CENTALINE PROPERTY AGENCY LTD v. LIU WING YAN

DCCJ 4290/2022

[2024] HKDC 1466

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 4290 OF 2022

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BETWEEN

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JUDGMENT

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A. Introduction

1.  This action is concerned with the outstanding commission in respect of a derailed conveyancing transaction.

2.  The crux of the parties’ dispute concerns what was verbally agreed at the meeting that took place on 1 September 2017 (the “1 September 2017 Meeting”).

3.  In the present trail, Ms Shannon Leung represents the Plaintiff, and Mr Sik Chee Ching represents the Defendant.

B. Material Background

4.  The Plaintiff is a well-known company that offers real estate agency services in Hong Kong.

5.  Ms Ayumi Tang was at all material times an estate agent[1] working at the Plaintiff’s branch on Castle Road. She reported to Mr Alexander Kan, who was the Plaintiff’s senior district manager[2].

6.  On 3 August 2017, the Defendant (as purchaser), Ms Elizabeth Wong (as seller) and the Plaintiff (as estate agent) entered into a standard preliminary sale and purchase agreement (the “Baguio Villa PSPA”). It was agreed that the Defendant should purchase, and Ms Wong should sell, Flat D, 13^th Floor, Bock D, Baguio Villa, No 555 Victoria Road (the “Baguio Villa Property”)[3] at the consideration of HK$16.7 million.

7.  The following provisions of the Baguio Villa PSPA are pertinent for the purposes of the Plaintiff’s claims in this action:-

(1) Clause 11 provided that the Defendant and Madame Wong should respectively pay the Plaintiff a commission of HK$167,000 (totally HK$334,000).

(2) Clause 12 provided that if a party failed to complete the transaction, she should forthwith compensate the Plaintiff in regard to the total commission payable by both parties (ie HK$334,000).

8.  As admitted by the Defendant and her husband (namely Mr Cheung Ka Po (“Mr Cheung”)), the Defendant presented a dishonoured cheque in respect of the first deposit payment of HK$500,000. This constituted repudiation, and Ms Elizabeth Wong accepted the same on 8 August 2017[4].

9.  It is common ground that the Defendant failed to complete the transaction under the Baguio PSPA, and thus she was prima facie liable to pay a sum of HK$334,000 to the Plaintiff pursuant to clause 12 of the Baguio PSPA.

10.  The contemporaneous WhatsApp messages show that after the transaction under the Baguio Villa PSPA derailed, Ms Ayumi Tang continued to introduce properties to the Defendant. One of these properties was Flat A, 9^th Floor, Emerald Garden, 86 Pok Fu Lam Road (the “Emerald Garden Property”) ^[5].

11.  It is not in dispute that in the evening on 1 September 2017, the Defendant and Ms Ayumi Tang had a meeting at Pure Yoga Centre in Asia Standard Tower on Queen’s Road Central. This was the 1 September 2017 Meeting, and the purpose thereof was concerned with putting forward an offer to the owner of the Emerald Garden Property.

12.  According to the Defendant[6]:-

(1) Ms Ayumi Tang asked or persuaded her to put forward an offer to purchase the Emerald Garden Property at HK$17.2 million and to draw a cheque of HK$800,000 to demonstrate her sincerity to the owner. Although the Defendant doubted whether the owner genuinely intended to sell, she took the view that there was no harm to try.

(2) At the 1 September 2017 Meeting, the Defendant asked Ms Ayumi Tang about the outstanding commission payable under the Baguio PSPA, and Ms Ayumi Tang told the Defendant it was likely that the Plaintiff would hold her liable.

(3) In the circumstances, the Defendant and Ms Ayumi Tang had a discussion with Mr Alexander Kan over the phone. During the discussion, Mr Alexander Kan together with Ms Ayumi Tang agreed that if the Defendant were to purchase a property through the Plaintiff within the near future, the Plaintiff would not seek to recover the outstanding commission pursuant to the terms of the Baguio PSPA.

(4) In reliance of the said agreement and/or assurance, the Defendant put forward an offer proposing to purchase the Emerald Garden Property. She signed the draft preliminary sale and purchase agreement and drew a cheque of HK$800,000.

13.  According to Ms Ayumi Tang[7]:-

(1) On 31 August 2017, the Defendant agreed that she would offer to purchase the Emerald Garden Property at HK$17.2 million. As such, the purpose of the 1 September 2017 Meeting was to arrange for the Defendant to sign the draft preliminary agreement, which would be presented to the owner of the Emerald Garden Property.

(2) During the 1 September 2017 Meeting, the Defendant asked about the outstanding commission under the Baguio PSPA, and the Defendant was informed that the Plaintiff would hold her liable.

(3) In the circumstances, the Defendant proposed that the outstanding commission under the Baguio PSPA be waived in the event that she successfully purchased the Emerald Garden Property.

(4) The Defendant’s proposal was acceptable to Ms Ayumi Tang. She took into account that (i) she could share the commission received by the Plaintiff if the Defendant successfully purchased the Emerald Garden Property; and (ii) she could keep a good relationship with the Defendant.

(5) In the circumstances, Ms Ayumi Tang, using the loud speaking function of her mobile phone, made a call to her supervisor, ie Mr Alexander Kan, in the presence of the Defendant. During the discussion, Ms Tang asked Mr Kan whether the Plaintiff could waive the outstanding commission payable under the Baguio PSPA if the Defendant successfully purchased the Emerald Garden Property through her. In response, Mr Kan said that there should be no problem, and he could make an application to the Plaintiff.

14.  After the 1 September 2017 Meeting ended, at 8:59 pm on the same day, the Defendant sent the following message to Ms Ayumi Tang:-

“Ayumi- please ensure that as approved by your senior management today, if the purchase of Emerald Garden 9A is successful, Centaline has agreed and will waive all costs of the previous provisional agreement of BV. Thanks”[8]

15.  At 9:44 pm on the same day, Ms Ayumi Tang unequivocally responded: “Confirm”[9]. In the meantime, Ms Tang also sent an emoji showing “thump up”. In response, at 12:42:25, the Defendant stated “Thx for [your] help. Wait for your goods news!”

16.  It transpired that the intended acquisition of the Emerald Garden Property did not materialize as the owner did not accept the Defendant’s offer.

17.  Unbeknownst to Ms Ayumi Tang and Mr Alexander Kan, as early as 19 August 2017 the Defendant started liaising with two estate agents who worked at the Plaintiff’s branch on Bonham Road, namely Mr Kenny Au-Yeung and Ms Eva Yip.

18.  On 9 September 2017, the Defendant, through Mr Kenny Au-Yeung and Ms Eva Yip, entered into a preliminary sale and purchase agreement with the owner of Flat A, 22^nd Floor, Kenyon Court, 50 Bonham Road (the “Kenyon Court Property”). It was agreed that the Defendant should purchase the Kenyon Court Property for the consideration of HK$17.28 million. The Plaintiff (as estate agent) was also a party to the said preliminary sale and purchase agreement.

19.  It is not in dispute that the sale and purchase in respect of the Kenyon Court Property duly completed, and the Plaintiff received commissions in respect of this transaction.

20.  Meanwhile, Ms Ayumi Tang continued to introduce properties to the Defendant. These included the Baguio Villa Property, which was put on sale again at a higher price after Ms Elizabeth Wong accepted the Defendant’s repudiation of the previous Baguio Villa PSPA.

21.  On 13 September 2017, Ms Tang sent a voice mail to the Defendant through WhatsApp seeking to persuade her to put forward a fresh offer in respect of the Baguio Villa Property. On 15 and 18 September 2017, Ms Tang chased the Defendant for a response. As indicated in her WhatsApp message on 19 September 2017 at 1:06 pm, the Defendant was not interested.

22.  On 19 September 2017 at 1:15 pm , the Defendant sent the following WhatsApp message to Ms Ayumi Tang:-

“Ok. We will continue to look for other options. As confirmed previously, please ensure that Centaline has agreed to waive all costs of the previous provisional agreement of BV if we successfully purchase another flat through Centaline in the short terms.[10]”

23.  Ms Ayumi Tang did not respond to the said WhatsApp message from the Defendant.

24.  Whilst the Defendant alleges Ms Ayumi Tang knew that she purchased the Kenyon Court Property[11], Ms Ayumi Tang denied that this was the case[12]. In this connection, it is noteworthy that as of 26 September 2017, Ms Tang was still introducing properties to the Defendant, and she expressly asked whether the Defendant was interested[13]. None of the WhatsApp messages shows that the Defendant had informed Ms Tang about her purchase of the Kenyon Court Property.

25.  As evidenced by the Defendant’s WhatsApp message to her husband on 29 September 2017, she blocked Ms Ayumi Tang on WhatsApp, and as such Ms Tang could no longer contact her.

26.  On 28 July 2022 and 4 August 2022, the Plaintiff issued letters to the Defendant demanding her to pay the outstanding commission of HK$334,000 pursuant to clause 12 of the Baguio Villa PSPA.

27.  The Plaintiff commenced the present action on 3 November 2022.

28.  In her defence dated 20 December 2022, the Defendant pleads that[14]:-

(1) In light of the agreement or consensus amongst Ms Ayumi Tang, Mr Alexander Kan and the Defendant at the 1 September 2017 Meeting, the Plaintiff has waived the outstanding commission of HK$334,000 payable under the Baguio Villa PSPA.

(2) In reliance on the promise or guarantee from the Plaintiff’s Ms Ayumi Tang and Mr Alexander Kan, the Defendant entered into the preliminary sale and purchase agreement for acquiring the Kenyon Court Property at HK$17.28 million. Thus, the Plaintiff is estopped from claiming the outstanding commission payable under the Baguio Villa PSPA.

(3) Due to the Plaintiff’s inaction or delay, the Plaintiff’s claim is barred by operation of the doctrines of waiver, acquiescence and/or laches.

C. Witnesses

29.  The Plaintiff adduces evidence from (i) Ms Ayumi Tang; (ii) Mr Alexander Kan; (iii) Ms Kama Ngai (who works for the Plaintiff as an assistant legal manager); and (iv) Mr Horus So (who works for the Plaintiff as a legal assistant).

30.  The Defendant adduces evidence from (i) herself; and (ii) her husband, ie Mr Cheung.

D. Legal Principles on Assessing Credibility

31.  In Lee Fu Wing v Yan Paul Po Ting [2009] 5 HKLRD 513 at 524, DHCJ Au (as Au JA then was) set out the well-established approach on assessing credibility. In the course of assessing the credibility of a party’s case, the Court shall consider the following matters:

(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.

32.  In the context of adjudicating a dispute in relation to an alleged oral agreement or understanding, in Joint and Several Trustees of Yeung Wing Sing v Yeung Wing Sing & Anor [2021] HKCFI 2018, at para 26, Yvonne Cheng J pointed out that:

(1) contemporaneous written documents and documents which came into existence before the problems in question emerged are of the greatest importance in assessing credibility;

(2) in deciding whether to accept a witness’ account, importance should also be attached to the inherent likelihood or unlikelihood of an event having happened, or the apparent logic of events;

(3) care should be taken in regard to the consistency of the witness’ evidence with undisputed or indisputable evidence, and the internal consistency of the witness’ evidence;

(4) care should be taken in drawing conclusions about truthfulness and reliability solely or mainly from the appearance of a witness or from the assessment of a witness’ character; and

(5) witnesses’ credibility should be tested by reference to the objective facts proved independently of their testimony, and regard should be had to their motives and to the overall probabilities.

33.  The aforesaid approach is well-established: see eg Siu Miu Hua v Wu Ching Kuen [2024] HKCFI 232, para 84 (per Keith Yeung J); Hui Chi Ming v Koon Wing Yee [2023] HKCFI 93 at para 147; Salleh Abu Baker v Anway Ltd [2021] HKCFI 3407 at para 12 (per Recorder William Wong SC). I will apply the same in assessing the credibility of the parties’ case and their assertions.

E. Deliberation

E1. What was agreed at the 1 September 2017 Meeting?

34.  The crux of the parties’ dispute is whether at the 1 September 2017 Meeting, Ms Ayumi Tang and Mr Alexander Kan agreed with the Defendant that the Plaintiff would waive the outstanding commission payable under the Baguio PSPA:

(1) if the Defendant successfully purchased the Emerald Garden Property through Ms Ayumi Tang (which is the Plaintiff’s case); or

(2) so long as the Defendant purchased a property through the Plaintiff within a reasonable time (which is the Defendant’s case).

35.  Having considered the inherent probabilities, the objective circumstances surrounding the parties’ dispute, the apparent logic of events, the contemporaneous WhatsApp messages, the evidence of the witnesses and the submissions from counsel, I am of the view that the Plaintiff’s case is preferable to the Defendant’s case.

36.  First of all, I am of the view that the inherent probabilities lie in favour of the Plaintiff’s case and against Defendant’s case:-

(1) Ms Ayumi Tang and Mr Alexander Kan were the ones who reached the agreement with the Defendant at the 1 September 2017 Meeting. Apart from the interest of the Plaintiff, Ms Tang and Mr Kan would have their own financial interest in mind when they liaised with the Defendant, and this was likely to be their foremost concern.

(2) It is not seriously in dispute that (i) Ms Tang and Mr Kan were entitled to share the commission to be received by the Plaintiff under the Baguio Villa PSPA; and (ii) unless a successful purchase was procured and/or handled by Ms Tang and/or Mr Kan, they would not be entitled to share the commission received by the Plaintiff. In this connection, Ms Tang and Mr Kan’s evidence is neither contradicted nor seriously challenged.

(3) In the circumstances, Ms Tang and Mr Kan had no commercial reason to agree that the commission payable under the Baguio Villa PSPA be waived so long as the Defendant purchased a property through the Plaintiff, regardless of whether the estate agent who procured or handled the future transaction was Ms Tang or not. In this connection, I accept the evidence of Ms Tang as well as Mr Kan, and I agree that they would not have consented to the agreement alleged by the Defendant in these proceedings. I do not see any reason why Ms Tang and Mr Kan would risk giving up their own financial interest. They could not be so altruistic. In my view, the Defendant’s case does not make commercial sense.

(4) Furthermore, it is important not to lose sight that the purpose of the 1 September 2017 Meeting was concerned with putting forward an offer for purchasing the Emerald Garden Property. As admitted by the Defendant when she gave oral evidence, she met Ms Ayumi Tang on 1 September 2017 in order to sign the draft preliminary sale and purchase agreement in respect of the Emerald Garden Property. The Defendant’s admission is consistent with Ms Tang and Mr Kan’s evidence that the parties’ discussion during the 1 September 2017 Meeting did not touch upon other intended acquisitions (which I accept). It is hardly disputable that the Emerald Garden Property was what the parties focused on when the telephone conversations took place. In my view, this is an important circumstantial factor that supports the Plaintiff’s case that the parties’ agreement at the 1 September 2017 Meeting was confined to the Emerald Garden Property.

(5) Bearing in mind (i) the financial interest on the part of Ms Ayumi Tang and Mr Alexander Kan; and (ii) the purpose of the 1 September 2017 Meeting (which was concerned with the intended acquisition of the Emerald Garden Property), it was inherently unlikely that Ms Tang and Mr Kwan would agree so long as the Defendant purchased a property through the Plaintiff in the future (regardless of the handling estate agent), the commission payable under the Baguio SPA would be waived.

37.  Second, the Defendant’s case is flatly contradicted by her own WhatsApp message to Ms Ayumi Tang on 1 September 2017 at 8:59 pm. This WhatsApp message indeed supports the Plaintiff’s case:

(1) As pointed out in paragraph 14 above, shortly after the 1 September 2017 Meeting, the Defendant sent the said WhatsApp message to Ms Ayumi Tang seeking her confirmation that the Plaintiff would waive the commission under the Baguio Villa PSPA “if the purchase of [the Emerald Garden Property] is successful”. In response, Ms Tang unequivocally indicated that this was confirmed.

(2) The WhatsApp messages between the Defendant and Ms Ayumi Tang on 1 September 2017 are the best contemporaneous evidence that shows the parties’ agreement at the 1 September 2017 Meeting.

(3) Contrary to the Defendant’s assertion, not an iota of the parties’ WhatsApp messages on 1 September 2017 suggested that the Plaintiff would waive the commission under the Baguio Villa PSPA so long as the Defendant purchased a property via the Plaintiff. In contrast, the WhatsApp messages show that the Plaintiff’s concession was confined to the Defendant’s intended acquisition of the Emerald Garden Property, which was handled by Ms Ayumi Tang.

(4) I am not impressed by the Defendant’s explanation regarding her WhatsApp message on 1 September 2017 at 8:59 pm, and I cannot see how she may wriggle out of it. The Defendant received tertiary education, and used to be the marketing manager of a leading accounting firm that offers auditing and consultancy services. The Defendant’s WhatsApp messages with Ms Ayumi Tang and her husband show that she was capable of articulating herself in English effectively[15]. Bearing in mind that the purpose of the Defendant’s WhatsApp message on 1 September 2017 at 8:59 pm was to confirm the parties’ verbal agreement and that the Defendant’s financial interest was at stake, I am of the view that the Defendant was careful in drafting the message, and it could not be the case that she casually sent out the message without considering the accuracy of the contents.

(5) In my view, had the parties agreed that the waiver been applicable to other properties purchased via the Plaintiff in the future, such agreement would have been recorded in and/or reflected by the WhatsApp message on 1 September 2017 at 8:59 pm. This was not the case.

(6) In this connection, I reject the following oral evidence from Defendant. She said that at the 1 September 2017 Meeting, she expressly indicated to Ms Ayumi Tang that she was skeptical about the prospect of being able to purchase the Emerald Garden Property at HK$17.25 million, and eventually Ms Ayumi Tang and Mr Alexander Kan agreed that even if the intended purchase of the Emerald Garden Property failed, the agreement to waive the commission under the Baguio Villa PSPA would be applicable so long as she purchased a property via the Plaintiff at a similar price within a reasonable time.

(7) In light of the Defendant’s skepticism about the prospect of acquiring the Emerald Garden Property at an acceptable price, she knew there was a real possibility that she would purchase another property at the end of the day. As such, the Defendant had every reason to ensure her WhatsApp message would record that the waiver was applicable to other properties. I cannot see any convincing reason why the Defendant did not write down this alleged consensus. The most probable explanation was that no such consensus existed.

38.  Third, I am of the view that the Defendant’s WhatsApp message to Ms Ayumi Tang on 19 September 2017 was self-serving, and the same would not avail the Defendant’s case:-

(1) As pointed out in paragraph 22 above, in her WhatsApp message on 19 September 2017 at 11:15 pm the Defendant stated (i) that she would look for other options; and (ii) that Ms Tang should ensure the Plaintiff had agreed to waive the commission payable under the Baguio Villa PSPA if she purchased another property through the Plaintiff within a short period of time. However, as of 19 September 2017, the Defendant had already entered into a preliminary sale and purchase agreement for acquiring the Kenyon Court Property through Mr Kenny Au-Yeung and Ms Eva Yip.

(2) I cannot see how the Defendant may capitalize on Ms Ayumi Tang’s silence. In this regard, I accept Ms Tang’s evidence. She said that although the Defendant’s assertion in her WhatsApp message on 19 September 2017 was incorrect, she did not wish to rebut her as bad feeling might arise and their relationship might be damaged. Ms Tang also emphasized she was all along led to believe that she was the only estate agent engaged by the Defendant. Ms Tang’s evidence makes sense, and is consistent with the undisputed facts and the objective circumstances. Had Ms Tang known that the Defendant had already entered into the preliminary sale and purchase agreement in respect of the Kenyon Court Property, she would not have persuaded the Defendant to put forward a fresh offer in respect of the Baguio Villa Property; nor would she have kept introducing properties to the Defendant until 26 September 2017[16]. In the circumstances, there is no question that Ms Ayumi Tang wished to have business dealing with the Defendant, and it was understandable as to why she did not wish to engage in an argument with her. There is no room to suggest that Ms Tang did not respond to the Defendant’s WhatsApp message on 19 September 2017 at 1:15 pm because she agreed with the contents thereof. This was not the case.

(3) The Defendant’s WhatsApp message on 19 September 2017 at 1:15 pm was plainly inconsistent with her previous WhatsApp message on 1 September 2017 at 8:59 pm. In my view, the Defendant issued the said message on 19 September 2017 at 1:15 pm because she wished to renege from the agreement at the 1 September 2017 Meeting (which was evidenced or reflected by her previous WhatsApp message on 1 September 2017 at 8:59 pm). It appears to me that the Defendant generated the message on 19 September 2017 in a self-serving manner in order to advance her financial interest.

(4) It also appears to me that the Defendant did not want Ms Ayumi Tang to find out that she purchased the Kenyon Court Property through other estate agents. This was why she said to Ms Tang that she would continue to look for other options when she had already entered into a preliminary sale and purchase agreement in respect of the Kenyon Court Property. It is obvious that the Defendant did not seek to have an honest and candid discussion with Ms Tang.

39.  Fourth:-

(1) As mentioned, in her voice mail on 13 September 2017, Ms Ayumi Tang sought to convince the Defendant to put forward a fresh offer in respect of the Baguio Villa Property (which was put on sale again at a higher price). Ms Tang said that the parties could create a win-win situation, and she reminded the Defendant that the Plaintiff would hold her liable for the outstanding commission under the previous Baguio Villa PSPA.

(2) Had the Defendant’s allegations in these proceedings been true, she would have said to Ms Tang that she had already fulfilled the conditions of the parties’ agreement by purchasing the Kenyon Court Property through the Plaintiff, and thus the Plaintiff was no longer entitled to claim the outstanding commissions under the previous Baguio Villa PSPA.

(3) Instead of doing so, in her message on 19 September 2017 at 1:15 pm, the Defendant suggested to Ms Tang that she would look for other options. This suggestion was plainly untrue. On 29 September 2017, the Defendant even blocked Ms Tang on WhatsApp.

(4) The Defendant was unable to provide any meaningful explanation as to her conduct when she was cross-examined. The Defendant said, inter alios, that she wished to keep things simple, that it was uncertain as to whether the transaction in respect of the Kenyon Court Property would complete, that she had already fulfilled the contractual conditions, and that whilst Ayumi Tang kept promoting the Baguio Villa Property to her, she wished to forget about this property, about which she had a bad experience.

(5) The Defendant’s husband, ie Mr Cheung, had provided comments on the WhatsApp message on 19 September 2017 at 1:15 pm before the Defendant sent out the same to Ms Ayumi Tang. As evidenced by his WhatsApp message on 13 September 2013, Mr Cheung asked the Defendant to ignore Ms Tang. When Mr Cheung gave oral evidence, he reiterated that that Ms Tang was annoying and that there was a risk the transaction in respect of the Kenyon Court Property might derail. Mr Cheung also said it was believed that a senior managerial staff at the Plaintiff’s branch on Robinson Road (who was probably Mr Alexander Kan) knew about the Defendant’s purchase of Kenyon Court Property. However, there is no suggestion that the Defendant and/or Mr Cheung had taken steps to find out whether the alleged senior managerial staff was Mr Alexander Kan or not; nor is there any evidence showing that the Defendant and/or Mr Cheung had informed Mr Kenny Au-Yeung and Ms Eva Yip about the agreement that was reached during the 1 September 2017 Meeting (such that they would provide an update to the alleged senior managerial staff). Mr Cheung simply made a bare assertion that is not corroborated by any evidence.

(6) In my view, all the explanations provided by the Defendant and Mr Cheung were unconvincing and incredible. They hardly explained or justified the Defendant’s conduct at the time.

(7) I agree with Ms Leung that had the aforesaid allegations made by Defendant and Mr Cheung been true, what they would have done was to inform Ms Ayumi Tang that they were in the course of purchasing the Kenyon Court Property, and as such pursuant to the parties’ agreement at the 1 September 2017 Meeting, the Plaintiff should not take action regarding the outstanding commission under Baguio Villa PSPA until the purchase of the Kenyon Court Property completed. In my view, this was what a bona fide and honest person would have done in the circumstances.

(8) I also agree with Ms Leung’s submissions the truth was that the Defendant did not want Ms Ayumi Tang to find out about her purchase of the Kenyon Court Property as she was concerned that Ms Tang might cause the Plaintiff to take action against her immediately. This was why the Defendant made an untrue allegation to Ms Tang and avoided having contact with her subsequently.

40.  For completeness, I shall also address the following points advanced on the Defendant’s behalf:-

(1) Mr Sik (doing his best to advance the Defendant’s interest) criticizes the Plaintiff for not producing the records in the internal file and/or internal system in respect of the present matter. He suggests the records may show that the Plaintiff was aware of the Defendant’s address (ie the Kenyon Court Property) as early as 2018. As such, the Defendant’s inaction until July 2022 was inexplicable, and it shows that the Plaintiff might appreciate some valid reasons why it was not entitled to sue the Defendant. For the following reasons, I disagree with Mr Sik’s criticism and suggestion:-

(a) I accept Ms Kama Ngai’s evidence that the Plaintiff’s internal file and/or system contained privileged information[17], and the Plaintiff received legal advice that the same should not be produced. As will be further elaborated below, I am of the view that Ms Ngai is a credible witness, and I do not believe that an employee in her position will venture to lie on oath in order to advance the interest of her employer.

(b) I disagree with the suggestion that the Plaintiff’s internal system and/or file might contain informing showing that the Plaintiff’s legal department (which was responsible for handling outstanding commissions) knew about the Defendant’s address in 2018. Mr Sik’s suggestion is speculative and without foundation. As will be further elaborated below in paragraph 52, the evidence shows, and I find, that the Plaintiff’s legal department only found out the Defendant’s address in July 2022 when Ms Kama Ngai carried out investigation.

(c) Furthermore, the suggestion that the Plaintiff might appreciate some valid reasons as to why it was not entitled to sue the Defendant is also entirely speculative and without basis.

(d) Taking all the circumstances into account, I am not of the view that the Plaintiff was reasonably expected to produce the records in its internal file and/or system, and I refuse draw an adverse inference against the Plaintiff.

(e) In any event, bearing in mind the overwhelming circumstantial factors and evidence against the Defendant’s case as discussed hereinabove, the criticism and submissions made by Mr Sik, even if accepted, are not capable of swaying me to accept the Defendant’s case (which is materially incredible in multiple respects).

(2) Mr Sik also submits that had the Plaintiff’s case been true, the Defendant would not have purchased the Kenyon Court Property through other estate agents, thereby exposing herself to liabilities. In response, Ms Leung draws my attention to the WhatsApp messages exchanged between the Defendant and Mr Cheung on 4 and 6 September 2017. These messages show that the Defendant and Mr Cheung were very attracted to the Kenyon Court Property for multiple reasons (such as the location, the layout, the outlook of the building and the price). Mr Cheung even expressly said that he felt excited. In the circumstances, it appears that the Defendant and Mr Cheung were very fond of the Kenyon Court Property back in September 2017, and they were eager to complete the purchase. In the circumstances, there were reasons why the Defendant would purchase the Kenyon Court Property despite the agreement at the 1 September 2017 Meeting. I am unable to infer that the Defendant’s allegations in these proceedings were true because she purchased the Kenyon Court Property.

(3) I disagree with Mr Sik’s criticism of Ms Ayumi Tang’s evidence regarding the 1 September 2017 Meeting. I have carefully considered Ms Tang’s witness statement and oral evidence. Ms Tang’s evidence, when properly understood in context, is as follows:-

(a) What Ms Tang meant in paragraph 12 of her witness statement was that in her mind, she was agreeable that the outstanding commission under the Baguio Villa PSPA be waived so long as the Defendant purchased a property through her as she could share the commission and kept a good relationship with the Defendant.

(b) However, this was not what was said and/or discussed at the 1 September 2017 Meeting, which focused on the intended purchase of the Emerald Garden Property.

(c) At the time when the 1 September 2017 Meeting took place, the parties knew and/or presumed that if the intended purchase of the Emerald Garden Property succeeded, Ms Tang could share the commission as she was the handling agent.

(d) It was in these circumstances that the Defendant, Mr Alexander Kan and Ms Tang agreed that if the intended purchase of the Emerald Garden Property (which was handled by Ms Tang) succeeded, the outstanding commission payable pursuant to the Baguio Villa PSPA would be waived.

I am of the view that Ms Tang’s evidence regarding the 1 September 2017 Meeting makes perfect sense, and is consistent with the analysis set out in paragraph 36 above. I accept Ms Tang’s evidence.

41.  For the above reasons, I accept the Plaintiff’s case, and I reject the Defendant’s case. I find that:-

(1) At the 1 September Meeting, Ms Ayumi Tang and Mr Alexander Kan agreed with the Defendant that if she successfully purchased the Emerald Garden Property, the Plaintiff would waive the commission which the Defendant was liable to pay pursuant to the terms of the Baguio Villa PSPA.

(2) Ms Ayumi Tang and Mr Alexander Kan had never agreed with the Defendant that so long as she purchased a property through the Plaintiff in the near future, the Plaintiff would waive the commission under the Baguio Villa PSPA.

E2. Promissory Estoppel

42.  It is trite that in order to rely on the doctrine of promissory estoppel, there must a promise, assurance or representation from a party that it will not insist on enforcing its legal rights, and the other party acts in reliance thereon in a manner that would render it unconscionable for the party making the promise, assurance or representation to renege: see Luo Xing Juan v Estate of Hui Shui See Willy (2009) 12 HKCFAR 1 at paras 55-57 (per Ribeiro PJ); Bank of Communications Co Ltd v Victory Season Ltd [2024] HKCFI 580 at para 35 (per DHCJ Reyes SC).

43.  Following the findings and analysis set out in Section E1 above, the Defendant’s defence based on promissory estoppel fails.

44.  The Defendant did not purchase the Emerald Garden Property and her purchase of the Kenyon Court Property had nothing to do with Ms Ayumi Tang. As such, the agreement reached at the 1 September 2017 Meeting (or the promise or assurance from Ms Ayumi Tang and Mr Alexander Kan) were inapplicable and irrelevant. There is accordingly no basis for the Defendant to suggest that the Plaintiff is estopped from claiming the commission of HK$334,000 pursuant to clause 12 of the Baguio Villa PSPA and/or that the Plaintiff has waived its contractual entitlement by reason of the events that took place at the 1 September 2017 Meeting.

E3. Waiver arising from Delay or Inaction

Legal Principles

45.  In order to succeed in establishing waiver, it will have to be shown that the party that is entitled to enforce a right makes a clear and unequivocal representation either by words or conduct that it will forgo such right: see Wilken & Ghaly: The Law of Waiver, Variation and Estoppel (3^rd Ed, 2012) at para 4.45; Large Land Investments v Cheung Siu Kwai [2003] 1 HKLRD 313 at 15(4) (per Yuen JA)

46.  If the conduct relied on is capable of more than one explanation, such conduct would be equivocal. Mere silence or inaction is of their nature equivocal: see Sealegend Holdings Ltd v China Taiping Insurance Hong Kong Co Ltd & Ors (CACV 238/2014, 18 September 2015) at para 40 (per Kwan JA, as Kwan VP then was); Fortisbank SA v Trenwick Internaitonal Ltd [2005] 1 Lloyd’s Report 464 at para 30(ii); and Allied Marine Transport Ltd v Vale Do Rio Doce Navegacao SA [1985] 1 WLR 925 at 937 and 941 (per Goff LJ, as Lord Goff then was).

47.  It has been suggested that “[i]nactivity, even if prolonged, is as likely to be attributable to carelessness as an intentioned act and pure inactivity will almost always be equivocal”: see Daily-Tech Hongkong Co Ltd v iAdvantage Ltd [2023] HKCFI 891 at para 29(3) (per DHCJ Roxanne Ismail SC), citing Wilken (supra) at para 8.21 and The Leonidas D [1985] 2 All ER 796 at 808.

Analysis

48.  The Defendant contends that by reason of the Plaintiff’s inaction until 22 July 2022, the Plaintiff must have waived its entitlement under the Baguio Villa PSPA.

49.  I reject the Defendant’s contention.

50.  In light of the authorities set out in paragraphs 45 to 47 above, I cannot see how the Defendant’s contention may succeed. The Plaintiff’s mere inaction was plainly equivocal. It could be attributable to carelessness or confusion. I am unable to infer that the Plaintiff had by inaction communicated to the Defendant that it elected to forego its contractual entitlement. This suggestion is not supported by the objective circumstances, and the Defendant is unable to point out any overt act on the part of the Plaintiff.

51.  In any event, it is important not to lose sight that the Plaintiff has been carrying on a sizeable operation involving hundreds of estates agents, and the Plaintiff’s estate agents handled a huge amount of transactions throughout the years. There is, in my view, nothing unusual about the fact that the Plaintiff’s administrative staff did not diligently pursue the receivables under an aborted transaction involving a modest sum that falls within the jurisdiction of the District Court.

52.  On the available evidence, I am of the view that the delay was ascribed to matters relating to the Plaintiff’s internal administration as well as the difficulty faced by the Plaintiff at the time. In this connection:-

(1) I accept Ms Ayumi Tang and Mr Alexander Kan’s evidence that they left it to the Plaintiff’s legal department to deal with the outstanding commission under the Baguio Villa PSPA. Their evidence makes sense to me. Ms Tang and Mr Kan were obviously not responsible for chasing bad debts, and they had every reason to focus their energy on locating business opportunities.

(2) I also accept Ms Ayumi Tang’s evidence that in around May 2008, she was contacted by a colleague of the Plaintiff’s legal department (ie Ms Anthea Koo), and she informed Ms Koo that the Defendant was not contactable and that she did not know the Defendant’s address. Ms Tang’s evidence is credible. It is consistent with the facts that (i) the Defendant did not provide her address in the Baguio Villa PSPA; (ii) the Defendant blocked Ms Tang on WhatsApp; and (iii) Ms Tang was not aware of the Defendant’s purchase of the Kenyon Court Property[18].

(3) It is true that the Defendant purchased the Kenyon Court Property through Mr Kenny Au-Yung and Ms Eva Yip who were estate agents working for the Plaintiff. However, it does not follow that the staff of the Plaintiff’s legal department would immediately know about this and appreciate the implication. The Plaintiff is not a monolith. It is a huge organization, and its staff in different departments and branches may not have regular contact with each other.

(4) According to Ms Kama Ngai (who resumed working for the Plaintiff as an assistant legal manager in May 2022):-

(a) In July 2022, Ms Samantha Leung (who was the Plaintiff’s chief legal manager) assigned her with the task of following up the outstanding commission under the Baguio Villa PSPA.

(b) Ms Athena Koo (who had resigned from the Plaintiff and emigrated to a foreign country) was previously responsible for this task. Ms Koo was unable to find out the address of the Defendant. In this connection, whilst Ms Koo did not have access to the Plaintiff’s internal database that contained information regarding, inter alios, properties transactions in Hong Kong and names of registered owners, Ms Ngai had partial access to this internal database.

(c) Upon searching the information relating to the Defendant in the Plaintiff’s internal database and verifying the information therein against the public records and documents obtained from the Lands Registry[19], it was discovered that the Defendant actually purchased the Kenyon Court Property via the Plaintiff after the Baguio Villa PSPA was rescinded.

(d) It was also discovered that the Defendant was still the registered owner of the Kenyon Court Property. Thus, it would be possible to locate her and serve legal documents on her.

(5) In my view, Ms Ngai is a credible witness who strived her best to provide information to the court. Her evidence makes sense to me, and I accept the same.

(6) I find that the Plaintiff’s legal department only found out about the Defendant’s purchase of the Kenyon Court Property and her address (which was the Kenyon Court Property) when Ms Kama Ngai (who had the benefit of accessing the Plaintiff’s internal database partially) carried out investigation in July 2022.

(7) I also find that the Plaintiff’s delay in bringing claims against the Defendant was ascribed to the following matters:-

(a) The Defendant’s conduct of avoiding Ms Ayumi Tang;

(b) The fact that Ms Ayumi Tang did not know about the Defendant’s address; and

(c) Ms Athena Koo’s inability to find out the Defendant’s address and her purchase of the Kenyon Court Property.

53.  In the premises, I reject the suggestion that the Plaintiff has abandoned its legal entitlement under the Baguio Villa PSPA. This suggestion is inconsistent with the evidence before me.

E4. Laches

Legal Principles

54.  As pointed out by DHCJ Kent Yee in Cheng Hung Kit v Tsoi Chik Sang Lawrence [2017] 4 HKLRD 579 at paras 51-57 (citing and applying Incorporated Owners of v Lam Kong Wan (CACV 158/2007, 12 December 2007) at para 7 (per Le Pichon JA); and Re Pauling’s Settlement Trusts [1964] Ch 303 at 353), the defences of laches and acquiescence have no application if the underlying cause of action is subject to a statutory limitation period. See also Mo Ying v Brillex Development Ltd [2014] 3 HKLRD 224 at paras 161-164, DHCJ Eugene Fung SC (as Recorder Eugene Fung SC then was)[20].

55.  In Fisher v Brooker [2009] 1 WLR 1764 at paras 64 and 79, Lord Neuberger stated:-

“64. … laches is an equitable doctrine, under which delay can bar a claim to equitable relief.”

“79. The argument based on laches faces two problems. The first is that as pointed out by David Richards J, laches only can bar equitable relief, and a declaration as to existence of a long-term property right, recognized as such, by statute, is not equitable relief. Secondly, in order to defeat Mr Fisher’s claims on the ground of laches, the respondents must demonstrate some acts during the course of the delay period which result in a balance of justice justifying the refusal of the relief…”

56.  In Lindsay Petroleum Co v Hurd (1873-74) LR 5 PC 221, 239-240 (which was cited and applied by Keith Yeung J in New Well Master Co Ltd v Tidjan Ananto [2021] HKCFI 2953 at para 130), Lord Seldbourne stated:-

“Now the doctrine of laches in Courts of Equity is not an arbitrary or a technical doctrine. Where it would be practically unjust to give a remedy, either because the party has, by his conduct, done that which might fairly be regarded as equivalent to a waiver of it, or where by his conduct and neglect he has, though perhaps not waiving that remedy, yet put the other party in a situation in which it would not be reasonable to place him if the remedy were afterwards to be asserted….”

Analysis

57.  Applying the aforesaid legal principles, the Defendant’s defence of laches is plainly unsustainable.

58.  First, the Plaintiff’s cause of action in this action is founded on a simple contract within the meanings of section 4(1)(b) of the Limitation Ordinance (Cap 347). Thus, the defence of laches is not applicable at all: Cheng Hung Kit (supra).

59.  Second, the Plaintiff’s claim in this action is monetary in nature, and no equitable relief is sought. It is hard to see how the doctrine of laches (which can only bar equitable relief) may constitute a defence to the Plaintiff’s claim: Fisher v Brooker (supra)

60.  Third, even if the doctrines or defence of laches were applicable (which is not the case), for the following reasons, I am of the view that it would not be just and fair to bar the Plaintiff’s claim:-

(1) The Defendant has not made any plea nor adduced any evidence to show that by reason of the Plaintiff’s delay, her position has changed, such that it is no longer just and fair for the Plaintiff to enforce its legal rights against her.

(2) For the reasons set out in paragraphs 51 to 53 above, the Plaintiff’s delay was not inexplicable, and the Defendant (who evaded Ms Ayumi Tang and made an untrue allegation to her) did contribute to the Plaintiff’s delay.

(3) Taking all the circumstances into account, I am not of the view that it would be practically unjust to allow the Plaintiff to enforce its contractual rights under the Baguio Villa PSPA.

E5. Acquiescence

Legal Principles

61.  In Freder Centre (IO) v Gringo Ltd [2016] 2 HKLRD 190 at para 26, Chu JA (as Chu VP then was) pointed out that:-

“…to succeed in a defence of acquiescence, it must be shown firstly, there was on the part of the plaintiff, an assent or lying by in relation to the acts of another person; and secondly, in with of the assent or lying by and consequent acts it is unjust in all the circumstances to grant the relief in question: see Spry, Equitable Remedies, (9^th ed), p 56”

62.  Similar to the legal principles on waiver, mere inactivity is usually ipso facto insufficient to establish the defence of acquiescence. As pointed out by the authors of Snell’s on Equity (34^th Ed) at para 18-041:-

“Acquiescence primarily means conduct from which it can be inferred that a party has waived his rights. Mere inactivity is insufficient, for ‘quiescence is not acquiescence’.”

Analysis

63.  The Defendant’s defence of acquiescence must fail.

64.  First, since the Plaintiff’s cause of action is subject to section 4(1)(b) of the Limitation Ordinance, the defence of acquiescence is not applicable: Cheng Hung Kit (supra).

65.  Second, as pointed out in paragraphs 45 to 50 above, the mere inaction on the part of the Plaintiff was equivocal, and I cannot infer that the Plaintiff had given up or abandon its contractual entitlement under the Baguio Villa PSPA.

66.  Third, as pointed out in paragraphs 51 to 53 above, I find that the delay in bringing claims against the Defendant is explicable. It was ascribed to matters relating to the Plaintiff’s internal administration and the difficulty faced by the Plaintiff at the time.

67.  Fourth, as pointed out in paragraph 60 above, the Defendant has failed to show that it would be practically unjust for the Plaintiff to enforce its contractual rights under the Baguio Villa PSPA.

F. Conclusion and Order

68.  For the above reasons, I conclude that the Defendant has no defence to the Plaintiff’s claims in this action.

69.  I accordingly order the Defendant to pay the Plaintiff a sum of HK$334,000 (being the outstanding commission owed to the Plaintiff pursuant to section 12 of the Baguio Villa PSPA).

70.  The Plaintiff is entitled to interest at 1% above prime rate on the said sum of HK$334,000 from 3 November 2022 (ie the date of the writ in this action) to the date of this judgment, and thereafter interest at judgment rate until payment in full.

71.  There is no reason why costs does not follow the event.

72.  I make a costs order nisi that the costs of these proceedings, including all costs reserved, be paid by the Defendant to the Plaintiff to be taxed if not agreed (with certificate for counsel). Any application to vary such costs order nisi shall be made within 14 days.

G. Other Matters

73.  I express my gratitude to Ms Leung and Mr Sik who have rendered helpful assistance to me.