WONG KUN CHEONG v. TONG YING YUNG, JAMES

DCCJ 6135/2002

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 6135 OF 2002

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JUDGMENT

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1. In this claim the Plaintiff claims against the Defendant for repayment of loan in the sum of HK$363,350.00 particulars of which are as follows:-

Amount (HK$)	Advance Date
10,000.00	14th March 2001
160,000.00	14th March 2001
50,000.00	23rd August 2001
20,000.00	10th September 2001
40,000.00	24th September 2001
45,350.00	23rd October 2001
38,000.00	5th December 2001

2. The method of payment of the loans to the Defendant or on the Defendant's behalf is pleaded in para 1A of the Amended Statement of Claim. The Defendant does not dispute the amount of the loan and particulars thereof and the manner in which the various parts of the loan was made to him.

3. By an Admission Notice, the Defendant admitted that the Defendant owe the sum of HK$363,350.00. The dispute in this action is restricted to the contention between the parties wherein the Plaintiff stated that the loan is repayable on demand whereas the Defendant contends that the loan is to be repaid by instalments sometime after 2005.

4. The Defendant's contention is that subsequent to the dates of the all the instalments of the loan, the Plaintiff agreed to allow the Defendant to repay the loan by instalments after 2005. There were no precise date for repayment of the instalments nor were there any specification of the amount of the instalments.

5. The other issues mentioned by the Defendant do not amount to a defence of this claim.

6. It is not in dispute that the Plaintiff was in 1995 retained by Sparkle Life Limited as an insurance agent and Mr. Wong Kwok Sun, Ernest (hereinafter referred to as "Mr. Ernest Wong") was a shareholder and director of the same company. In 1998, the Plaintiff joined Sparkle Consultants (Hong Kong Company Limited (the "Company") as a shareholder. Mr. Ernest Wong and the Defendant were the Directors of the Company. In or about April 1999, Mr. Ernest Wong resigned as the chief executive director of the Company and remained a shareholder of the Company. In about November 1999, the Defendant assumed the post of the chief executive director of the Company. Thereafter, the Defendant and the Plaintiff became the directors of the company.

7. In 2000, Mr. Ernest Wong commenced a legal action against the Plaintiff and the Defendant in HCMP1538 of 2000 under Section 168A of the companies Ordinance (Cap 32) of the Laws of Hong Kong. It was agreed between the Plaintiff and the Defendant that the legal costs of defending the action was to be paid by the Plaintiff and the Defendant in equal shares. The parties instructed a Solicitor Yeung of a firm of solicitors to defend those proceedings. Judgment in the said action was handed down on or about the 23rd April 2001. The Plaintiff and the Defendant lost the action.

8. The Plaintiff and the Defendant considered taking the case on appeal to the Court of Appeal. They retained a Senior Counsel and paid his fees in equal shares. The Defendant alleged that the Plaintiff suggested that they should appeal against the judgment in the said action and instruct the same firm of solicitors to appeal. The Defendant stated that he had lost confidence in their former solicitors. However the Plaintiff insisted on his views and stated that they were sure to succeed in the appeal.

9. In support of the contention by the Defendant that there is an oral agreement between the parties that the Defendant did not have to repay the loan until 2005, he produced a transcript of recording of a conversation at a meeting on the 21 March 2002 between the Plaintiff, a Solicitor Yeung and the Defendant wherein the Plaintiff and Solicitor Yeung persuaded the Defendant to appeal and to employ the same firm of solicitors and a Counsel referred to in the conversation. The Defendant did not consent to the proposal there and then. In the conversation, it was clear at page 50 of the transcript at page 121 of the Bundle of Documents that the Defendant stated that he would give his reply to their proposal on or before the 4th April 2002. It was clear that at the end of the conversation, at page 54 of the transcript, the Plaintiff left with the words to the Defendant, "算啦！真係唔好搞喇！算啦！佢話四月四，就四月四喇！真係架喎！X！". It was clear that the Defendant's reply was to be given on or before 4th April 2002.

10 ． In the conversation at the meeting the repayment was first stated to be deferred to 2003, subsequently to 2004 and lastly to 2005. The deferring of the date of repayment of the loan was part and parcel of the proposal by the Plaintiff to the Defendant that the Defendant would appeal against the Judgment jointly with the Plaintiff and together instruct Solicitor Yeung and the named Counsel to appeal against the Judgment. No date was mentioned as regards repayment. The Defendant stated that in the conversation it was mentioned that he would not file a Petition for bankruptcy. He has not done that. It is not in dispute that no mention was made of repayment by instalments. It is not in dispute that the Defendant did not in the end agree to the Plaintiff's proposal to instruct Solicitor Yeung and the named Counsel to continue the Appeal although the Defendant did continue the appeal but in person. He stated he did not file a Petition for bankruptcy. However he had not accepted the package of proposals offered by the Plaintiff.

11 ． The Defendant stated that it was subsequently after the 21 March 2002 in oral communication between the Plaintiff and the Defendant in their work place that the Plaintiff suggested that the Defendant need not repay the loan until 2005 and could repay by instalments.

Finding

12 ． From the contents of the conversation between the parties on the 21 March 2002 it does not seem that any agreement was reached between the Plaintiff and the Defendant related to the repayment of the loan after 2005. There was the statement of various time frame for repayment of the loan such as 2003, 2004 or 2005. However these were in the context that the Defendant should instruct the firm of solicitors of Solicitor Yeung and instruct the stated Counsel whereupon the Plaintiff would continue to lend to the Defendant whatever is needed for legal fees. The Defendant stated that he would give a reply to that proposal on or before 4th April 2002. The meeting ended when the Plaintiff stated "if he (the Defendant) says that it should be 4th April 2002, then so be it". It is clear that the parties left without any agreement being reached. The alleged oral offer made after the 21 March 2002 by the Plaintiff to the Defendant that the Defendant could repay the loan by instalments after 2005 seem again to be couched in vague terms so that the veracity of such a statement is doubtful. I do not find that the evidence of the Defendant related to that offer to be reliable.

13 ． Hence I find that at the meeting on the 21 March 2002 between the parties no agreement had been reached between the Plaintiff and the Defendant for deferring repayment of the loan until after 2005. Further the terms of the offer were so vague that it could not amount to an agreement.

14 ． Chitty on Contracts 28th Ed. Vol 1 at para 2-128 in the paragraph headed "The terms of the contract must be certain" state,

"An agreement may be so vague or uncertain that it cannot give rise to a binding contract. This principle is illustrated by G. Scammell & Nephew Ltd v. Ouston, where the House of Lords held that an agreement to acquire goods "on hire-purchase" was too vague since there were many kinds of hire-purchase agreements in widely different terms, so that it was impossible to specify the terms on which the parties had agreed."

15 ． Were any agreement made to defer repayment of the loan, it must state the date when repayment is to commence. Where there is no specification of the date of repayment, there could not have been any agreement reached as the term related to the date of repayment is a vital term and a specific date has to be clearly stated.

16 ． Further, even were the allegation that the Plaintiff in conversation after 21 March 2002 offered the Defendant that he could repay the loan by instalments in 2005 a fact accepted by me as true, which is not the case, the alleged statement is vague and uncertain. It does not contain the dates of repayment of instalments and the amount to be paid in each instalment. In the light of the passage in Chitty on Contracts cited above, there could not have been any agreement for repayment of the loan by instalments after 2005, due to the uncertainty of terms, even were the Defendant's evidence on this fact accepted. This evidence is not accepted by me.

17 ． I therefore find that the Defence must fail.

18 ． Judgment for the Plaintiff against the Defendant in the sum of HK$363,350.00 together with interest thereon at judgment rate from date of Writ to date of judgment and thereafter at judgment rate until payment. I grant an order nisi for costs of the action to be paid by the Defendant to the Plaintiff to be taxed if not agreed.