NG YEE YUNG v. KWOK KWOK YU

HCA 1677/2018

[2023] HKCFI 2500

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1677 OF 2018

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REASONS

FOR

JUDGMENT

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INTRODUCTION

1.  In the present trial, the Plaintiff, Ng Yee Yung, claims against the Defendant, Kwok Kwok Yu, for the repayment of a loan in the sum of HK$4,000,000 with interest (“the Loan”) pursuant to a written deed of loan dated 11 May 2017 duly witnessed by a solicitor, Mr Henry H C Wong (“the Loan Agreement”).

2.  There is no dispute that the Defendant has not repaid any of the loans, whether principal or interest, under the Loan Agreement.

3.  On or about 30 November 2017, one Kwok Kar Industries Limited, a company to which the Defendant is a director, issued a cheque (Draft No. 063080) payable to E. Tech Management (HK) Limited (“E. Tech”), a company to which the Plaintiff and her husband are the shareholders, for HK$5,397,166.00 (being the HK$4,000,000 and the accumulated interest as at that date) (“the Cheque”) for the repayment of the Loan by the Defendant to the Plaintiff, with interest accrued to that date.

4.  On or about 9 January 2018, the Plaintiff was notified by the bank that the Cheque was dishonoured and return the Cheque to the Plaintiff.

5.  On 11 October 2018, the Plaintiff issued the writ in the present action.

6.  On 25 January 2019, the Defendant filed a Defence and Counterclaim and alleged that the Loan Agreement was subject to an oral agreement in the following terms:

“(a) In or around May 2017, the Defendant informed the Plaintiff that he was participating as an intermediary in a business transaction involving large sums of money (the “Business Transaction”). The Defendant further informed the Plaintiff that, as the intermediary of the Business Transaction, he was required to cover certain fees and expenses, but will be well remunerated if the Business Transaction succeeds.

(b) The Plaintiff agreed to lend to the Defendant HK$4,000,000 for the purpose of funding the intermediary work in the Business Transaction, and the Plaintiff and the Defendant made an agreement orally on the following terms:

(i)     The Plaintiff lends HK$4,000,000 to the Defendant on or before 12 May 2017;

(ii)    The monthly interest rate is 3.5%;

(iii)   The debt, consisting of the principal of HK$4,000,000 and monthly interest at a rate of 3.5% (the “Debt”), will only become due at the conclusion of the Business Transaction;

(iv)   The Defendant will not have any obligations to repay the Plaintiff until the Plaintiff has completed her payment of the principal amount of HK$4,000,000;

(v)    If the Business Transaction is cancelled or fails, the Debt will immediately become due; and

(vi)   If the Business Transaction succeeds and the Defendant is paid the compensation for this intermediary work, the principal and interest will immediately become due. The Defendant also promised to enter into discussions to invest in the Plaintiff’s metal recycling business in the event the Business Transaction succeeds. (the “Oral Agreement”) (Emphasis added.) (Paragraph 3 of the Defence and Counterclaim)”

7.  Under the Loan Agreement, the Loan has to be repaid on or before 28 May 2017, a very specific date. This is contrary to the allegations as set out in the Oral Agreement as pleaded by the Defendant.

8.  As far as the Loan Agreement is concerned, the Defendant’s pleaded case is that:

“The Defendant did not know any English. He asked the Plaintiff to translate the Agreement to him. In order to induce the Defendant to make the Agreement, the Plaintiff orally misrepresented to the Defendant that the terms of the Agreement simply reduced the terms of the Oral Agreement to writing (the “Misrepresentation”).” (Paragraph 4(b) of the Defence and Counterclaim)

9.  The Plaintiff and the Defendant exchanged witness statements on 27 October 2020. The Plaintiff also filed and served the witness statement of Wong Ho Cheong Henry (“Mr Wong”), the solicitor who witnessed the parties’ execution of the Loan Agreement on 28 October 2020.

10.  Both the Plaintiff and the Defendant acted in person in this trial.

11.  On 21 September 2023, two working days before the commencement of this trial, the Defendant, by way of letter, applied to this Court to have this trial adjourned because he has medical conditions which would prevent him from attending the trial. However, he only attached a medical examination record.  This Court directed him to produce a medical certificate from a medical doctor to certify that he was not fit to attend this trial.  The Defendant failed to response to this Court’s direction.

12.  The medical examination record only shows that due to chest pain, the Defendant had undergone certain medical examinations.  I am of the view that it is not enough to have the trial adjourned on this basis. The Plaintiff also objects to the application for adjournment.

13.  As the Defendant has produced no cogent and reliable medical certificates to prove that he was unfit to attend this trial, his application to adjourn the trial is dismissed.

ANALYSIS OF EVIDENCE AND DETERMINATION

14.  First, the Plaintiff gave evidence in court and I see no reason to disbelieve her evidence.  In the absence of the Defendant’s challenge to her evidence, her evidence stands unchallenged. In fact, I find her evidence convincing and believable.

15.  Secondly, what is critical and determinative in this trial is the evidence of Mr Wong, the solicitor who testified the parties’ execution of the Loan Agreement.  Mr Wong gave evidence in court and he testified that he personally translated the Loan Agreement word by word to the Defendant.  The Defendant was fully informed of the content of the Loan Agreement. Mr Wong further said that according to his recollection, the Defendant read the Loan Agreement, line by line, word by word, carefully and slowly.

16.  There is no reason for this Court to disbelieve Mr Wong who is an impartial and honest witness.

17.  In my view, Mr Wong’s evidence completely destroys the Defendant’s case of the Oral Agreement and the Misrepresentation.

18.  I am satisfied that the Defendant knew perfectly well that the Loan with interest had to be repaid on or before 28 May 2017.

19.  Thirdly, from the contemporaneous documents, in particular, the WhatsApp or WeChat messages dated 20 December 2019, it can be seen that the Defendant was asking time for repayment and was actually assuring the Plaintiff that the Loan would be repaid before March 2020.

20.  I have no doubt that the Defendant dishonestly fabricated a case so as to delay making legitimate repayment to the Plaintiff.

21.  For the above reasons, I find for the Plaintiff and am satisfied that the Plaintiff has proved her case. I also dismiss the Defendant’s Counterclaim.

22.  As far as the quantum of the damages is concerned, the Plaintiff is sensible and agreed that the actual amount advanced under the Loan Agreement is HK$3,879,140.00.

23.  I am satisfied that the Plaintiff is entitled to interest from 28 May 2017 to 19 July 2018 in the sum of HK$2,390,021.76.

24.  The total sum including the principal of HK$3,879,140.00 and interest accrued from 28 May 2017 to 25 September 2023 (the commencement date of this trial) on a simple interest of 3.5% per month is HK$14,197,652.40.

DISPOSITION

25.  Accordingly, I make the following orders:

(1)  The Defendant is to pay the Plaintiff the sum of HK$14,197,652.40 forthwith;

(2)  The Defendant’s Counterclaim is dismissed;

(3)  The Plaintiff is entitled to interest at the judgment rate from the date hereof;

(4)  The Defendant is to pay the costs of and occasioned by the Plaintiff in this action (including the Defendant’s Counterclaim) on a party to party basis, to be taxed if not agreement, to the Plaintiff.