The Bank of East Asia, Ltd. v. HO Walter Chi Kwan

CACV 129/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 129 OF 2000

(ON APPEAL FROM HCMP NO. 2575 OF 1999)

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J U D G M E N T

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Wong JA: (giving the judgment of the court)

1. This is an appeal against the judgment of Yeung J in the Court of First Instance dismissing the appeal of an order of Master Poon.

2. By Originating Summons dated 3 May 1999, the Respondent sought to enforce against the Appellant and another Defendant a Legal Charge dated 16 January 1997 in respect of a property situated at and known as Flat B4 21st floor, Peace Building, Peace Avenue, Kowloon. The proceedings were brought under Order 88 of the Rules of the High Court for unpaid mortgage instalments due to the Respondent and for vacant possession of the premises in question.

3. The matter first came before Master Kwan on 9 August 1999 who adjourned the hearing for the Defendants to file and serve their affirmations in opposition within 14 days. At the request of the Defendants, the Respondent agreed to an extension of time for them to file affirmations until 5 September 1999. In the meantime the Defendants applied for legal aid and proceedings were stayed for a period of 42 days. Legal aid was subsequently refused. No affirmation was filed and instead the Defendants filed a Defence and Counterclaim on 28 October 1999 alleging an oral agreement between the Respondent and the Defendants that the Respondent agreed at a meeting on 9 March 1999 that the Respondent would not take any further legal action against the Defendants. Acting on this promise, the Defendants cancelled a potential sale of the property which would have realized sufficient fund to pay off the total outstanding balance due to the Respondent. This allegation was denied by the Respondent by affirmation.

4. On 2 March 2000 the hearing of the summons was restored before Master Poon who gave judgment for the Respondent in the terms applied for. None of the defendants was present.

5. On the same day, the Appellant took out a summons to set aside the order made by the Master and for the rehearing of the case. In an affirmation, the Appellant stated that he arrived late in court due to an accident in the cross-harbour tunnel as well as traffic jam caused by pouring rain. Master Poon heard the application on 8 March 2000 and dismissed it with costs.

6. The Appellant appealed against the order of Master Poon and the appeal was heard and dismissed by Yeung J on 3 April 2000. The Appellant now appeals and the grounds of appeal are as follows :-

(i) the appeal judge made an error not allowing the Defendants to call witnesses to prove the existence of the verbal agreement of 9 March 1999;

(ii) the appeal judge made an error that the Plaintiff being a big corporation that it would have never carried out business based on a verbal agreement; and

(iii) the appeal judge made an error that a verbal agreement in this case is not enforceable by the Court.

7. We agree with the submissions of Mr Vaughan for the Respondent. Ample opportunity had been given to the Defendants to adduce evidence by affirmations but they had chosen not to do so. It was very easy for the Appellant to file an affirmation to this effect on his own and this had not been forthcoming. We also agree with Mr Vaughan that even if the judge made the observations he was alleged to have made in grounds (ii) and (iii), these would have no real bearing on his decision in dismissing the appeal. The law is clear that a mortgage deed can only be varied in writing. There is simply no issue to warrant a trial and any further proceedings would be completely a waste of time and expense.

8. The Appellant has advanced no grounds of any substance and accordingly we dismiss the appeal with costs to the Respondent.