FAIRWING INVESTMENT LTD v. CHAU SAU NGOR AND ANOTHER

HCA 2068/2018

[2024] HKCFI 2133

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 2068 OF 2018

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(By Original Action)

(By Counterclaim)

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J U D G M E N T

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Background

1.  These proceedings were commenced by the Plaintiff against Madam Chau Sau Ngor as 1^st Defendant (“Chau”) and Wan Sai Hang as 2^nd Defendant, in relation to the Plaintiff’s interests in Lot 2152 in DD 244 located in Sai Kung and the building constructed thereon.

2.  The Plaintiff is a company incorporated in Hong Kong in 1994, and its founding directors and shareholders were BB Chan (“Chan”) and his wife Cho. Around 2003, the Plaintiff had taken part in the development of the properties known as Lots 2150, 2151, 2152 and 2153, in Ho Chung, Sai Kung (“Site”), and in the construction of small village houses thereon (“Project”).

3.  Mr Siu Kai Ming (“Siu”) and his wife Madam Cheng Yin Fong (“Cheng”) are the current shareholders and directors of the Plaintiff. According to Siu, he had been informed by Chan in 2002 that the Plaintiff was then the beneficial owner of the Site and was the registered owner of Lot 2152. Siu expressed interest in collaborating in the development, and in July 2003, the shares of Chan and Cho in the Plaintiff were transferred into the names of Siu’s wife and mother, who also became directors of the Plaintiff. On Siu’s case, his wife and mother were at that time merely holding the shares in the Plaintiff as trustees for Chan and Cho. It was only later, in around May 2005, that Chan purported to transfer all his rights and interests in the Project to the Plaintiff, by an agreement in writing dated 3 May 2005 which was signed by Chan, the Plaintiff, and Siu. A sum of $1 million was paid by Siu to Chan under the agreement and the Plaintiff acquired the entire interests in the Project.

4.  Chan had been in need of funds and since 2004, Siu had procured loans to be made to Chan, with himself and/or the Plaintiff acting as guarantors. Siu himself also required financing for other projects of companies owned/operated by him, and since around 2004, loans were obtained from a company known as Easy Policy Financial Limited (“Easy”). There were loan agreements made between Easy and Siu’s companies, some of which were guaranteed by Cheng, and others were guaranteed by Siu. According to Siu, he had since 2004 refinanced the construction loans of his companies’ projects with Easy.

5.  As a result of his business dealings with Easy, Siu came to know Chau. She was the administrative manager of Easy. When Chan approached Siu for loans in 2004, Siu contacted Chau and it was Chau who made personal loans to Chan, with Siu and the Plaintiff acting as guarantors. There was also a series of loans made by Chau personally to Siu from June 2004 to November 2004, for sums ranging from $50,000 to $200,000.

6.  Because of Siu’s frequent liaison with Easy and with Chau, Siu and Chau developed an intimate relationship by 2005 at the latest (although Chau claims it was earlier, in 2004).

7.  By May 2005, Siu had acquired the beneficial ownership of Chan’s shares in the Plaintiff and the interests in the Project. On the Plaintiff’s pleaded case, it made an oral agreement in February 2009 (“2009 Agreement”) with Wan Sai Hang (“2^nd Defendant”), one Wan Sai Chung and one Wan Sai Pong (together referred to as “Wans”), who were respectively the registered owners of Lot 2152, Lot 2151 and Lot 2153 (together referred to as “Lots”). The oral agreement was for completion of the construction of a small village house on Lot 2152, and in relation to the development and sale of the Lots and the village houses constructed/to be constructed thereon. The 2009 Agreement is evidenced or incorporated in a document entitled “Supplemental Payment Agreement” dated 12 February 2009 (“Supplemental Payment Agreement”), signed by the Plaintiff and the Wans. The Supplemental Payment Agreement provides, inter alia, for the Plaintiff to make payment of a total sum of $700,000 to the 2^nd Defendant for “Ding Rights”, essentially the right to build and sell the small village house to be constructed on the Lots. In consideration and upon receipt of the payment, the Wans acknowledged that the entire ownership rights to the Lots belonged to the Plaintiff and that the Wans would have no further right to deal with the properties in the Lots. The Plaintiff claims that in reliance on the 2009 Agreement and the Supplemental Payment Agreement, it had make payment of $700,000 to the Wans and had expended money in completing the construction of the small village house on Lot 2152.

The disputes

8.  The Plaintiff’s case is that the 2^nd Defendant had failed to act in accordance with the 2009 Agreement and the Supplemental Payment Agreement. The legal title in Lot 2152 remained registered in the 2^nd Defendant’s name and was not transferred to the Plaintiff. The Plaintiff’s claims against the 2^nd Defendant in this action are for specific performance of the 2009 Agreement and of the Supplemental Payment Agreement, and for a declaration that the Plaintiff is the beneficial owner of Lot 2152. The Plaintiff further claims that the 2^nd Defendant is estopped from denying that the Plaintiff is the true and beneficial owner of Lot 2152 together with the building constructed thereon.

9.  As the 2^nd Defendant did not file any defence in this action, the protagonists at trial are the Plaintiff, and Chau as the 1^st Defendant.

10.  Some time in September 2007, the construction work for the small village houses at the Site was approaching completion. It is not disputed that around that time, the Plaintiff arranged for Chau to move into and occupy the 2^nd Floor and the Roof of the building on Lot 2152 (“Premises”). On the Plaintiff’s case, this was only so that Chau could “watch over the Site to prevent unauthorized occupation” thereof, until the completion of all construction work and the formalities of obtaining a certificate of compliance in respect of the Lots, for the restriction on alienation thereof to be removed. On Siu’s evidence, there had been trouble from the Wans who were the original residents of the Site and had been disrupting construction at the Site, and were not cooperative in passing their title in the Site, in breach of their agreement to do so. According to Siu, Chau told him that she was then living in a small house with her mother, and offered to help him “guard” the Site by occupying one of the units constructed. On Siu’s evidence, he agreed to Chau moving into the Premises. Siu conceded that he also agreed to Chau fitting out the Premises, in view of their intimate relationship at the time.

11.  In about October 2013, construction of the small village houses on the Site was completed, and a certificate of compliance was obtained.

12.  The Plaintiff claims that when it requested Chau to move out of the Premises in July 2013, she refused to do so and remained in occupation of the Premises without the Plaintiff’s consent. The Plaintiff accordingly claims, against Chau, an order that she should deliver up vacant possession of the Premises to the Plaintiff, together with damages for her unlawful occupation.

13.  By way of defence, Chau tells a different story.

14.  Chau claims to be a financial consultant of the Plaintiff, and on her case, there was an oral agreement made between the Plaintiff acting through Siu and herself (“Oral Agreement”), whereby Chau would secure sources of funds for the Plaintiff to borrow and to finance the Plaintiff’s development of Lot 2152. In return, it was agreed that she would be entitled to the beneficial ownership of the Premises as remuneration, after the issue of the Certificate of Compliance and the Plaintiff’s payment of premium for the Lot. On her pleaded case, the Oral Agreement was made in about April 2005, and is evidenced by a written agreement dated 17 August 2007, which was signed by Cheng on behalf of the Plaintiff, Chau and Siu, and was witnessed by Siu Wah of Easy (“Agreement”). The Agreement states that upon the Plaintiff’s completion of the Project at the Site, Chau was entitled to the Premises, and Siu personally guaranteed the Plaintiff’s performance of the Agreement.

15.  Chau claims that she had performed her obligations under the Oral Agreement by assisting the Plaintiff to obtain the financing it required to launch and complete the Project, and that the Plaintiff delivered vacant possession of the Premises to her in mid-August 2007, all pursuant to the Oral Agreement. Chau denies that she moved into the Premises because of any housing need on her part as Siu alleged, nor to “oversee” the Site. She claims that it was in reliance on and pursuant to the Oral Agreement that she moved into the Premises, expended money for the decoration and refurbishment of the Premises, and paid all outgoings to maintain the Premises, all to her detriment.

16.  In her Defence, Chau claims that by reason of proprietary estoppel, the Plaintiff is estopped from denying that the Premises belong to her beneficially, that it would be unconscionable to deny her the beneficial interest, and that the Plaintiff and the 2^nd Defendant (as registered owner of Lot 2152) hold the beneficial interest in the Premises on trust for her.

17.  It is Chau’s alternative claim that the Oral Agreement gave rise to a common intention on the part of herself and the Plaintiff, that the Plaintiff and/or the 2^nd Defendant should hold the Premises on an express trust, or on constructive trust for Chau. Chau further claims that by reason of her expenditure on the decoration and refurbishment of the Premises, the Plaintiff and/or the 2^nd Defendant hold the Premises, or a share thereof proportional to her contribution, in resulting trust for Chau.

18.  By way of Counterclaim, Chau seeks declarations: that she is the true beneficial owner of the Premises, that the 2009 Agreement and the Supplemental Payment Agreement are null and void against her, and that the Premises are held on trust for her; an order that the title and interest in the Premises should be vested in her; and alternatively damages for breach of the Oral Agreement.

19.  The Plaintiff denies the existence of the Oral Agreement. Even if the Oral Agreement is held to exist, the Plaintiff has raised myriad claims to allege that the Oral Agreement is unenforceable or should be vitiated. To summarize the matters raised in the Reply and Defence to Counterclaim, it is the Plaintiff’s claim that:

(1)  The Oral Agreement is not evidenced in writing and is unenforceable by virtue of section 3 of the Conveyancing and Property Ordinance (“CPO”);

(2)  Chau was acting as agent and employee of Easy in arranging finance for the Plaintiff to develop Lot 2152, and the Agreement does not constitute a memorandum as required under section 3 of CPO;

(3)  The Agreement was uncertain in terms and was not supported by any consideration stated in the Agreement;

(4)  Chau had orally misrepresented to Siu that Easy would enforce the loan agreements guaranteed by Siu;

(5)  The Oral Agreement evidenced by the Agreement is illegal and unenforceable because it contravenes section 27 of the Money Lenders Ordinance (“MLO”), as the transfer of the beneficial interests in Lot 2152 was on account of costs, charges or expenses incidental to or relating to the negotiations for the granting of a loan, or the guarantee or securing of the repayment of the loan;

(6)  The Oral Agreement evidenced by the Agreement is voidable by reason of a presumption of undue influence on the basis of a relationship of trust and confidence between Siu and Chau; and

(7)  the Agreement is unenforceable for contravening section 24 of MLO, for charging an effective rate of interest for a loan which exceeds 60% per annum.

20.  By the time of Closing, Counsel for the Plaintiff expressly stated that the CPO defences under (1) and (2) above and the excessive interest defence under (7) above were not pursued. Nor did Counsel make submissions on the misrepresentation claim under (4) and the uncertainty defence under (3). The only submissions made in the Plaintiff’s Closing were that, first, there was in fact no Oral Agreement, which was the entire basis of Chau’s claims of common intention constructive trust and proprietary estoppel. Secondly, it was argued that the Agreement evidencing the Oral Agreement was in contravention of section 27(3) of MLO, and is unlawful. Thirdly, although there were pleas of undue influence and claims of duress, Counsel for the Plaintiff only argued in Closing that Chau and Siu Wah of Easy were “unconscionable” in creating the Agreement for Siu and Cheng to sign, that the Agreement was signed by them under coercion, and that it would not be unconscionable for the Plaintiff to keep the Premises.

21.  On behalf of the Plaintiff, it was submitted by Counsel in Closing that if Chau could bring herself within the ambit of common intention constructive trust and proprietary estoppel, her case for the beneficial ownership of the Premises would succeed, and CPO would not stand in her way. In this regard, the main thrust of the submissions made for the Plaintiff in Closing was that Chau’s entire case on common intention constructive trust and proprietary estoppel is based on the existence of the Oral Agreement, but on the evidence, there was no Oral Agreement between Siu and Chau, such that Chau’s case should be rejected in toto.

The Plaintiff’s claim against the 2^nd Defendant

22.  No Defence was filed by the 2^nd Defendant, and there is no evidence to rebut or contradict the Plaintiff’s case against the 2^nd Defendant on the basis of the 2009 Agreement and the Supplemental Payment Agreement.

23.  Nor is there any evidence from the 2^nd Defendant to dispute the relief sought by Chau.

24.  The Supplemental Payment Agreement was signed on its face by Chau on behalf of the Plaintiff. The Plaintiff does not dispute either her authority, or the existence of the Supplemental Payment Agreement. Although Chau in her evidence in these proceedings refused to acknowledge unequivocally that the signature on the Supplemental Payment Agreement was hers, the Plaintiff pointed out that on the 2^nd Defendant’s part, it had never disputed the Supplemental Payment Agreement in the separate proceedings between the Plaintiff and the 2^nd Defendant.

25.  I am satisfied on the face of the documents that as against the 2^nd Defendant, the Plaintiff is entitled to the transfer of the legal and beneficial interests and title in Lot 2152 from the 2^nd Defendant to the Plaintiff, in accordance with the 2009 Agreement and the Supplemental Payment Agreement. As beneficial owner of Lot 2152, the Plaintiff is then in a position to transfer and confer beneficial interests in the Premises to Chau, if the Court finds in favor of Chau on her claims against the Plaintiff.

The Plaintiff’s claims against Chau

26.  It is fair to say that the claims in this action can only be decided on the credibility of the 2 main protagonists: Siu and Chau. As recognized by Counsel for the Plaintiff, the case turns on the existence of the alleged Oral Agreement and whether it was ever made.

27.  This is not the first case in which the Court has to explain that it cannot aim for perfect justice, as it can only attempt to achieve practical justice within the constraints of time and circumstances as they exist (see, for example, paragraph 25 of the judgment of Litton JA (as he then was) in Nagata v New Japan Securities International (Hong Kong) Ltd (No 1) CACV 136/1993). The Court cannot ascertain the absolute truth. It can only decide on what appears to be the truth, on a balance of probabilities, and on the materials as presented to the Court in the manner presented by the parties.

28.  When assessing the credibility of a party’s case on a particular issue, the Court takes into consideration matters such as whether the party’s case is inherently plausible or implausible; whether the party’s case is contradicted by the evidence (documentary or otherwise) which is undisputed or indisputable; whether it is shown that a witness has been discredited over one or more matters to which he has given evidence; and of course, the demeanour of the witnesses. Demeanour has been explained to be mostly concerned with whether a witness appears to be telling the truth as he now believes it to be, and is accordingly unreliable as the sole determining factor.

29.  As to the credibility of a witness, the Courts have issued many reminders, that the question of whether a witness is truthful or untruthful has to be approached with caution, with particular regard being given to the fallibility and potential unreliability of human memory. A witness’s recollection of events as recounted is often affected and altered by unconscious bias. A more recent reminder is contained in the decision of Coleman J in Yu Man Fung Alice v Chiau Sing Chi Stephen [2020] HKCFI 2923. In summary, His Lordship pointed out that “memories are fluid and malleable, being constantly rewritten whenever they are retrieved”, and that what is subsequently retrieved from a witness’s memory is determined by a multitude of factors and by what drives the recollection of the event. Litigation is recognized as being a strong factor either in the active or subconscious manipulation or reconstruction of any information retained in memory. As emphasized in Yu v Chiau and in other cases, the inherent probabilities and likelihoods of an event or account may often be of greater assistance in deciding what actually happened, on a balance of probabilities.

30.  The standard of proof in civil cases is proof on a balance of probabilities. In Nina Kung v Wong Din Shin (2005) 8 HKCFAR 387, Ribeiro PJ referred to the well-known passage in the speech of Lord Nicholls of Birkenhead in Re H & Others (Minors) (Sexual Abuse: Standard of Proof) [1996] AC 563:

“The balance of probability standard means that a court is satisfied an event occurred if the court considers that, on the evidence, the occurrence of the event was more likely than not. When assessing the probabilities the court will have in mind as a factor, to whatever extent is appropriate in the particular case, that the more serious the allegation the less likely it is that the event occurred and, hence, the stronger should be the evidence before the court concludes that the allegation is established on the balance of probability. Fraud is usually less likely than negligence. Deliberate physical injury is usually less likely than accidental physical injury. A step-father is usually less likely to have repeatedly raped and had non-consensual oral sex with his under age stepdaughter than on some occasion to have lost his temper and slapped her. Built into the preponderance of probability standard is a generous degree of flexibility in respect of the seriousness of the allegation. (at p.586)”

31.  The above passage is relevant in the consideration of the probabilities of the witnesses’ evidence as to the events which are said to have occurred and the motives of their conduct.

The existence of the Oral Agreement and whether the Agreement in writing and the conduct of the parties support same

32.  The evidence of Siu and Chau are at variance as to whether there was any agreement or understanding that Chau was to have the beneficial ownership of the Premises.

33.  What is indisputable from the contemporaneous documents is that from early 2004, there had been a series of loans and loan agreements made between Chau personally and Siu personally; between Chau personally and Chan personally, which loans were guaranteed by Siu; and between Easy and companies controlled by Siu, which loans were guaranteed by either Siu or Cheng, and/or secured by property which was (on the evidence of Siu and Cheng) developed by Siu/his companies. This is against the background and in the context of the Plaintiff’s case, that the Plaintiff had been beneficially owned by Chan until May 2005, and that Siu had been working in collaboration with Chan from 2003, to assist him in obtaining funding for development of Lot 2152.

34.  These documents lend support to Chau’s case on the Oral Agreement, that she had agreed and had been able to procure and source funds for Siu and the Plaintiff. Irrespective of whether she had any qualification (as disputed by the Plaintiff) to act as the Plaintiff’s/Siu’s “financial consultant”, it is indisputable that loans had in fact been obtained by Siu, the Plaintiff and other companies he controlled, in 2004 (around the time of the Oral Agreement as pleaded), and thereafter, in 2005.

35.  It is pertinent that despite the many claims made in the Reply and Defence to Counterclaim to deny the validity or enforceability of the Oral Agreement and the Agreement, the Plaintiff never pleaded nor claimed in its evidence the fact that Siu had no authority to enter into the Oral Agreement with Chau, or to sign the Agreement on the Plaintiff’s behalf.

36.  I agree with Counsel for Chau, that Siu was on the whole evasive in his testimony, and that his evidence cannot be accepted as either truthful, or reliable. My finding is based on the following matters.

37.  In his evidence, Siu attempted to distance himself from the loans which Chau had made to him, and was reluctant in testimony to accept this fact. In his witness statement, for example, he only referred to the loans made by Chau to Chan in September 2004 and November 2004, in the respective sums of $110,000 and $50,000, which he claimed were made by Chau to Chan at Siu’s request, when Chan had approached Siu initially for a loan. He did not mention that at around the same time, Chau had made personal loans to him of $250,000 in June 2004, and of $200,000 in November 2004.

38.  Siu purported to disclaim his signatures which appeared in the loan agreements between Chau and himself in June and November 2004, but the fact that the signatures were not his had never been raised in either the pleadings or his witness statements, and was not argued by Counsel at trial. Nor was Siu’s claim, that the signature was forged, seriously or further pursued, after he acknowledged in cross‑examination that the loans did exist, and that he had in fact “acquiesced” to Chau putting his signature on the documents, and in his presence.

39.  Siu’s assertion, that he did not sign the loan agreements because he considered that the money which Chau had lent to him was in fact his own money, is likewise ludicrous and can be rejected. According to Siu, he had given to Chau sums which ranged from $30,000 to $50,000, and there had been occasional payments of $10,000, over a period of approximately 3 years. He claimed that he would also make payments to Chau when he won in gambling in Macau. These monies were all paid by him to Chau in cash, and the payments were referred to by Siu as “happy money”. He acknowledged that the payments were not made for any specific purpose, and that Chau could spend the money as she pleased. On Siu’s case, he had made total payments of $250,000 to $260,000 over the period of 3 years. Siu also admitted that he had not intended, nor asked, that Chau was to use this “happy money” when she made the loans to him.

40.  Despite the fact that on Siu’s evidence, the money he had given to Chau were obviously gifts, his rationale for claiming that they were not loans from Chau to him was that: (1) the loans were sourced from the gifts of “happy money” which he had made to Chau, so Chau’s loans were made from his money; (2) he was allegedly representing his companies when he personally accepted the loans from Chau; and (3) Chau was able to benefit from the loans to Siu’s companies, as she could earn interest.

41.  I reject Siu’s testimony on the loans from Chau being his own money as totally contradicted by the documentary evidence, and as being in any event unsustainable in law. I regard his excuses as self‑serving and tailored in order to suit his case that Chau had not secured funding for him as she claimed, and there was no reason for him to make a gift of, or to agree to transfer, the beneficial interest in the Premises to Chau.

42.  As pointed out by Counsel for Chau, Siu’s evidence is also self-contradictory. Whist maintaining that there can be no loan from Chau of his own money, Siu nevertheless maintained that the loans to him existed and had to be repaid. He even claimed that his companies could claim the interest payment for Chau’s loans as “company expenditure”.

43.  In another attempt to disclaim the fact that Chau had made personal loans to him, Siu claimed in cross-examination that the loan of $200,000 recorded in the Loan Agreement between Chau and Siu dated 25 November 2004 was in fact a distribution of the profits that had been made in a joint investment between Chau and himself in a property in Amoy Gardens. However, his evidence in this respect was incoherent, and is contradicted by the contents of his own witness statements.

44.  Siu had claimed in his witness statement that as his relationship with Chau became intimate, Chau had suggested that they should make investments together, and that one of such joint investments was a property at Amoy Gardens (“Amoy Investment”). When Siu was cross-examined on the November 2024 loan of $200,000 which Chau had made to him, Siu claimed that this payment was in fact related to the Amoy Investment. When further asked how the payment was related, Siu claimed that he had contributed $50,000 for the purchase of the Amoy Investment, but Chau had not informed him when the property was later sold at a profit. He claimed however that at some unspecified time, Chau had asked him if he wanted a share of the profits, and when he said that he did, Chau gave him the $200,000 which Siu said was equivalent to the alleged loan Chau made to him in November 2004.

45.  However, according to Siu’s witness statement made in July 2020, he claimed that the Amoy Investment was made on 31 March 2005, when the property was purchased in Chau’s name at $1,212,000, and that he later found out that the Amoy Investment had been sold in November 2008, for $1,538,000. The loan of $200,000 in November 2004 was before the purchase, and could not have been distribution of Siu’s share of the profits. Nor can the payment of $200,000 represent (on his own evidence) any proportionate share of Siu’s contribution of $50,000 towards the purchase price of the Amoy Investment.

46.  It is clear that Siu’s evidence is self-contradictory and incredulous, and based on the answers which he gave when cross‑examined on the series of loans which are documented, I conclude that his memory is faulty and unclear, and that his version of events is vague as to some aspects to be unreliable to say the least, and patently untrue in others.

47.  As for Siu’s relationship with Chau and with Easy, Siu’s claim in his witness statement was that he had been introduced to Easy, and had come to know Siu Wah who was one of the shareholders of Easy, at the end of 2003. Although it was suggested that Chau was a mere “administrative manager” at Easy, and had no role to play in securing the lending to Siu and the Plaintiff, there was no actual evidence from the Plaintiff that the funding from Easy in 2004 had been procured through Siu Wah only. According to Chau, Siu himself had told her that he and the Plaintiff had difficulties in their attempts to obtain financial backing and funding support. Cheng also admitted in her evidence that by the time the Plaintiff commenced dealing with Easy at the end of 2004, the sales of the projects in which Siu’s companies had invested were stagnant, interest on the loans had accumulated and repayment had fallen behind.

48.  According to Chau’s evidence, when Siu approached her in early 2004 to seek further funding from Easy, the shareholders of Easy (including Siu Wah) were not agreeable to approving further loans to Siu, or any company controlled by Siu. This was in view of the risks of the village houses development, and also because there were loans made to Siu and his companies which were already outstanding. In any event, security would be required for any further loans. Chau then asked Siu what security could be offered for the funding which was required for the Plaintiff, and Siu told her that if she should succeed in obtaining financial support for the projects of the Plaintiff, the Plaintiff would offer her the beneficial ownership of any flat within the small village houses on the Lots as remuneration.

49.  In my judgment, it is not incredible that at a time when Siu and the Plaintiff were hard pressed to obtain funding to continue the development of the Project, and faced with very limited choices (as Siu and Chang acknowledged in their evidence), Siu would have offered an incentive to Chau to help the Plaintiff to source and obtain funding, by agreeing to let her have the beneficial ownership of the Premises as one unit within the building on Lot 2152. Even on Siu’s own evidence (paragraph (3)(b) of his witness statement of June 2021), he had stated that he felt grateful for Chau’s assistance and had arranged for his companies to transfer their mortgage loans to Easy.

50.  More significant is the fact that an intimate relationship had by 2004 already developed or was developing between Siu and Chau. In view of such relationship, it is very probable that Siu would have offered the Premises to Chau, irrespective of whether or not Chau was able to fulfill and perform in accordance with the Oral Agreement. After all, as Siu admitted, he was more than ready to give Chau the “happy money” which he had made to her throughout a period of 3 years from 2005 (when Siu claimed their intimate relationship commenced), and the offer of the Premises would be neither incredible nor improbable.

51.  Counsel for the Plaintiff criticized Chau’s evidence on the alleged date when the Oral Agreement is made, highlighting the fact that Chau had three versions of such a date. Her pleading at paragraph 6(c) of the Defence was that the Oral Agreement was made in about April 2005, which was later recorded and evidenced by the Agreement dated 17 August 2007. Counsel pointed out that in Chau’s witness statement made on 7 July 2020, she referred to early 2004 as the date when Siu allegedly disclosed to her his plans for the Project and the funding he required. She had also claimed in her witness statement that it was in early 2004 that the Oral Agreement was reached. In her cross‑examination, Chau claimed that throughout, there had only been one oral agreement, and that it was formed between 2004 and early 2005, and that it had taken time to discuss the terms.

52.  On behalf of the Plaintiff, it was also highlighted that even on Chau’s own case, it was not until August 2007 that the Agreement was signed, allegedly to evidence and record the Oral Agreement which had been made nearly 3 ½ years earlier. The Plaintiff submitted that Chau’s claims of the existence and terms of the Oral Agreement cannot be believed.

53.  Having considered the entirety of the evidence from Siu and Chau as to their dealings, the loans, and their admitted relationship, and having found Siu to be an unreliable witness, I find Chau’s evidence and version of the relevant events to be more probable on a balance of probabilities. I accept her evidence to mean that the offer of ownership of one of the flats on the Lots may have been made earlier, and that the Oral Agreement was reached and agreed in “about April 2005” as pleaded. It is clear from the evidence that Siu and Chau had a long-term business relationship which had started in 2004, and this developed into a romantic and intimate relationship. There had been numerous loans between Siu and Chau, and as she admitted, she could no longer remember all the intricate details of all the small transactions she had entered into with Siu. As evidenced by the documents produced at trial, and as Siu and Cheng themselves admit, there were also loan transactions between Easy, the Plaintiff and Siu’s other companies. It is hence very likely that Siu and Chau would have been in constant conversation and negotiation on the different projects and the financing thereof. It is more probable than not that the Oral Agreement was negotiated and made at around the same time. Essentially, Chau had trusted Siu and his obvious control and authority over the Plaintiff, and it is credible that Chau had not insisted on reducing the Oral Agreement in writing before 2007, particularly when she had already moved into the Premises by September 2006.

54.  In my judgment, Siu obviously knew and understood that by the Oral Agreement, he was making a gift to Chau of the beneficial ownership of the Premises and was promising to transfer such ownership to her upon completion of the construction, the issue of the Certificate of Compliance and the payment of premium - the usual formalities and procedure for the acquisition, development and sale of small village houses. These are the essential terms of the Oral Agreement, which are reflected in and recorded by the Agreement, signed later in 2007.

55.  The Oral Agreement is evidenced by the parties’ conduct in 2006. Chau moved into the Premises. It is incredible that, as Siu purported to maintain, Chau was permitted to move in in order to oversee the Site and to prevent any obstructive actions that may be taken by the Wans. It is indisputable that Chau moved into the Premises in September 2006, and had continued to occupy the Premises for nearly 7 years. No real, adequate or satisfactory reason has been given as to why Chau’s occupation of and residence in the Premises would have been able to offer sufficient “protection” or deterrence against the Wans, what real risks the Wans could have posed to necessitate Chau’s presence on the Site, and why 7 years of oversight was required on her part. In my view, the excuse given by the Plaintiff is totally unconvincing. Siu allowed Chau to move into the Premises simply because of their intimate relationship (which is actually the Plaintiff’s pleaded case at paragraph 4(j) of the Reply), coupled with the fact that Chau had, as she had promised, made loans to and procured loans to be made to the Plaintiff and to Siu, and he had promised to let her have the beneficial ownership of the Premises.

Common Intention Constructive Trust/Proprietary Estoppel

56.  Chau relies on the principles of common intention trust, citing Leung Hang Lin and anr v Lam Mei Yung [2019] HKCFI 2819, and the principles summarized by DHCJ Alexander Stock SC:

“In summary:

(1) The starting point is that equity follows the law. There is a presumption that the beneficial interest follows the legal interest. Where the property is registered in a defendant’s name, the plaintiff bears the burden of showing, on the balance of probabilities, that the defendant held the property on trust for him or her such that the beneficial ownership differs to the legal ownership. See: Liu Wai Keung §44; Mo Ying §5.16; Primecredit §17.

(2) The burden may be discharged by showing that: (i) there was a common intention held by the plaintiff and the property owner at the time of the purchase (or exceptionally, thereafter) that the beneficial ownership was to be different to the legal ownership; (ii) the plaintiff altered his or her position in detrimental reliance upon the common intention; and (iii) it is unconscionable for the property owner to assert ownership in reliance on the legal title. The constructive trust is constituted by the plaintiff’s detrimental reliance on the common intention and the unconscionability of the legal owner departing therefrom. See: Luo Xing Juan §38; Liu Wai Keung §46.

(3) The approach to ascertaining common intention is objective. One looks to the intention of each party which was reasonably understood by the other party to be manifested by the first party’s words and conduct. See: Liu Wai Keung §47; Mo Ying §5.16.

(4) The doctrine is sometimes described as having two limbs. First, where at any time prior to the acquisition (or exceptionally, at alater date), there is an agreement, arrangement or understanding reached between the parties as to how the property is to be held beneficially, based on evidence of express discussions. Second, where there is no evidence to support such a finding but the court relies on the parties’ conduct as a basis from which to infer a common intention. There is some authority that under the second limb, direct contributions to the purchase price by a party who is not a legal owner will readily justify the inference. See: Mo Ying §5.8; Primecredit §§2.3 and 2.4.” (Emphases added)

57.  The judgment in Liu Wai Keung v Liu Wai Man [2013] 5 HKLRD 9 was relied upon by Counsel for the Plaintiff, where G Lam J (as His Lordship then was) observed:

“The focus of the inquiry is therefore on the elements that the plaintiff has to prove in order to establish a constructive trust in his favor. In the context of this case, this means that the plaintiff must prove (i) there was a common intention between him and the defendant that the plaintiff was to be the beneficial owner of the Property despite that it was acquired in the defendant’s name; (ii) the plaintiff altered his position in detrimental reliance upon such common intention; and (iii) it is unconscionable for the defendant to assert ownership in reliance on her legal title to the Property.”

58.  On the facts and the available evidence which I accept in this case, I am satisfied that there was a common intention between the Plaintiff acting through Siu on the one part and Chau on the other part that the beneficial ownership of the Premises would be vested in Chau, upon the completion of construction of the building on Lot 2152 and upon the Plaintiff’s payment of the premium for the Lot. The common intention is reflected in the Agreement signed later in 2007, and can also be inferred from the conduct of Chau in procuring loans to be made to the Plaintiff and to Siu, and from the Plaintiff’s allowing Chau to move into the Premises in 2006. Chau had in reliance on the common understanding incurred expenditure in decorating and fitting out the Premises, and in my judgment, it would be unconscionable to permit the Plaintiff to assert ownership in the Premises in breach of the Verbal Agreement and the common understanding between the parties.

59.  There is no doubt, and Siu’s own evidence is that he and the Plaintiff had all along been under the belief that the Plaintiff had obtained from the Wans (including the 2^nd Defendant) all the beneficial interests in and rights to the Site including Lot 2152, and was free to dispose of the same upon the issue of the Certificate of Compliance and the payment of premium.

60.  Although it is Siu’s evidence that it was only in May 2005 that he (through his wife and mother) obtained beneficial ownership of all the shares in the Plaintiff, it is not the Plaintiff’s pleaded case that Siu had no authority to enter into any agreement for the Plaintiff. On the evidence, Siu had clearly considered himself as a collaborator of Chan in the Plaintiff’s construction projects even before 2005, and even on Siu’s evidence, when he approached Chau for loans and funding, the understanding was that the loans were for the projects of his companies, including the Plaintiff’s project in Lot 2152. I accept that Chau had regarded Siu as acting not only on his own behalf but also on behalf of the Plaintiff, when he made the representation as to conferring the beneficial ownership of the Premises to Chau.

61.  The findings made in paragraph 58 above also establish a representation and assurance made by Siu for the Plaintiff to Chau; reliance by Chau; and detriment to Chau as a consequence of her reliance, which constitute the 3 essential elements for proprietary estoppel, as identified by Lord Walker in Thorner v Major [2009] 1 WLR 776.

The Agreement

62.  Being satisfied on the existence of the Oral Agreement, and that the elements of a common understanding constructive trust and proprietary estoppel have been satisfied, it is not strictly necessary to decide on whether the Agreement is, by itself, valid and enforceable. Although it has been pleaded that the Agreement should be vitiated and should not be enforced by reason of misrepresentation, breach of CPO/MLO, uncertainty, undue influence, and duress, none of these arguments have been seriously pursued by the time of Closing, save for counsel’s contention that the signing of the Agreement by Siu and Cheng for the Plaintiff, allegedly on 17 August 2007, was unconscionable and made under pressure such that it should not be enforced.

63.  I do not accept the evidence of Siu and Cheng, that they had signed the Agreement under duress or threats, and I reject the submission that there is any ground to permit the Plaintiff to disown the Agreement.

64.  First and foremost, the Plaintiff is bound by its pleading. In its Reply and Defence to Counterclaim to the claims of the existence of the Oral Agreement and the Agreement made in the Defence and Counterclaim, the Plaintiff’s reply is that (leaving aside the defences raised under the CPO and MLO, uncertainty, lack of consideration and misrepresentation) the Oral Agreement as evidenced by the Agreement is voidable by reason of “the presumption of undue influence on the basis of a relationship of trust and confidence between Siu and Chau”.

65.  I agree with Counsel for Chau, that there has never been any pleading of duress, in the form of any illegitimate pressure amounting to compulsion of the will of the victim, or any threat to the life, health or liberty of the person threatened to enter into a contract (as explained in Re Li Xiaoming [2019] HKCFI 272). Nor is there any pleading of economic duress.

66.  There is nothing in the evidence which can support any claim that the relationship between Siu/the Plaintiff and Chau can raise a presumption of undue influence, and no particulars of the claim have been furnished. Nor is there evidence that the Plaintiff and Siu had somehow placed trust and confidence in Chau, and that Chau had somehow abused Siu/the Plaintiff’s trust and confidence, or that the Oral Agreement and the Agreement cannot be explained by reference to the relationship of trust. Nor has Counsel for the Plaintiff, by the time of Closing, made any further arguments on the undue influence said to be presumed from the relationship between Siu and Chau.

67.  In any event, it is important to bear in mind the principles of undue duress as explained by the Court in Esquire (Electronics) Limited v The Hong Kong and Shanghai Banking Corporation Limited [2007] 3 HKLRD 439:

“The key to proving economic duress is proof of the illegitimacy of the suggested pressure. Much commercial activity necessarily involves pressure, often considerable and sometimes overwhelming, exercised by parties who find themselves in powerful bargaining positions. But that of itself is not illegitimate. It was suggested by McHugh JA, as he then was, in Crescendo Management Pty Ltd v Westpac Banking Corporation (1988) 19 NSWLR 40, 46 that:

‘Pressure will be illegitimate if it consists of unlawful threats or amounts to unconscionable conduct. But the categories are not closed. Even overwhelming pressure, not amounting to unconscionable or unlawful conduct, however, would not necessarily constitute economic duress.’

155. The reference there to ‘unconscionable conduct’ itself needs explanation. It has been explained in the Australian courts by reference to a special disadvantage suffered by the weaker party of which the stronger party takes advantage and is discussed in Australia & New Zealand Banking Group v Karam and Others (2005) 64 NSWLR 149 at paragraphs [46] and [66]. In Commercial Bank of Australia Ltd v Amadio [1982-1983] 151 CLR 447, 462 Mason J, as he then was, explained the significance of the adjective ‘special’ in the phrase ‘special disadvantage’:

‘I qualify the word ‘disadvantage’ by the adjective ‘special’ in order to disavow any suggestion that the principle applies whenever there is some difference in the bargaining power of the parties and in order to emphasise that the disabling condition or circumstance is one which seriously affects the ability of the innocent party to make a judgment as to his own best interests, when the other party knows or ought to know of the existence of that condition or circumstance and of its effect on the innocent party.’”

(Emphases added)”

68.  As Counsel for Chau argued, the references and claims made by Siu and Cheng that they had been pressurized, or that they were under a lot of pressure from Easy/Siu Wah to sign the Agreement cannot in the context constitute sufficient evidence that the Agreement had been signed by Siu and Cheng under or as a result of any duress. The Plaintiff admitted they were in heavy debt and owed a substantial amount to Easy under their loan agreements with Easy. On Cheng’s own evidence, by August 2007, there was approximately $31.7 million outstanding from the Plaintiff to Easy on loans for the various projects in which the Plaintiff and other companies owned by Siu and Cheng were involved, and there had been negotiations as to how these loans could be settled or restructured.

69.  I accept the submissions made by Counsel, that it was legitimate for Easy and Siu Wah to put pressure on Siu, Cheng or the Plaintiff for repayment of the debt due to Easy in the usual course of its commercial activity, so long as such pressure did not involve any unlawful acts. Nor does the fact that, at the time when the Agreement was signed, Siu or Cheng felt pressure because Easy may be calling in the outstanding loans, constitute or evidence any duress on the part of Easy or Siu Wah which may vitiate the Agreement. Apart from the events of the meeting on 17 August 2007, the Plaintiff has not adduced any evidence of any unlawful pressure exerted by Easy, or Chau, on them.

70.  In this context, Counsel for the Plaintiff in his Closing still relies on the fact that there was “unconscionable conduct” on the part of Chau and Siu Wah of Easy, by virtue of the circumstances under which Siu and Cheng had allegedly signed the Agreement in Easy’s offices. In gist, the combined effect of the evidence from Siu and Cheng on the “threats” made or pressure exerted at the meeting on 17 August 2007 at Easy’s office (“Meeting”) is as follows:

(1)  Siu and Cheng saw the Agreement for the first time at the Meeting. On Siu’s testimony, they had attended the Meeting at Chau’s request, to discuss repayment and consolidation of the various loans from Easy. According to Cheng, she had only received from Chau before the Meeting a document which set out the interest payable on the loans, but had been told to attend the Meeting and to bring the company chop.

(2)  At the Meeting, Siu Wah asked them how the loans due to Easy could be repaid and when the properties could be sold. Siu Wah then explained that as Siu was too preoccupied with the numerous projects which were ongoing and with various litigation in which he was involved, he might not be able to cope, and so Siu Wah had arranged for Chau to attend meetings and dinners with Siu and to prepare documents for him, and that Cheng should not have any “misunderstanding”.

(3)  Chau then produced the Agreement and Siu and Cheng were asked to sign it. Siu and Cheng were shocked by the contents, that Chau was to receive beneficial ownership of the Premises.

(4)  Chau and Siu Wah left the conference room, and then Siu Wah returned later with a cup of tea. He put down the cup on the conference table loudly with a bang, and asked again when and how Siu could pay the interest due on the outstanding loans.

(5)  According to Cheng, Siu Wah looked ferocious, and he was shouting as he spoke.

(6)  Siu and Cheng in particular were frightened.

(7)  Siu said to Cheng that they should sign the Agreement first to avoid complications, and that they could talk about it later after they left Easy’s office.

(8)  Siu and Cheng both felt resigned to the fact that they had no choice but to sign the Agreement (無奈只有同意), which they did, and Siu Wah signed as witness.

71.  The above version of the Meeting is denied by Chau, whose evidence is that the Agreement had been signed before the Meeting.

72.  Even if I should adopt the Plaintiff’s case, that the Agreement was signed at the Meeting, I consider that the evidence of Siu and Cheng on the Meeting and the duress allegedly exerted on them is exaggerated, inconsistent with their own witness statements, contradictory and on the whole too unreliable to be accepted.

73.  First, Although Cheng’s account of the Meeting in cross-examination was that Siu Wah’s threatening manner and her fear as a result had left a deep and memorable impression on her, she only gave a cursory description of the Meeting in her witness statement which was made for these proceedings in July 2020. At paragraph 18 of the statement, Cheng only stated that after Siu Wah had explained that he would arrange for Chau to assist Siu in attending meetings and preparing documents etc, Chau suddenly produced the Agreement, which caught her by surprise. She then stated that when Siu Wah returned to the conference room with tea, he had a serious look and suddenly put down the teacup heavily on the table, which frightened Siu and herself. There was no mention of Siu Wah’s ferocious look, nor of the fact that he was shouting or talking loudly, as described by Cheng in cross-examination. If Cheng had indeed felt intimidated, or if she had feared for her safety as a result of Siu Wah’s words, looks or actions, such that she had signed the Agreement only out of fear, one would reasonably expect her to give a more detailed account in the witness statement to explain the alleged duress. After all, on Cheng’s evidence, the Meeting was the first time she had encountered anything akin to what she had witnessed of Siu Wah’s attitude and tone, and she had been very frightened. If this was true, the deep impression was not reflected in the witness statement.

74.  Secondly, the account of the Meeting given by Siu and Cheng in Court is inconsistent with other details of their evidence.

75.  Siu claimed in Court that he was surprised when Chau produced the Agreement at the Meeting for their signature, and that he was taken aback by the contents of the Agreement when it was produced. However, in his own witness statement signed in July 2020, Siu had claimed (at paragraph 26 thereof) that even before the Meeting, Chau had told him that she had persuaded Siu Wah not to call in the entire loan that was due to Easy, if Siu could persuade his wife to sign a document to unconditionally make a gift to Chau of the Premises which she was already occupying, as remuneration. According to Siu, Chau then told him Siu Wah wanted he and Cheng to attend at Easy’s office on 17 August to discuss the repayment of the loans.

76.  Therefore, even if Cheng can be said to have been startled by the contents of the Agreement, Siu could not possibly have been taken by surprise, when Chau had already told him before the Meeting about the document to be signed and the remuneration to be given to Chau.

77.  It is obvious that Siu was simply making up his answers when he gave testimony in Court, and his evidence cannot be accepted as either true or reliable.

78.  As Counsel for Chau highlighted, despite the attempts made by Siu and Cheng to portray themselves as having been succumbed by Siu Wah’s threatening words and behavior at the Meeting, and although it was their evidence that Siu had told Cheng that they should sign the Agreement first so that they could safely leave Easy’s office and discuss the matter later, they did not leave immediately after the Agreement was signed. According to Cheng, she had stayed to deal with and sign other documents relating to the loans and the payment of the outstanding interest on the loans. This does not sit well with the suggestion that they were so afraid that they just signed the Agreement so that they could leave quickly for their own safety.

79.  Thirdly, the conduct of the Plaintiff, Siu and Cheng after the Meeting simply do not support their attempts to argue that the Agreement had been procured by duress, or any form of illegitimate pressure or special disadvantage which was known to and abused by Chau/Siu Wah. Even if there had been any threat by Chau/Siu Wah at the Meeting, and even if they had in any way been so succumbed by threats at the Meeting that they were unable to make sound judgment, it is obvious and indisputable that the Plaintiff, Siu and Chau had not taken any action to disavow the Agreement, nor made any claim of duress, pressure or undue influence as to the signing of the Agreement, at any time after they left Easy’s office. If there had been any unlawful act on the part of Easy or Siu Wah, the Plaintiff could have made a report to the police. The least that they could have done was to instruct solicitors and to immediately issue a letter to disown the Agreement, and to record the fact that it had been signed under threats. Nothing was in fact done by the Plaintiff until the filing of the Reply to Chau’s Defence and Counterclaim in February 2019, when the Agreement was pleaded. Even in that Reply, there was no plea of unlawful duress, pressure or threats.

80.  As Counsel for Chau put to the Plaintiff’s witnesses, it was open to Siu and the Plaintiff to have negotiated and secured alternative funding from banks or other moneylenders, to pay off the loans due to Easy with a transfer of the security in the properties. This would have had the effect of removing the threat from Easy/Chau/Siu Wah that the loans would be called in, if the Agreement was not signed. Even if it was not possible for the Plaintiff or Siu to have secured alternative financing immediately after the Meeting, there is no suggestion that they had considered such an alternative in the months and years after the allegedly harrowing encounter with Siu Wah in August 2007,when the alleged “conspiracy” between Chau and Siu Wah (“to skim off the Plaintiff”) had been revealed. The fact that no other reasonable option to secure an alternative source of funding had been considered or pursued by Siu and the Plaintiff after the Meeting in August 2007 is evidence that the claims of duress are fabricated, and that the loan agreements with Easy, the related securities and the Agreement with Chau were, essentially, commercial arrangements and decisions made by the Plaintiff, Siu and Cheng, of their own choice and for their own reasons. I am not satisfied that the Plaintiff had no other practical choice or alternative but to submit to the alleged duress – even if any can be shown.

81.  The Plaintiff may claim that there were suspicious circumstances as to why Siu Wah was insisting upon the Plaintiff assigning the beneficial ownership of the Premises to Chau, but these are not sufficient, as there is no solid evidence to establish any proved facts from which any inference of duress, or any other unlawful act, can be properly drawn by the Court. The judgments in Nina Kung v Wong Din Shin and Ming Shiu Chung v Ming Shiu Sum (2006) 9 HKCFAR 334 amply explain that inferences of fraud or serious misconduct are not to be reached by conjecture, but have to be plainly established as a matter of inference from proved facts.

82.  On the facts of this case, it is not disputed that Chau had moved into the Premises with Siu’s consent from as early as 2006. The probabilities are whether she was permitted to occupy the Premises in order to oversee the Site as some manager or watchman; or to prevent destructive behavior or harassment by the Wans; or because of the personal intimate relationship between Siu and Chau. On the available evidence, I can conclude with little reservation that the relationship between Siu and Chau is the more probable, to the extent of being the most likely, reason for Siu to have agreed to Chau’s occupation of the Premises for nearly 7 years, rent-free. Even Siu accepted (at paragraph 21 of his witness statement of July 2020) that one reason he had agreed to Chau’s occupation of the Premises was their intimate relationship. I find that their relationship was the significant cause of the agreement for the transfer of the beneficial ownership of the Premises to Chau. There is nothing unconscionable in finding that Siu and the Plaintiff for which Siu acted should be bound by the agreement made with Chau.

Conclusion on the Agreement

83.  I find that Siu is not a credible witness and accept that on the entirety of the evidence, Chau’s claim is more probable than the assertions made by Siu and the Plaintiff. It is very probable that after the commencement of their intimate relationship in 2004/2005, there had been a verbal agreement and an understanding between Siu and Chau, that the beneficial ownership of the Premises would ultimately be transferred to Chau, in light of her agreement to assist Siu in obtaining and procuring funding and loans to Siu and the Plaintiff. It is credible that instead of simply relying on the Oral Agreement, Chau wanted this verbal agreement to be recorded in writing, in case Siu should renege. The Agreement was prepared and signed in 2007, to reflect the essence of the Oral Agreement already made.

84.  I do not accept that the evidence of Siu and Cheng shows any prima facie case of undue influence as pleaded, nor of duress which is not even pleaded. Since there is no evidence that their signatures to the Agreement had been obtained by any form of duress on the part of Chau (or anyone on her behalf) which can vitiate their consent to the Agreement, that is the end of the matter. Siu may have regretted the Oral Agreement and the promise of the gift he had made to Chau whom he now describes as “greedy for profit”, but on the evidence, I am satisfied that he had entered into the common understanding and the agreement in 2004/2005 with his eyes wide open. I fail to see how the Plaintiff can avoid the Agreement on any ground of unconscionability, or otherwise.

Contravention of s 27(3) MLO?

85.  My findings on the evidence are that the beneficial ownership of the Premises was promised to Chau as a result of the Verbal Agreement and the common understanding made between Chau and Siu, and because of the intimate relationship between Chau and Siu. It was not part of or on account of the charges or expenses of Easy’s loan to the Plaintiff, nor remuneration or reward from a borrower to procure the loan of a moneylender, to come within section 27(3) of MLO.

Disposition

86.  The claims made by the Plaintiff against Chau as 1^st Defendant have not been proved, and are accordingly dismissed.

87.  I will grant the order of specific performance of the 2009 Agreement and the Supplemental Agreement as sought by the Plaintiff as against the 2^nd Defendant, but declarations are also granted on the 1^st Defendant’s claim against the 2^nd Defendant and her Counterclaim against the Plaintiff.

88.  Orders are accordingly made in terms of the 1^st Defendant’s counterclaim: with declarations that she is the beneficial owner of the Premises, that the 2009 Agreement and the Supplemental Agreement have no effect as against her, that the 2^nd Defendant holds the Premises on trust for the 1^st Defendant, and that the estate, right, title and interest in the Premises be vested in the 1^st Defendant.

89.  The costs of the Plaintiff’s action against the 1^st Defendant and the costs of the Counterclaim are to be paid by the Plaintiff to the 1^st Defendant, to be taxed if not agreed, with certificate for one counsel.

90.  The costs of the Plaintiff’s action against the 2^nd Defendant are to be paid by the 2^nd Defendant to the Plaintiff, to be taxed if not agreed, with certificate for one counsel.

91.  There be liberty to the parties to apply to the Court in relation to the orders made.