MIDLAND REALTY (COMM.) LTD v. ROYAL SHINY DEVELOPMENT LTD

DCCJ 4798/2011

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 4798 OF 2011

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

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

DECISION

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

Leave to appeal

1. On 10 June 2013, I handed down a reserved judgment (“ the Judgment”) thereby it is adjudged that:-

(a) the plaintiff’s claim be dismissed;

(b) the defendant do pay the plaintiff a sum of HK$155,000 together with interest at judgment rate from the date of judgment; and

(c) the plaintiff do pay the defendant costs of the action with certificate for counsel.

Grounds for leave to appeal

2. The plaintiff is dissatisfied with the Judgment and now seeks leave of the District Court to appeal to the Court of Appeal on the following grounds (I adopt the abbreviations used in the Grounds of Appeal):-

(A) The learned Deputy Judge erred in accepting the    evidence of Mr Leung and Mr To in that:-

(a) In both cases, he failed to resolve the material inconsistencies between the witness statement and the evidence given in court by each witness in relation to the encounters with Mr Ng and/or Mr Elvis Ho (“Mr Ho”), particularly:-

(I) how the verbal agreement was allegedly reached between the plaintiff and the defendant at the defendant’s office on or about 3 November 2010; and

(II) how the Confirmation was allegedly executed by Mr Ho after the Provisional Agreement had been signed;

(b) Having realized that the witness statements of both witnesses were almost identical, he failed to address the material discrepancies between the evidence of Mr To and Mr Yeung given in court in respect of the matters set out in paragraphs A(a)(I) to (II) above;

(c) He failed to appreciate the extent and significances of such inconsistencies and discrepancies;

(d) In finding both Mr To and Mr Yeung to be honest and reliable witness, the learned Deputy Judge unduly and unfairly took into account of the facts that both witnesses had resigned at the time of making their respective witnesses statements and had no vested interest in the action thereby bolstering their credibility and reliability;

(e) He erroneously found that Mr To took a major part during the encounters with Mr Ng and/or Mr Ho at the material times and therefore preferred the evidence of Mr Yeung to that of Mr To whenever discrepancies arose when the evidence from both witnesses did not support such a finding; and

(f) He failed to consider whether there was any risk of concoction (innocent of otherwise) by both witnesses particularly when:-

(I) Mr To admitted that he had previously discussed his evidence with Mr Yeung even before he signed his witness statement;

(II) Mr To admitted that he did not have his own recollection of most matters and he had to rely on the accounts of Mr Yeung to refresh his own memory; and

(III) This was clearly contradictory to what had been deposed in the affirmation in the support of the Defendant’s application for leave to file the witness statement of Mr To at the beginning of the trial.

(B) The learned Deputy Judge erred in rejecting the evidence of Mr Ng in that:-

(a) He failed to identity to what extent and in what way the question of whether or not Mr Ng had instructed Mr Ho  to chase the defendant for payment of the commission would affect the credibility and /or reliability of Mr Ng;

(b) The learned Deputy Judge erroneously found that the evidence of Mr Ng to be unreliable based merely upon his omission to mention the meeting with the defendant’s witnesses on or about 3 November 2010 in his statement when:-

(I) the existence of such a meeting was not in issue; and

(II) the witness had, by way of his witness statement, clearly denied he had reached any agreement, verbal or otherwise, by which the plaintiff would waive its entitlement to any commission in procuring the sale and purchase of the property.

(C) The learned Deputy Judge erred in finding there existed an oral agreement between the plaintiff and the defendant on about 3 November 2010 by which the plaintiff had agreed to waive its entitlement of the commission in that:-

(a) The learned Deputy Judge failed to gave proper and sufficient regard to the fact the defendant had nonetheless signed on the Provisional Agreement which did not reflect such an agreement;

(b) In erroneously finding that the Confirmation was evidence tending to prove the existence of such an agreement, the learned Deputy Judge failed to give proper and sufficient regard to the evidence of Mr Yeung that Mr HO had initially intended to procure the defendant to sign the Confirmation, in its original form, with a view to confirming the defendant’s obligation to pay for the commission;

(c) The learned Deputy Judge failed to give proper and sufficient regard to the ways the defendant had responded to the plaintiff’s demand for payment of the commission at the material times which were significantly inconsistent with existence of such an agreement; and

(d) The learned Deputy Judge wrongly concluded that such an agreement was instigated by the plaintiff without any evidence.

(D) The Learned Deputy Judge erred in law by giving effect to any oral agreement allegedly reached between the plaintiff and the defendant on about 3 November 2010 in that:-

(a) There was no sufficient evidence upon which the learned Deputy Judge could find with certainty as to the actual terms of such an agreement;

(b) There was no consideration given to such an agreement; and

(c) Having erroneously found the Confirmation to be evidence tending to prove the existence of such an agreement, the learned Deputy Judge then found that the Confirmation had taken legal effect at the same time as the Provisional Agreement.

(E) Having erroneously accepted that the Confirmation had taken legal effect at the same time as the Provisional Agreement, he erred in law in also finding that the Confirmation had varied the Provisional Agreement. In doing so, he also erred in finding that the Confirmation had the requisite consideration to give the same any legal effect.

(F) The learned Deputy Judge wrongly relied upon the plaintiff’s instigation of changing the date of the Provisional Agreement to allow the defendant to come to equity without clean hands.

The law

3. Section 63A(2) of the District Court Ordinance (Cap 336) provides that:-

“(2) Leave to appeal shall not be granted unless the judge, the master or the Court of Appeal hearing the application for leave is satisfied that:-

(a) the appeal has a reasonable prospect of success; or

(b) there is some other reason in the interest of justice why the appeal should be heard.”

4. I agree with the submission of plaintiff’s counsel that the reasonable prospect of success involves the notion that the prospects of succeeding must be “reasonable” and therefore more than “fanciful”, without having to be “probable”.

Discussion

5. Counsel for the defendant submitted that Grounds A to E were attempts to challenge the finding of facts under the disguised notion of “error of law”, to which I agree.

6. Counsel for the plaintiff denied that he is challenging the finding of facts.  I disagree.  By looking at the grounds for leave to appeal, it seems clear he is challenging the assessment of credibility of witnesses and the finding of facts.

7. The principles upon which the appellate court will upset the primary findings of facts based on credibility of witnesses are well settled.  The principles have been helpfully summarized by Woo VP in Tin Kwong International Enterprise Company Limited & Ors v San Tung & anor (unreported, CACV 164/2005) at paragraph 14 are as follows:-

“(i) if the Court of Appeal is to reverse the trial judge’s decision on the facts, it must not merely entertain doubt whether the decision below is right but be convinced it is wrong;

(ii) the Court of Appeal will certainly not disturb the judge’s finding of primary fact where they are based on the credibility of witnesses or the preference of the evidence of one witness for that of another because he enjoyed the advantages of receiving the evidence in a living state of first-hand; and

(iii) in order to disturb a finding of primary fact, the Court of Appeal has to be satisfied that the judge’s conclusion is plainly wrong in the sense that either:-

(1) that there is no evidence to support it; or

(2) that is contrary to documentary or other incontrovertible evidence that the judge overlooked.  It is not enough to show there is little evidence to support the judge’s finding, or that it was contrary to the weight of the evidence.  The weight of the evidence is a matter for the trial judge.  It does not matter how many witnesses say one thing, and how few say the contrary.  The judge is perfectly entitled to prefer the evidence of the few to that of the many.”

8. The Court of Appeal will only set aside the findings of fact under exceptional circumstances.  It is not submitted by counsel for the plaintiff that the finding of facts are plainly wrong.  If it is submitted, I am not satisfied that they are plainly wrong.  The defendant’s case is supported by the documentary evidence, the Confirmation.

9. In view of the above, it is unnecessary to deal with each and every ground.  Three points I would like to state.  The first one is that there is no inconsistency between the verbal agreement and Mr Ho’s act of asking the defendant to sign the Confirmation.  Counsel for the plaintiff submitted that Mr Ho’s intent to procure the defendant to sign the Confirmation, in its original form, is inconsistent with the existence of the verbal agreement.  There is no finding of fact that Mr Ho intended to sign the Confirmation in its original form.  The plaintiff did not call Mr Ho to be a witness.  No evidence as to his intention has been adduced in the trial.  Mr Yeung said that Mr Ho approached him with the original form of the Confirmation.  Such act is not inconsistent with the existence of the verbal agreement.  Mr Ho had his own interest to serve.  He wished to confirm the payment of commission, as there was the possibility that he might obtain his commission if colliers did not know about the transaction.  Mr Yeung, on the other hand, required the plaintiff to confirm the oral agreement. The two findings do not contradict each other.

10. The second point is the issue of consideration.  It has been dealt with in paragraph 26 of the Judgment.  I will not repeat here.

11. The third point is that the equitable remedy issue has been dealt with in paragraph 25 of the Judgment.  As stated in the Judgment, only if the findings are not accepted, we have to deal with the equitable remedy.  I am of the view that even if the plaintiff is successful about the issues of consideration of the verbal agreement and the equitable remedy, they are only subsidiary points and cannot bring about her success in appeal.

Conclusion

12. For the above reasons, I am not satisfied that the plaintiff has any reasonable prospect of success in her appeal.  The Plaintiff’s application for leave to appeal is dismissed.

13. I also make an order nisi that the defendant shall have the costs, with certificate for counsel, to be taxed if not agree.  Unless varied within 14 days, such order shall become absolute.