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HCA 2518/2018
[2025] HKCFI 2754
IN THE HIGH COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF FIRST INSTANCE
ACTION NO 2518 OF 2018
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BETWEEN
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YS INTERNATIONAL PROPERTY DEVELOPMENT |
Plaintiff |
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LIMITED (沂淳國際置業發展有限公司) |
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and |
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WELLFIRM HOLDINGS LIMITED |
1st Defendant |
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LAW SAU FAI FRANCIS(羅守輝) |
2nd Defendant |
________________________
| Before: |
Hon Fung J in Court |
| Dates of Hearing: |
10 – 14, 17, 20 March 2025 and 2 May 2025 |
| Date of Judgment: |
2 July 2025 |
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J U D G M E N T
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1. The Plaintiff is suing the 1st and 2nd Defendants for damages for breach in not paying the commission fees arising from the sale of the company Bight Spot Ltd (“Company”) which is the vehicle for holding the entire building known as “299QRC” at 287-299, Queen’s Road Central, Hong Kong (“Property”).
Background
2. The Company was the registered owner of the Property. The 1st Defendant was the sole shareholder of the Company, and the 2nd Defendant was a director and the beneficial owner of the Company.
3. The Plaintiff is a licensed estate agent under the Estate Agent Ordinance (Cap. 511). Mr Raymond Hui was a representative of the Plaintiff. Raymond Hui has been engaging in work relating to the sale of real property and sometimes companies holding real property, but he is not a licensed estate agent.
4. In about May 2018, the 2nd Defendant decided to put the Property on the market. The 2nd Defendant is a seasoned investor in real property, and has carried out many deals in commercial property before.
5. On 16 May 2018, Ms Angela Kung, of the Midland Realty Group (“Midland”), an estate agency listed on the Hong Kong Stock Exchange, created the WhatsApp chat group “QRC299”, later renamed “QRC299 – Angela Kung” (“Angela Kung Chat Group”), with members including the 2nd Defendant, Ms Winnie Lee, assistant of the 2nd Defendant, and some staff members of the 2nd Defendant.
6. On 16 and 17 May, 2018, there were preliminary discussions about the sale of the Property in the Angela Kung Chat Group. A meeting was fixed at 10:30 am on 18 May 2018. Winnie Lee asked Angela Kung to prepare an engagement letter of the client with offer price and payment terms, etc. The request for an engagement letter was later changed to a simple offer letter on Midland’s letterhead.
7. Before the meeting, Angela Kung mentioned in the chat group she would attend the meeting with a director of Tap First Investment Ltd. The 2nd Defendant asked for the background and Angela Kung said Mr Au represented a Hong Kong banker investment funds. The 2nd Defendant said the asking price for the Property was $2.3 billion.
8. On 18 May 2018, a meeting took place at the office of the 2nd Defendant (“1st Meeting”). The meeting was attended by Angela Kung, Mr Ricky Choi, a licensed estate agent and Managing Director of Landsources (HK) Property Consultants Ltd (“Landsourcess”), Mr Kenny Au and Mr Billy Li, both of Evernet Co, the 2nd Defendant and Winnie Lee. Ricky Choi, Kenny Au and Billy Li have tendered their name cards to the 2nd Defendant.
9. For the purpose of the 1st Meeting, Landsources prepared a document entitled “Letter of Intent on Sale and Purchase of Property” dated 16 May 2018 addressed to the Company and the 2nd Defendant signed by Ricky Choi. The intended buyer Tap First Investment Ltd (“Tap First”). The offer price was $1.7 billion, and the agent’s fee for Landsources was 6% of the consideration upon completion to be paid by the seller. There was also a letter dated 15 May 2018 for earnest money of HK$50,000,000 signed by Tap First.
10. There is no dispute that the Tap First Letter of Intent was not genuine but prepared for the purpose of the 1st Meeting. In any case, the Tap First offer was not accepted by the 2nd Defendant. In fact, a letter similar to the Tap First letter was screenshot in the Angela Kung Chat Group before the meeting, and it had not been accepted by the 2nd Defendant because the price was too low.
11. After the 1st Meeting, Kenny Au was added to the Angela Kung Chat Group on 20 May 2018. Angela Kung exited the chat group and it was renamed the “QRC 299 Kenny Au” chat group (“Kenny Au Chat Group”). Raymond Hui was not in the chat group yet at this stage.
12. On 21 May 2018, Kenny Au wrote in the Kenny Au Chat Group that $2.3 billion was too hard to the mandatory (ie funder), and he set out a revised the offer of:
“1/ transaction price 2B; 2/ initial deposit 50M; 3/ preliminary in 14 day and 10% deposit; 4/ dd for 3 months to official contract”.
13. Kenny Au asked for the law firm that would be holding the initial deposit, but the 2nd Defendant asked Kenny Au to hold on for his consideration of the revised offer and would revert after the holiday.
14. Also on 21 May 2018, Raymond Hui screenshot the massages on the terms proposed by Kenny Au above, where the 2nd Defendant had asked Kenny Au to hold on, to one Mr Patrick Wong, who turned out to be the buyer of the Property eventually.
15. On 22 May 2018, The 2nd Defendant asked in the Kenny Au Chat Group the law firm acting for Kenny Au’s client. Kenny Au replied that the law firm for the funder was either Messrs PC Woo or Messrs Reed Smith, at the choice of the 2nd Defendant. The 2nd Defendant added that he had offered the Property to a serious buyer at $2.3 billion.
16. On 22 May 2018, Raymond Hui also screenshot the message of the 2nd Defendant saying he had made an offer to a serious buyer $2.3 billion to Patrick Wong.
17. On 23 May 2018, Kenny Au wrote in the Kenny Au Chat Group whether he could tell his funder that the 2nd Defendant had considered to close the deal at $2 billion, and asked for the name of the 2nd Defendant’s lawyer. The 2nd Defendant again asked Kenny Au to hold on and not to make any report.
18. Later on the same day, Raymond Hui screenshot to Patrick Wong the message by Kenny Au whether he could tell his client the suggested price of $2 billion. Patrick Wong asked Raymond Hui whether there was no deal? Raymond Hui said he would try his best to close at $2 billion.
19. On 23 May 2018, the 2nd Defendant replied in the Kenny Au Chat Group that not interested to dispose of the Property at $2 billion.
20. On 28 May 2018 at 10:30 am, Raymond Hui went to see the 2nd Defendant at his office (“2nd Meeting”). Winnie Lee was also present. There is substantial divergence in the evidence of Raymond Hui (PW1) and the 2nd Defendant (DW1). The evidence will be dealt with in the parties’ respective cases below.
21. After the 2nd Meeting on 28 May 2018 at about 11:47 am, Winnie Lee created the “Raymond Hui QRC299” Chat Group (“Raymond Hui Chat Group”). Raymond Hui and the 2nd Defendant were added as administrators. Irwin Kwok of the 2nd Defendant’s staff was added as a member. At about 11:52 am, Winnie Lee sent a screenshot of the business card of Messrs Gallant attention of Ms Annie Wong, solicitor. Raymond Hui then wrote in the chat group that he had reported to the client.
22. On 28 May 2018 at 1 pm, Kenny Au asked in the Kenny Au Chat Group whether he could reply to his boss that it was impossible to close a deal at $1.8 billion, and the 2nd Defendant said yes. Later in the afternoon, Kenny Au wrote in the Kenny Au Chat Group:
“Mr Law, the funder has just cancelled my agency in negotiating for purchase of [the Property], and the offer I have made will cease on today. Hereafter, Mr Hui and other relevant persons will take over the negotiation of this project, and it will have nothing to do with me and my company…”
23. On 29 May 2018, Reed Smith Richards Butler (“Reed Smith”) sent a letter to Gallant attention of Annie Wong offering $1.8 billion for the entire issued share capital of the Company.
24. On 6 June 2018, Raymond Hui wrote to the 2nd Defendant in the Raymond Hui Chat Group that:
“The client had a meeting and eventually could offer $2 billion. Is there a chance of consideration?”
Winnie Lee replied that Annie Wong of Gallant would reply directly to his client’s lawyer Reed Smith.
25. On 8 June 2018, Mr Lee Shu Chung Adolf, Chief Financial Officer of Tenacity Capital Management Ltd (“Tenacity”), the eventual buyer, sent a WhatsApp message to Raymond Hui, stating that:
“Raymond, Talked to the boss, it seems more acceptable to Mr Law for direct negotiation through the solicitors, and our solicitors are familiar with the solicitors for Mr Law. In order not to transmit the wrong message again, the boss has decided to let the solicitors negotiate directly. Will pay you appreciation money upon completion. Thank you.”
26. Raymond screenshot Adolf Lee’s message for Patrick Wong. Patrick Wong replied: “What he said is right.”
27. On 27 June 2018, a Sale and Purchase Agreement (“SPA”) for the sale of the Company holding the Property at $2,100,000,888 was entered into with Tenacity as the buyer, the 1st Defendant as vendor and the 2nd Defendant as guarantor.
28. On the same day, Raymond Hui wrote in the Raymond Hui Chat Group:
“Mr Law, my client said (he) had signed the deal with you. Thank you.”
Within a few minutes, he 2nd Defendant replied:
“Please ask for his confirmation letter...”
29. After a few more minutes, the 2nd Defendant posted in the Raymond Hui Chat Group screenshot of messages between Annie Wong and the 2nd Defendant on 21 June 2018.
30. The screenshot showed the following messages:
“Annie Wong: ‘Doreen Kong called me and I just hang up the phone. She said her client is still very keen and serious and would like to ask Mr Law for the price indication off the record. She asked whether her client would have a chance if offered $2.1 billion, or what sum Mr Law would consider selling the property.’
“Annie, I am now with Evon. Please call [telephone number] if free.”
“Annie: Done. Massage passed to Doreen and she will tell her client $2.18 billion now. Also she said not through agent Raymond.”
31. The 2nd Defendant wrote:
“Doreen Kong is the lawyer acting for the buyer.”
32. Raymond Hui did not reply to these screenshot messages.
33. On 28 June 2018, Raymond Hui wrote in the Raymond Hui Chat Group:
“Mr Law, Good morning, both parties have confirmed by signing. Whether the commission document will be issued to me? ”
34. The 2nd Defendant replied:
“For the sake of clarity, please ask the buyer Tenacity (Patrick Wong) to issue written confirmation”.
35. On 10 July 2018, Adolf Lee of Tenacity issued a confirmation letter to the Plaintiff and Raymond Hui (“Tenacity Letter”). In gist:
“(1) In early May 2018, Mr Raymond Hui of your company contacted Mr Patrick Wong of our company, stating that the owner was interested in selling the Property by transfer of company shares.
(2) Mr Hui said the buyer must negotiate the sale through the solicitor for the vendor Annie Wong of Messrs Gallant.
(3) According to the information of Mr Hui, our company instructed Messrs Reed Smith Richards Butler to negotiate with Gallant, and on 27 June 2018 the investor as represented by our company and the owner of the Property signed a provisional shares transfer agreement.
(4) On 28 June 2018, Mr Hui of your company contacted Mr Adolf Lee of our company, stating that the owner required our company to confirm that our company learnt about the above shares transfer matter through the Plaintiff before releasing the commission. Mr Hui informed Mr Lee of our company that the commission would be wholly paid by the owner, and our company would not be liable or responsible to pay any fees or commission to your company or yourself.”
36. On the same day, Raymond Hui wrote in the Raymond Hui Chat Group:
“Mr Law, good morning. Mr Wong had issued the confirmation letter. Shall I bring it up to your company, and to get the commission document as well? Thank you.”
37. There was no response from the 2nd Defendant, and there was no messages in the Raymond Hui Chat Group until 19 July 2018 when Raymond Hui asked:
“Mr Law, good morning, wonder when to take the letter up to your company? Thank you.”
38. The 2nd Defendant replied:
“WhatsApp the letter to me first, I just returned from a trip.”
39. Raymond Hui asked again:
“Mr Law, is it convenient for me to come up to your company at 12 pm tomorrow?”
40. The 1st Defendant replied:
“WhatsApp me the letter first.”
41. Then Raymond Hui screenshot the Tenacity Letter in the Raymond Hui Chat Group.
42. There was no message until 25 July 2018 where Raymond Hui asked:
“Mr Law, good morning, wonder when I could take the letter up to your company? Thank you.”
43. On 26 July 2018, Gallant issued a letter dated 25 July 2018 to the Plaintiff attention Raymond Hui (“Gallant Letter”). The Gallant Letter stated they were acting for the acting for the 1st Defendant. It referred to the Tenacity Letter, and put the Plaintiff to strict proof of the matters stated therein, and vehemently denied that the 1st Defendant had appointed the Plaintiff to provide agency service in relation to the Property, and that the 1st Defendant was liable to the Plaintiff for any commission.
44. The Gallant Letter further averred that Raymond Hui was an agent for Tenacity and the 1st Defendant would not be involved in any dealings or commission arrangement between the Plaintiff and Tenacity.
45. In the afternoon of 26 July 2018, Raymond Hui asked in the Raymond Hui Chat Group whether able to talk on the phone. The 2nd Defendant said their lawyer had issued a written response, and it was not convenient to talk. The 2nd Defendant further stated:
“Raymond, we spoke earlier. For clarification (of) all facts, you are all along the agent acting for Tenacity. Thus, Tenacity is liable to you for commission. We have never appointed you as agent to act for us. We are not liable to you for any commission.”
46. After about half an hour later, Raymond Hui replied:
“Our company received the Gallant Letter by email. Our company wished me to clarify when happened. When in the beginning came up to your company to have the meeting with Mr Law about the Property, I said clearly to charge your company 1% as commission. As the purchase price was not yet concluded by both parties, Mr Law requested the solicitors for both parties to negotiate until it is eventually true, hence, it was not requested that your company sign a commission document for confirmation. Hope Mr Law will understand. Thankyou”.
47. Then the 2nd Defendant wrote:
“Raymond, I remember that when you first represented the client of your company and offered $1.7 billion, the meeting was very preliminary, and our company never discussed or negotiated any commission matter, and all negotiations on the sale and purchase must finally be ‘according to the accurate and correct version as signed by both parties’”.
48. Then Raymond Hui wrote:
“Mr Law, when I came up by myself to your company for the second time for negotiation, my client offered $2 billion, but it was not Mr Law’s price in mind. Hence, I requested Mr Law to let the solicitors of both parties negotiate for real. I hope Mr Law will be benevolent, and give us small firm some breathing space.”
49. The 2nd Defendant replied:
“Raymond, I am very clear that during the meeting, my company never discussed or promised any commission.”
50. Then Raymond Hui wrote:
“Mr Law, At that time I want to facilitate the deal of (the Property), I proposed in the meeting the commission of 1% and not the 5% proposed by Kenny Au in the 1st Meeting. You also asked me to clarify the commission for Mr Au and to make a declaration, and Mr Au later issued a declaration for you, that in future everything will be followed up by me and your company, and has nothing to do with Mr Au, because I will cease any cooperation with him.”
51. The 2nd Defendant said:
“Raymond, the more you said, the more I could not understand what you were talking about.”
52. Then Raymond screenshot the relevant messages between Kenny Au and the 2nd Defendant in the Kenny Au Chat Group about the departure of Kenny Au from the deal (see §22 above).
53. On 27 July 2018, Raymond Hui sent a message in the Raymond Hui Chat Group:
“Good morning, when I met you alone in the 2nd Meeting, both of us felt that it was ridiculous for Mr Au to charge you 1% commission. I said in the meeting that I would charge you 1% commission, and you said it was reasonable. You said I was experienced to see what the problem is, but you feared that my client was not for real, hence you passed me you solicitors’ firm, for the solicitors on both sides to negotiate the price and terms. You can see from Mr Wong’s letter that they do not pay me any commission for the Property, because when I first approached Mr Wong, he indicated that he was a tenant of the Property, hence, he suggested not to pay me commission. Therefore I could only proposed to Mr Law my request for 1% commission. Such a commission is a small problem for Mr Law, but a big problem for us small firm. I hope Mr Law will appreciate and understand. Thank you.”
54. The 2nd Defendant replied:
“Raymond, You have completely misunderstood it. I wondered why your company not issue the invoice to Tenacity to get the commission?
55. Raymond Hui then said:
“Mr Law, When I first introduce [the Property] to Mr Wong, he had indicated that he was a tenant there, and was letting me do it without paying commission, hence I requested 1% commission from you. You should understand if there were no commission from both parties, the agent would not facilitate the completion of the deal, and I would not have passed the 2nd Defendant’s solicitor firm to Patrick Wong, and under the mutual trust to allow the solicitors of both parties to negotiate and bargain. Hope Mr Law will be considerate.”
Plaintiff’s case
56. Raymond Hui was the only witness for the Plaintiff.
57. He said he was approached by Kenny Au that the Property was put on the market through the transfer of shares in the Company.
58. On 14 May 2018, Raymond Hui approached Mr PatrickWong of Tenacity to engage the Plaintiff and Evernet to negotiate with the owner for the purchase. He said although Patrick Wong was to be the Plaintiff’s client, the condition was that the owner of the Property would be solely liable for the commission for the sale.
59. At the 1st Meeting, Angela Kung introduced Kenny Au, Ricky Choi and him to the 2nd Defendant. Although the sale of the Property was originally placed with Midland, Angela Kung said the client belonged to the team and not Midland. He understood Angela Kung was asking the 2nd Defendant to entrust the sale of the Property to the team.
60. Raymond Hui admitted that the Tap First offer was not genuine, but was only prepared for approaching the 2nd Defendant. Although the 2nd Defendant had asked for $2.3 billion, Kenny Au said the client could only offer $1.7 billion.
61. In the Tap First letter the agent’s fee was 6% of the purchase price, which the 2nd Defendant said was too high, and Kenny Au reduced it to 5%. He disagreed with the 2nd Defendant that agent’s fee was not discussed at the 1st Meeting.
62. Raymond Hui was not in the Kenny Au Chat Group after the 1st Meeting. Nevertheless, he forwarded screenshots of the bargaining in the chat group by Kenny Au and he on forwarded them to Patrick Wong.
63. On 28 May 2018, Raymond went to see the 2nd Defendant by himself. Winnie Lee and Irwin Kwok were also present.
64. Raymond Hui said he had given two name cards to the 2nd Defendant at the 2nd Meeting. At first, he gave the name card of two companies “YS International Property Development Ltd” (ie the Plaintiff with the estate agent licence number) and also “YS International Enterprise Ltd” (a trading company) (“Plaintiff’s Business Card”). Towards the end of the 2nd Meeting, he also gave the name card of YS International Enterprise Ltd alone (“YS Enterprises Card”) as he would like the 2nd Defendant to introduce some trading business to him. He disagreed that he had only given the YS Enterprises Card to the 2nd Defendant.
65. Raymond Hui’s position was not shown in either name cards. It is not clear as to his position in the Plaintiff save that he is a good friend of Mr Lam Fai-kit, the shareholder and director of the Plaintiff.
66. On the price, Raymond Hui said he told the 2nd Defendant that his client was willing to pay $2 billion, not just $1.7 billion, but the 2nd Defendant did not agree to reduce from $2.3 billion. The 2nd Defendant said the price should be left to the negotiations by the respective solicitors.
67. On the commission fee, Raymond Hui said Patrick Wong was a tenant of the Property so he would not be paying commission to him.
68. In the 1st Meeting, Kenny Au had made it clear that only the seller would be responsible for the commission.
69. In the 2nd Meeting, the 2nd Defendant said 5% as proposed by Kenny Au in the 1st Meeting was too much, and 1% was reasonable, and he was willing to pay 1% on the price finally negotiated by the lawyers.
70. Raymond Hui said the 2nd Defendant had orally agreed to pay him 1%, and would give him the commission document once the client had paid the deposit, with the condition that Kenny Au would not charge any commission and withdraw from the deal.
71. He had originally asked the 2nd Defendant to sign a commission document for the Plaintiff, but the 2nd Defendant said: “Raymond, I am the owner, you trust me, once your client had paid the deposit, I would immediately issue the commission document to you”.
72. Raymond Hui said he trusted the 2nd Defendant, and there was no way not to trust the him as he was a billionaire, and he would be earning over $1 billion profit, and 1% would be a small amount to him. In any case, the 2nd Defendant was not willing to sign the document bought to him at the 1st Meeting.
73. He would not have asked the 2nd Defendant to issue the commission document if the 2nd Defendant had not orally agreed to do so.
74. After the 2nd Meeting, the Raymond Hui Chat Group was created. Raymond Hui said he was careless in not recording the oral agreement in the chat group because he was in a hurry to pass the contact of Gallant to Patrick Wong. He said if he had not passed the contact of Gallant to Patrick Wong, the 2nd Defendant would not have known Patrick Wong, and there would not have been any deal between them eventually.
75. Raymond Hui emphasized that part of the oral agreement for the commission was that Kenny Au would withdraw from the deal, and he did get Kenny Au to so inform the 2nd Defendant such that the 2nd Defendant would not be liable for commission to both him and Kenny Au.
76. Raymond Hui said when he repeatedly asked for commission document in the Raymond Hui Chat Group, the 2nd Defendant’s response was to ask for the confirmation letter, showing there was an oral agreement. Hence, he asked Adolf Lee to issue the Tenacity Letter.
Defence case
77. Both the Defendant and Winnie Lee gave evidence.
78. The 2nd Defendant denied ever engaging Raymond Hui as his agent in the sale of the Property. He asked rhetorically that how could he have engaged an agent to act only in the interest of the buyer to undercut his price.
79. The 2nd Defendant denied that there was any oral agreement on the agent’s fee. It was not the case that he would never make an oral agreement, but only with someone he knew and trusted. He hardly knew Raymond Hui and his company, and he was not a person he trusted. Hence, he suggested to leave the negotiations to lawyers with a sound reputation.
80. The 2nd Defendant said he had received one name card only from Raymond Hui at the 2nd Meeting, the YS Enterprise Card. He had never received the Plaintiff’s Business Card.
81. The 2nd Defendant said he had a system of putting a date chop on the name cards he received. From the name cards produced by the Plaintiff in discovery, only the YS Enterprise Card had a date chop, and the Plaintiff’s Business Card had none. The original of the YS Enterprise Card was produced (Exh D2). This evidence was corroborated by Winnie Lee who handled the name cards for the 2nd Defendant.
82. After the signing of the SPA, Raymond Hui said his client had signed the deal in the Raymond Hui Chat Group. The 2nd Defendant replied: “Please ask for his confirmation letter”.
83. Under cross-examination, it was put to the 2nd Defendant that he asked for Tenacity Letter in order to confirm the payment of commission to Raymond Hui. The 2nd Defendant denied that because he knew Doreen Kong had told Annie Wong that the deal was through Raymond Hui. He never thought of any possibility of paying commission to Raymond Hui. He was just trying to figure out what was Raymond Hui’s role in the deal and on what basis he was making the allegation that he needed to bear the responsibility for the commission.
84. Winnie Lee said Raymond Hui never made an appointment for the 2nd Meeting and it was an impromptu meeting. She said Raymond Hui only presented one name card, his offer at the 2nd Meeting was $1.7 billion, and the 2nd Defendant said it was too low. Raymond Hui requested 1% commission and the 2nd Defendant did not answer him. The 2nd Defendant told Raymond not to waste time, and if his client had other proposals, his client’s lawyers could do so in writing to Gallant.
Analysis
85. Miss Yu, counsel for the Plaintiff, submitted that the causes of action were framed on three bases:
(1) An oral agreement between the Plaintiff and the 1st Defendant (acting through the 2nd Defendant) to pay 1% commission of the purchase price of the Property upon completion of the sale of the Property via the transfer of shares of the Company and on condition that the Plaintiff procure Evernet not to charge any commission;
(2) Recognition by the 2nd Defendant that the Plaintiff was its agent in the sale of the Property/Company with the knowledge that the agent would only be charging the commission from the seller;
(3) Regardless of any agency, the tortious claim against the 2nd Defendant for breach of duty of care under a special relationship between the Plaintiff and the 2nd Defendant and/or misrepresentation based on the representation by the 2nd Defendant that he was the owner and he would be paying 1% commission on the purchase price for the service of the Plaintiff.
86. In her Opening, Miss Yu put reliance on the agency, yet at closing, she relied on the special relationship, and regardless of whether there was any agency would not affect the validity of the oral contract.
87. In the absence of any written agreement or document, Miss Yu conceded that all the bases of claim would depend on Raymond Hui’s evidence that the 2nd Defendant had orally agreed to pay the commission.
88. Miss Yu also conceded that the cause of action by the Plaintiff would depend on the Raymond Hui evidence that he had tendered the Plaintiff’s Business Card instead of YS Enterprise Card only. No case of undisclosed principal has been pleaded or run in this case.
89. Mr Ko, counsel for the 1st and 2nd Defendants, submitted that the Plaintiff’s case depended on the evidence of Raymond Hui, and he is an inherently unreliable and incredible witness.
90. In assessing the credibility of the parties, the Court would consider (a) whether party’s case is inherently plausible or implausible; (b) whether the party’s case is contradicted by evidence (documentary or otherwise) which is undisputed or indisputable; (c) where it is shown a witness has been discredited over one or more matters to which he has given evidence using the above tests; and (d) the demeanours of the witness (see Lee Fu Wing v Yan Po Ting Paul [2009] 5 HKLRD 513 at §53 per DHCJ Au ( as he then was)).
91. As a matter personal background, Raymond Hui is not a licensed estate agent although he has been carrying on an estate agent’s work for over 30 years. His exact position in the Plaintiff is not clear.
92. Raymond Hui said that he saw no problem at all so long as the Plaintiff is licensed. Although there is no issue of illegality in the context of this case, this may reflect on his manner of doing business.
93. Raymond Hui admitted that the Tap First Letter of Intent offering $1.7 billion at the 1st Meeting was not genuine but just a bargaining tactic. The fact that he has no hesitation in admitting that and saw nothing wrong with it reflects somewhat adversely on the level of his business morals.
94. There are a number of inconsistencies in the evidence of Raymond Hui. These matters are relevant in the question of credibility.
95. In the Amended Statement of Claim, it was pleaded that the in the 1st Meeting, the Plaintiff and Evernet had made known to the 2nd Defendant that the owner of the Property would be solely liable for the commission. Further, Raymond Hui stated in his witness statement that it was he so represented on behalf of the Plaintiff and Evernet. However, under cross-examination, he admitted that he had in fact said nothing in the 1st Meeting. That is an important inconsistency.
96. As to how many name card(s) Raymond Hui presented in the 2nd Meeting, it bears some importance because only the Plaintiff’s Business Card bears the name of the Plaintiff. Raymond Hui did not say in his witness statement that he had presented two name cards. This point could affect the Plaintiff’s locus to sue.
97. The 2nd Defendant had explained his system of putting the date chop on the name cards he received. The 2nd Defendant said he only received the YS Enterprise Card, and only that card had a date chop.
98. Moreover, the Plaintiff’s Business Card contains the respective names and addresses of the Plaintiff and of the trading company. Both cards contain the same telephone number and email addresses of Raymond Hui. If Raymond Hui had already presented the Plaintiff’s Business Card to the 2nd Defendant at the beginning of the 2nd Meeting, there was really no need for him to present the YS Enterprise Card at the end of the meeting. He could just mention that one of the two companies also carried on trading business.
99. Another matter was the offer price Raymond Hui made in the 2nd Meeting. Raymond Hui said it was $2 billion, and the 2nd Defendant said it was $1.7 billion.
100. Mr Ko submitted that if Raymond Hui’s client had set the upper limit at $2 billion, it should not have been the opening gambit in the, as it would leave no room for further bargaining.
101. Moreover, the Reed Smith Letter on 29 May 2018, the day after the 2nd Meeting, was offering $1.8 billion only.
102. Furthermore, on 6 June 2018, Raymond Hui wrote in the Raymond Hui Chat Group that “the client had a meeting and eventually could offer $2 billion. Is there a chance of consideration?” If Raymond Hui’s client had already offered $2 billion on 28 May, why would he have said the client was eventually offering $2 billion on 6 June? On the other hand, if Raymond Hui had really offered $2 billion at the 2nd Meeting, he would have done so without instructions from his client. It harks back on the business integrity of Raymond Hui.
103. As to the so-called agency, it was not in the legal sense where the agent would bind the principal(s), but the typical Hong Kong estate agent of a broker or go-between as explained in the Court of Appeal case of Bright Gold Ltd v Mega Well Development Ltd [2020] 4 HKLRD 26.
104. The 2nd Defendant said he would not be appointing an agent to undercut his stated price for the buyer. There is a lot of sense in that. More so, Raymond Hui had been forwarding the message of Kenny Au where the 2nd Defendant had expressly told Kenny Au not to tell the intended buyer of the offer of $2 billion. In any case, even Kenny Au was only regarded as an agent for Tap First.
105. It was also pleaded that the so-called agency or engagement was an exclusive one, but it was not seriously argued and there was hardly any evidence as to the duration and terms of the alleged exclusivity.
106. Hence, whatever type of agency as alleged, it really comes back the same point as the oral agreement or representation to pay 1% commission.
107. Before looking at the alleged oral agreement, one must first focus on what exactly Raymond Hui had actually done, and the relevant time was at the 2nd Meeting where the promise to pay 1% commission was allegedly made.
108. It was definitely not the service ordinarily provided by an estate agent in helping to negotiate the price and close the deal between the parties, as that was left to the respective solicitors.
109. Miss Yu submitted that without Raymond Hui’s introduction， the 1st and 2nd Defendant would not have known the potential buyer, and the eventual purchase would not have taken place.
110. Strictly speaking, it was not the introduction of the intended buyer at the time of the 2nd Meeting, as the identity of Tenacity was not disclosed until the signing of the contract. What he did was the forwarding the name of the solicitor for the seller to the buyer and/or its solicitor.
111. The identity of Reed Smith was in fact disclosed by Kenny Au in the Kenny Au Chat Group beforehand before the 2nd Meeting, even if might not be obvious to the 2nd Defendant then.
112. Be that as it may, suppose the service was to link up the solicitors for the respective parties as if Reed Smith were never disclosed before, it was still a very limited one as compared with the usual service of help the parties to negotiate the price and close the deal, where one would ordinarily have expected a fee be paid.
113. In such circumstances, would one have reasonably expected some record in writing in order to avoid unnecessary argument in the future.
114. Raymond Hui said part of the reasons he did not further ask the 2nd Defendant to sign a commission document in the 2nd Meeting was because the 2nd Defendant was not willing to sign the document brought to him at the 1st Meeting. The fact that the 2nd Defendant had not signed anything in the 1st Meeting was because there was no agreement at all, not to mention that the Tap First offer was fake. This reason is wholly inept.
115. Raymond Hui said he was careless in not recording the oral agreement in the Raymond Hui Chat Group as he was in a hurry to link up Gallant and Reed Smith. That is hardly a reasonable explanation. There was no reference to any oral agreement in the Raymond Hui Chat Group even when he was repeatedly trying to obtain the commission document.
116. It should also be noted that on 26 July 2018, after receiving the Gallant Letter, Raymond Hui wrote in the Raymond Hui Chat Group that he had said clearly to charge the Company 1% commission in the 2nd Meeting, but as the purchase price was not yet deceded, the 2nd Defendant requested the solicitors for both parties to negotiate until it is eventually for real, hence, he did not request that the 2nd Defendant sign a commission document for confirmation. That is from Raymond Hui’s own mouth and it does not seem to assist to his case at all.
117. Raymond Hui said the 2nd Defendant’s request that the status of Kenny Au and himself be clarified was part of the oral agreement. It is not disputed Kenny Au departed and entry of Raymond Hui joined in the respective chat groups. However, that by itself does not mean there was any oral agreement. In any case, there is no evidence of any agreement between Kenny Au and the 2nd Defendant.
118. Raymond Hui stressed that Kenny Au had made it clear in the 1st Meeting that only the seller would be paying the commission. That was in the context of the Tap First offer which was fake, and in any case, that offer was not accepted by the 2nd Defendant because the price was too low. I see no carry over effect to the 2nd Meeting when a totally different deal and service was proposed at the 2nd Meeting. Whatever happened in the 2nd Meeting will depend entirely on the evidence of Raymond Hui.
119. As to the 2nd Defendant, his case was mostly denial of the Plaintiff’s allegations. I find him generally a sensible and straight forward witness. However, his response to Raymond Hui’s request for the commission document seems somewhat strange and warrants some serious consideration.
120. On 27 June 2018, when Raymond Hui wrote in the Raymond Hui Chat Group his client had signed the agreement, the 2nd Defendant’s immediate response was “please ask for his confirmation letter…”. Raymond Hui had not mentioned any commission yet. Thereafter, when Raymond Hui asked for the commission document, the request for confirmation letter was repeated. The 2nd Defendant did not ask what the commission document was about. It seems to suggest there had been some previous understanding or discussions as to some commission document.
121. To complete the picture, apart from asking for confirmation, the 2nd Defendant did screenshot the message that Doreen Kong said the deal was not through Raymond Hui, which Raymond Hui never answered.
122. The 2nd Defendant explained that he had already known from Doreen Kong that the deal was not done through Raymond Hui. In such circumstances, it begs the question as to what the 2nd Defendant was trying to find out from the confirmation letter from Tenacity.
123. Could it be that the 2nd Defendant did promise Raymond Hui to pay 1 % commission but reneged on it when he found out that Doreen Kong said the deal was not through Raymond Hui? But it was the 2nd Defendant who had decided to leave it to the lawyers and not Raymond Hui to negotiate the deal.
124. Actually, that was also the decision of Patrick Wong as well as shown in Adolf Lee’s WhatsApp message.
125. Raymond Hui said Tenacity would not pay commission to him because they were an existing tenant in the Property. That is hardly any reason why the opposite party should or would be willing to shoulder the commission alone. In fact, the 2nd Defendant asked Raymond Hui to ask his client Tenacity for commission since he was their agent when Raymond Hui chased for the commission document.
126. Raymond Hui referred to the WhatsApp message between Adolf Lee and himself on 8 June 2018 that Tenacity would not be paying him commission but appreciation money only. That is neither here nor there, and he had not explained what was “in order to avoid further transmission of wrong information” mentioned by Adolf Lee.
127. Even if the 2nd Defendant’s explanation in asking for a confirmation letter upon Raymond Hui asking for the commission document were less than satisfactory, would it necessarily stride by quantum leap to an oral agreement or representation to pay 1% commission? Or was Raymond Hui opportunistic in leaping on this response?
128. I find Raymond Hui a wholly unsatisfactory witness, evasive, inconsistent and introducing assertions for the first time only at the trial. Apart from all the inconsistencies and exaggerations, more importantly is that his relationship with the 2nd Defendant was one that they had hardly known each other and had only spoken for a very short time in the 2nd Meeting. That was why the 2nd Defendant said he would not have trusted Raymond Hui to make an agreement only orally.
129. Raymond Hui himself knew that in the circumstances, a commission document was important, and that was why he had asked for one at the 2nd Meeting. However, did not insist having one there and then because he trusted the 2nd Defendant, nor to put it down in the WhatsApp chat group because he was careless and too hurried in passing the contact of Gallant to his client. Furthermore, his role was much more limited than a negotiating agent where one would have normally expect to entail a fee.
130. As aptly pointed out by Coleman J in Yu Man Fung Alice v Chiau Sing Chi Stephen [2020] HKCFI 2923, “Anyone with business experience understand the value of a written record. Therefore, the absence of any written record may – depending on the circumstances – tend to suggest no contract was in fact concluded.”
131. I do not accept Raymond Hui’s evidence that the 2nd Defendant has promised to pay him 1% commission. By the same token, I do not accept that he has tendered the Plaintiff’s Business Card at the 2nd Meeting, and I accept Winnie Lee’s evidence notwithstanding that she is an employee of the 2nd Defendant. Hence, the occasion for the consideration of the different bases of the claim do not arise.
Conclusion
132. In the event, the Plaintiff’s claim is dismissed.
Costs
133. I make the order nisi that the Plaintiff do pay the costs of the 1st and 2nd Defendants, to be taxed if not agreed. The order shall be made absolute in 14 days.
134. Lastly, may I thank Miss Yu and Mr Ko for their submissions.
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(Barnabas Fung) |
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Judge of the Court of First Instance
High Court |
Miss Teresa Yu, instructed by K. T. Tam & Co., for the Plaintiff
Mr Tony Ko, instructed by Gallant, for the 1st and 2nd Defendants
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