NG SHING CHIT v. LEE KIN CHU by her guardian ad litem GO MAN YIN

HCA 1228/2015

[2018] HKCFI 2395

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

HIGH COURT ACTION NO 1228 OF 2015

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J U D G M E N T

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INTRODUCTION

1.  This action concerns the beneficial ownership of a property known as Flat C4, 6/F, Kam Ping Mansion, Nos 63-69 Kam Ping Street, Hong Kong (“the Property”).

BASIC FACTS

2.  Mr Ng Shing Chit (“Mr Ng”), a married man with 3 children, came to know Madam Lee Kin Chu (“Madam Lee”) in Hong Kong in about 1976, and later developed an extra-marital relationship with her.  Madam Lee was at that time a divorcee and had a son, Go Man Yin, (“Man Yin”), born in 1963.  According to Madam Lee, Mr Ng told her at that time that he and his wife had divorced, and it was only in about 1989 that Mr Ng told her that he had not divorced his wife.  On the other hand, Mr Ng says that he never told Madam Lee that he had divorced his wife, and Madam Lee well knew that he had a wife and children in Mainland China, who came to join him in Hong Kong in 1978.  I shall come back to this matter later in this judgment.

3.  By an agreement dated 30 July 1984, Mr Ng and Madam Lee agreed to purchase the Property as joint tenants at the price of HK$249,000.

4.  Madam Lee paid the sum of HK$120,000 as down payment for the purchase of the Property, as well as, inter alia, the expenses for the decoration of the Property.  The balance of the purchase price was paid with the assistance of a mortgage loan of HK$130,000 from The Hong Kong Building and Loan Agency Limited.

5.  On 5 September 1984:-

(1)  the Property was assigned to Mr Ng and Madam Lee as joint tenants; and

(2)  a mortgage of the Property was executed by Mr Ng and Madam Lee in favour of The Hong Kong Building and Loan Agency Limited (“the 1^st Mortgage”) as security for the loan of HK$130,000.

6.  According to Mr Ng, he was solely responsible for making repayment under the 1^st Mortgage, whereas according to Madam Lee, she, Man Yin and Mr Ng all contributed to the repayment of the loan under the 1^st Mortgage.

7.  After the purchase, Madam Lee and Man Yin started to reside in the Property, and Mr Ng visited Madam Lee and stayed there overnight frequently.

8.  On 15 May 1987, the 1st Mortgage was discharged, and replaced by a legal charge of the Property in favour of The Yien Yieh Commercial Bank Limited (“the 2^nd Mortgage”) as security for general banking facilities to the extent of HK$150,000 granted by the bank to Mr Ng and Madam Lee.

9.  As in relation to the 1^st Mortgage, Mr Ng says that he was solely responsible for making repayment under the 2^nd Mortgage, whereas according to Madam Lee, she, Man Yin and Mr Ng all contributed to the repayment of the loan under the 2^nd Mortgage.

10.  According to Mr Ng, in or about 1987, he and his wife were allocated a Home Ownership Scheme (“HOS”) flat in Chai Wan, but they were later disqualified from the allocation because Mr Ng was a registered owner of the Property.  At that time, Mr Ng did not want his wife to know that he was holding the Property together with Madam Lee as joint owners, and therefore told his wife that the qualification was due to the fact that his income exceeded the upper limit for purchasing a HOS flat.

11.  On 16 November 1989:-

(1)  the 2^nd Mortgage was discharged;

(2)  Mr Ng as “Vendor” and Madam Lee as “Purchaser” entered into a written agreement for the sale and purchase of Mr Ng’s interest in the Property at the stated consideration of HK$128,000;

(3)  Mr Ng as “Vendor” assigned his interest in the Property to Madam Lee as “Purchaser” at the stated consideration of HK$128,000, receipt thereof was acknowledged by Mr Ng in the assignment; and

(4)  Madam Lee as “Mortgagor”, Mr Ng and Madam Lee as “Principal” and The Yien Yieh Commercial Bank Limited as “Mortgagee” entered into a mortgage of the Property (“the 3^rd Mortgage”) as security for general banking facilities granted by The Yien Yieh Commercial Bank Limited to Mr Ng and Madam Lee.

12.  According to Mr Ng, he transferred his interest in the Property to Madam Lee because he and his wife intended to apply again for a HOS flat and also because he was worried that his wife would eventually find out that he and Madam Lee had a property held in their joint names.  He therefore asked Madam Lee to hold his interest in the Property on trust for him, which she agreed.  Mr Ng also says that he did not receive the purchase price of HK$128,000, or any sum, from Madam Lee under the assignment.

13.  On the other hand, Madam Lee says that in around 1989, Mr Ng proposed to sell his half interest to her, which caused her to feel unease and worried.  It was only after her repeated questioning that Mr Ng admitted that he and his wife had not been divorced.  Mr Ng begged Madam Lee for her forgiveness for having cheated her all along. Mr Ng further told Madam Lee that he and his wife intended to apply for a HOS flat but a registered owner of a property was not qualified to apply for a HOS flat, and he did not wish his wife to know that he jointly owned a property with another woman.  Mr Ng therefore proposed to sell his half interest to Madam Lee.  After discussion with Man Yin, Madam Lee eventually agreed to purchase Mr Ng’s half interest in the Property for HK$128,000, that being the price proposed by Mr Ng.  Madam Lee also says that she fully paid the purchase price of HK$128,000 to Mr Ng by making a down payment of HK$28,000 in late 1989 or early 1990, and 5 subsequent payments each of HK$20,000 (from her earnings derived from doing part-time jobs as well as moneys given to her by Man Yin) over a period of 4 to 5 years.

14.  On 27 January 1996, the 3^rd Mortgage was discharged, and replaced by a legal charge of the Property in favour of Liu Chong Hing Bank Limited (“the Charge”) with Madam Lee as “Mortgagor”, Man Yin as “Requesting Party” and Liu Chong Hing Bank Limited as “Mortgagee” as security for general banking facilities to the extent of HK$350,000 granted to Man Yin.

15.  On 24 June 1997, a further legal charge (“the Further Charge”) of the Property was executed with Madam Lee as “Mortgagor”, Man Yin as “Principal” and Liu Chong Hing Bank Limited as the “Mortgagee” as security for further general banking facilities to the extent of HK$600,000 (in other words, up to the total of HK$950,000) granted to Man Yin.  The Charge and Further Charge will hereinafter collectively be referred to as the “Charges”.  According to Mr Ng, he was not aware of the Further Charge until around 2000.

16.  The following allegations raised by Mr Ng in paragraphs 16 to 19 of the Statement of Claim form the crux of his claim against Madam Lee, which I shall quote in full:-

“16. The Plaintiff was not aware of the 2^nd Charge of LCHB until in or about 2000 when the Defendant told the Plaintiff that [Man Yin] was in financial difficulty and was unable to repay the outstanding loans under [the Charges] in respect of the Property. The Defendant begged for help from the Plaintiff and made a representation to the Plaintiff to the effect that whoever repaid the loans would get her interest and share of the Property after her death (‘the Defendant’s Representation’).

17. In reliance of the Defendant’s Representation, and fearing that any failure of repayment would result in the Property being entered into possession by LCHB and in turn affect his beneficial interest therein, the Plaintiff caused his son, Ng Chi Chiu (‘NCC’) to open a joint bank account at LCHB with the Defendant for making repayments of the outstanding loans under the Charges. After 4 repayments [were] made, the Plaintiff himself took over from NCC the responsibility of repayment and further repaid until the Charges were ultimately released in January 2006 by way of a Release, registered by Memorial No.06022801440033 in the Land Registry.

18. For the period from 2001 to early 2006, since the Plaintiff’s export business was not going well, the Plaintiff had also been working as a night shift taxi driver to make money for the repayment of loans under the Charges. During that time, the relationship between the Plaintiff and the Defendant was good. The Plaintiff would visit the Defendant at the Property everyday.

19. Starting from about mid-2006, the Plaintiff had from time to time on various occasions requested the Defendant to put back his name in the title of the Property. However, the Defendant refused to do so.”

17.  The above allegations are denied by Madam Lee. It is not in dispute, however, that:

(1)  In 2000, Man Yin defaulted in making repayment of the loans under the Charges (he was adjudged bankrupt in June 2001, and the bankruptcy order against him was discharged in June 2005).

(2)  In 2000, Mr Ng’s son (Ng Chi Chiu, “Chi Chiu”) and Madam Lee opened a joint bank account at Liu Chong Hing Bank Limited.

(3)  Between July 2000 and October 2005, Mr Ng or Chi Chiu made a series of monthly payment, each of approximately HK$8,800 (with a few exceptions) to Madam Lee’s account (save that the payment on 5 July 2000 was made to Man Yin’s account, and the payment on 2 February 2001 was made to Madam Lee and Chi Chiu’s joint account), which she used to repay the loans owing to Liu Chong Hing Bank Limited.  The loans were eventually fully repaid, and the Charges were released on 3 January 2006.

18.  According to Mr Ng, he visited Madam Lee at the Property less frequently since about 2008 because Madam Lee started to let the 2 bedrooms in the Property to pregnant women from Mainland China from time to time (while Madam Lee would sleep in the living room), and he himself stayed in Mainland China most of the time since about 2009.  Mr Ng says that his relationship with Madam Lee lasted up to around 2011.  Mr Ng has also produced some photographs allegedly taken in about 2008 to show that he and Madam Lee went out together and were still seeing each other at that time.  On the other hand, Madam Lee says that she and Mr Ng seldom saw each other after 2006, and she was not clear about Mr Ng’s situation or whereabouts as from that time.  Madam Ng also says that she did not receive any further money from Mr Ng since 2006.

19.  On 15 January 2014, Mr Ng, through his solicitors (Wan and Leung), sent a letter to Madam Lee demanding for her agreement to transfer the Property to him “subject to [her] right to occupy the Property during [her] lifetime”.  At paragraphs 2 and 3 of that letter, the following allegations were made:-

“2. We are instructed by our client the following:

(1) You and our client met back in 1976 and shortly afterwards our client developed an extra-marital relationship with you. At the time, our client was doing import and export business of Chinese medicine and you were a worker working at a factory. At that time, our client was married with 3 children and you were divorced with a son.

(2) In or about 1977, you stopped going out to work because our client started to maintain you and your son’s living by giving you a sum of money each month as living expenses.

(3) In or about September 1984, you and our client jointly purchased the Property as joint tenants at the purchase price of HK$249,000 and the Property was to be used as a home of you and our client. The arrangement was that you paid the down payment of the Property in the sum of about HK$120,000. The remaining HK$130,000 was financed by way of a mortgage on the Property in favour of the Hong Kong Building and Loan Agency Limited and our client was solely responsible for the monthly mortgage repayment.

(4) In or about May 1987, our client changed the mortgagee bank to The Yien Yeh Commercial Bank Limited as he had business relationship with the bank and he could obtain overdraft facility for his use as he was doing business at that time and needed money for liquidity purpose. The mortgage amount was HK$150,000. After the change of the mortgagee bank, our client continued to be solely responsible for the monthly mortgage repayment.

(5) In or about November 1989, our client transferred his registered ownership in the Property to you by way of a purported sale and purchase at a sale price of HK$128,000. The purpose of the transfer was to remove the name of our client from the Property so that he might re-apply for a housing unit under the Home Ownership Scheme and he was worried that his wife might eventually discover his ownership of the Property. Before the removal of his name from the Property, our client had successfully applied for a housing unit under the Home Ownership Scheme, but he was later disqualified due to his ownership of the Property. You had never made payment of the purported sale price to our client. Although our client transferred his registered ownership in the Property to you, he continued to be solely responsible for the monthly mortgage repayment until the mortgage with Yien Yeh Commercial Bank Limited was discharged in January 1996.

(6) On 27^th January 1996 and 24^th June 1997, you borrowed money from Liu Chong Hing Bank Limited (‘LCHB’) in the sums of HK$350,000 and HK$600,000 respectively by way of a charge over the Property in favour of LCHB. It is our client’s belief that you borrowed the 2 sums of money for the benefit of your son, namely Mr Go Man Yin.

(7) In or about 2000, your son was in financial difficulty and you and your son were unable to make the loan repayment to LCHB and therefore the Property was liable to be repossessed by LCHB. As you did not want the Property to be repossessed by LCHB, you begged our client and his son, Mr Ng Chi Chiu for financial assistance in repaying the loans. In return, you promised our client and his son that whoever repaid the loans would get the Property after your death. You also promised to our client’s son that his name could and would be put in the Property as a joint owner with you. At your request and in reliance on your promise, our client’s son initially paid several monthly instalments of the loan and thereafter our client started making monthly payment of about HK$8,800 to the mortgagee bank for repayment of the loans on your behalf. We enclose copies of our client’s Deposit Advices to your bank account for the period from July 2000 to September 2005 for your reference.

(8) The legal charge of LCHB was released in January 2006.

(9) Due to the advancing age of you and our client and for fear of the untimely death of the parties before proper conveyance is made in accordance with the agreed arrangement set out in paragraph 2(7) above, our client repeatedly requested you on various occasions to do legal documentation to include his name in the Property. However, you refused our client’s requests.

3. We are further instructed that our client’s transfer of the Property to you in November 1989 was made with the intention of the parties and on the basis that you were and are only holding our client’s share in the Property on trust for our client. Our client did not intend you to take the Property beneficially. In other words, our client still retains beneficial interest in the Property even though the Property was transferred to your sole name.”

20.  Madam Lee, apparently, did not respond to the said letter from Wan and Leung.

THE PRESENT ACTION

21.  On 3 June 2015, Mr Ng commenced the present action against Madam Lee seeking, inter alia, a declaration that she held the Property on trust for him subject to her life interest in the Property.

22.  On 7 September 2015, Madam Lee filed a homemade defence in this action, she being unrepresented at that time.

23.  Pursuant the court’s order dated 26 February 2018, Man Yin was appointed as guardian ad litem of Madam Lee in this action due to her mental incapacity.  On 14 May 2018, the court made a further order granting leave to Man Yin to rely on the two witness statements of Madam Lee filed on 16 March 2016 and 17 October 2016 respectively as hearsay evidence at the trial.

WHETHER MADAM LEE HELD MR NG’S HALF INTEREST IN THE PROPERTY ON TRUST FOR HIM AFTER THE ASSIGNMENT IN 1989?

24.  On the face of the sale and purchase agreement and assignment both dated 16 November 1989, Mr Ng transferred his interest in the Property to Madam Lee for the consideration of HK$128,000, receipt of which was acknowledged by him in the assignment.  Prima facie, Madam Lee thereby became the sole legal and beneficial owner of the Property.  This having been said and notwithstanding the submission of Mr Wong to the contrary, it is trite that, as a matter of law, Mr Ng may prove the true nature of the transaction between the parties, in particular that he did not receive any consideration from Madam Lee for the transfer of his interest in the Property to her, and she agreed to hold such interest on trust for him.  The question is whether Mr Ng has successfully proved the same by evidence, it being clear that the burden is on him to do so.

25.  The respective cases of Mr Ng and Madam Lee are based, essentially, on bare assertions.  Mr Ng has not been able to produce any contemporaneous documentary evidence to prove the alleged trust.  Equally, Madam Lee and Man Yin have not been able to produce any contemporaneous documentary evidence to prove the alleged payment of HK$128,000.  Nevertheless, in view of the relationship between Mr Ng and Madam Lee at the material time and the long lapse of time, the absence of relevant documentary evidence is not, I consider, surprising.

26.  As earlier mentioned, Mr Ng gives two reasons for transferring his interest in the Property to Madam Lee, neither of which I consider to be convincing.  First, he says that he and his wife intended to again apply for a HOS Flat.  However, he and his wife did not, as a matter of fact, made any application for a HOS flat in 1989 or at any time thereafter.  The fact that no application was made casts doubts on the first reason given by Mr Ng for transferring his interest in the Property to Madam Lee.

27.  Second, Mr Ng says that he did not wish his wife to know that he and Madam Lee held the Property as joint owners.  However, it is also Mr Ng’s evidence that in 1987, his wife once went to the Property and found Mr Ng there, and had a quarrel with Madam Lee.  Thereafter, she also questioned him from time to time on whether he had an interest in the Property.  It is clear, therefore, that Mr Ng’s wife was fully aware of the existence of the Property, and believed or suspected that Mr Ng had an interest in the Property.  Transferring his interest in the Property to Madam Lee would not achieve his purpose of concealing from his wife the fact that he and Madam Lee were once joint owners of the Property, since that fact is a matter of public record.

28.  These having been said, it is common ground that these were the two reasons given by Mr Ng to Madam Lee at that time, and it is possible that these were indeed the reasons why Mr Ng did not wish his name to continue to appear as a joint owner of the Property.  It does not necessarily follow, however, that Madam Lee held Mr Ng’s interest in the Property upon trust for him as alleged, because an absolute transfer of his interest in the Property to Madam Lee for consideration would also mean that his name would no longer appear as a joint owner of the Property.

29.  Mr Ng says that Madam Lee had little income at that time (1989 to 1994) and suggests that she was in no position to pay the sum of HK$128,000 to him within a period of 4 to 5 years.  I accept, however, the evidence of Madam Lee (at paragraph 35 of her first witness statement) and Man Yin (at paragraphs 20 and 21 of his witness statement, which he confirmed in court) regarding their financial positions and reject Mr Ng’s evidence to the contrary, and find that they were financially capable of paying the sum of HK$128,000 to Mr Ng in 4 to 5 years.  In coming to this conclusion, I take into account Mr Ng’s allegation that Madam Lee also had little income prior to the purchase of the Property in 1984, but it is not in dispute that she was able to make the down payment of HK$120,000 for the purchase of the Property, and also pay the decoration expenses of the Property in the amount of about HK$12,000.

30.  Overall, I prefer the evidence of Madam Lee and Man Yin to that of Mr Ng, and find, on the balance of probabilities, that Madam Lee did pay the consideration of HK$128,000 to Mr Ng for the transfer of his half interest in the Property to her under the assignment.  It follows that I reject Mr Ng’s allegation that Madam Lee held the half interest in the Property on trust for him.

31.  Having come to this factual finding, it becomes unnecessary for me to determine whether, as a matter of law, the alleged trust should, in any event, not be recognized or given effect by the court on the ground of illegality, it being Mr Ng’s own case that one of the reasons for purportedly transferring his half interest in the Property to Madam Lee was to get around the prohibition against a registered owner of a property from applying for a HOS flat.

WHETHER MR NG IS ENTITLED TO THE PROPERTY SUBJECT TO MADAM LEE’S LIFE INTEREST BY REASON OF HER PROMISE OR REPRESENTATION AND/OR HIS REPAYMENT OF THE LOANS UNDER THE CHARGES?

32.  Before I consider Mr Ng’s principal case based on an express promise or representation allegedly made by Madam Lee to him to the effect that whoever repaid the loans under the Charges would be entitled to the Property after her death, I should briefly dispose of an alternative claim raised by him at the trial, namely, that in view of the fact that he made repayment in the total sum of HK$524,700 to Liu Chong Hing Bank Limited, he should be entitled to a 87.45% share of the Property (by reference to the repayment amount of HK$524,700 as compared to the loan amount HK$600,000) based on a “resulting trust” (see paragraphs 7 and 8 of Mr Poon’s opening submissions, and paragraph 60 of his closing submissions).  In my view, this alternative claim is not open to Mr Ng because it is not pleaded in the Statement of Claim.  In any event, I am far from being satisfied that such claim (if pleaded) is sound in law.  While a resulting trust may in some circumstances be presumed where a person pays the purchase price for the acquisition of a property in another person’s name, Mr Poon has not cited any authority to support the proposition that the presumption of resulting trust would also arise merely from the fact that a person repays a mortgage loan in respect of a property which, subject to the mortgage, is already vested in another person beneficially.

33.  Mr Ng’s principal case as advanced in his Statement of Claim is as follows:-

“16 The Defendant … made a representation to the Plaintiff to the effect that whoever repaid the loans would get her interest and share of the Property after her death (‘the Defendant’s Representation’).

17 In reliance of the Defendant’s Representation, and fearing that any failure of repayment would result in the Property being entered into possession by LCHB and in turn affect his beneficial interest therein, the Plaintiff caused his son, Ng Chi Chiu (‘NCC’) to open a joint bank account at LCHB with the Defendant for making repayments of the outstanding loans under the Charges. After 4 repayments [were] made, the Plaintiff himself took over from NCC the responsibility of repayment and further repaid until the Charges were ultimately released in January 2006 by way of a Release…”

34.  The evidence adduced by Mr Ng does not, however, quite measure up to his pleaded case.

(1)  According to Mr Ng, the initial agreement or arrangement with Madam Lee was that his son, Chi Chiu, would be responsible for repaying the loans, and would be entitled to the Property after Madam Lee’s death (see paragraph 41 of Mr Ng’s first witness statement).  There was no agreement at that stage that Mr Ng would make any repayment, or would be entitled to the Property after Madam Lee’s death.

(2)  It was only after Chi Chiu had decided, having paid 4 instalments, not to continue with the repayment (for various reasons given by Chi Chiu which it is not necessary to set out in this judgment) that Mr Ng stepped in and repaid the balance of the loans.  It is not, however, pleaded, nor is there any evidence to the effect, that Chi Chiu ever assigned to Mr Ng his right or interest (if any) that he might have arising from the 4 instalments paid by him.

(3)  There is no plea or evidence to the effect that Madam Lee made any further promise or representation, or that any further agreement was made between Mr Ng and Madam Lee, to the effect that Mr Ng could combine his payments with those made by Chi Chiu for the purpose of satisfying the condition laid down by Madam Lee for claiming entitlement to the Property after her death.

(4)  It is also not pleaded that after Chi Chiu had decided not to continue with the repayment, Madam Lee made any further promise or representation to Mr Ng that if he continued to repay the balance of the loans until the same were fully discharged, he would be entitled to the Property after her death.  Although Mr Ng did say something to that or similar effect in his oral evidence, such evidence does not appear in either of his two witness statements, or in Wan and Leung’s pre-action letter.  I do not accept Mr Ng’s oral evidence in this regard.

(5)  According to Mr Ng, after Madam Lee came to know that Chi Chiu refused to make any further repayment, she became very agitated and begged Mr Ng to help her out, and Mr Ng agreed to do so.  In Mr Ng’s own words, at paragraph 44 of his first witness statement:-

“李琼珠知道我兒子吳志超拒絕再替她還欠款後，她情緒很激動，還跪在床邊擁著我求我要幫助她還錢。由於我與她多年的感情，我不忍心看見李琼珠這樣傷心，所以我便答應李琼珠我會幫助她及吳文賢還清廖創興銀行的欠款。”

(6)  I believe this to be the true reason why Mr Ng decided, and in fact continued, to make repayment on behalf of Madam Lee/Man Yin, namely, his long standing relationship with Madam Lee. I consider the true nature of his payments to be a “gift”, even though he might not have expressly used the word “gift”, in the same way that when he used to give Madam Lee money for living or household expenses he would not have said to her that the money was a gift.

35.  It is, in my view, significant that according to Mr Ng, even at the time when he first started making the repayment, he already knew that Madam Lee had been hiding from him her continuous association or contact with her former husband’s family and her daughter and son-in-law in the Philippines, and had doubts about whether Madam Lee was someone whom he could trust (see paragraph 49 of Mr Ng’s first witness statement).  Also, it is Mr Ng’s evidence that when he, repeatedly, requested Madam Lee to transfer the Property to him after mid-2006, she allegedly put forward various excuses for declining or refusing to do so which seem to me to be obviously lame excuses. Indeed, Mr Ng says that he thought or believed that Madam Lee’s reaction showed that she disregarded his rights, and wished instead to claim the whole Property for herself (see paragraph 52 of Mr Ng’s first witness statement).  In my view, if Mr Ng genuinely believed that he was entitled to the Property after he had completed the repayment of the loans due to Liu Chong Hing Bank Limited in early 2006, he would not have waited until mid-2015 to commence the present proceedings against Madam Lee.

36.  In support of Mr Ng’s claim, Mr Poon has laid some emphasis on the fact that Mr Ng made the relevant payments by bank transfer and kept the relevant deposit slips, in contrast to the monthly housekeeping monies that he paid her by cash.  I accept that this fact may arguably support the existence of some arrangement between Mr Ng and Madam Lee, but is far from being sufficient to prove the case that Mr Ng seeks to advance against her in this action.

37.  I accept Chi Chiu’s evidence that at some point in time Madam Lee must have made a representation to him to the effect that if he (Chi Chiu) would repay the loans on her/Man Yin’s behalf, she would give the Property to him after her death.  I come to this conclusion for two principal reasons.  First, while I can see why Mr Ng would be prepared to repay the loans even for no consideration (because of his relationship with Madam Lee), I do not believe that Chi Chiu would agree to do so unless he was given to believe that he would be entitled to the Property after Madam Lee’s death. Second, the fact that Chi Chiu opened a joint bank account with Madam Lee at Liu Chong Hing Bank Limited supports the existence of an arrangement as outlined above.  On the other hand, Madam Lee’s explanation for the joint account, involving a convoluted story about some decoration or renovations works in a property in Hong Kong belonging to, or proposed to be acquired by, Madam Lee’s overseas relative or friend in the Philippines which Mr Ng recommended could be carried out by Chi Chiu (no such works were in fact ever carried out), is incredible and cannot be accepted.

38.  It is, however, clear that Chi Chiu is not entitled to make any claim in respect of the Property because he only paid 4 instalments and did not repay the loans in full.  Anyhow, Chi Chiu has not suggested that he has any beneficial interest in the Property or any part thereof.

39.  I believe what happened was that Madam Lee initially sought help from Mr Ng.  He was, however, not able or willing to help at that time because he was also financially tight and therefore suggested asking his sons for help.  It was in that context that Madam Lee promised or represented to Chi Chiu that if he repaid the loans she would give the Property to him after her death.  Later, Chi Chiu decided not to continue with the repayment and, upon Madam Lee’s “begging”, Mr Ng decided to help because of his long standing relationship with her (as stated in paragraph 44 of Mr Ng’s first witness statement).

40.  I do not accept Mr Ng’s evidence that Madam Lee ever represented to him that (i) if he would repay the loans, or continue to repay the loans after Chi Chiu stopped making repayment, she would give him the Property after her death, or (ii) whoever (meaning or including Mr Ng) repaid the loans would be entitled to the Property after her death.  I also find that Mr Ng has failed to prove the case against Madam Lee as advanced by him in the Statement of Claim.

41.  Before I end this judgment, I would add the following observation.  This is a case where the Property has been transferred to Madam Ng’s sole name for nearly 30 years.  If Mr Ng’s claim in respect of the Property is true, he has been sitting on his rights for many years.  He fully repaid the loans to Liu Chong Hing Bank Limited no later than early 2006. He did not, however, commence this action until June 2015 when, on his own account, Madam Lee has been disregarding his rights since about mid-2006.  In the meantime, Madam Lee has become mentally incapacitated, thereby preventing her from giving oral testimony at the trial.  Mr Ng’s delay is of course not fatal to his case, but it makes the court’s task more difficult in determining the true arrangement or agreement between the parties which was not fully documented.  In my view, when the court is being asked to find that the registered owner’s title to a property is subject to some oral trust or arrangement in such circumstances, the court must act cautiously, and should look for clear and convincing evidence before upholding the alleged trust or arrangement.

DISPOSITION

42.  For the foregoing reasons, the Plaintiff’s action against the Defendant is dismissed, with costs to the Defendant (including all reserved costs) to be taxed if not agreed.  The Defendant’s own costs are to be taxed in accordance with legal aid regulations.