WONG YUK TUNG v. WONG PO LING AND ANOTHER

HCA 899/2012

[2019] HKCFI 1947

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 899 OF 2012

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D E C I S I O N

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1.  The plaintiff and the 1^st defendant are father and daughter. Together with the 2^nd defendant, which is a company controlled by the 1^st defendant, the parties have been entangled in litigations for years. Before me are the appeals by the 1^st defendant against two separate decisions of the masters. After lodging the appeals, the 1^st defendant took out another application, now also before me.

Background

2.  The plaintiff is legally aided.  He commenced this action in 2012 against the defendants.  Briefly, the plaintiff claimed against the defendants for account of the proceeds of the sale of certain properties and for the transfer of certain property by the 2^nd defendant to the plaintiff, all held by the defendants but said to be on trust for the plaintiff.  At the trial of the action, the 1^st defendant appeared in person and also represented the 2^nd defendant.

3.  On 30 September 2016, Madam Recorder Lisa Wong SC (as the learned Judge then was) handed down judgment whereby she found in favour of the plaintiff (“the Judgment”).  The learned Recorder ordered the 1^st defendant to account for the proceeds of sale of certain properties (defined, with reference to the name of the properties, as the “Kam Fai Proceeds” in the Judgment), the defendants to account for the proceeds of sale of another property (defined, again with the name of the property, as the “St Louis Flat 1D Proceeds” in the Judgment) and the 2^nd defendant to assign another property (defined as the “St Louis Flat 25C” in the Judgment) to the plaintiff absolutely.  The defendants were also ordered to pay the plaintiff’s costs of the action to be taxed in accordance with the Legal Aid Regulations, if not agreed.

4.  The defendants then applied to the Court of Appeal for leave to appeal against the Judgment out of time and stay of execution of the Judgment pending the intended appeal (HCMP 620/2017). For those proceedings, the defendants were legally represented.  On 28 February 2018, the Court of Appeal dismissed the defendants’ application on paper with costs summarily assessed at HK$150,000.

5.  Pursuant to the plaintiff’s application, Hon Lisa Wong J gave directions on 27 June 2018 for the taking of accounts in respect of the Kam Fai Proceeds and the St Louis Flat 1D Proceeds pursuant to the Judgment.  For reason which will be explained below, the application for direction in respect of the assignment of the St Louis Flat 25C to the plaintiff was adjourned.

6.  On the basis that the 1^st defendant has defaulted in complying with the court’s directions mentioned above, the plaintiff commenced committal proceedings against her (HCMP 129/2019).  These were heard by the learned judge in June 2018, and adjourned part heard to the end of August 2019.

7.  Upon the Court of Appeal’s dismissal of the defendants’ application on paper as mentioned above, the defendants had also applied for reconsideration of their application by way of oral hearing before the Court of Appeal.  This again met with dismissal by the Court of Appeal on 11 September 2018.  The Court made no order as to costs on this occasion.

8.  The costs payable by the defendants pursuant to costs order under the Judgment have since been taxed at the sum of HK$1,427,167[1]. The defendants applied for review, which was dismissed[2] on 20 July 2018, with costs against the defendants summarily assessed at the sum of HK$19,700. The taxed costs were certified by the allocatur issued on 20 August 2018.

9.  In summary, the defendants have been adjudged liable to pay the following costs:

(1)  the costs of the action pursuant to the Judgment (HK$1,427,167);

(2)  the costs of the application for leave to appeal in HCMP 620/2017 (HK$150,000); and

(3)  the costs of the defendants’ application for review of taxation (HK$19,700).

All taxed costs carry interest until payment.

10.  The defendants have paid no part of the above costs.

11.  On 15 February 2019, the plaintiff obtained a charging order nisi against the property registered in the name of the 1^st defendant, namely Flat 24A (“the Property”), which is at the same mansion as St Louis Flat 1D and St Louis Flat 25C mentioned above.

12.  On 9 April 2019, the 1^st defendant appeared in person before the master.  Considering that she had failed to show cause why the charging order nisi should not be made absolute, the master made the charging order absolute on the same day (“the Charging Order”).

13.  By notice of appeal filed on 23 April 2019, the 1^st defendant appeals the master’s decision dated 9 April 2019.  This is the first appeal before me.

14.  By summons filed on 29 March 2019, the 1^st defendant applied for “directions from the master about the questions of / stay of execution”[3] of the Judgment.  This was dismissed by the master after hearing on 17 April 2019.  By notice of appeal filed on 30 April 2019, the 1^st defendant appeals.  This is the second appeal before this court.

15.  While the above appeals are pending, the 1^st defendant took out another application by summons filed on 15 July 2019, seeking to set aside the Judgment.  Hence the third matter before this court.

Overview

16.  The Charging Order was granted in respect of the debt arising out of the costs payable by the defendants pursuant to the Judgment and the subsequent decisions of the Court of Appeal in dismissing the defendants’ application for leave to appeal and stay of execution of the Judgment.

17.  In response to the plaintiff’s application for directions for the taking of accounts, the defendants countered by their application[4] for, amongst others, stay of execution of the Judgment.  As mentioned, Lisa Wong J gave the directions for the taking of accounts and dismissed the defendants’ application for stay of execution.

18.  By her subsequent summons filed on 29 March 2019, the defendants again applied for so-called “directions about stay of execution”, which was dismissed by the master, and hence one of the appeals now before this court.

19.  By her recent summons filed on 15 July 2019, the defendants apply to set aside the Judgment altogether.

20.  It is immediately apparent that insofar as the 1^st defendant’s attempt to impeach the Judgment is concerned, this is prima facie abuse of court process, in view of the fact that the defendants have exhausted the venue of appeal against the Judgment.  The decision of the Court of Appeal in this respect is binding on this court.

21.  Insofar as the 1^st defendant’s application for directions on 29 March 2019 was filed with a view to staying the execution of the Judgment, this was likewise a repeated attempt of the same.  As explained below, the room for entertaining that is narrow.

22.  Insofar as the above applications by the 1^st defendant were taken out separately with a view to the execution or stay of execution of the Judgment on the one hand and to the setting aside of the Judgment on the other hand, her stance is inherently inconsistent.

Principles governing the appeals

23.  An appeal under O58 of the Rules of the High Court is a re-hearing of the relevant application before the master.

24.  O58, r1(5) provides that no further evidence (other than evidence as to matters which have occurred after the date on which the judgment, order or decision was given or made) may be received on the hearing of an appeal under this rule except on special grounds.  The party seeking to adduce further evidence must satisfy the conditions laid down in Ladd v Marshall [1954] 1 WLR 1489, namely:

(1)  that the evidence could not have been obtained with reasonable diligence for use at the hearing below;

(2)  the evidence must be such that, if given, it would probably have an important influence on the result of the case, though it need not be decisive; and

(3)  the evidence must be such as is presumably to be believed.

The appeal in respect of the Charging Order

25.  Notwithstanding that it was for the 1^st defendant to show cause why the charging order nisi in respect of the Property should not be made absolute, she appeared at the hearing before the master without any affirmation in support of the cause that she might intend to show.  In any event, the master heard her but found that she failed to show cause.

26.  Now together with her notice of appeal, the 1^st defendant filed her affirmation in support.  In her affirmation, the 1^st defendant made clear that its purpose is to provide additional information to court for the purpose of her appeal[5]. She has to satisfy the conditions mentioned above, before she may rely on the further evidence.

27.  In her affirmation filed for such purpose, the 1^st defendant referred to the issue of the beneficial interest in the Property.  However, it is not that she denies her beneficial interest in the Property that is capable of being made subject to the Charging Order.  During the present hearing, the 1^st defendant was adamant that the Property belongs to her legally and beneficially.  As far as I manage to understand, the premise for the 1^st defendant’s query seems to be that the plaintiff sought, and was awarded, an order that the 1^st defendant account to him the Kam Fai Proceeds, but part of such proceeds, according to her, had been applied towards the down payment for the purchase of the 3 properties mentioned above, including the Property.  She questions how the plaintiff should be entitled to the Charging Order on the Property, if he is allowed to trace his interest in the Kam Fai Proceeds, which has become part of the Property.

28.  The premise of the 1^st defendant’s query is incorrect.

29.  Whilst the plaintiff managed to trace the Kam Fai Proceeds into the three properties mentioned above, the Property, unlike the other two, did not form part of his claim or relief granted[6]. Further, by preferring the plaintiff’s evidence, Lisa Wong J observed that the 1^st defendant had been rewarded with, amongst other interests, the down payment on the Property, to which the plaintiff had agreed[7].  In other words, the plaintiff did not set out to claim beneficial interest in the Property as such.  There is nothing sinister about the plaintiff’s claim for an account of the Kam Fai Proceeds instead of any beneficial interest in the Property attributable to the contribution of part of such proceeds to its purchase.

30.  In her affirmation, the 1^st defendant also referred to the plaintiff being a pensioner in Australia and not regularly residing in Hong Kong.  Neither of such references is remotely relevant to the attachment to the Property of the debt arising out of the taxed costs payable by the defendants.

31.  The 1^st defendant also referred to the plaintiff being one of the defendants in another District Court action (DCMP 878/2018).  As explained in the written decision of Lisa Wong J dated 27 June 2018[8], the District Court action was commenced by the mortgagee bank of St Louis Flat 25C against the 2^nd defendant in recovery of outstanding mortgage loan and vacant possession of that property.  Because of the interest of the plaintiff in that property pursuant to the Judgment, the plaintiff’s application for directions in respect of that property before the learned Judge, as mentioned above, was adjourned to enable the plaintiff to consider taking part in such proceedings in the District Court.  So it did apparently.  But that has nothing to do with the Property, subject matter of the Charging Order.

32.  The 1^st defendant also asked the court to clarify several questions.  Only one of them is sensible and relevant.  The 1^st defendant questioned why the Property belonging to her should be attached for the enforcement of the costs orders which are against both defendants.  The answer to that is that the costs orders against the defendants impose joint and several liabilities on them to pay.

33.  Considering the matters in respect of which the further evidence is sought to be adduced, I find that the 1^st defendant fails to satisfy conditions (1) and (2) of the test under Ladd v Marshall, and I need say no more in respect of condition (3).  Leave to rely on the further evidence is therefore refused.

34.  As far as the 1^st defendant’s affirmation contains submissions instead of further evidence, none of them demonstrates any valid cause against the making of the Charging Order.  Her submissions in court did not change that.

35.  In the circumstances, the appeal in respect of the Charging Order fails.

Appeal in respect of stay of execution of the Judgment

36.  The directions that Lisa Wong J gave on 27 June 2018 were essentially as follows:

(1)  The 1^st defendant shall file and serve her account of the Kam Fai Proceeds with a verifying affirmation and supporting documents within 60 days.

(2)  The plaintiff shall file and serve his list of objections to the above account and the grounds therefor by affirmation with supporting documents within 28 days thereafter.

(3)  The 1^st defendant shall file and serve her response to the above list of objections by affirmation with supporting documents within 28 days thereafter.

(4)  The account shall be taken before as master.

(5)  Any application for further directions should be made to the master.

37.  In addition to her affirmation filed in support of her summons filed on 29 March 2019, the 1^st defendant filed two more affirmations on 10 April and 15 April 2019 respectively.  According to the affirmations, the Judgment cannot be executed without the court’s clarification and direction. She therefore requested the court to answer a number of questions set out in her affirmations.

38.  The order for account under the Judgment is simple and clear.  The defendants have to account for what had become of the relevant proceeds of sale at all material times up to the present.  I have also referred to the transcript of the hearing on 27 June 2018, which reveals that Lisa Wong J also explained to the 1^st defendant what is expected to be included in such account.  Other than that, it is not for the court to give legal advice, as some of the 1^st defendant’s questions seem to be seeking.  Some of the questions are effectively queries about the findings or reasoning of the learned judge in the Judgment, which are neither for the 1^st defendant to raise under the guise of request for clarification nor for this court to take the findings further.

39.  Lisa Wong J has already given what are normally expected to be the necessary directions for the taking of account before the master.  The logistic is clear.  The defendants have to form their own judgment on what to produce for the purpose of full account in compliance with the Judgment and in accordance with the logistic set out in the directions.  Whether they have done so will be a matter before the master upon hearing both sides.  Attributing their inability to do so to the alleged difficulty in compliance as mentioned in the 1^st defendant’s affirmations is both unsound and unacceptable.

40.  In her affirmation, and not on the face of her summons, the 1^st defendant asked for the following orders from this court:

(1)  transfer DCMP 878/2018 from the District Court to the High Court for hearing;

(2)  discharge the charging order in respect of Unit 25C in DCMP 878/2018;

(3)  stay of execution of the Judgment and costs orders pending the hearing of DCMP 878/2018;

(4)  requiring the plaintiff to disclose his whereabouts in Hong Kong and Australia as well as his assets; and

(5)  costs of the defendants in this action and HCMP 620/2017 (ie, the proceedings before the Court of Appeal mentioned above) to be paid by the plaintiff.

41.  Pursuant to section 42 of the District Court Ordinance, Cap 336, the District Court has the power to transfer any action or proceedings, or part of it, to the Court of First Instance of the High Court.  Pursuant to section 43 of Cap 336, the Court of First Instance may transfer any action or proceedings, or part of it, to the District Court that should be in the jurisdiction of the District Court.  Whether in terms of procedure or substance, I see no basis for the request for the master, or now this court, to transfer any part of the proceedings in DCMP 878/2018 to this level of court.

42.  As discussed in the previous section, the master was correct in making the Charging Order absolute. The proceedings in DCMP 878/2018, which concerns St Louis Flat 25C, are neither relevant to nor capable of altering that conclusion.

43.  As at today, the Judgment remains intact, despite the defendants’ attempts to appeal.  The defendants are not in a position to dispute liability under the various costs orders by seeking again to impeach the Judgment.  Likewise, the defendants have failed in their previous attempts to have the execution of the Judgment stayed pending the then intended appeal.  Whilst a party may[9] apply for stay of execution on the ground of matters which have occurred only after the date of a judgment, the basis for the 1^st defendant’s renewed attempt to impeach the Judgment and to stay the execution of the Judgment is neither new nor justified in the present case.

44.  The request for an order compelling the plaintiff to disclose his whereabouts and assets in the outstanding proceedings in this action is totally unfounded and irrelevant for the present purposes.

45.  In the circumstances, this appeal must also fail.

46.  It follows that there is absolutely no basis for the application for costs of this action and the previous applications for leave to appeal.

Application to set aside the Judgment

47.  Notwithstanding her previous attempts and repeated attempt to impeach the Judgment for the purpose of her appeals before this court, the 1^st defendant somehow saw fit to file yet another application by summons on 15 July 2019 returnable before this court, seeking to set aside the Judgment.  In her affirmation filed in support of such summons, the 1^st defendant also asks this court to set aside the Charging Order and to grant the defendants their costs of the action.

48.  Not only has the 1^st defendant persisted in taking out legal proceedings with a view to impeaching the Judgment notwithstanding the matters discussed above, but she has also chosen to do so notwithstanding the obvious multiplicity of proceedings.  Further, and fundamentally, this court does not have the jurisdiction to set aside the Judgment of another court of the first instance and in respect of the defendants’ challenge the appellate court has handed its ruling binding on this court.

49.  Clearly an abuse of legal process, this application must be dismissed.

Order

50.  The 1^st defendant’s two appeals are dismissed with costs to the plaintiff.  So is her application by summons filed on 15 July 2019.  The plaintiff’s costs shall be taxed, if not agreed, with certificate for counsel, in accordance with Legal Aid Regulations.  This costs order is nisi.  In the absence of application in 14 days to vary, this costs order shall become absolute without further order of the court.

Remark

51.  Counsel for the plaintiff requested that the 1^st defendant be warned, whether on her own behalf or purportedly on behalf of the 2^nd defendant, not to bring further legal proceedings which is either defiance of proper procedure or effective re-litigation.  Vexatious and abuse of court process must stop, or she may be faced with restrictive order of the court pursuant to section 27 of the High Court Ordinance, Cap 4.  The 1^st defendant should consider herself so warned by the court.