CHINA CITIC BANK INTERNATIONAL LTD v. DURRANT SIMON PATRICK MICHAEL

HCMP 3196/2013

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 3196 OF 2013

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D E C I S I O N

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1.  The Plaintiff obtained judgment from Master Leong in respect of 2 mortgage loans against the Defendant under Order 88 of the Rules of the High Court. This is the Defendant’s appeal against the learned Master’s decision.

2.  Before Master Leong, the Defendant sought to orally advance a defence that the Plaintiff has provided inaccurate credit information of the Defendant to financial institutions and thereby, obstructing him from applying further credit facilities from the financial institutions[1]. The Defendant requested the learned Master to allow him to file affidavit evidence in opposition but the request was refused.  The learned Master considered that what was said by the Defendant does not constitute any valid defence and therefore entered judgment against the Defendant.

3.  As pointed out by the learned Master, the purported defence relied on by the Defendant before him can at most be regarded as a separate claim against the Plaintiff for damages.  It is no defence to the Plaintiff’s claims which are based on the Defendant’s breaches of the loan agreements in defaulting payment of the mortgage instalments.

4.  In the appeal, the Defendant put forward an additional defence.  This time he seeks to challenge the accuracy of the Plaintiff’s account on the outstanding amounts.   The Defendant complains that the supporting affidavits of the Plaintiff do not give sufficient information as to how the Plaintiff arrived at the final figures.

5.  Before hearing the appeal, the Defendant issued several other summonses including:

(a) a summons to order the Plaintiff to supply supporting documents with regard to the amounts and interest claimed by the Plaintiff in its supporting affidavit and for an extension of time to file his affidavit in support of the appeal;  

(b) a summons to dismiss the Plaintiff’s Originating Summons for the Plaintiff being in contempt of the court in filing inaccurate affidavits;

(c) a summons for recusal of myself to deal with this matter; and

(d) a summons, again, to dismiss the Plaintiff’s Originating Summons for the Plaintiff’s misrepresentation of the facts and knowingly deceiving the Defendant.

6.  I have dismissed (a) and (c) above with oral reasons given.  It was not until the time specified[2] for the Defendant to file his affidavit in support has expired that he issued the summons requesting those documents.  Since after the Plaintiff has demanded payment from him the Defendant has never queried the Plaintiff’s account.  I considered the Defendant’s summons requesting documents a mere delaying tactic and therefore gave an unless order against the Defendant for filing of his affidavit in support of the appeal. 

7.  For the recusal summons, the grounds given by the Defendant were that firstly, I have refused summons (a) and secondly, I have dealt with his complaints against District Judges not in his favour in relation to other legal proceedings in the District Court.  These are in my view not valid grounds and I found no occurrence of actual or apparent bias in continue dealing with this matter.  

8.  Regarding (b) and (d), they are actually identical in substance but framed in different wordings.  Whilst inaccuracy in evidence may be relevant to the merits of the case, it is not in itself a ground for dismissal of the whole action.  The summonses of the Defendant are totally without merit and thus liable to be dismissed. 

9.  Mr Chan, solicitors for the Plaintiff, initially relied on clause 15.01 of the mortgage agreement for proving the outstanding sum of the loans, which provides that:

“Any statement of account purporting to show an amount due from the Mortgager to the Bank under this Deed and signed as correct by a duly authorised officer of the Bank shall, in the absence of manifest error, be conclusive evidence amount so due.”

10.  Mr Chan submitted that as paragraphs 14 to 16 of the Plaintiff’s supporting affidavit are statements purporting to show the amount due under the loans, those paragraphs are within the meaning of “Any statement of account” under clause 15.01 and therefore they are conclusive evidence for the amount due.

11.  I queried Mr Chan’s interpretation of clause 15.01 and requested Mr Chan to submit relevant legal authorities for consideration.  At the adjourned hearing, Mr Chan withdrew his initial position and indicated that he would no longer rely on clause 15.01 to prove the Plaintiff’s case.  Instead, a further affidavit was filed by the Plaintiff to fill in the evidential gap on the final sums.

12.  On the other hand, the Defendant said that the last annual statements in respect of the loans sent by the Plaintiff to him were on 14 April 2014 showing only the outstanding loan amounts as at 1 June 2012.  There is no information provided by the Plaintiff as to how they arrived at the final figures as provided under paragraphs 14 to 16 of the Plaintiff’s affidavit as it set out the outstanding amounts and the calculations thereof only from the date of the demand letter, i.e. 4 November 2013. 

13.  The Defendant submitted that according to the annual statements, as at 1 June 2012, the outstanding loan amount was $764,596.60 and $2,465,120.50 respectively, whereas the outstanding loan amount as at 4 November 2013 was stated as $858,077.21 and $2,546,922.50, under the Plaintiff’s affidavit.   

14.  Besides, according to the annual statements, there were a few sums paid by the Defendant during the period between 1 April 2011 and 1 June 2012 in the amount of around $50,000 and $60,000 respectively for the 2 loans.  It was never mentioned anywhere in the Plaintiff’s affidavits about these payments. 

15.  The Defendant also referred to a letter from the Plaintiff dated 18 June 2013, informing the Defendant of the revision of interest rate.  The Defendant alleged that there were discrepancies on the interest rate and outstanding loan amount between the figures shown on the letter and the affidavit of the Plaintiff. 

16.  A few days before the adjourned hearing on 26 May 2014, the Plaintiff filed a further affidavit[3] setting out in details, by way of 2 tables, the monthly arrears of instalments and interest rates in respect of the 2 loans in the period from 18 and 20 March 2011 to 18 and 20 October 2013 respectively.  I granted leave to the Plaintiff to file this further affidavit as the Defendant has himself also put in another affirmation in the last minute, albeit under the disguise of it being the supporting affirmation of a new but superfluous summons.  Besides, the information disclosed under the Plaintiff’s latest affidavit is actually what the Defendant demanded under his summons under paragraph 5(a) herein.

17.  The Defendant started defaulting payment of the instalments of the 2 mortgage loans on 18 March 2011 and 20 March 2011 respectively.  There were annual statements sent to the Defendant on 10 November 2011 from the Plaintiff setting out the accounts of the 2 loans as at 28 February 2011.

18.  Putting together the annual statements and the 2 tables in the Plaintiff’s further affidavit, I have no difficulties in arriving at the outstanding loan amount stated under the Plaintiff’s first affidavit by simple arithmetic.  The payments of the Defendant between 1 April 2011 and 1 June 2012 have in fact been taken into account.   

19.  No query has been raised at any time by the Defendant against the correctness of the annual statements he received.  In fact, the first time when the Defendant queried the accuracy of the Plaintiff’s account was in this appeal, after Master Leong has entered judgment against him.  The complaints of the Defendant were based solely on the different figures shown on several isolated documents of the Plaintiff sent to the Defendant at different time.  These differences are inevitable as extra interests would be incurred as time passed.  When the Plaintiff now putting in all the details of the loan accounts, one can immediately see that there is really no substance in the Defendant’s complaints.

20.  The Defendant has failed to show any specific defect of the Plaintiff’s version of the accounts.  I am satisfied that the Plaintiff’s evidence reflected accurately the states of the 2 subject mortgage loan accounts. 

21.  In the circumstances, I find the Defendant disclosed no valid defence to the Plaintiff’s claims. 

22.  The Defendant’s appeal is therefore dismissed and the orders of Master Leong do stand.

23.  I make a costs order nisi that costs of the Defendant’s appeal be to the Plaintiff to be taxed if not agreed, except that there be no order as to costs for the hearing on 8 May 2014.  This costs order nisi will be made absolute upon the expiry of 14 days from the date of this decision.