YIU SAU LIN v. WONG TANG

HCA 397/2023

[2024] HKCFI 656

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 397 OF 2023

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REASONS FOR JUDGMENT

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1.  This is an application for default judgment pursuant to Order 19 Rule 7 of the Rules of the High Court by the Plaintiff’s summons issued on 31 January 2024.

2.  At the conclusion of the hearing, I granted judgment to the Plaintiff and gave the relief in terms as set out in the penultimate paragraph below.  These are my reasons.

3.  I was satisfied by the affirmation of Ho Sze Wai Alan filed herein that the Defendant has been duly served in September 2023 the Amended Writ and the Statement of Claim.  No Acknowledgment of Service or Defence has been filed by the Defendant in time or at all.  The said summons, the bundle of documents for this hearing and the Plaintiff’s written submissions have also been duly served to the Defendant.  I was satisfied that there were such defaults entitling the Plaintiff to apply for default judgment pursuant to O19 r7 and that I should proceed with the hearing in the absence of the Defendant.

4.  It is trite that upon such an application for default judgment the court shall give judgment as the plaintiff appears entitled to on his statement of claim without admitting any evidence, though the court retains its discretionary power whether to give judgment.

5.  For the present purposes, it suffices to summarize and paraphrase the Plaintiff’s case as pleaded in the Statement of Claim, as follows.

6.  The Plaintiff was born in 1931, has been a housewife, and is an illiterate.  She is only fluent in the Chiuchow dialect and not Cantonese.  She was married to her husband in 1953.  They have 4 children.  The Defendant is her youngest son, born in 1964.  Her husband passed away in 1999.

7.  In view of her advanced age, the Plaintiff:

(a)  gifted to her eldest son and the Defendant each a total of HK$1,870,270.50 between November 2018 to February 2019, keeping only her residence and a sum of money sufficient to support herself for the rest of her life;

(b)  was bad of hearing and suffered from mobility issues; and

(c)  from around 2018 to February 2020, was accompanied by her eldest son to the banks to operate her accounts as the eldest son would interpret the documents and the instructions of the bank staff to her.

8.  From February 2020 to August 2022, the eldest son was not in Hong Kong due to the COVID pandemic and in his stead, the Defendant accompanied her to the banks.

9.  In relation to the Plaintiff’s time deposit account number 707-1-26336101 with China CITIC Bank International Limited (“China CITIC Bank”) :

(a)  On 19 November 2021, the Defendant accompanied the Plaintiff to China CITIC Bank’s branch at Taikoo Shing.

(b)  There, the Defendant orally and knowingly and fraudulently misrepresented to the Plaintiff that the document she was signing was for the renewal of the time deposit when in fact the same was a Mandate or Authorization Letter authorizing the Defendant to operate the Plaintiff’s accounts with the said bank (“the CITIC Mandate”).  Relying on the said misrepresentation, the Plaintiff signed the document.

(c)  On 30 November 2021, wrongfully and without consent of the Plaintiff and with the authority given by the CITIC Mandate so wrongfully obtained, the Defendant withdrew US$174,610.00 (“Sum 1”) belonging to the Plaintiff from the said account by the issuance of a cashier order to the Defendant as payee.

10.  In relation to the Plaintiff’s time deposit account number 0000000000003558759*4 and multi-currency savings account number 000012233041 with China Construction Bank (Asia) Corporation Limited (“CCB”):

(a)  On 19 November 2021, the Defendant accompanied the Plaintiff to CCB’s branch at Taikoo Shing.

(b)  There, the Defendant orally and knowingly and fraudulently misrepresented to the Plaintiff that the document she was signing was for the renewal of the time deposit when in fact the same was a document entitled “Power of Attorney (For Non-Corporate Customers)” authorizing the Defendant to operate the Plaintiff’s said accounts.  Relying on the said misrepresentation, the Plaintiff signed the document.

(c)  On 7 December 2021, wrongfully and without consent of the Plaintiff and with the authority given by the said Power of Attorney so wrongfully obtained, the Defendant cancelled the time deposit of US$201,668.87 (“Sum 2”), transferred the said sum to the Plaintiff’s said multi-currency savings account, then withdrew Sum 2 by the issuance of a cashier order to the Defendant as payee.

11.  In relation to the Plaintiff’s time deposit account number 52-508-0588-1 and multi-currency savings account number 52-888-6277-2 with Dah Sing Bank Limited (“Dah Sing Bank”):

(a)  On 22 November 2021, the Defendant accompanied the Plaintiff to Dah Sing Bank’s branch at Taikoo Shing.

(b)  There, the Defendant orally and knowingly and fraudulently misrepresented to the Plaintiff that the documents she was signing were for the renewal of the time deposit when in fact the documents were (i) an “Account Withdrawal Slip” by which the Plaintiff closed her said multi-currency savings account and (ii) an “Application for Cashier’s Order” applying for a cashier order for US$173,931.34 in favour of the Defendant as payee with money from the Plaintiff’s said multi-currency savings account.

(c)  Relying on the said misrepresentation, the Plaintiff signed the documents, US$173,931.34 (“Sum 3”) was thus transferred from the Plaintiff’s said time deposit account to the Plaintiff’s said multi-currency savings account and Sum 3 was withdrawn by the issuance of a cashier order to the Defendant as payee. 

12.  In relation to the Plaintiff’s time deposit account number 706-823-04921-3 with Industrial and Commercial Bank of China (Asia) Limited (“ICBC”):

(a)  On 22 December 2021, the Defendant accompanied the Plaintiff to ICBC’s branch at Quarry Bay.

(b)  There, the Defendant orally and knowingly and fraudulently misrepresented to the Plaintiff that the document she was signing was for the renewal of the time deposit under her said time deposit account when in fact the document was an application form for the issuance of a cashier order for US$149,121.00 to the Plaintiff as payee by the withdrawal of the same sum from the Plaintiff’s said time deposit account.  Relying on the said misrepresentation, the Plaintiff signed the document.  The said US$149,121.00 (“Sum 4”) was so withdrawn and the said cashier order issued.

(c)  Unbeknownst to the Plaintiff and on the same day, the Defendant took the said cashier order and deposited it into the Plaintiff’s time deposit account number 707-1-26336101 with China CITIC Bank.

(d)  On 24 December 2021, wrongfully and without consent of the Plaintiff and with the authority given by the CITIC Mandate, the said sum of US$149,121.00 was withdrawn from the Plaintiff’s time deposit account number 707-1-26336101 with China CITIC Bank by the issuance of a cashier order of the same amount to the Defendant as payee.

13.  All of the above payments of Sums 1 to 4 to the Defendant by way of cashier orders issued from money withdrawn from the Plaintiff’s various bank accounts were procured by the Defendant’s said fraudulent misrepresentations, and where the CITIC Mandate and the said Power of Attorney were used, were additionally in breach of fiduciary duties owed by the Defendant to the Plaintiff.  The Defendant was also thereby unjustly enriched.  Sums 1 to 4, and their traceable proceeds, thus have been held by the Defendant under a constructive trust on behalf of the Plaintiff, the true beneficial owner.  The Plaintiff is entitled to their return with interest at prime lending rate plus 1%.

14.  Based on these averments, which were deemed to have been admitted by the Defendant upon his default to file the Acknowledgment of Service and Defence, I was satisfied that the Plaintiff was entitled to the relief she now sought, which as discussed with Mr Au at the hearing, would no longer include declarations to the effect that the CITIC Mandate and the said Power of Attorney be null and void.   I was of the view that there was a genuine need for the declaratory relief presently sought, which was appropriate to be granted.

15.  At the conclusion of the hearing, I therefore gave judgment to the Plaintiff and granted the following relief:

(1)  A declaration that the Plaintiff has been the beneficial owner of the following 4 sums which have been held by the Defendant as constructive trustee for the Plaintiff:

(a)  US$174,610.00, withdrawn from the Plaintiff’s time deposit account number 707-1-26336101 at China CITIC Bank International Limited on 30 November 2021;

(b)  US$201,668.87, withdrawn from the Plaintiff’s multi-currency savings account number 000012233042 with China Construction Bank (Asia) Corporation Limited on 7 December 2021;

(c)  US$173,931.34, withdrawn from the Plaintiff’s multi-currency savings account number 52-888-6277-2 with Dah Sing Bank Limited on 22 November 2021; and

(d)  US$149,121.00, withdrawn from the Plaintiff’s time deposit account number 706-823-04921-3 with Industrial and Commercial Bank of China (Asia) Limited on 22 December 2021;

(2)  The Defendant do return or pay the said 4 sums to the Plaintiff, with interest at prime lending rate plus 1% from their respective withdrawal dates set out in paragraph (1) above up to the date of this Judgment and thereafter at judgment rate until full payment;

(3)  Costs of this action, including costs of this application, be to the Plaintiff to be taxed if not agreed; and

(4)  The Plaintiff’s own costs be taxed in accordance with the Legal Aid Regulations.

16.  I thank Mr Au for his assistance.