ULSAN LTD. v. LAU KAM SHING and Another

1997, No. MP2082

IN THE HIGH COURT OF

THE HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS

---------------------

---------------

---------------

J U D G M E N T

---------------

1. This is a vendor and purchaser summons by the potential purchaser, seeking an order that the vendor has not made out a good title to the property concerned.

2. The respondent seek to convey a property vested in them by a Deed of Gift dated 4 October 1967. The donor was their father, LOU Kai-man, who I am told was then 63 years of age approximately. He had been the purchaser of the property by a Deed of Assignment dated 12 January 1955.

3. The applicants contend that it has not been shown that the person who executed the Deed of Gift in 1967 was the same person who signed the Assignment in 1955 as purchaser because the form of signature on those two occasions is materially different. As a separate point or issue, and also by way of support for their prime contention, the applicants contend that the Chinese characters in the margin of the 1955 Deed constitute a trust in favour of seven of the sons of the then purchaser.

The two signatures

4. There is no doubt that a comparison of the two signatures in the 1955 and 1967 Deeds shows that the characters of LOU Kai-man in the latter are far less clearly defined and appeared to have been written by a less steady hand. Although it has been described as illegible, only parts of the characters are not clearly legible.

5. It is to be noted, however, that the signature in abbreviated form but still identifiable as LOU Kai-man's, appears in three other places attesting to alterations signed by the two donees, and at the bottom of the first and second pages of the Deed: the third page, is the attestation and execution page. Twelve years elapsed between the execution of the two Deeds, and we know the age of LOU Kai-man at the date of the Deed of Gift.

6. The execution and attestation provisions show the care exercised by the solicitors acting in the transaction. The interpreter had "previously identified the donor as LOU Kai-man." The donor's Hong Kong identity card number was written beneath his signature. A solicitor from Messrs Philip Remedios & Co attested the signatures of the parties. The solicitors would have had a copy or the original of the 1955 Deed of Assignment at the material time. Responsible and reputable solicitors would have taken care to ensure that the donor was indeed vested with the title to the property he sought to give to his eldest two surviving sons, if only for their own protection.

7. The 1955 Deed of Assignment also contained an attestation clause in which the vendors had "been previously identified" by a solicitor in the firm of Lau Chan & Ko. who also witnessed the signature of LOU Kai-man. One fact is not to be ignored, and that is that the Deed of Gift in 1967 was from a father to his two eldest sons. I do not find that surprising. The purchaser in 1955 was that same father of these two sons, for in the margin of the 1955 Deed of Assignment are Chinese characters which recite the names of eight sons, of whom the donees are the eldest surviving two; and in 1967, the donor was identified by his identity card.

8. I will return to the matter of the writing in Chinese characters in the margin of the 1955 Deed, because that forms the basis of a further argument by the applicant.

9. Section 13 Subsection 4 of the Conveyancing and Property Ordinance, Cap. 219 provides that "a recital statement and description of any fact, matter or party contained in any document of title relating to any land and dated or made not less than 15 years before the Contract of Sale of that land shall, for the purposes of any question as to proof of title concerning the parties to that contract and unless the contrary is proved, be sufficient evidence of the truth of that recital, statement and description." The Agreement for Sale to the applicants is dated 18 June 1997. The Deed of Gift, through which the respondents hold title, is dated 4 October 1967, almost 30 years ago.

10. I have been referred to the decision of Godfrey J. (as he then was) in LAM Kin I v. TSUI Ming Yee, unreported, 24 February 1989. The transcript reflects the considerations of law involved in such applications, but there was a significant difference on the facts. The questionable signatory in the 1977 Assignment is not described as "having previously been identified by anyone". Furthermore, the Deed of Assignment was a little less than 12 years before the Agreement for Sale, so Section 13 Subsection 4 of the Conveyancing and Property Ordinance did not apply. Not only was the vesting Deed in the case which I have to consider over 15 years old, but it is also over 20 years old. The Deed of Assignment considered by Godfrey J did not qualify under either period.

11. The applicants' therefore have to prove that the recitals are not true. [See the decision in Keith J. in CHAO Mei Hua v. Ferrier [1995] 1HKC 673]. In my view, they fall well short of that, and the presumption has not been displaced. The applicants have abandoned their contention that the mental capacity of the donor in 1967 is to be doubted, and therefore the presumption under Section 22 stands. The only basis had been the questioned signature of the donor.

12. There remains the matter I referred to earlier concerning the Chinese characters written in the margin of the first page of the 1955 Deed of Assignment. These mean, in summary, according to the translation - "one son deceased, seven other sons named", "seven brothers divide in equal shares father's handwriting". I am satisfied that this writing was not on the Deed at the time of execution. Otherwise, if it was intended to constitute some form of Declaration of Trust, it would have been properly drafted, signed, attested and incorporated. When the Deed was registered, no such writing was on the Deed. The Memorial bears no such reference or writing.

13. When the writing was added is not clear, but it is obviously some informal note of unknown date without signature. It is open to a number of possible interpretations, but none of them meets the valid requirements for the creation of a legal or equitable interest. There is no certainty as to what is being disposed of, or the date at which such disposition - whatever it may have been - is to be made. If it was on the 1955 assignment, at the time of the 1967 Deed of Gift it is surprising that there was no reference to it or incorporation of it in the Deed itself, if it was deemed to have any effect. If it was on the Deed, then it is likely to have been explained as having no relevance to the Deed of Gift.

14. It is not necessary for me to conjecture as to its possible nature or source or dating. It is not, in my view, of any material significance, nor should its existence give rise to any reasonable concern as to claims by any other sons. Nearly 30 years have elapsed since the property vested in the two eldest sons; it is over 42 years since the father purchased the property.

15. I am satisfied therefore the respondents have made a good title. The requisitions have been sufficiently answered. The application is dismissed. The applicant is to pay to the respondents their costs to be taxed if not agreed.

I/we certify that to the best of our ability and skill, the foregoing is a true transcript of the audio recording of the above proceedings

...............................................

B. Pirie Date: 29 September 1997