LEUNG YUK LAN SUING BY THE OFFICIAL SOLICITOR, HER NEXT FRIEND v. LIANG CHENG RU AND ANOTHER

DCCJ 3868/2018

[2019] HKDC 228

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 3868 OF 2018

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DECISION

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1.  By a summons filed on 20 December 2018, the plaintiff seeks a default judgment against the 1^st and the 2^nd defendants.  Having considered the evidence as to service adduced by the plaintiff, I am satisfied that the documents in these proceedings have been duly served on the defendants.

2.  It is well established that in an application for a default judgment, only the matters pleaded in the statement of claim would be considered and no evidence on merits is admissible.  See Lam Chi Fat v Liberty International Insurance Ltd [2002] 3 HKLRD 480, [27]; Leung Pak Ki v The Estate of Pang Kau (彭九), deceased & Anor (HCA 624/2009, 1 March 2016), [5]

3.  The plaintiff’s case as pleaded in the statement of claim is as follows:-

(1)  The plaintiff was born in 1935.  On 18 May 2010, she purchased a property known as Flat No 16 (Formerly Flat No 1516), 15/F, Wai Lee Building, 997 King’s Road, Hong Kong (“the Property”) and has since been the sole registered and beneficial owner of the Property up to the present. 

(2)  The plaintiff was illiterate and has never received formal education.  She had been a domestic maid for nearly 45 years before she retired in late 1990s.

(3)  The plaintiff started residing in the Property in 2011.  Since mid-2011, the plaintiff’s health condition has been deteriorating.

(4)  In or about June 2011, the 1^st defendant, who claimed to be a nephew of the plaintiff, learned about the plaintiff’s situation.  The 1^st defendant suddenly showed care and concern to the plaintiff and came from Mainland China to Hong Kong to live in the Property with the plaintiff.

(5)  The 1^st defendant has been living in the Property since then. The 1^st defendant was in possession and took control of various personal belongings of the plaintiff including bank books, bank statements, a will dated 13 March 1991, name chop, house keys and title deeds of the Property (“the plaintiff’s personal properties”).

(6)  Since in or about early 2010, the plaintiff suffered from mixed-type dementia and was then no longer capable of considerable reasoning and decision making.

(7)  On 27 July 2013, the plaintiff was found in poor personal care and weak health conditions by the caseworker of Social Welfare Department.  She was admitted to the hospital for treatment.  She was also officially certified as mentally incapacitated.

(8)  The plaintiff has moved to an elderly home since 13 September 2013.

(9)  A Guardianship Order was issued for the plaintiff with the Director of Social Welfare being appointed as her legal guardian since 10 October 2013.

(10)  It was the direction of the Guardianship Board that the 1^st defendant should return the plaintiff’s personal properties to the public guardian.  The 1^st defendant was also requested to return vacant possession of the Property.  However, the 1^st defendant refused and claimed that he had the right to keep the plaintiff’s personal properties as he was the “adopted son” of the plaintiff.

(11)  By an Order made by the DHCJ Kent Yee on 23 February 2017 in HCMH 44/2016 (“the Order”), the Official Solicitor was appointed as the Committee of the plaintiff’s estate (“the Committee”) upon being satisfied that the plaintiff was incapable by reason of her incapacity of managing and administering her property and affairs.

(12)  Pursuant to the Order, a letter was issued to the 1^st defendant at the Property and his address in Mainland China respectively on 6 March 2017. He was requested, amongst others, (a) to hand over all personal belongings of the plaintiff to the Committee; and (b) to give vacant possession of the Property to the Committee.

(13)  The Committee issued another letter to the 1^st defendant at the Property and his address in Mainland China respectively on 28 August 2017.  Again, the 1^st defendant was requested, amongst others, to hand over all personal belongings to the Committee and give vacant possession of the Property to the Committee.

(14)  Despite repeated demands, there was no response or reply from the 1^st defendant and the 1^st defendant failed to hand over or deliver vacant possession of the Property to the Committee.

(15)  The 1^st defendant’s possession of the Property was and is without licence or consent from the Committee and/or public guardian of the plaintiff since 10 February 2014.  The 1^st defendant wrongfully entered and took possession of the Property and has thereafter wrongfully remained in possession thereof.

(16)  Further to and by reason of the matters aforesaid, the plaintiff has suffered loss and damage, being (a) use and enjoyment of the Property at the market rental of HKD13,000.00 per month; and (b) costs of the repair work to the Property, which are to be assessed.

(17)  The 1^st defendant has procured the plaintiff to withdraw cash from the plaintiff’s bank accounts and give the money to the 1^st defendant for his handling during the period from June 2011 to June 2013.  The total amounts withdrawn are HKD471,000.00 and CNY5,000.00.

(18)  In procuring the plaintiff to do the aforesaid, the 1^st defendant has breached the fiduciary duties owed by him to the plaintiff, and is liable to account to the plaintiff as a constructive trustee of the misappropriated assets and the profits generated therefrom.

4.  Based upon the matters pleaded in the statement of claim, I am of the view that the plaintiff is entitled to have judgment against both the 1^st and the 2^nd defendants.  The plaintiff has made out a clear case against the defendants.  According to the plaintiff’s case as pleaded, the 1^st and the 2^nd defendants certainly have no right to remain in possession of the Property and shall not stay in the Property.  In these circumstances, I am of the view that the reliefs claimed by the plaintiff are necessary reliefs and the plaintiff is entitled to have the same.  I enter judgment in favour of the plaintiff and against the defendants.

5.  The 1^st defendant has to, inter alia, return the HKD471,000.00 and the CNY5,000.00 to the plaintiff plus interest.  The plaintiff’s solicitors, adopting the interest rate of 1% above the best lending rate of HSBC, has calculated that the interest on the HKD471,000.00 up to the date of this decision should be HKD191,747.41, and the interest on the CNY5,000.00 up to the date of this decision should be CNY1,855.11.  I accept the calculation and would order the 1^st defendant to return the principal sums and pay these interests to the plaintiff.  I would further order post-judgment interest on the principal sums at the judgment rate until full payment of the principal sums.

6.  The order made in favour of the plaintiff and against both defendants is as follows:-

(1)  An order that the defendants do forthwith deliver vacant possession of the Property to the plaintiff;

(2)  A declaration that each of the defendants is not entitled to enter the Property;

(3)  An injunction to restrain the defendants and each of them whether by himself or herself or by his or her servants or agents or otherwise howsoever from entering the Property;

(4)  Payment of mesne profits at the rate of HKD13,000.00 per month to the plaintiff from 10 February 2014 until vacant possession of the Property is delivered up; and

(5)  Damages as to the costs of the necessary repair work to be done to the Property to be assessed.

7.  There be a further order against the 1^st defendant:-

(1)  An order that the 1^st defendant do forthwith return the HKD471,000.00 and CNY5,000.00 plus interests thereon, ie HKD191,747.41 and CNY1,855.11 respectively, to the plaintiff;

(2)  An order that the 1^st defendant shall pay to the plaintiff interest accrued on the HKD471,000.00 and CNY5,000.00 at the judgment rate immediately after the date of this decision until full payment of the principal sums; and

(3)  An order that the 1^st defendant do forthwith delivery up of all personal belongings of the plaintiff which are in possession of the 1^st defendant, including the plaintiff’s personal properties referred to under paragraph 10 of the statement of claim.

8.  There be liberty to apply.

9.  Costs of these proceedings up to the date of this judgment be paid by the defendants to the plaintiff.  Those costs are summarily assessed at HKD60,000.00.