YASUKO YOSHIMURA v. TAM CHI MING, NOEL

HCA 10653/1998

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 10653 OF 1998

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J U D G M E N T

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1. The plaintiff claims against the defendant in the sums of US$520,000.00 and ￥5.4 million being money lent by the plaintiff to the defendant between 22 January 1996 and 13 January 1997. In addition, she claims ￥42,700.00 as bank charges incurred for remitting the money advanced to the defendant from Japan, and US$50,000.00 being interest agreed to be paid by the defendant on the loans under an undertaking signed by the defendant dated 12 December 1996.

2. The defendant was initially represented until shortly before the trial when he filed a Notice to act in person. He has not appeared today.

3. It is not in dispute that the plaintiff had made ten remittances in the total sum of the amounts as claimed to the defendant from Japan between January 1996 and January 1997 and that the money was paid into the defendant's personal bank account with a bank in Hong Kong. It is also not in dispute that the parties had an intimate relationship at the time. According to the plaintiff, she made the loans to the defendant at the defendant's request on account of their relationship. The defendant has alleged in his defence that the money remitted was not in the nature of a loan. Money was remitted because the plaintiff had agreed to invest in two companies controlled by the defendant, known as Kids Collection Ltd. and Gainchop Ltd. (collectively "the Companies"), and she had promised in January 1996 to inject ￥60 to 70 million in the Companies as capital. Further, in June 1996, the plaintiff and the defendant on behalf of the Companies had reached an oral agreement by which the plaintiff was appointed as the Companies' agent in Japan for at least 2 years to promote and market the toys manufactured by the Companies, and in return the plaintiff had agreed to pay ￥60 million by instalments to the Companies in 1996 (of which the Companies had received US$300,000.00 by the time of the alleged agreement). It was further agreed that the plaintiff should be entitled to a share of 5% to 10% of the gross sale proceeds from the sale of the toys marketed by her in Japan as remuneration. The defendant has further alleged that the money remitted into his personal account was all transferred to the Companies.

4. As I have mentioned, the defendant has not appeared today to give evidence of the matters alleged in his defence. All I need to do is to consider the plaintiff's evidence in her witness statement (which she has confirmed in court), the documentary evidence, and to evaluate the evidence before me with regard to the defendant's allegations to see whether the plaintiff has established her case of personal loans to the defendant on the balance of probabilities. I am satisfied the plaintiff has established her case to the required standard.

5. I accept the plaintiff's evidence she had made the personal loans to the defendant due to their special relationship at the time. There is not a single piece of document produced by the defendant to indicate that the plaintiff had any interest or had committed herself in any way to invest in the Companies or to become a marketing agent of the Companies in Japan.

6. The plaintiff's case is to a large extent supported by contemporaneous documents. Apart from the undertaking signed by the defendant in December 1996 that I have mentioned, there is also a repayment schedule signed by the defendant on 2 June 1996. These documents are clearly inconsistent with the defendant's allegation. The defendant's further allegation that the plaintiff had asked him to sign these documents on the understanding that they would have no legal effect and that they would just be used by the plaintiff to explain the remittances to her husband is simply incredible.

7. As for the fact that the plaintiff had written "business deposit" as the purpose of the remittances on all the remittance application forms of the banks, she has given a satisfactory explanation about this. These words were written on the instructions of the defendant who had faxed to the plaintiff a draft form to show how the purpose for the remittance should be described. The draft faxed by the defendant is produced in evidence.

8. Further, if the defendant's allegations were true, there is no reason why the ten remittances should all be sent to his personal account in Hong Kong and not to the bank accounts of the Companies.

9. The plaintiff has also produced a number of demand letters sent to the defendant by her lawyers in Japan between October 1997 to February 1998. There was no reply to any of these demand letters or to the letter before action sent by the plaintiff's solicitors to the defendant on 10 June 1998. The writ herein was issued on 29 June 1998.

10. I give judgment to the plaintiff as claimed in the sums of:

(1) US$520,000.00 and ￥5.4 million being the advances made to the defendant ;

(2) ￥42,700.00 being bank charges for the remittances;

(3) US$50,000.00 being agreed interest in the undertaking signed by the defendant;

(4) interest on the amounts in (1) and (2) at the rate of 10% p.a. from the date of the writ being 29 June 1998 to judgment and thereafter at the prevailing judgment rate until full payment; and

(5) costs of this action to be taxed if not agreed.