CHAN HON WING v. LEUNG WAI HANG

HCMP3352/97

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 3352 OF 1997

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J U D G M E N T

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1. The Plaintiff in this action was the son-in-law of the Defendant. He is now a Senior Court Prosecutor and he has conducted these proceedings himself, competently and diligently.

2. On 10th October 1990, he married the Defendant's daughter, Ms Tam Siu Fun ("Ms Tam"). They lived together as husband and wife for a few years at Flat 15B, Hoi Sun Building, No.12, Mercury Street, North Point, Hong Kong ("the Property").

3. The Plaintiff's case is that in 1988, he and Ms Tam decided to get married and to purchase a property jointly for use as the matrimonial home. They were and are civil servants and he had suggested to Ms Tam that both of them should apply for loans from the Government under the Housing Loan Scheme so as to provide the down-payment on the Property. According to the Plaintiff, Ms Tam and he had discussed the matter on several occasions and sometimes in the presence of a friend of both of them, a Mr Wei Kwok Wah ("Mr Wei"), who was also a civil servant and who was familiar with the housing benefits available from the Government. It was Mr Wei who suggested to the Plaintiff that the Plaintiff should apply jointly with Ms Tam for loans under the Housing Loan Scheme.

4. Ms Tam and the Plaintiff submitted their applications in July 1988; they were approved in September 1988. The Plaintiff was granted a loan of just in excess of $150,000 and Ms Tam was granted a loan of just under $100,000. One of the conditions for the grant of these loans is that the purchase of a property had to be made within three months of the approval.

5. During that time, Ms Tam and the Plaintiff looked for suitable premises all over. However, they were not able to find anything suitable within those three months and the Plaintiff's application to extend the time limit was also rejected. His case is that Ms Tam then suggested that she would seek assistance from the Defendant for a loan for a down-payment as the Defendant's money was on fixed deposits or in foreign currency, and that the loan would be repayable by the two of them. Later, after further discussion between Ms Tam and the Defendant, the Plaintiff was informed by Ms Tam that the Defendant agreed to lend the whole purchase price for a property of around $500,000. According to the Plaintiff, Ms Tam suggested that the Property should be registered in the Defendant's name because Ms Tam stated that if the Property was in Defendant's name, the Plaintiff could eventually obtain a loan under the Home Purchase Scheme to purchase the Property from the Defendant when he had attained 20 years of service in the Government. At that time, he had already been working in the Government for some 16 years.

6. The Plaintiff's evidence is that he thought it was fair for the Property to be registered in the Defendant's name as she was providing the purchase money. According to the Plaintiff, after further search, Ms Tam eventually found the Property which he then also looked at and liked. This was in about May 1989. The price was about $750,000 and he and Ms Tam decided that they would mortgage the Property to a bank for the balance of about $250,000 as the Defendant was going to supply $500,000. The Defendant was informed of their decision by Ms Tam according to the Plaintiff.

7. On the Plaintiff's case, an important meeting took place towards the end of July 1989 at a dinner amongst Ms Tam, the Defendant and the Plaintiff. At this dinner meeting, the Defendant agreed to lend the whole purchase price in the sum of just over $720,000. The three of them agreed the following terms :-

(1) the Defendant would lend a sum of just in excess of $720,000 to the two of them for the purchase of the Property and the loan would be interest free;

(2) the loan would be repayable to the Defendant by monthly instalments at amounts to be agreed between Ms Tam and the Defendant;

(3) the Defendant would be the registered owner of the Property and would hold the Property as trustee for him and for Ms Tam; and

(4) the Defendant would transfer the Property to the Plaintiff and Ms Tam when the Plaintiff's application under the Home Purchase Scheme from the Government is approved and granted in a few years' time.

8. The Plaintiff's case is that Ms Tam told him that she would go to the development company with the Defendant on 30th August 1989 to make the purchase and asked him to go along. As 30th August was a weekday on which he had to work, and since the Property was to be registered in the Defendant's name, he told Ms Tam that he preferred not to go.

9. The Agreement for Sale and Purchase was duly entered into on 30th August 1989 in the Defendant's name when Ms Tam and the Defendant attended the development company. At that time, the Hoi Sun Building was still in the course of construction.

10. The Plaintiff's average monthly income in 1989 was about $8,400 per month and the total monthly income of Ms Tam was about the same. She was holding two jobs at that time. After deliberation, Ms Tam and the Plaintiff, on his evidence, decided to repay the Defendant the sum of $8,000 per month starting from November 1989. The Plaintiff's evidence is that he provided his share of the monthly repayments by depositing $4,000 into Ms Tam's Hong Kong Bank Account No.006-070-5480 through the automatic teller machine ("ATM") and Ms Tam was responsible for transferring the total amount of $8,000 to the Defendant.

11. At some stage after July 1989, the Plaintiff's evidence is that he discussed with Ms Tam the complications which would follow if the Defendant died since she had four other children. Ms Tam had suggested that she would ask her mother, the Defendant, to prepare a Power of Attorney giving her absolute power in disposing of the Property.

12. The Occupation Permit of the Property was issued on 13th March 1990 and the completion of the purchase took place on 28th March 1990. By then, according to the Plaintiff, the Plaintiff and Ms Tam had already been repaying the Defendant for five months at $8,000 each month. After completion in or about April 1990, the Plaintiff's case is that Ms Tam told him that the Defendant had signed the necessary Power of Attorney at the solicitor's firm of Johnson Stokes and Master.

13. The next significant event on the Plaintiff's case is that in June 1990 he started to renovate the Property with the assistance of his younger brother, Mr Chan Pak King, and a friend, a Mr Fung Leung Yiu, who was a sub-contractor in the building industry. Mr Fung also had the assistance of his friend, a Mr Ma Kwok Wan, in the construction of a hanging concrete cabinet in the kitchen. The four of them must have carried out much work on the Property including painting and affixing fixtures. The Plaintiff said that he paid for all the materials required in the decoration but that neither his brother nor his friends charged him for the work. This I accept. I also accept that much of the decoration work was done by the four of them. I should mention at this stage that the Plaintiff sought to rely on these works to get within the principle laid down in the line of cases exemplified by Eves v. Eves [1975] 1WLR 1338, Burns v. Burns [1984] 1 All ER 244, and Grant v. Edwards [1986] 1 Ch 638. None of those cases are applicable. The Plaintiff's case, as I understand it, is based on an express agreement made at the dinner meeting towards the end of July 1990.

14. Ms Tam and the Plaintiff shopped around for the furniture and fittings of the premises. They each paid for some of the items as they did the wedding banquet. A lot of detailed evidence was given and cross-examined upon about the wedding expenses. I need not go into the details. Suffice it to say that I do not think much turns on the exact amounts and the breakdowns and the amounts of gifts by guests at the banquet, which duly took place on 10th October 1989. Whatever the exact sums and the number of guests who turned up, the evidence supports the view that this was a couple who did not have plenty of money to spare.

15. According to the Plaintiff, Ms Tam and he had agreed before the marriage that apart from contributing an equal amount towards the repayment of the loan from the Defendant, each should contribute together towards the household expenses. The Plaintiff's monthly salary in 1989 was, as I have said earlier, about $8,400 and it increased to nearly $10,000 in 1990. His evidence is that in October 1989, he and Ms Tam had agreed that they would each repay the Defendant $4,000 per month starting from November 1989. In July 1990, $6,000 was paid by the Plaintiff. He says that this was because of a backdated increase in salary as from 1st April 1990 and both he and Ms Tam had agreed to make a higher repayment for that month. No repayments were made in October, November and December 1990 because they had just married and were in need of money. Before the marriage, the Plaintiff and Ms Tam had already made repayments of some $76,000 to the Defendant.

16. Detailed breakdowns were given in evidence as to the monthly amounts, the method of repayment, cash or ATM, and the reasons therefor. A schedule supplied by Mr Lee from the further and better particulars supplied by the Plaintiff may for convenience be consulted. Anyway, the details appear to be as follows :

(i) A smaller amount of $3,000 was paid in January 1991 because of extra Chinese New Year expenses;

(ii) $5,000 was paid in February 1991 because Ms Tam and the Plaintiff decided to make up the difference for the previous month. There was no change from March to June 1991;

(iii) In July 1991, their financial position had improved and the Plaintiff's average monthly salary in 1991 was in excess of $11,000. The two of them decided to raise the amount of repayment and decided on $4,500 each;

(iv) $7,000 was paid in the following month because of another backdated increase in salary as from 1st April 1991;

(v) $4,600, according to the Plaintiff, was paid in September 1991; and;

(vi) In October 1991 Ms Tam and the Plaintiff decided to pay the Defendant $5,000 each per month.

17. Ms Tam's evidence, to which I will refer, is that these payments were the Plaintiff's contribution to the rent of the premises and to the household expenditure. There was never any loan from her mother.

18. I should mention that a child was born to the Plaintiff and Ms Tam in January 1992. By April 1992, according to the Plaintiff, they had decided each to put $3,000 per month into a kitty for the household and other expenses. On the Plaintiff's evidence, the amount of $6,000 was more than sufficient for the family and Ms Tam never approached him for more. He says that, out of habit, he continued to make his share of the monthly repayments by operating the ATM but provided the monthly expenses of $3,000 in cash. About the only item of evidence with which Ms Tam agreed is that she did not ask the Plaintiff for more money. Her evidence is that she had to contribute more of the rent and household expenditure than the Plaintiff and that the Plaintiff never paid her in cash.

19. The Plaintiff's case is that in July 1992, Ms Tam had suggested to him that she preferred to receive the total amount each month in cash because cash was what she gave to her mother each month and the Plaintiff had agreed. He tells me that that is why there were no ATM receipts for most of the months from August 1992 to May 1995. Occasionally he would revert to his habit of making monthly repayments by using the ATM, but the monthly expenses he paid in cash. Ms Tam's case is that any sum not transferred by ATM was never paid which explained, according to her, why she had to work long hours in the Auxiliary Police to make ends meet.

20. The Plaintiff's case is that the $5,000 monthly repayment starting from October 1991 until September 1995 were by and large maintained. There were isolated exceptions. First, the amount to $3,125 in March 1992 was made after deducting his school fees of $1,875 which Ms Tam had agreed to pay since the Plaintiff passed his exams at the City University for a law diploma. Secondly, $6,000 was repaid in August 1994 in error. The Plaintiff then rectified the mistake by paying less household expenses in cash to Ms Tam that month. Thirdly, there were no repayments made in November and December 1994 because the Plaintiff's father was ill with cancer and had to be hospitalised, and the Plaintiff was in need of money. He had suggested to Ms Tam to postpone the repayment to the Defendant for those two months and she had agreed. Lastly, $10,000 was paid in January 1995 because of a cash advance by the Government for the Chinese New Year and the Plaintiff had wished to make up some of the arrears. In respect of this last item, Ms Tam's evidence is that it was paid because she had asked the Plaintiff to vacate the premises so that she can let a room to ease her financial burden. The Plaintiff's evidence is that towards the end of September 1995, he suggested to Ms Tam to raise the monthly repayments from $5,000 to $7,000. As Ms Tam did no demur, the monthly repayments became $7,000 for October and November 1995.

21. Back-tracking somewhat in the narrative, although still staying in the Property, the Plaintiff had taken to sleeping in the living room while Ms Tam continued to use the bedroom in or about February 1993. According to the Plaintiff, there were attempts at reconciliation but ultimately their relationship got worse. In 1995, Ms Tam proposed a divorce, and according to the Plaintiff, she suggested that he should have custody of the child and she the Property, and that the petition be based on two years' separation by consent. She then left a separation agreement for his signature but he refused to sign. He thought that at that time the market value of the Property was about $2,400,000. In November 1995, the Plaintiff suggested to Ms Tam that she could retain the Property if she would let him have $700,000. He also said that at a later stage he was willing to give up his claim to the Property for a loan of $500,000. However, Ms Tam refused to negotiate on the Property and claimed that the Defendant is the sole beneficial owner of the Property, and that the Plaintiff has no interest or share in it at all. At that point, according to the Plaintiff, he ceased making monthly repayments to the Defendant. He claims to have paid a total of in excess of $320,000 to the Defendant via Ms Tam.

22. The contest as appears from the pleadings and the evidence comes down essentially to whether the Defendant lent the purchase price to the Plaintiff and Ms Tam as the Plaintiff alleges, or whether the Defendant purchased the Property for herself and merely rented the Property to the Plaintiff and Ms Tam. The Defence evidence from the Defendant and Ms Tam flatly contradicts the Plaintiff's evidence. Before I consider the Defence evidence, however, I need to refer to other evidence called by the Plaintiff and which, if believed, supports his case.

23. I start with Mr Wei Kwok Wah, who was a friend and a colleague of the Plaintiff in 1988 when Mr Wei was still in Government. Mr Wei used to work as a Clerical Assistant in the Accounts Office of the Causeway Bay Magistracy where he met the Plaintiff who was then a Clerical Officer and Ms Tam who was a Clerical Assistant to the Court Prosecutors. He became friends to both of them (and this is not in dispute) and a very close friend of the Plaintiff. Ms Tam does not, however, appear to take too kindly to Mr Wei anymore.

24. In 1988, on Mr Wei's evidence the Plaintiff had told him that he was going to marry Ms Tam and asked him what housing benefits they could get from the Government. After finding out their years of service, Mr Wei had suggested that both of them could jointly apply for loans under the Housing Loan Scheme for the down-payment for a new flat which could then be mortgaged to a bank.

25. In September 1988, according to Mr Wei, they told him that their respective loans had been approved and the total amount was about $250,000 and that they preferred to buy what was referred to in the evidence as a secondhand flat because it would be cheaper. Mr Wei knew a couple, a David Yau and a Sarina Sze, who were in property and introduced them to the Plaintiff and Ms Tam. Thereafter, on Mr Wei's evidence, on several evenings the five of them visited a number of flats in North Point and Wanchai. However, none of them were satisfactory to the Plaintiff and Ms Tam. His evidence is that the Plaintiff and Ms Tam were looking for Property to buy and not to rent Ms Tam denies having viewed properties when Mr Wei or the other couple were present.

26. Mr Wei said that there was a time limit of three months for every applicant under the Housing Loan Scheme and when more than two months had elapsed, the Plaintiff asked him what to do and he had suggested that they applied for an extension of time. Later on, the Plaintiff told Mr Wei that their applications for extension were not approved.

27. In or about April 1989, Mr Wei said that the Plaintiff told him that it was not necessary for them to re-apply under the Housing Loan Scheme because Ms Tam's mother had promised to lend them money for the down-payment to purchase a new property. Mr Wei had brought this matter up with Ms Tam on one occasion when there were other colleagues present and she had confirmed that her mother was lending them the money. Mr Wei had remarked that if she had known her mother would help, it would not have been necessary for them to go through their applications for loans.

28. Mr Wei says that he also visited that Property and took part in some minor decoration work. According to him, they continued to have frequent get togethers and on one occasion he had asked Ms Tam how much her mother had lent and whether they had to mortgage the Property to the bank. Mr Wei had asked the Plaintiff before but he was reluctant to discuss the topic and Mr Wei only asked Ms Tam when the Plaintiff was not present. According to Mr Wei, Ms Tam replied that her mother had lent the full purchase price and that both of them had to repay her mother $4,000 each per month and that the repayment had already started.

29. I should next refer to the evidence of Fung Leung Yiu. His evidence covers a slightly narrower compass but of no less importance. He was a sub-contractor in the building industry and has known the Plaintiff for some time. They are good friends. He is also known to Ms Tam. According to Mr Fung, a few months before the Plaintiff got married in 1990, he had asked him to decorate his new flat in Mercury Street. He had looked at the flat and he promised the Plaintiff that he would build a hanging concrete cabinet in the kitchen. He would work there when he was free in the evenings and sometimes on Sundays. He can no longer recall how many nights he spent working there. Apart from him, a friend of his, a Mr Ma Kok Wan, also assisted him. Mr Fung's evidence is that on a particular Sunday he was painting there with the Plaintiff and his younger brother, Chan Pak King. Mr Fung was painting the room facing the sea whereas Chan Pak King and the Plaintiff were painting the sitting room. The Plaintiff's brother suggested putting on an extra coat of paint in the sitting room, and the Plaintiff had gone out to buy paint. The Plaintiff's brother and Mr Fung continued to paint when, some minutes later, the Defendant and Ms Tam arrived. It was some time in the afternoon and Ms Tam had suggested that they go out for afternoon tea. After some discussion, it was agreed that Ms Tam would go out to buy tea to bring back. The Defendant stayed behind and, on Mr Fung's evidence, chatted casually to him, and he had said to her that the price of the flat would surely rise and asked her if she had purchased another one for herself as an investment. According to Mr Fung, the Defendant then replied to the effect that all her money had already been lent to Ah Wing and Ah Fun in buying this flat. Later, the Plaintiff returned and Ms Tam also returned with tea and egg-tarts.

30. According to Mr Fung, the Plaintiff had told him earlier that the flat was purchased with a loan from his mother-in-law. Mr Fung had asked him whether that was because he was unable to borrow from the Government, and the Plaintiff had said no, it was simply because his mother-in-law did not charge him interest.

31. The last witness for the Plaintiff is his brother, Chan Pak King. As far as I am concerned, the only material evidence he gives is that on the occasion to which Mr Fung referred, Mr Chan was present and confirmed that the Defendant and Ms Tam showed up and that the Defendant had a coversation with Mr Fung. He did not give any evidence as to the detail of that conversation.

32. It is the Defence case that the Defendant never had any such conversation with Mr Fung and that the occasion never took place. She was never there when any decoration was being done.

33. The Defendant's case is simple. She did not lend any money to the Plaintiff and Ms Tam to purchase the Property which she, and not they, had found. She never had the conversation to which Mr Fung affirms, and at all times the Property was rented to the Plaintiff and Ms Tam.

34. First, however, some more background about her. In 1989, the Defendant would have been about 58 years old. Her husband had passed away in 1973, leaving her with a flat in Argyle Street which they had purchased back in 1967. After her husband's death, she had rented out a room or rooms from that flat to supplement her income. She has five children, three daughters and two sons. The youngest of her children is about 30 years old now.

35. By the end of 1979 she had accumulated sufficient savings to buy another property at Flat B, 6th Floor, On Fook Court, Bedford Gardens, Tin Hau Temple Road, Hong Kong for $292,000. It was registered in her own name. This was rented out until it was sold in 1986 for $500,000.

36. In December 1979, the Defendant sold the property at Argyle Street and used the proceeds of that sale to purchase another property at Flat A, 12th Floor, Pak Hee Court, Bedford Gardens, No.159 Tin Hau Temple Road, North Point. This was also registered in her own name and used by her as a residence for herself and the children.

37. As for the Property, the subject matter of these proceedings, she had purchased it as an investment. She gave these reasons. First, after she had sold the property in On Fook Court in 1986, she had a lot of cash. Secondly, it was shortly after the June 4th incident and the property prices had gone down, she thought it was a good time to purchase a property as a long term investment. Thirdly, although at the time the Property was part of an uncompleted development, she was confident that after completion it could be rented out easily because of its convenient location.

38. On 30th August 1989, she signed the Memorandum for Sale with the developer and purchased the Property in her own name. This purchase was completed on 28th March 1990. After completion of the purchase, in about April 1990, she had instructed an estate agency to help her rent out the Property. She could no longer remember the name of the agency, but according to her it was along King's Road in North Point. Although her evidence may have been a touch confused, I think the Defendant said that some interest was expressed by a prospective tenant and I understood her to say that she did not think they were suitable for one reason or another.

39. About July 1990, her daughter Ms Tam approached her and asked if she could rent the Property from the Defendant because the Plaintiff and Ms Tam were planning to get married in October 1990 and they had been unable to find a suitable flat and the marriage date was approaching. The Defendant, on her evidence, was pleased to hear about the wedding and was prepared to help, but she also said that she had to be fair to all her children. She rented the Property to Ms Tam and the Plaintiff and she did not make an interest free loan to them. A tenancy agreement in respect of the Property was signed on 15th July 1990 between Ms Tam and the Defendant for a term of two years at a rental of $6,500 a month. A copy of this tenancy agreement was put in evidence. The two agreements for the years 1992-1994 and for 1994-1996 had been misplaced.

40. The Defendant's evidence is that Ms Tam would pay rent to her when Ms Tam visited her each month. Rental receipts would be issued and the Defendant would keep the counterfoils. These, as well as the tenancy agreements, except the one for 1996-1998, were all filled in by Ms Tam and signed by the Defendant or whose chop was affixed. Some of the rental receipts and counterfoils were adduced in evidence, others were said to have been lost. The details of the tenancies are as follows :

Period	Rent
From September 1990 to August 1992	$6,500
From September 1992 to August 1994	$7,000
From September 1994 to August 1996	$7,500
From September 1996 to August 1997	$8,000
From September 1997 to present	$7,000

41. The rental was reduced to $7,000 in September 1997 because, says the Defendant, she knew that Ms Tam was in financial difficulty as the Plaintiff had not been paying maintenance to her. The tenancy agreement beginning in 1996 was filled in in part by a niece visiting from China. The date was omitted inadvertently; clause 11 evidencing the reduction was filled in by Ms Tam at a later stage. The Defendant, in addition, refutes the Plaintiff's evidence of the dinner agreement in July 1989 and is adamant that she had never lent the purchase price to the Plaintiff and Ms Tam.

42. When the Defendant purchased the Property, apart from the purchase price, she also had to pay for the legal cost, stamp duty and other disbursements relating to the conveyancing. She was, according to her, slightly short of funds and another daughter, a Theresa Tam, had to lend her some of the money. The Defendant repaid this daughter shortly afterwards when a son of her gave her some money. Ms Tam had made out the cheque for the legal fees and disbursements for about $24,000 but she was also paid back soon after.

43. The Defendant also says, in contradicting the Plaintiff, that since the purchase of the Property, she had kept all the title deeds of the Property with her at her home save that the Sale and Purchase Agreement and the Assignment were kept in a safe deposit box.

44. The Defence's version of events is supported in the main by Ms Tam's testimony, in particular, the tenancy agreements, the receipts and the counterfoils and who filled them in. Ms Tam's evidence is that in 1989, when the Plaintiff and she were considering marriage, their financial situation did not allow them to have both a wedding banquet and a honeymoon. The Plaintiff and Ms Tam then agreed that they should postpone the marriage so that they could save enough money to enable them to have both a banquet and a honeymoon. Ms Tam's evidence is that because the Plaintiff was fond of gambling, they further agreed that he should transfer a sum of money to her Hong Kong Bank account every month so as to ensure that their saving plan would proceed smoothly. That was how and why the Plaintiff started transferring $4,000 to her account every month beginning the 30th October 1989.

45. On 28th March 1990, the Defendant had completed the purchase of the Property and, by May 1990, the Plaintiff and Ms Tam had decided to get married on 10th October 1990. They had started to look for rental premises for use as their matrimonial home. They had looked for about two months in North Point, Shaukeiwan and Chai Wan but were unable to find anything suitable. At an earlier stage, some time between August and December 1989, she had realised that they did not have sufficient funds to buy suitable premises. She knew from the Defendant that the Property was still vacant and that the Defendant was looking for a suitable tenant. Ms Tam's evidence is that she did not think that the Property was suitable for them and initially was not keen to take up the tenancy because the flat was rather small. However, after two months' search which turned up nothing, and the wedding date was drawing closer, she, with the agreement of the Plaintiff, suggested to the Defendant that they would like to rent the Property from her at a rent of $6,500 per month for two years. According to her, the Defendant was cooperative and a tenancy agreement dated 15th July was entered into between her and the Defendant, as I have said, for a term of two years at the rent of $6,500 each month. Shortly afterwards, she says, she informed the Plaintiff that she had signed this tenancy agreement with her mother.

46. At that time, according to Ms Tam, she and the Plaintiff had an understanding that when the Plaintiff had attained 20 years of service with the Government, he would apply for the Civil Service Home Purchase Scheme so that they could purchase a property. Under this scheme the Government contributes an amount of money for housing benefit for a period of 10 years to civil servants to enable them to buy their own homes. The loan would be spread over 10 years and the amount would depend on the applicant's salary level. The applicant would get a fix sum per month. This monthly allowance does not have to be repaid, although any lump sum advance for the down-payment had to be. It was Ms Tam's evidence that, even if an application under the Home Purchase Scheme were later approved, they would not have used the funds to buy the Property as it was too small.

47. Anyway, the Plaintiff and Ms Tam got married on 10th October 1990 at the Marriage Registrar's Office at Eastern Marriage Registry in Hong Kong. A wedding banquet was held, but the total expenses in connection with the wedding were high and they had to cancel their plan for a honeymoon. Her evidence was that the renovation of the Property was done by the Plaintiff and his friends and the two of them merely paid for the costs of the material.

48. In 1992, a child was born to her and the Plaintiff, and in about February 1993, she decided to separate from the Plaintiff although he stayed on in the flat. According to her, the Plaintiff stopped all maintenance payments as from November 1995. Ms Tam petitioned for divorce in 1996.

49. I do not go into the detail of the causes of the breakdown of the marriage as they are not material to these proceedings, and there are still outstanding applications for financial provision in the Family Court. For the same reasons, I have not gone into the particulars of the household expenditure save where they have a bearing on the issue of whether the transfers of funds from the Plaintiff to Ms Tam were for the repayment of loans to the Defendant.

50. Ms Tam also gave evidence about the tenancy agreements which supports the Defendant's version to which I have already referred. Her evidence on how the rents were paid and how the receipts and counterfoils were made out is also entirely consistent with the evidence given by the Defendant.

51. Ms Tam declares that she never asked her mother for a loan to purchase the Property. Her financial situation did not make such a purchase possible. The Property in question she thought was too small anyway. It was and is around, I believe, 300 sq feet. As for Mr Wei Kwok Wah, Ms Tam says she became acquainted with him in 1986 when she was working at the Causeway Bay Magistracy. They were casual colleagues. She certainly did not have the conversation which Mr Wei alleged they had, and she did not tell him that the Defendant had provided her and the Plaintiff with a loan to purchase the Property. As for Mr Fung Leung Yiu, they had met on no more than five locations and according to Ms Tam, neither Mr Fung nor Mr Wei is an impartial witness because of the closeness of their relationships with the Plaintiff.

52. Ms Tam also says that the transfers of money by the Plaintiff to her account every month was for the purpose of maintenance and for the household expenditure out of which, with her own earnings, she paid rent to the Defendant. Those transfers, according to her, were not for the repayment to the Defendant of any loan which simply did not exist. The dinner agreement in July 1990 also never took place. She went into details of and the variations on the monthly sums paid to her by the Plaintiff.

53. The decree nisi had been made in the divorce proceedings. Ms Tam has applied for financial provision and has been granted interim maintenance in the sum of $7,000 - I think for her and the child. The application for financial provision has been adjourned pending the outcome of these proceedings. A number of other formal witnesses were called and they produced certain documents which featured in the cross-examinations of the three main protagonists. The Plaintiff was also allowed to call a rebuttal character witness who gave clear and sensible evidence. She did not think the Plaintiff was a flirt or that he fooled around with women. I accept that she was trying to give truthful evidence, although I doubt if she is capable of proving that the Plaintiff never fooled around with women. Fortunately, I do not have to resolve this as an issue in these proceedings and I am more than happy to proceed on the basis that the Plaintiff did not fool around with women while he was married to Ms Tam and before their separation.

54. After all the detailed evidence and some very capable submissions, I am left with the clearest possible conflict of evidence on the main issue in this case, namely whether the Property is beneficially owned by the Plaintiff and Ms Tam, or by the Defendant alone. The witnesses for of the Plaintiff support the contention that the Defendant made a loan to the Plaintiff and Ms Tam to enable them to buy the Property, while the Defendant and Ms Tam's version is that there was never a loan.

55. All six factual witnesses gave oral testimony, and all of them were cross-examined. None of them deviated much in cross-examination nor stuck essentially to their stories. Ultimately, I have had to resort to the inherent probabilities and also to a lesser extent on the burden of proof.

56. First, a few words about the Plaintiff and the Defendant. The Plaintiff, as I have said earlier is now a Senior Court Prosecutor. He has had to work hard to achieve this. He was from a humble background and he is a man of determination and doggedness. The Defendant did not have it easy either. She had to bring up five children, and sent one of them to the United States of America to further his education. By dint of hard work and at least some financial acumen, she has managed to make money from property. She was and is, from her evidence, obviously careful with her money and on good terms with her children.

57. Ultimately, the inherent probabilities are against the Plaintiff's case. The evidence of the Plaintiff, his brother, Mr Fung and Mr Wei on the crucial of the loan, I do not accept. I attribute the Plaintiff's other witnesses' versions of events to their misguided loyalty to the Plaintiff. I find that the Defendant did not have the conversation about the loan with Mr Fung, and neither did Ms Tam have the two conversations with Mr Wei. These conversations were supposed to have taken place some 10 years ago, and the witnesses' recollections are simply too rehearsed and convenient for comfort. I am also unable to find that agreement was reached about the loan and the purchase of property in July of 1990 amongst the Plaintiff, the Defendant and Ms Tam.

58. The concept of a trust and the concept of trusteeship would not have been understood by the Defendant. On the Plaintiff's evidence it was not familiar from him in July 1990 either, as he really began reading up on this area of the law for the purposes of these proceedings. Yet the trust was fundamental to what was supposed to have been agreed in July 1990. According to the Plaintiff, this concept and everything else at that meeting was discussed by all three of them. This is evidence that I am not able to accept.

59. In November 1995, when the Plaintiff raised the issue of the Property with Ms Tam, it is his evidence that she was already saying that he had no interest in the Property which was beneficially the Defendant's. So it is not as if the Defendant's and Ms Tam's versions were prompted by this litigation.

60. When the Plaintiff was discussing the matter with Ms Tam, who according to the Plaintiff had suggested getting the loan from the Defendant, Ms Tam was alleged to have said that the Defendant had fixed deposits and foreign currencies, in other words, her assets were earning income for her. A careful woman such as the Defendant who knew the value of money was hardly likely to make an interest free loan in 1989.

61. When I take into account that, on the Plaintiff's case, at the July 1990 meeting, even repayment amounts and the terms of the repayment had not been agreed, I have even more difficulty in accepting that version of events. As for the missing tenancy agreements and some of the receipts and counterfoils, it was suggested by the Plaintiff that they were all fabrication. I do not think that they are. I have observed, I hope, carefully all the witnesses while they were giving evidence. The Defendant and Ms Tam struck me as essentially frank witnesses. If those documents had been fabricated, in my view, the likelihood is that there would no missing ones and everyone of those documents would have been properly filled in, signed or chopped. And it would not have been necessary to put in Clause 11 on the fourth tenancy agreements evidencing the $1,000 reduction of the monthly rent. I also accept that the Plaintiff invariably paid Ms Tam via ATM transfers and not in cash. The amounts in the documents are very precise. On 31st August 1991, for instance, $4,600 instead of $4,000 was transferred, and on an earlier occasion, on 4th July 1991, $4,500 instead of $4,000 was transferred. Both the additional amounts are, I accept from Ms Tam, to reimburse her for her getting gift coupons for the Plaintiff.

62. All these circumstances lead me to conclude that the Plaintiff has not proved his case on the balance of probabilities.

63. I mention one other point, and that is Mr Lee's lack of writing defence under section 3 of the Conveyancing and Property Ordinance Cap.219. If I had believed the Plaintiff's version of events, I would, in all probability, have found a constructive trust in the Plaintiff's favour and the lack of writing defence would not necessarily have availed the Defendant. On the findings I have made, however, this point does not arise and I will say no more about it.

64. As it is, the Plaintiff's claim is dismissed and I will now hear the parties as to costs.

[Submissions on Costs]

65. The Plaintiff's claim is dismissed with costs to the Defendant to be taxed in accordance with the Legal Aid Regulations.