foot in Hong Kong. The very fact that all members of the Au family were present in Hong Kong and attended the Deceased’s birthday simply pointed to that it was a very special birthday occasion if not the most special one.

28.  The Defendant has specifically pointed at two property transactions relating to Yui Ming and Tat Ming, which allegedly disproves the existence of the 2001 Family Meeting. However, the land searches provided by the Defendant were adduced by the Defendant herself, and the Plaintiff actually does not even know the actual addresses of the properties gifted to Yui Ming and Tat Ming by the Deceased.

29.  The Plaintiff’s submissions are that:-

(1)  Whatever the actual addresses of the properties gifted to Yui Ming and Tat Ming were, in the end, they would not affect the inherent probabilities of the 2001 Representations made in respect of the two landed properties, which is corroborated and confirmed by Vannie Gao.

(2)  She could not know whether the properties gifted to Yui Ming and Tat Ming as alleged and referred to by the Deceased in the 2001 Meeting did in fact correspond to the two properties now referred to in the land searches.

(3)  She could not know whether the Deceased was telling the truth as to the gifts of properties to the others. She could in no way verify the same. Nor did it appear to her that there was any need to verify the same. Further, it could well be that the Deceased was not telling the truth intentionally so as to lead her into believing that she would receive the two landed properties to ensure that she would still continue to perform her obligations under the 1998 Oral Agreement.

(4)  When it came to a statement or representation as to the distribution of assets and properties, it was well reasonable for her to focus on those parts relating to her and not others. She should be excused of any incomplete or inaccurate recollection of those parts relating to other individuals. After all, among the various contents of the Representations, the most crucial question is whether the Deceased in fact said that:-

(a)  The Deceased would gift the two landed properties to her;

(b)  The Deceased had already executed a will with a view to deal with the inheritance and distribution of his assets among his family members, to such an effect and extent that the two landed properties would go to her.

THE DEFENDANT’S CASE

30.  The Defendant’s case is simple and straightforward. She denies the existence of the 1998 Oral Agreement and/or the 2001 Representations. She puts the Plaintiff to strict proof.

31.  The Deceased was a self-made man.  He was successful in garments manufacturing and trading business.  He was an authoritative and highly respected figure amongst his partners and children. This is not in dispute. As such, he managed his three partners and families, his businesses, and his properties.

32.  Until his fall in Panyu (番禺) in March 2006, the Deceased was active, healthy, mentally sound and physically independent. After his fall in Panyu in March 2006 (aged 74), the Deceased’s health deteriorated drastically thereafter.

33.  The Deceased owned and operated a number of companies:-

(1)  Lana Fashionwear Company Limited (“Lana”), is a 50:50 business with a business partner, Turbo Bright International Limited. Lana remains the family’s main line of business.

(2)  Kanoway Development Limited (“Kanoway”) which was dissolved in April 2005.

(3)  Yuen Tai Garment Manufacturing Company (“Yuen Tai”). This was a business that the Deceased operated at the Fook Shing Property. Between 1980 and 1999, Yuen Tai used the Fook Shing Property as a place of business. The Plaintiff worked at Yuen Tai from 1987 to 1990.

(4)  Yuen Bong. Yeung Ming consented to act as a director in 1999. In 2001, the two directors were the Deceased and Yeung Ming. By 2001, Yuen Bong used the Fook Shing Property as its registered office. It was deregistered in 2005. The Defendant’s case is that the Deceased made Yeung Ming a director, hoping that Yeung Ming would have a proper chance to run a business, despite his limited abilities. Arthur and Yim Ling gave evidence that due to Yeung Ming’s limited abilities, the Plaintiff had always assisted him in running the business of Yuen Bong. I note that the shareholders of Yuen Bong were the Deceased and the Deceased’s wholly owned corporate vehicle, namely Churchill Management Corp (BVI) (“Churchill”). The Plaintiff’s evidence is that the Deceased lent Yuen Bong for her to use to conduct her own business. The Defendant’s case is that the Deceased did not lend Yuen Bong’s name exclusively to the Plaintiff, or let the Plaintiff take over Yuen Bong for her merchandising business. After Yeung Ming became a director, the Plaintiff merely assisted Yeung Ming in Yuen Bong’s business. Arthur’s evidence is that if the Deceased had wanted to let the Plaintiff take over Yuen Bong, it would have been simple for him to appoint the Plaintiff as a director of Yuen Bong.

(5)  Allied Good International Limited (“Allied Good”) was a garment business with a French supplier. It was incorporated due to a Mr Leung Kam Wai (梁錦維) (“Leung”) bringing in a French clothing brand.  The Deceased invested in it.  The Deceased incorporated Allied Good for the purpose of exploring new line of business in Europe, so it was kept as a separate business from Yuen Bong. Yeung Ming ran Yuen Bong and Allied Good for a short while, and then Yeung Ming left Hong Kong for the USA.  Yeung Ming worked in Lana’s USA business. The shareholders of Allied Good were Churchill and Arthur. The directors were Arthur and the Deceased. It was deregistered in 2006. It is the Defendant’s case that Allied Good used the Fook Shing Property between 1999 and 2006.

34.  Arthur in his witness statement supplemented the Defendant’s pleaded understanding that after the grant of a licence to the Plaintiff to use the two landed properties, the Deceased was not inclined to revoke the licence before the children of the Plaintiff and Yeung Ming have grown up, by saying that:

“19. Given that the Fook Shing Property was largely used for the benefit of the family and not allocated to any particular member, we were all content to share use of the property as long as it did not interfere with the family business.

20. I recall that prior to Yeung Ming’s relocation to the US, the Au family would allow both the Plaintiff and Yeung Ming to visit the Fook Shing Property for the purposes of operating their own merchandising business. As I understand it, their business model involved the on-sale of products manufactured in Hong Kong, the PRC market. During that period, the Plaintiff would frequently visit the Fook Shing Property for the merchandising business and sometimes use the property for her personal purposes. For example, members of the Au family would allow her to visit the Fook Shing Property and play mah-jong there during non-peak hours for the family businesses.

21. Initially, the Plaintiff would only play mah-jong at the Fook Shing Property on Saturdays, However, over time the Plaintiff’s conduct became less appropriate and she started to use the Fook Shing Property for her mah-jong games on week days during business hours. This was also around the time when we discovered that the Plaintiff and Yeung Ming mismanaged the Allied Good business, and that the Plaintiff’s merchandising business had replicated some of the garment designs from My Late Father’s garment businesses. I recall that the combination of these issues greatly irritated other family members, especially My Lare Father.

23. I was present when My Late Father had the said conversation with the Plaintiff. At the time, the Plaintiff asked for his indulgence so that she could make use of the Fook Shing Property and I-Feng Property until her youngest child Ling Hon (“Ling Hon”) reached adulthood, on the basis that she would otherwise have difficulty caring for the children on her own. As regards the Fook Shing Property in particular, I recall that she asked My Late Father for lenience so that she could continue to run her merchandising business there to earn income to raise her children. It was on this basis that the Informal Understanding (as defined further at Section III below) came about some time between 1999 and 2005.

29. As I recall, because of the Plaintiff’s lobbying, My Late Father intimated that he could have indulgence for the Plaintiff to remain in or use the I-Feng Property and the Fook Shing Property, until her youngest child Ling Hon turned 18 (the “Informal Understanding”). As far as I understand, such understanding arose in the context of an informal family discussion. There was no request from anyone to reduce it into writing, and it was not meant to be legally binding. Nevertheless, as family members, we respect such Informal Understanding. As Ling Hon was born in 1997, he would turn 18 by 2015.

30. It was made very clear to all three of us that the Informal Understanding was not meant to transfer any ownership or permanent rights to the Plaintiff. It only took the form of an informal indulgence or permission for the Plaintiff’s use for a limited time.”

ASSESSMENT AND ANALYSIS

35.  I have carefully considered all the evidence, including documentary evidence and all the witnesses’ oral testimony in court. I have also considered the parties’ rounds of detailed written submissions. On balance, I have come to the view that the Plaintiff’s claims should be dismissed as she has failed to discharge the burden of proving the existence of the 1998 Oral Agreement and the 2001 Representations. On the other hand, I find the Defendant’s pleaded understanding and the Informal Understanding sit well with the commencement of possession actions in 2015.

36.  In particular, I note that prior to 2015, there was no mention of any 1998 Oral Agreement and/or the 2001 Representations. It was first pleaded in the Statement of Claim in the present action in 2016. This is difficult to fathom as it is common ground that the Plaintiff had knowledge of the HK Will at the latest in 2011.

37.  Strangely, when possession actions were commenced in 2015 against the Plaintiff, instead of raising and relying on the 1998 Oral Agreement and the 2001 Representations, the Plaintiff relied on the 2004 Tenancy Agreement as her sole basis to resist such claims.

38.  Overall, I find the evidence of Arthur and Yim Ling, on the whole, credible and logical. Despite being cross-examined on various topics, they stood firm. They were simply telling the truth. The Defendant herself knew very little and her evidence is of limited value to this Court. I accept her evidence.

39.  On the contrary, I find the Plaintiff’s evidence including her oral testimony in court incredible and inconsistent in a large number of serious and material respects.

40.  First, the Plaintiff said that the Deceased gifted the I-Feng Property to her and Yeung Ming as a wedding gift in 1987. If that is true, it would have been quite impossible for the Deceased to gift that property to her again in 1998. There would have been no basis for the Deceased to deal with the I-Feng Property because by then, namely, in 1998, the Deceased would have no locus to deal with a property that had already been gifted away. There is no need for the Deceased to carry out such a redundant act. It is also inexplicable as to why the Plaintiff would accept a gift in 1987 as a part consideration for her giving up her claims for ancillary relief against Yeung Ming.

41.  It also makes no sense for the Deceased to gift what was essentially Yeung Ming’s half share of the I-Feng Property to the Plaintiff without Yeung Ming’s knowledge if the property was indeed gifted to them in 1987.

42.  Further, the Plaintiff’s case that the I-Feng Property was gifted by the Deceased to her and Yeung Ming is also contradicted by her own statement to the Police in 2013. In her police statement dated 10 October 2013, she stated that:

(1)  §2:  “… 至1987年與丈夫歐揚明結婚，我老爺區志祥於1987年將 [IF Property]送俾我。”.

(2)  §3:  “雖然我老爺一早送咗單位俾我，但未做有關轉名手續，所以業主個名仍然係我老爺，而我老爺於2、3年前去逝，我仍然辦理緊轉名手續。而我實際上多年來係單位業主。” (Emphasis added.)

43.  The Plaintiff’s narrative to the Police was that (1) the Deceased gave the I-Feng Property to her alone in 1987; (2) the Deceased intended to but had not yet completed the transfer of title to the Plaintiff, and passed away 2-3 years ago and (3) in 2013, the Plaintiff was then in the middle of processing the transfer of title albeit that she was the sole beneficial owner of the I-Feng Property.

44.  The above version does not sit well with the Plaintiff’s version of event in her own witness statement (see §36 of her first witness statement) or her oral testimony in court. It is simply untrue that the Deceased was in the process of transferring the legal title of the I-Feng Property to her. That never happened. She lied in her police statement.

45.  I accept Mr Ah-weng’s submission that not only did the Plaintiff tell a different version as to who was gifted the property in 1987 (whether the Plaintiff and Yeung Ming or her alone), the Plaintiff lied about the Deceased wanting to transfer the title to her before death, and the existence of an ongoing transfer procedure.

46.  Importantly, in explaining her beneficial ownership in 2013, well after the death of the Deceased, the Plaintiff did not mention the 1998 Oral Agreement which according to her is the basis of her entitlement to the I-Feng Property.

47.  I can well understand that the dispute in 2013 did not touch and concern the ownership of the I-Feng Property. As such it might not be necessary to go into the details of the ownership of the property. But it is quite another thing to put in a police statement a version of facts which is inconsistent and contradictory to the 1998 Oral Agreement.

48.  Additionally, if it were indeed a wedding gift by the Deceased in 1987, it is inexplicable as to why the legal title of the said property was not transferred to Yeung Ming and the Plaintiff for so many years. This is contrasted by the gift of the USA Property by the Deceased to Yeung Ming in 2003 when he got remarried. Yeung Ming was the legal owner of the USA Property.  When being asked on why no legal title of the I-Feng Property was transferred to her and Yeung Ming, the Plaintiff’s answer was that she thought that the Deceased would like to maintain ultimate control and did not totally trust his children. I do not find such explanation credible. The Deceased had no difficulty in passing the legal title of the USA Property to Yeung Ming in 2003.

49.  Still further, I accept Arthur’s evidence that the Deceased never had a practice of devising properties to his children as wedding gifts. None of the other members of the Au family had ever been gifted any properties as wedding gifts by the Deceased. He was married in 1999 and Yim Ling was married in 1997. None of them were gifted any properties as a wedding gift.

50.  Secondly and importantly, the land searches records for the I-Feng Property showed that from 1987 to 2001, i.e. since around the time or after the Deceased supposedly gifted to the Plaintiff (and/or Yeung Ming) the I-Feng Property as wedding gift, the Deceased pledged repeatedly the I-Feng Property as security for loans for his business.  The chargor, namely, the Deceased, was stated as the beneficial owner of the I-Feng Property, in the security documents.

51.  The same applies to the Fook Shing Property. Land searches records also show that it was charged by the Deceased in 1997 as beneficial owner. A receipt on discharge of a charge dated 15 August 2001 was registered to show that the charge was paid off.

52.  This is inconsistent with the 1998 Oral Agreement and the 2001 Representations. From the records, it appears that, at all material times, the Deceased treated the two landed properties as his own properties. In the course of the trial, when presented with these land searches records, the Plaintiff’s response was that she was not even aware that her properties were mortgaged and/or charged to banks without her knowledge. She concluded, with the benefit of hindsight, the Deceased had deceived her. I do not accept her evidence. I am of the view that there was no motive on the part of the Deceased to deceive the Plaintiff. The legal charges over the two landed properties could easily been found from public records. There was no need for the Deceased to deceive the Plaintiff. I am of the view that, on balance, the public records sit better with the fact that the Deceased had never gifted and/or agreed to devise the two landed properties to the Plaintiff.

53.  I also accept Mr Ah-weng’s submission that it is incredible that the Plaintiff would have only found out about the pledges and/or charges recently. She attempted to register the 2004 Tenancy Agreement against the Fook Shing Property. In view of the disputes over the two landed properties and her case that the Decased had been stringing her all along, the Plaintiff’s inaction and silence over the years about the 1998 Oral Agreement is hard to reconcile with its very existence.

54.  Thirdly, it is the Plaintiff’s case that there was an additional element to the 1998 Oral Agreement, namely, the Deceased asked her to keep the said oral agreement confidential and she should not inform any members of the Au family about the 1998 Oral Agreement. The Plaintiff said that this is one of the reasons why she did not mention the 1998 Oral Agreement. I find this hard to believe. First, on the Plaintiff’s own case, in February 2001, the Deceased had no difficulty in openly inform all relevant Au family members that he would devise the two landed properties to the Plaintiff. If that is the case, it is difficult to fathom why the Deceased was so keen to keep the 1998 Oral Agreement confidential. Secondly, as a matter of fact, Yeung Ming got remarried in the USA in 2003. Members of the Au family knew about that at the time. There was no point in keeping the 1998 Oral Agreement confidential after 2003. It is inexplicable as to why the Plaintiff and/or the Deceased would still like to keep the 1998 Oral Agreement confidential. In fact, given that the Deceased was still the legal owner of the two landed properties, it is important that the 1998 Oral Agreement be made known to the members of the Au family, either by the Plaintiff and/or the Deceased. I find the Plaintiff’s evidence on this issue not credible.

55.  Fourthly and significantly, on 1 May 2004, the Deceased and the Plaintiff signed a tenancy agreement in relation to the Fook Shing Property for a period from 1 May 2004 to 30 April 2045 at a monthly rent of HK$6,000, the 2004 Tenancy Agreement. There is an additional term that the landlord, namely, the Deceased, agreed that the tenant, namely, the Plaintiff, could sub-let the premises to other parties. In my view, this is very damaging to the Plaintiff’s case. If the Fook Shing Property had been gifted or promised to be gifted to the Plaintiff, there is no need for the parties to enter into this 2004 Tenancy Agreement in 2004 when Yeung Ming got remarried in 2003.

56.  I have to say that I find the Plaintiff’s story on how the 2004 Tenancy Agreement came about incredible. The Plaintiff accepted that the Deceased was an authoritative figure in the Au family and all his children obeyed his instructions and wishes.  Against that background the Plaintiff’s case is that:

(1)  As Lana failed to pay Madam Lau’s monthly retirement money for half a year after Arthur took over the control of Lana, Madam Lau told the Plaintiff the same who then called the Deceased to set up a meeting (“the Complaint Meeting”).

(2)  The Deceased after understanding Madam Lau’s situation subsequently called Arthur to the Complaint Meeting, scolded him and asked Arthur to rectify the situation. Arthur, trying to change the focus of the Deceased, then repeatedly questioned the Plaintiff’s entitlement to the possession and rental income of the Fook Shing Property. The Deceased then told Arthur that this was none of his business.

(3)  The Plaintiff further said that as Arthur had begun to take over the family business, he had more guts to challenge the Deceased’s decisions. This was different from the situation in the 2001 Family Meeting, when the Deceased had announced that the Plaintiff was to inherit the two landed properties upon his death, when Arthur was still under the impression that the Plaintiff and Yeung Ming were married, and the Deceased was still in charge.

(4)  In these circumstances, the Plaintiff felt anxious due to Arthur’s repeated questioning, as she did not have an immediate right to the two landed properties, she then asked the Deceased what to do. The Deceased, instead of suggesting that the Fook Shing Property be transferred to the Plaintiff’s name immediately, asked the Plaintiff what she wanted. At this juncture, Madam Lau interjected and suggested that the parties enter into the 2004 Tenancy Agreement, and the Deceased agreed. It is said that the Plaintiff did not have any opportunity to object, so she went and bought the stationary lease and the parties signed the 2004 Tenancy Agreement, which according to the Deceased was supposed to protect the Plaintiff from any further questioning.

57.  Mr Fan for the Plaintiff submitted that it is inherently probable for the Plaintiff to have been overwhelmed by Arthur’s questioning, and not having the requisite legal knowledge, agreed to the signing of the 2004 Tenancy Agreement. This is further reinforced by the fact that the 2004 Tenancy Agreement had a long term of 41 years, which on the face of it would give her a right to stay for 41 years from signing, which seemed like a convenient way to settle the matter. It was logical for a lay person like the Plaintiff to never even think about asking the Deceased for a copy of the 2001 Will. She was told that the 2001 Will was placed at a solicitor’s firm, and she believed that it could not be taken out until the Deceased’s death.

58.  Mr Fan further submitted that objectively speaking, these events reflect that the Deceased was deliberately misleading the Plaintiff by asking her to sign the 2004 Tenancy Agreement to protect her interests which led her to believe that the 2001 Will existed, and that she was to have an interest in the two landed properties after his death, so she would continue to abide by the 1998 Oral Agreement.

59.  I have no difficult in rejecting the Plaintiff’s case on this issue. I find it quite incredible that having entered into the 1998 Oral Agreement and having made the 2001 Representations, the Deceased would go against his own wishes and words to his family members, by entering into the 2004 Tenancy Agreement qua landlord. Both the Deceased and the Plaintiff were in the garment trading business. The existence of the 2004 Tenancy Agreement defeats the 1998 Oral Agreement and the 2001 Representations. This contemporaneous document evidences that the Plaintiff in 2004 was not the beneficial owner of the Fook Shing Property. It is as simple as that. I find it hard to believe that the Plaintiff did not appreciate this point at the material time.

60.  I also find it incredible that if this 2004 Tenancy Agreement were only meant to be a formality as contended, there was a need to insert an additional sub-letting clause and many standard clauses were in fact deleted. It appears to me that the terms of the 2004 Tenancy Agreement were carefully designed to give the Plaintiff the right to occupy and sub-let the Fook Shing Property until 2045, and the Plaintiff would not have to pay for any damage to the premises to the Deceased, as long as the Plaintiff paid the utilities (Clause 10).

61.  Further, I do not find the Plaintiff’s explanation that Arthur suddenly became assertive in 2004 to such an extent that the Deceased would rather enter into the 2004 Tenancy Agreement, a sham document (according to the Plaintiff), instead of telling Arthur and other family members about the 1998 Oral Agreement credible at all. This sudden weakness of the Deceased vis-à-vis Arthur is inexplicable and unreal. In 2004, the Deceased had no difficulty in scolding Arthur. Yet, he had to create a sham document to cover up the 1998 Oral Agreement. This is when the Plaintiff’s divorce was a known fact to the Au family members.

62.  I am of the clear view that after Yeung Ming’s remarriage in 2003, the Plaintiff obtained the 2004 Tenancy Agreement in order to protect her own interest qua tenant to which the Deceased agreed. This defeats the Plaintiff’s case of the 1998 Oral Agreement and the 2001 Representations.

63.  I also find it hard to believe that if Madam Lau had any complaints about her entitlements, she would not have taken up the same directly with the Deceased. At the end of the day, it was Madam Lau and the Deceased who founded the family business and it is common ground that the Deceased respected Madam Lau and they had an intimate relationship.  She had credibility and gravitas as a founding member of Lana (the Plaintiff agreed under cross-examination that she “打江山” with the Deceased).

64.  Further, the 2004 Tenancy Agreement was supposedly made for the purpose of dealing with Arthur’s challenge, yet on the Plaintiff’s admission, Arthur did not pursue his challenge at all, and the Plaintiff never showed him the 2004 Tenancy Agreement, or any other members of Au Family until the WeChat message on 7 November 2015.

65.  Importantly, in the WeChat message sent on 7 November 2015, the Plaintiff, for the first time, asserted her right to use the two landed properties qua tenant. She did that by sending the 2004 Tenancy Agreement to Yim Ling.  By the terms of the 2004 Tenancy Agreement and her WeChat message that followed, she asserted that she was a tenant of the Fook Shing Property:

“甘你問律師啦，你爸爸同我簽咗四十年，過去了十一年，還有二十九年後歸還給你媽啦…”(Emphasis added.)

66.  Indeed, if the Plaintiff’s case is to be believed, there is no need to suggest that she would return the two landed properties to the Defendant in 29 years’ time.

67.  The Plaintiff puts the blame on her then lawyer, Mr Tam Yat Ming (“Mr Tam”) for failing to advise her that she could put forward the 1998 Oral Agreement and the 2001 Representations as the grounds  for resisting the Defendant’s claim for possession. Her evidence is that she had told Mr Tam about the details of the 1998 Oral Agreement and the 2001 Representations but Mr Tam advised her that she could only rely on the 2004 Tenancy Agreement to assert her rights. I find that hard to believe. The existence of the 1998 Oral Agreement and the 2001 Representations is a matter of fact. If indeed, pursuant to such agreement and representations, on the Plaintiff’s case, she had given up her rights and opportunities, her first reaction would have been to assert her rights under the 1998 Oral Agreement and the 2001 Representations. Hence, I find the Plaintiff’s evidence on how the 2004 Tenancy Agreement came about incredible.

68.  Fifthly, on 8 March 2016, the Plaintiff further sent an explanatory note to Yim Ling (the “Explanatory Note”). In the Explanatory Note, the Plaintiff set out the detailed situation of the Fook Shing Property for Yim Ling’s information. Clause 1 of the Explanatory Note states that the Plaintiff paid rent to the Deceased: “從2004年至2016年，關要付給區志祥租金 $6,000 HKD/ 月, $72,000 HKD/年, 共要付864,000 HKD”.

69.  It is common ground that the Plaintiff in fact did not pay any rent to the Deceased. This shows that the Plaintiff lied in this Explanatory Note as well. This affects the credibility of her case. It appears that she was willing to lie in order to make good her claims. It is also the Plaintiff’s evidence that when Yim Ling asked her for proof of her entitlement to the two landed properties, she did tell Yim Ling she had title transfer documents in her hands when she did not have the same at all. What she ultimately sent to Yim Ling was the 2004 Tenancy Agreement. She did not at the time, well after the Deceased died in 2011, tell Yim Ling or indeed any member of the Au family, the existence of the 1998 Oral Agreement and the 2001 Representations. If such agreement and representations indeed existed and the Plaintiff relied upon the same to her detriment, her immediate reaction would have been to assert her rights pursuant to such agreement and representations forthwith. Instead, she chose to rely on the 2004 Tenancy Agreement. On balance, I am of the view that the 1998 Oral Agreement and the 2001 Representations are an afterthought by the Plaintiff to resist the Defendant’s claims for possession of the two landed properties.

70.  It is pertinent to note that as late as March 2016, the Plaintiff was claiming a sum of HK$13,624,822.50 as compensation for an early possession of the Fook Shing Property on the basis that she would suffer a loss by giving up her rights for the remaining 30 odd years under the 2004 Tenancy Agreement. This, in my view, defeats the existence of the 1998 Oral Agreement and the 2001 Representations. She was then asserting her right as a tenant rather than as a beneficial owner of the Fook Shing Property and using her rights as a tenant to calculate her entitlements.

71.  In the Plaintiff’s Opening Submissions, Mr Fan for the Plaintiff raised an issue on the admissibility of evidence relating to the negotiations between the Plaintiff and the Defendant. It was submitted that such evidence is subject to legal professional privilege. However, I note that in fact the Plaintiff responded and addressed in details her negotiations with Yim Ling in her own witness statement. Mr Fan for the Plaintiff also confirmed to this Court that the Plaintiff was not asking for such evidence to be excluded or expunged from the court file. When Mr Ah-weng cross-examined the Plaintiff on such negotiations, Mr Fan did not raise any objections. In such circumstances, even if there were any legal professional privilege attached to such negotiations, the same would have been waived by the Plaintiff’s conduct in this trial. I also note that in the Plaintiff’s closing submissions, Mr Fan fairly accepts that the negotiations in 2015 are not legally privileged.

72.  Sixthly, I find that as a matter of fact, the 2001 Family Meeting did not happen. There were no 2001 Representations as alleged. The Plaintiff set out a detailed distribution of the Deceased’s properties to his children. However, the public records show that the Deceased could not have made such representations in 2001.

(1)  The Deceased would supposedly leave a “黃埔新邨的單位” for Yui Ming. However, the land search record shows that in 1994, Yui Ming bought a flat in Whampoa Estate from a third party. It happened 7 years before the 2001 Family Meeting. I agree that it is quite impossible for the Deceased to have said that he decided to leave a property that he did not own, which his son bought 7 years ago.

(2)  The Deceased would supposedly leave a “黃埔花園的單位” for Tat Ming. However, the land search record shows that Tat Ming bought a flat in Whampoa Garden in 2003 from a third party, 2 years after the 2001 Family Meeting. I agree that the Deceased could not have said that he decided to leave a property that he did not own or buy, which his son was to buy 2 years in the future. The Deceased did not have a crystal ball.

(3)  The Deceased would supposedly leave Willow Mansions (翠楊苑) to Arthur. However, the land search record shows that the Deceased sold the same to Arthur in 1999, 2 years before the 2001 Family Meeting. The Deceased initially put it up for sale in open market, subsequently he sold it at HK$1 million discount from market price to Arthur. I agree that the property had already been sold in 2001 and hence it was impossible for the Deceased to give the same to Arthur again in 2001.

(4)  The Deceased would supposedly leave the Regalia (爵士花園) to the Defendant. However, the land search record shows that the Deceased bought the property in 1998 with the Defendant as joint tenants. This was more than 2 years before the 2001 Family Meeting.

(5)  The Deceased would supposedly leave Pengshengeun (鵬盛村) to Hon Ming. However, the Deceased only paid for down payment, and Hon Ming had repaid the same and paid for the mortgage.

(6)  The Deceased would supposedly leave Hongcheng Huayuan (鴻城花園) to Hon Ming. However, the property was purchased by Hon Ming before the 2001 Family Meeting and the Deceased was never a legal owner. Vienne Gao confirmed the same. Hence, it was impossible for the Deceased to gift the property which he did not own to Hon Ming.

(7)  The Deceased would supposedly leave Yuehai New Village (粵海新村) to Yim Ling. This property was always owned by the Deceased.  However, it was never given to Yim Ling. Yim Ling confirmed that she was never interested in this Mainland property and never owned it.  She only dealt with its management fees. The property was rented to their relative.

73.  As for the two landed properties, the Plaintiff’s evidence is that the Deceased said he “會把涉案物業送贈給” the Plaintiff. It is unclear as to whether the Deceased had already gifted the two landed properties to her or the Deceased promised her that he would gift the two landed properties to her in the future, upon his death. At one time, the Plaintiff’s oral testimony in court was that pursuant to the 1998 Oral Agreement, the Deceased had already gifted the two landed properties to her.

74.  Mr Ah-weng is right that this further contradicts the Plaintiff’s case that the Deceased by 2001 must have effectively recognized her beneficial title to the two landed properties because by 2001, the Plaintiff, on her case, had already spent money on renovation, had exercised control over the Fook Shing Property including sub-letting the same to third parties since 2000 and granting a bare licence to Ka Fung in 2000.  All these do not sit well with the Plaintiff’s case that somehow in 2001, the Deceased suddenly made an announcement that he would  (“會”) gift the two landed properties to the Plaintiff when according to the Plaintiff she had already obtained beneficial title and exclusive possession of the same by then.

75.  Mr Fan for the Plaintiff submitted that to the Plaintiff, “would (“會”) gift” and “already gifted to her” means the same and she used the same interchangeably. I do not accept such submissions. I am of the view that the Plaintiff must be able to appreciate the difference between the two.  

76.  Further, the Plaintiff’s evidence is that the Family Meeting took place at noon time on 2 February 2001 in Star Court. Mr Ah-weng for the Defendant is right in submitting that the Deceased’s birthday was a Friday and a working day for Lana.  Lana resumed work between the 7^th day and the 10^th day of Chinese New Year.  Anyone involved with Lana (including the Deceased) would have been working that day.  Further, Tat Ming worked as a salesperson in Fortress Electronics retail store.  He would not have taken a day off on Friday for the Deceased’s birthday celebrations.

77.  Mr Fan for the Plaintiff that it is inherently probable that all  of the Deceased would come to the 2001 Family Meeting because the Deceased “announced in advance” that he was to discuss distribution of family assets. However, that is not the evidence. There is no evidence that the Deceased made any prior announcement before the 2001 Family Meeting.

78.  Mr Ah-weng is also right that the Plaintiff has not provided particulars as to the location and time of the 2001 Family Meeting in her pleadings. Arthur set out the details of the family gathering in his first witness statement on 21 May 2019. After 21 May 2019, the Plaintiff filed three witness statements including the one by Vannie Gao, none of which traversed Arthur’s account of the 2001 Family Meeting.

79.  I also accept that it is more probable than not that the Deceased would not have discussed his posthumous arrangements on the day of celebrations for the Deceased’s birthday combined with Chinese New Year celebrations for his staff,  suppliers and business partners. I accept the Defendant’s case that there was only a family gathering in the evening at the Restaurant to celebrate the Deceased’s birthday.

80.  I also note that the Plaintiff’s evidence is that the Deceased on 2 February 2001 called a family meeting to tell members of the Au family that he had executed a will in 2001 but in fact he did not. It is difficult to see why the Deceased needed to deceive all members of the Au family, on his birthday, in 2001.

81.  Further, Mr Ah-weng also submitted that the location and timing of the 2001 Family Meeting is not one of the agreed list of issues simply because the Plaintiff had never contested that other than the family gathering at the time and location as described by Arthur, there was no other family meeting in Star Court at noon as alleged by Plaintiff. I agree that in so far as the Plaintiff attempts to rely on the 2001 Family Meeting, it is up to her to plead particulars in relation to the location and timing of the same which she has not done. The fact that the Plaintiff never mentioned the location and timing of the 2001 Family Meeting until she went into the witness box does affect the credibility of her case.

82.  For the above reasons, on balance, I do not accept the Plaintiff’s case that the Deceased did make the 2001 Representations. I accept Arthur’s evidence that the only family gathering on that day was the dinner gathering in the Restaurant and not in Star Court. This also materially affects the credibility of the Plaintiff’s case.

83.  Seventhly, the conduct of the Plaintiff, after the death of the Deceased, objectively speaking, indicates the 1998 Oral Agreement and the 2001 Representations do not exist.

(1)  There is no dispute that the Plaintiff did have knowledge of the HK Will of the Deceased in 2011. By then, she would have discovered that the Deceased had not gifted the two landed properties to her. Nonetheless, she did not assert her rights pursuant to the 1998 Oral Agreement and the 2001 Representations thereafter.

(2)  Under cross-examination, the Plaintiff said that when she and Kit Ming first saw the HK Will, their immediate reaction was that the Deceased’s signature on the last Will was forged.  However, Mr Ah-weng is correct that if they truly shared similar views on falsity of signature, such an allegation curiously never appeared in contemporaneous documents, such as (i) Kit Ming’s letter to the High Court dated 27 May 2013 (the “High Court Letter”) or (ii) PRC Judgment dated 8 July 2019 (the “PRC Judgment”). In the High Court Letter, Kit Ming only complained about (a) the HK Will dated 27 July 2005 “不是我父親當時的真實意願”, (b) Kit Ming inferred from the Deceased’s deterioration in April or May 2006, that the Deceased had no mental capacity in 2005 when he signed the HK Will. There was no reference to or any direct evidence that the Deceased suffered from any illness or problems before March 2006, (c) “尹美有女士也只能繼承我父親與我母親 [Au Ying] 共有財產中的50%” and the other 50% to be shared by Yeung Ming and Kit Ming.

(3)  I note that in the High Court Letter what is conspicuously missing is any assertion about the existence of the 2001 Will or the 2001 Representations. There was no mention about any false signature of the HK Will. Kit Ming also did not mention that the Deceased suffered any injuries from a fall in 2005 or that he was already mentally incapable to sign the HK Will.

(4)  In PRC Judgment, Kit Ming sued the Defendant, Arthur, Yui Ming, Hon Ming, Tat Ming, Yim Ling and Yeung Ming.  Kit Ming claimed for certain PRC properties, on the basis that: (i) the Deceased and Madam Au Ying were married; (ii) the Deceased executed a PRC will dated 10 September 2004 (the “PRC Will”) and (iii) Madam Au Ying’s PRC will dated 20 June 2011. Again, no allegation was made about false signature of the HK Will, nor was there any allegation that the Deceased was already mentally incapable to sign the HK Will in 2005.

(5)  Plainly, contrary to the Plaintiff’s oral testimony, no allegation of forgery was made by Kit Ming and the Plaintiff knew about it. There was also no mention about the 2001 Representations or the 2001 Will.

(6)  It is not that the Plaintiff must file a writ or a challenge to the validity of the HK Will. But her stone silence on the existence of the 1998 Oral Agreement and the 2001 Representations after her discovery of the content of the HK Will is inexplicable unless the same did not exist. It is not a matter that one had to resort to legal advice. Given the great sacrifice the Plaintiff said she had suffered as a result of the 1998 Oral Agreement and the 2001 Representations, it must be a shock to her to discover that contrary to the Deceased’s promises and representations, the two landed properties were not bequeathed to her. It is against common sense that she would not have raised the 1998 Oral Agreement and the 2001 Representations with the executor of the last Will, namely, Arthur.

(7)  The Plaintiff said she did not assert her rights over the two landed properties because Kit Ming said he “反對及追究” the HK Will. She said, in court, that it was more proper for Kit Ming to challenge the last Will as the Deceased’s son. I find this hardly convincing. The Plaintiff’s claims are different from Kit Ming’s. She has to rely on the content of her perceived 2001 Will. Even if the HK Will were to be revoked and the Deceased died intestate, it would not benefit the Plaintiff.  Her inaction speaks volume on the credibility of the 1998 Oral Agreement and the 2001 Representations.

(8)  Mr Fan for the Plaintiff submitted that the Plaintiff’s inaction is understandable as upon the revocation of the HK Will, the Plaintiff then believed that the 2001 Will would then be propounded and she would obtain the beneficial ownership of the two landed properties under the 2001 Will. I am not convinced that such reasoning is correct. First, as a matter of fact, there has never been any application to revoke the HK Will and the Plaintiff knows this perfectly well. She did not take any action, not even issue a letter before action, to assert her legal rights under the 1998 Oral Agreement and the 2001 Representations. Secondly, I find it hard to see any basis for the Plaintiff to have faith in 2011 that the Deceased did genuinely execute the 2001 Will. By that time, the Plaintiff must at the very least have entertained doubts as to the existence of the 2001 Will. Nonetheless, she took no action to find out the same.

(9)  On the other hand, the Defendant and Arthur’s inaction vis-à-vis the two landed properties sit well with the Informal Understanding. The Plaintiff was allowed to have the benefit of the two landed properties until 2015 when Ling Hon turned 18.

(10)  In 2015, the Defendant and Arthur, after failing to have a meaningful discussion with the Plaintiff on the two landed properties instructed Messrs. Tang & Associates to issue a letter demanding that the Plaintiff to vacate the two landed properties. On 31 July 2015, Messrs. Tang & Associates issued a letter to the Plaintiff demanding for vacant possession of the two landed properties (the “2015 T&A Letter”). One would have expected that the Plaintiff, upon receiving such a letter, would have immediately raised the 1998 Oral Agreement and the 2001 Representations. That was not done. It does not matter that in the 2015 T&A Letter, the Defendant did not raise the Informal Understanding because it was a simple letter for repossession by the Defendant qua registered legal owner. It is not surprising that the Defendant and Arthur did not go into the details of the Informal Understanding.

(11)  On 29 September 2015, the Plaintiff’s then solicitors (Messrs. Cheng & Wong (“C&W”)) replied by letter and requested time to take instructions (“2015 C&W Letter”). It did not set out the 1998 Oral Agreement and the 2001 Representations. Under cross-examination, the Plaintiff asserted that she only instructed them to issue this holding reply letter, and no other professional work was conducted. This is strange because it would not have been difficult to set out the 1998 Oral Agreement and the 2001 Representations if they indeed existed.

(12)  Further, the Plaintiff could have mentioned about the 1998 Oral Agreement and the 2001 Representations in her WeChat exchange with Yim Ling in November 2015. In such WeChat exchanges, the Plaintiff only relied on the 2004 Tenancy Agreement to assert her rights qua tenant. There was no mention of the 1998 Oral Agreement and/or the 2001 Representations. In my view, this is an indicia that such agreement and representations did not exist at all.

(13)  Mr Ah-weng is correct that in all these personal WeChat messages between Yim Ling and the Plaintiff, the Plaintiff did not ever refer to her version of the story that she presented in court. She could have easily and logically done that in whole course of her personal WeChat messages with Yim Ling.  This is in the light of the supposed injustice she suffered over the history of the conduct with the Deceased.    Mr Ah-weng submitted that had the Plaintiff’s story been true, one would expect her to mention:

(a)  the Plaintiff had de facto or uninterrupted or exclusive possession and use of the two landed properties for rental income was because the Deceased already gave them to her by reason of the 1998 Oral Agreement.

(b)  Her ownership was affirmed in the 2001 Family Meeting, where the Defendant, Arthur, Yim Ling and other Au Family members were present and would have heard the Deceased’s arrangements;

(c)  Arthur had formerly complained about the Plaintiff’s possession and use of the Fook Shing Property for rental income, but was “shot down” by the Deceased in the Complaint Meeting.  Madam Lau was witness.  Indeed, the 2004 Tenancy Agreement was made to prove this, albeit it only mentions the Plaintiff was a tenant for 41 years.

(14)  I agree that it is bewildering that the Plaintiff never once let slip or have any tangential or casual reference to any part of her story or complaints, as if none of these ever occurred over the past decade or so (from 1998 to 2015).

(15)  Under cross-examination, the Plaintiff said that she in fact knew the 2004 Tenancy Agreement was a sham (in that the Deceased did not intend a tenancy in the Complaint Meeting). She said that both the Deceased and herself understood the 2004 Tenancy Agreement to be a sham. Nonetheless, the Plaintiff relied on such a sham document to claim for damages in the sum of about HK$13 million. This is troubling. I also agree with Mr Ah-weng that there is no logic why the Plaintiff would choose to agree to create a sham document on 7 November 2015, when it would have been simpler and easier to explain her “truth” about 1998 Oral Agreement to Arthur and other members of the Au family.

(16)  Further, I also find it inexplicable that in view of the 2001 Representations which were solemnly announced by the Deceased, there was there still a need to create a sham document so as to deal with Arthur’s challenges. On balance, I find the Plaintiff’s narrative of the Complaint Meeting hard to believe. It is simply incredible.

(17)  In her witness statement, the Plaintiff explained that the reason why she sent the 2004 Tenancy Agreement to Yim Ling on 7 November 2015: “雖然本人清楚有1998年協議的存在，… 但在沒有取得任何法律意見的情況下，卻真誠而錯誤地以為1998年協議只是口頭協議，…該口頭協議唔在於、或不足以向其他人證明本人於竊案物業的所擁有的權益。因此，本人於大約2015年11月，本人在沒有取得任何法律意見和沒有任何法律代表的情況下，選擇了和當時代表被告人的艷玲就涉案物業的業權進行談判。而基於上述本人錯誤的理解，本人亦沒有特意在談判中提及1998年協議，而只是將手上包括2004年的租約的所有文件拿出來…”(Emphasis added.)

(18)  On balance, I find this hardly believable. After she sent the 2004 Tenancy Agreement to Yim Ling, she wrote on WeChat to Yim Ling that: “甘你問律師啦，你爸爸同我簽咗四十年，過去了十一年，還有二十九年後歸還給你媽啦，其他益豐資料我全部交給律師了…” (Emphasis added.)  This, I agree, shows that the Plaintiff did engage lawyers at that stage. Mr Fan for the Plaintiff submitted that this was a bluff only. In fact, the Plaintiff did not engage a lawyer at that stage. Be that as it may, it is clear that the Defendant had then engaged lawyers. I do not really see the value of any bluffing at that stage.

(19)  Prior to 7 November 2015, the Plaintiff engaged C&W to issue a letter dated 27 September 2015. The Plaintiff only first paid and engaged Mr. Tam of Messrs. Tam & Partners (“T&P”) on 18 December 2015. The Plaintiff explained vividly that as the law firm staff had left that day, Mr Tam only used this photocopy to prove he received the costs on account.

(20)  I agree that the WeChat message on 7 November 2015 is explicit that the Plaintiff gave instructions and sought advice on the I-Feng Property on or prior to 7 November 2015.  Hence, on balance, it is more likely than not that the Plaintiff would have done the same for the Fook Shing Property.  The Plaintiff would have been concerned for her rights over both properties.  The Plaintiff’s mistaken belief without legal advice case does not sit well with her conspicuous stone silence on the 1998 Oral Agreement and the 2001 Representations throughout the period from 2011 to 2015, in particular, after the disputes over the beneficial ownership of the two landed properties arose. One does not need legal advice to raise factual issues.

(21)  About 4 months later, on 8 March 2016, the Plaintiff sent by WeChat a rent schedule (the “Rent Schedule”) and the Explanatory Note.  The Rent Schedule was sent as a photo on WeChat.  As discussed above, the content of the Explanatory contradicts any claims qua beneficial owner by the Plaintiff.

(22)  On 10 May 2016, T&A filed notices of application and commenced action in the Lands Tribunal to recover the two landed properties under LDPE 518/2016 and LDPD 999/2016). On 28 September 2016, the Law Society intervened into the practice of T&A. On 19 October 2016, another law firm Messrs Chung & Associates, on behalf of the Defendant, issued summons and affirmations to transfer the above two cases to the High Court.

(23)  On 25 September 2016, the Plaintiff issued the writ of summons in the present case.

(24)  On 16 November 2016, the Plaintiff filed her Statement of Claim and for the first time pleaded the 1998 Oral Agreement and the 2001 Representations.

84.  I am the view that the above course of conduct indicates that the 1998 Oral Agreement and the 2001 Representations do not, as a matter of fact, exist.

85.  Eighthly, I do not fine the evidence of the Plaintiff incredible. Apart from the matters set out above, I also note that:

(1)  The Plaintiff is an experienced business woman. She runs her own garment trading company. Between 1987 and 1990, the Plaintiff assisted the Deceased in Yuen Tai at the Fook Shing Property. After 1990, the Plaintiff and Yeung Ming had their own trading company called明駿貿易公司. After their divorce, 明駿貿易有限公司was closed, the Plaintiff continued “自己的貿易公司” (own trading business).   The Plaintiff on her own case only used “Yuen Bong” until 2001 or 2002. Between 2002 and 2014, the Plaintiff “轉移至內地繼續做本人的服裝批發貿易生意” (§25 of her first witness statement).  It really does not matter whether she stated herself to be a housewife in her divorce petition. The fact is that given her business experience, I find it hard to believe that she would take the view or accept the view that oral agreements could not be enforced and therefore needed not be mentioned.

(2)  Mr Ah-weng submitted that the Plaintiff’s asserted reasons for her divorce in court, namely, Yeung Ming’s unauthorized taking of HK$200,000 from their joint account, his financial mismanagement, his cover up for Hon Ming in respect of the latter’s loss of HK$500,000 which was obtained from Lana and his selling of their rental property and lost all the sales proceeds in investment, are different from the reasons which she stated in her divorce petition. In her divorce petition, she relied on four entirely different bases, namely, (a) Yeung Ming had hot temper with their children, (b) Yeung Ming failed to pay the Plaintiff maintenance that led to the Plaintiff’s claim for Comprehensive Social Security Assistance in September 1998, (c) Yeung Ming staying out late and (d) Yeung Ming left their home in May 1998. I agree that there are inconsistence between the Plaintiff’s stated reasons for divorce in her divorce petition and her evidence in this trial.

(3)  Under cross-examination, the Plaintiff said in court that the Deceased suggested that the Plaintiff should not claim for maintenance against Yeung Ming and so she told the counsel of the Legal Aid Department. But the counsel at the Legal Aid Department advised her that she should keep the amount at $1. She reverted back to the Deceased and the Deceased agreed. This does not sit well with what she set out in her witness statement: “老爺有特別交代本人不用與法援署律師表示有[1998 Oral Agreement] 只需要向他表示本人願意只索取HK$1 贍養費 … ” (§30 of the Plaintiff’s Second Supplemental Witness Statement). Mr Ah-weng submitted that this is illogical as it is commonly understood that the nominal maintenance order allows for the Plaintiff qua petitioner to have an enduring right to apply for maintenance in future. This squarely contradicts what the Plaintiff said the Deceased wanted, namely, to put an end to the litigation. By agreeing to preserve her right to apply indefinitely, it does not end the litigation. Even if the Deceased did not know, the Legal Aid Department counsel would have advised her of her rights under the nominal maintenance order. There is no reason why the Plaintiff would not have told the Deceased of the same and the Deceased would have agreed to it. For a complete bar to ancillary relief, the court needed to have dismissed the Plaintiff’s claim. I agree that this does not sit well with the Plaintiff’s version of the 1998 Oral Agreement.

(4)  The Plaintiff’s reliance on a lending note dated 22 May 1998 to show that “老爺當時要把福城物業交吉給本人” (“the Lending Note”). However, the Lending Note predates any discussions between the Deceased and the Plaintiff about the terms of the 1998 Oral Agreement. The Plaintiff’s case is that the Deceased only started to discuss terms of the 1998 Oral Agreement after (i) the Deceased failed to persuade her to stay in marriage with Yeung Ming and (ii) she commenced the matrimonial proceedings on 27 October 1998. I accept that it is inherently improbable and incredible that the Deceased would have vacated the Fook Shing Property in May 1998 in anticipation of a potential outcome of a series of discussions which were to take place in October 1998.

(5)  In court, the Plaintiff said that Madam Lau was by 2004 suffering from cancer, and she needed $5,000 monthly from Lana to survive. However, in her witness statement, the Plaintiff said that Madam Lau was only diagnosed with cancer after the Deceased died, namely, 23 April 2011. Hence, Madam Lau could not have been suffering from cancer in 2004: “在老爺過身後不久，…, 劉女士當時被確診患有癌症。” (See: §33 of the First Supplemental Witness Statement of the Plaintiff.) When confronted with the inconsistence under cross-examination, the Plaintiff said that what she meant in the witness statement was that Madam Lau all along had cancer, and although it said “確診” after 23 April 2011, she meant her cancer “復發” (relapsed) after 23 April 2011. I agree that this justification is hardly convincing. “確診” and “復發” (relapsed) are two different concepts.

(6)  The Plaintiff caused the 2004 Tenancy Agreement to be stamped and registered in February 2016. Under cross-examination, she said that she had told Mr Tam that the 2004 Tenancy Agreement was a sham. Yet Mr Tam, a solicitor, advised her that she should stamp the 2004 Tenancy Agreement despite knowing that it was a sham document. I find this hard to believe.

(7)  Further, on balance, I am not convinced that Mr Tam did advise the Plaintiff on the validity of the 1998 Oral Agreement and the 2001 Representations. On the Plaintiff’s case, the total fees she paid to Mr Tam were in total $4,500 ($1,500 + $1,000 + $2,000. Two receipts ($1,000; $1,500) both mention the “costs on account” were for “Registration of Tenancy Agreement”.  There is no evidence that Mr Tam advised on the merits of the Plaintiff’s claims based on the 1998 Oral Agreement and the 2001 Representations. There is no basis for this Court to accept the Plaintiff’s case that she did inform Mr Tam the 1998 Oral Agreement and the 2001 Representations but he advised that the same had no merits and the only viable route was for the Plaintiff to make claims based on the 2004 Tenancy Agreement which he knew was a sham document. I find this defies belief.

(8)  Mr Ah-weng also relied on the two complaints against Mr Tam which the Plaintiff filed with the Law Society of Hong Kong. In the first complaint which was filed when the Plaintiff was represented by Messrs. Hon & Co.. In the said complaint, the Plaintiff never alleged that Mr Tam had given her any advice in relation to the 1998 Oral Agreement and the 2001 Representations.  The Plaintiff said that the first complaint letter was only a draft and not filed (which is disputed by the Defendant). Be that as it may, it was signed by the Plaintiff. The conspicuous absence of any complaint against Mr Tam for rendering wrong legal advice in relation to the 1998 Oral Agreement and the 2001 Representations does not sit well with the Plaintiff’s version of events.

86.  Ninthly, the Plaintiff relied heavily on the fact that she sub-let the two landed properties to rent and thus asserted her rights as the owner of the same. It is true that she sub-let the properties to third parties. However, that does not mean that she was asserting her rights as the real owner of the same. In fact, the tenancy agreements show that prior to the death of the Deceased, many of the tenancy agreements were entered into in the name of the Deceased and/or Yuen Bong. It was only after the death of the Deceased that the Plaintiff used her own personal name to enter into some the leases. Mr Ah-weng has made extensive submissions on this point and I agree.

87.  Indeed, the 2004 Tenancy Agreement has a specific additional clause to allow sub-letting by the Plaintiff qua tenant. I accept Mr Ah-weng’s submission that the terms of the 2004 Tenancy Agreement were reached in order to protect the Plaintiff’s interest qua tenant. It is submitted that the terms of the 2004 Tenancy Agreement were carefully designed so as to give the Plaintiff the right to occupy and sublet the Fook Shing Property until 2045, and the Plaintiff would not have to pay for any damage to the premises to the Deceased, as long as the Plaintiff paid the utilities. I agree.

88.  I should also mention that I do not find any evidence from any of the sub-tenants helpful. For example, the evidence of Mr Lau is not probative in deciding the key issues in this case.

89.  Tenthly, there was a dispute between the Plaintiff and Ka Fung in relation to the shared expenses of the Fook Shing Property. The Plaintiff’s handwritten note in Allied Good’s debit note indicates that she asked Ka Fung to revert to the Deceased to ascertain what expenses she should bear. I agree that if the Plaintiff were truly the sole beneficial owner of the Fook Shing Property, the Deceased would never be involved in adjudicating over the splitting of expenses between Yuen Bong and Allied Good. In my view, this shows that at the time of such dispute, the Plaintiff still treated the Deceased as the owner of the Fook Shing Property.

90.  Eleventhly, given this Court’s finding that the 2001 Representations never exist, I do not find Vannie Gao’s evidence credible. She has also indicated that she had made claims against the properties that Hon Ming was entitled to pursuant to the 2001 Representations (which she subsequently gave up in the settlement in 2017). Given that she had made claims based on the 2001 Representations, she is hardly an independent witness as Mr Fan submitted.

91.  Finally, Mr Ah-weng also submitted that the terms of the 1998 Oral Agreement do not make common sense. First, there was no utility of foregoing the maintenance claim against Yeung Ming as both the Plaintiff and the Deceased knew full well that Yeung Ming had no assets at the material time. He also would not have any ability to pay any meaningful ancillary relief to the Plaintiff. The cause of the divorce was after all due to Yeung Ming’s dishonest and incompetent financial management of their assets. On this alone, the Plaintiff would have nothing to give up, if in her view, there was nothing to claim against in the first place.  On this view, there was no reason why the Deceased would have asked the Plaintiff not to claim against Yeung Ming. The Plaintiff’s answer is that the Deceased would intervene to help Yeung Ming. However, the Deceased being a seasoned businessman, is unlikely to offer his assets to support the ancillary claims of the Plaintiff.

92.  The terms of the 1998 Oral Agreement are also strange. For example, the Plaintiff can remarry anytime during her life term. According to the Plaintiff, the Deceased would have to bequeath the two landed properties to her with the possibility that she could remarry subsequently. Further, it is also not entirely clear that as to what it means by “負責並確保本人的子女…得到最好的照顧””?  For how long does this need to be carried out?  What does “負責…確保” entail? What does 最好 means in this context?

93.  I agree with the above submissions. The Deceased was a sophisticated businessman. It is unlikely that he would have simply gifted the Plaintiff the two landed properties, and hope that the Plaintiff would hold up her end of the bargain.  If he did so intend in the first place, he would have transferred the title directly to the Plaintiff. Equally, it is unlikely that the Plaintiff, as a sophisticated businesswoman, not a housewife, would not have agreed to continue to perform her obligations (all are continuing obligations until her death) without agreeing on when the landed properties would be transferred.

94.  For all the reasons stated above, I dismiss the Plaintiff’s claims based on the 1998 Oral Agreement and the 2001 Representations.

95.  As the 1998 Oral Agreement and the 2001 Representations do not exist, I do not find it necessary to address the issues of detrimental reliance and part performance. The Plaintiff had occupation of the two landed properties during the relevant period and indeed collected rents from tenants and sub-tenants. It is only natural that she would have incurred some relevant expenses.

THE COUNTERCLAIM

96.  As to the Defendant’s counterclaim, I agree that in the absence of anything special it would be the ordinary letting value of the property that would determine the amount of the damages. (See AG v Stephen Chiu Kwok Chun, unreported., CACV 167/1984, 9 April 1985 at §14).

97.  The Plaintiff submitted that she is entitled to a set-off in diminution or extinction of the Defendant’s counterclaim the expenses and paid by the Plaintiff in respect of the two landed properties. However, in relation to expenses incurred prior to 7 August 2015, such expenses were incidental to the Plaintiff’s occupation of the two landed properties and she derived benefit from sub-letting the same to third parties. Mr Ah-weng also submitted that such expenses are unrelated to the Defendant’s counterclaim for mesne profit.

98.  However, in relation to the renovation expenses relating to the Fook Shing Property in the sum of HK$145,228.40 incurred after 7 August 2015, I am of the view that the same can be set off against the Defendant’s claim for mesne profit. Renovation expenses, unlike utility expenses, government rate and rent, management fees, are normally shouldered by the landlord. There is evidence that the Plaintiff did pay for the said sum.

99.  Mr Fan for the Plaintiff also challenges on the credibility of the Informal Understanding and Arthur’s oral testimony on this issue. It was submitted that the Informal Understanding is not specifically pleaded. On balance, I am of the view that the Informal Understanding exists. However, if I am wrong on that, it really does not matter. The Plaintiff carries the burden to prove the existence of the 1998 Oral Agreement and the 2001 Representations which she fails to discharge.

100.  Mr Fan for the Plaintiff also submitted that Arthur’s oral evidence that Madam Lau voluntarily retired from Lana is different and inconsistent with what he stated in his witness statement that he exercised “an executive decision to dismiss Madam Lau as she could no longer fulfil her supposed role in the business.” I agree with Mr Fan. However, the Court has to assess the parties’ evidence holistically. The fact that a witness lied on a specific issue which is not directly relevant to the issues to be determined is not determinative of the overall credibility of the witness. Overall, I do accept that Arthur’s evidence in relation to the major factual issues to be credible.

101.  By an order dated 28 February 2020, the rental valuation evidence is agreed. I agree that the period of mesne profit should run from 7 August 2015 (per the Informal Understanding).

DISPOSITION

102.  Accordingly, I make the following orders:

(1)  The Plaintiff’s claims be dismissed.

(2)  A declaration that the Defendant is entitled to vacant possession of the I-Feng Property and the Fook Shing Property.

(3)  The Plaintiff do deliver up vacant possession of the I-Feng Property and the Fook Shing Property within 28 days herein.

(4)  For the Fook Shing Property, the Plaintiff do pay the sum of HK$3,872,071.60 to the Defendant for the period from 7 August 2015 to 27 December 2022 inclusive, and thereafter at HK$50,500 per month until the delivery up of the property.

(5)  For the I-Feng Property, the Plaintiff do pay the sum of HK$960,170 to the Defendant for the period from 7 August 2015 to 27 December 2022 inclusive, and thereafter at HK$11,500 per month until the delivery up of the property.

(6)  The registration of the Writ of Summons in the present proceedings in the Land Registry with the memorial no.17102300570019 against the I-Feng Property and the Fook Shing Property be vacated forthwith.

(7)  The Plaintiff do pay costs of this action to the Defendant, on a party to party basis, to be taxed if not agreed.

103.  For the sake of completeness, I should mention that I have considered all the submissions of the parties as set out in their respective rounds of Opening and Closing Submissions. I do not find it necessary to deal with each individual points and/or sub-points raised by the parties.

104.  Finally, I thank Mr Fan and Ms Seto for the Plaintiff and Mr Ah-weng and Mr Lam for the Defendant for their assistance in this trial.