MA MUI CHI OMEI v. HO KA FAI

HCA 1363/2021

[2022] HKCFI 421

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1363 OF 2021

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DECISION

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1.  This is the application by the plaintiff (“P”) against the defendant (“D”) for judgment in default of Acknowledgment of Service and Defence.

2.  The claim concerns Flat A on 31/F of Tower 1, Hanley Villa, No.18 Yau Lai Road, Ting Kau, Tsuen Wan, New Territories, and Car Parking Space No.21 on 2^nd Carport of Area A of Hanley Villa (the “Properties”).

3.  According to the specifically indorsed Writ of 9 September 2021, P and D used to be lovers. The Properties were originally acquired by them in June 2009 as joint tenants. Prior to its acquisition, they orally agreed, or formed the mutual understanding, or had the common intention, that their shares in the Properties to be acquired would be in accordance with their respective financial contributions towards the acquisition. Subsequently and as things turned out, P paid 90.92% of the totality of the purchase price, all duties, costs, expenses and mortgage repayments involved. Her contributions came from funds of their joint bank account (which funds represented the sale proceeds of a property they used to own as joint tenants) and other contributions out of her own resources. All mortgage repayments were paid off in June 2011.

4.  Since acquisition, the Properties have been used and occupied by D. In 2020, P discovered that D got married without her knowledge. D’s wife moved in the Properties. P has been denied possession or use of the same. P’s request to buy out D’s share in the Properties has been refused. D has changed the lock to the Properties. P’s request for rent has been refused. P’s further requests to D to vacate the same have also been refused. On the other hand, D asked his wife’s name to be added as an owner. P refused. P in May 2021 discovered that D and his wife had been trying to sell the Properties back in late 2019.

5.  In July 2021, P through her solicitors served a notice of severance upon D, thereby severing the joint tenancy between them.

6.  P seeks therefore, on the bases of constructive trust, resulting trust, and estoppel, a declaration that D out of the 50% he holds as joint tenant holds 40.92% of the total beneficial interest in the properties on trust for P, an order that D do assign, transfer and convey the legal title of the Properties to P in such shares, and mesne profit to be assessed[1].

7.  D has filed neither any Acknowledgment of Service nor any Defence.

8.  I am satisfied that D has validly been served with all necessary process and documents.

9.  I have considered the applicable principles in an application under Order 19 rule 7(1). I have considered the Statement of Claim. I have considered and scrutinized its contents carefully. I am satisfied that P appears to be entitled on the Statement of Claim to the judgment she is seeking.

10.  I note that P is seeking as part of the judgment a declaration that D holds on trust for P 40.92% of the total beneficial interest in the Properties.

11.  I note the court’s practice of not granting a declaration in default without a trial. That is a rule of practice and not of law and will give way to the paramount duty of the court to do the fullest justice to the plaintiff to which they are entitled.

12.  In the present case, the main and substantive relief which P is seeking to the assignment to P of the shares P says D holds on trust for her. The declaration is however necessary for the purpose of clarifying P’s beneficial interest in the Properties, in the absence of which she may face genuine difficulties in selling her interests in the Properties in the future. The Declaration is specific, and is not wider than necessary. I note also D’s previous attempts in selling the Properties. I accept Mr Kong’s submission that this is necessary to give fullest justice to P.

13.  I grant P judgment in terms of the Minutes of Judgment (as amended) attached to the Summons.

14.  As set out in the Minutes of Judgment, D shall bear the costs of the action, to be taxed if not agreed, with certificate for one counsel only. For avoidance of doubt, those costs shall be exclusive of any cost on the future assessment of mesne profit, which shall be decided separately in those proceedings.