AU WO CHEUNG v. AU AH

DCCJ249/2011

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 249 OF 2011

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BETWEEN

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D E C I S I O N

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1.  The plaintiff applies to strike out the defence of the defendant on the ground that it discloses no reasonable cause or no reasonable defence under Order 18 rule 19(1)(a).

2.  The plaintiff’s action against the defendant is for vacant possession of the property situated at Block D, 11th Floor, 94-96 Tong Lo Wan Road and 7 Lily Street in Hong Kong (hereinafter referred to as “the property”).  The property was purchased in the name of the plaintiff and Madam Kiu Lai in joint names. 

3.  It has been disclosed in the statement of claim that Madam Kiu was made a bankrupt in 2007 and there are a number of creditors who have charged on the property and the official receiver is now acting as a trustee of Madam Kiu’s half share interest in the property.  The official receiver has consented to the repossession proceedings in the present action.            

4.  The application is opposed by the defendant who pleaded she is the daughter of the plaintiff and Madam Kiu Lai, who was married to the plaintiff until their divorce was finalised on 31 August 1998.  At the time the defendant was 8 years old.   

5.  The defendant claimed in paragraph 6B of her defence that the plaintiff is under promise to her mother, Madam Kiu, to transfer both their interests in the property to her and allow her to remain in the property. 

6.  It is the plaintiff’s contention that paragraphs 6A & B of the defence are not sufficient to support a defence to the plaintiff’s claim against her. 

7.  Mr Ko, counsel for the plaintiff, submitted that no facts have been pleaded in the defence to show there was any consideration for the agreement, unless the agreement is made under seal, it is not enforceable.  She relied on the notes to Order 18/12/8 on page 392 of the White Book.   

8.  Mr Ko further submitted, as the defendant is not a party to the agreement, there is no privity of contract between the plaintiff and the defendant for the agreement to be enforced.

9.  As to the defendant’s defence of set-off against the plaintiff’s claim of default in maintenance payment since October 1998 under the order of Judge B Chan in the Family Court of $10,000 per month, the plaintiff claimed the defence of set-off had not been pleaded, even though paragraph 7 of the defence refers to the plaintiff’s failure to pay the monthly $10,000 maintenance since October 1998.  In any event, the default in maintenance payment, according to the plaintiff, is a separate claim and should be made under FCMC13779/1997.  Mr Ko further submitted that to pursue the maintenance claim in these proceedings is undesirable and a duplication of proceedings because it is not disputed that Madam Kiu had reactivated FCMC13779/1997 to enforce the default payment of maintenance by the plaintiff. 

10.  Both parties agreed at the hearing today that the plaintiff’s application is made under Order 18 rule 19(1)(a), and no affirmation evidence shall be filed in support for an application under Order 18 rule 19(1)(a).  According to Order 18 rule 19 at page 113 of the White Book, rule 19(2) stated clearly that no evidence shall be admissible on an application under paragraph 1A.  

11.  Mr Lee, counsel for the defendant, submitted that the defence has disclosed a defence, but, in any event, the defendant will seek to amend the defence which will include a defence based on agency, joint promise and trust. 

12.  Mr Lee also informed the court that his instructing solicitors are now also acting for the defendant’s mother, Madam Kiu, in the matrimonial dispute at the Family Court against the plaintiff’s default in payment of maintenance since October 1998, and that she intends to join in these proceedings as a co-defendant under Order 15 rule 6.    

13.  No application to join in has been lodged by any party, at present, there are only two parties before me.  Madam Kiu’s application is definitely not before the court today, therefore it is not an issue the court has to take into account.      

14.  On the basis of Mr Ko and Mr Lee’s agreement that today’s application is based solely on Order 18 rule 19(1)(a), I shall not take into my consideration the affirmation filed on behalf of the plaintiff on 26 November 2011 or the defendant and her mother’s affirmations filed on 22 December 2011 pursuant to Master Lee’s order of 21 December 2011. 

15.  The plaintiff commenced the present action on 20 January 2011.  It started as an action against a defendant named in the writ as person (persons) in occupation in the property.  In February 2011, the defendant acknowledged service of the writ through her present solicitors.  On 12 March 2011, the defendant filed the defence.  On 4 April 2011, the plaintiff filed a reply to the defence.  It was not until 6 October 2011 that leave to amend the writ and reply to defence was granted to the plaintiff by Master Lee at the case management conference to insert the defendant’s name in place of person or persons in occupation named on the writ.

16.  In accordance with the Master’s order, the amendment replacing the defendant’s name was made by the plaintiff in the writ and the reply, and the defendant amended the title of the action accordingly.  No further amendments to any part of the body of the pleadings were made by either party. 

17.  On the basis that the person in occupation as the defendant in these proceedings is known since February or latest by March 2011 after the defendant filed her defence, her identity is made known to the plaintiff.  That was why he filed a reply to the defence claiming the defendant had no authority to remain in the property despite the fact that she is his daughter.  He denied he had agreed with Madam Kiu to transfer his interests in the property to the defendant.  It took the plaintiff a further 7 months after his reply to take out a summons to strike out the defendant’s defence filed against the statement of claim claiming against the defendant as a person in occupation of the property.  The plaintiff’s delay in taking out the striking out application may be indicative of the strength of his application in view of the defence filed.

18.  The defence certainly is lacking in the legal foundations.  She pleaded a right on the basis that she is the child of the plaintiff and on the promise between her parents to transfer to her their interests in the property, but she failed to specify whether the defence was based on a breach of promise, a breach of the court order, or breach of trust.  Mr Lee now informed the court that he intends to rectify by amending the defence. 

19.  The statement of claim was intended as an action against a squatter, for it was couched on the basis of a squatter action.  The action has now been turned into an eviction of the plaintiff’s daughter who alleged he had made a promise to transfer his interests in the property to her.  The plaintiff’s case is now completely different from the one he started after the identity of the defendant in occupation had been disclosed as his own daughter.  

20.  According to note 4 to Order 18 rule 19 in the White Book, page 415, only in plain and most obvious cases that the court would exercise the summary power under this rule to strike out for failure to disclose a defence.   

21.  I cannot say from the defence filed the defendant has no defence whatsoever.  She had pleaded the facts and her relationship with the plaintiff, and that there was a promise according to her between her parents to transfer their interests to her.  Evidence has to be heard to determine whether there was a promise, a promise between the plaintiff and Madam Kiu on the disposal of the interests in the property, and to determine whether the defendant has a right to remain in the premises. 

22.  Furthermore, the Family Court proceedings on the plaintiff’s default in payment of maintenance for a period of 13 years would have an impact on these proceedings, whether Madam Kiu is a party to these proceedings or not.

23.  For the aforesaid reasons, I am not satisfied the defendant had failed to disclose a reasonable defence, particularly on the basis that Mr Lee had informed the court he intended to amend the defence. 

24.  I will make no order on the plaintiff’s summons and I will grant leave to the defendant to amend the amended defence generally within 14 days hereof.  I will grant leave to the plaintiff to amend the amended reply within 21 days thereafter. 

(Discussion re costs)

25.  Cost of the application will be the plaintiff’s costs in the cause.  As to the cost of the amendment of the amended defence and consequential amendments, these costs to be borne by the defendant in any event, to be taxed if not agreed.